Network resource meets organizational agility: Creating an idiosyncratic competitive advantage for SMEs

Abstract

Purpose

The purpose of this paper is to propose that a firm could exploit the ties of interfirm network to access external network resources (NR) to assist its sensing and responding capabilities for the variability of business environment, thereby leading to superior organizational performance.

Design/methodology/approach

This study uses the survey data collected from 260 small- and medium-sized enterprises (SMEs) in Taiwan to examine the causal effects of hypotheses testing. By adopting structural equation modeling technology, the direct and mediating effects among the NR, sensing capability (SC), responding capability (RC) and firm performance (FP) are explored.

Findings

The result of this paper shows that a firm’s NR and its organizational capabilities are critical antecedents of FP. Moreover, the mediating testing identifies NR and FP as being mediated by a firm’s organizational agility (OA) and RC.

Practical implications

The findings of this paper provide practical evidence that a SME could gain benefits and advantages from the joint effect of integrating NR and OA to compete with global conglomerates. Thus, a SME must put more effort into developing and maintaining its interfirm network and then figuring out its effect with its internal agility process in order to surmount unexpected changes, create advantages of the first-mover and innovation activities and boost the FP.

Originality/value

This paper combines external NR and internal OA and offers a practical strategy to a SME, creating a unique competitive advantage for further development in a dynamic business environment.

Citation

Liu, H.-M. and Yang, H.-F. (2020), "Network resource meets organizational agility: Creating an idiosyncratic competitive advantage for SMEs", Management Decision, Vol. 58 No. 1, pp. 58-75. https://doi.org/10.1108/MD-10-2017-1061