What Do They Know? The Antecedents of Information Accuracy Differentials in Interorganizational Networks

A growing body of network studies argues that firms purposefully act based on the network structure and their relative position in it. In this paper, we assess the validity of one of the core assumptions underpinning these arguments: that managers have accurate information about the structure of the network in which their organizations are embedded. We extend theory on interorganizational networks by developing novel hypotheses regarding the antecedents of differences in this network information accuracy between organizations. We test these hypotheses by drawing on a unique data set of two whole networks in the healthcare industry in the Netherlands in which both the “objective” network structure and the organizational perceptions of that structure are assessed. The empirical analyses revealed considerable differences among organizations in terms of the accuracy of their network information, especially with regard to accuracy about different parts of the network. A key finding is that the network position of the focal and the assessed organizations is essential for explaining information accuracy differentials. From these findings, we discuss which network strategies are viable strategic options for which organizations and derive implications for future network theory and research.