Session 415

Small Firms in a Networked Environment

Track D

Date: Tuesday, September 23, 2014


Time: 17:15 – 18:30


Room: Rotterdam

Session Chair:

  • Ayse Karaevli, WHU- Otto Beisheim School of Management

Title: Frequent Dark Favors by SMEs: A Signaling Based View


  • Kimberly Eddleston, Northeastern University
  • Elitsa Banalieva, Northeastern University

Abstract: We develop a signaling based view (SBV) of dark favors frequency (DFF) in small and medium sized enterprises (SMEs) in transition economies. DFF is the regularity with which firms engage in administrative corruption, i.e., informal and illegal payments made by firms in exchange for conventional, normally expected government services. We assess how DFF affects business obstacles, i.e., the institutional friction faced by private SMEs. We provide a nuanced perspective by recognizing the heterogeneity among SMEs in terms of two types of social linkages: family firm status and business association membership. We argue that such social linkages can modify the DFF-business obstacles relationship and identify the conditions under which institutional friction may actually increase rather than decrease for certain types of SMEs

Title: Network Governance and Associated Firms’ Outcomes: A Multilevel Analysis in the Southern Brazilian Context


  • Jorge Verschoore, University of the Sinos Valley
  • Alsones Balestrin, University of the Sinos Valley
  • Rafael Teixeira, University of the Sinos Valley

Abstract: The present article focuses on understanding the relationship between networks governance and outcomes obtained by firms. Specifically, this article seeks to provide enlightenment for this question: What is the influence of network governance (strategy, organizational structure and processes) in the outcomes obtained by associated firms? To do so, the study follows a multilevel analysis approach with Small Firm Networks in the south of Brazil, which benefit from a local public policy. Our results show that SFNs are drivers for firms’ outcomes. Our findings also show that the mechanisms of governance have different influence on outcomes of associated firms. Finally, our study could not find empirical evidence to support the relationship between network level variables time and size and firms’ outcomes.

Title: Non-market Strategies of Small Firms In Indonesia; The South Sulawesi Case Study


  • Abdullah Sanusi, Curtin University
  • Bella Butler, Curtin University
  • Maria Fay Rola-Rubzen, Curtin University of Technology

Abstract: This paper examines how small firms implement non-market strategies in an emerging economy such as Indonesia. Non-market strategies include political actions of business players, lobbying, philanthropy and business owners turning into politicians themselves. The research aims to identify the forms of business players behind the implementation of the non-market strategy. In-depth case studies were carried out in eight small-firms in the region of South Sulawesi, Indonesia. Based on 14 semi-structured interviews, our finding shows that small firms implement political activities in response to institutional changes. We contribute to the knowledge of the non-market environment in Indonesia, the role of different forms of cooperation and the implications for dealing with stakeholders in today’s business environment in Indonesia.

Title: What Influences Strategic Decisions in Family Firms?: The Effects of Exective Perceptions and Governance Context


  • Sabine Rau, King's College London
  • Ayse Karaevli, WHU- Otto Beisheim School of Management
  • David Hanisch, WHU - Otto Beisheim School of Management

Abstract: Integrating rational decision making and behavioral approaches, in this study, we suggest that the implementation of a strategic decision is influenced by both executive perceptions on the degree of economic/strategic needs and the governance context of family firms. While we do not find any significant effects of executive characteristics or governance context on executive perceptions, our results suggest that family ownership negatively, and the presence of supervisory boards positively, moderates the relationship between executive perceptions and the implementation of a strategic decision.

All Sessions in Track D...

Mon: 08:00 – 09:15
Session 413: CSR and Diversity
Mon: 11:00 – 12:15
Session 412: Public-Private Relationships and Politics
Mon: 14:45 – 16:00
Session 414: Global Networks and Business Groups
Mon: 16:30 – 17:45
Session 411: Ownership and Governance
Tue: 08:00 – 09:15
Session 410: Governance Relationships
Tue: 17:15 – 18:30
Session 415: Small Firms in a Networked Environment

Strategic Management Society