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Ties that blind? How strong ties affect small business owner-managers’ perceived trustworthiness of their advisors

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  • Teemu Kautonen
  • Roxanne Zolin
  • Andreas Kuckertz
  • Anmari Viljamaa

Abstract

This research investigates how a strong personal relationship (strong tie) between a small business owner-manager and his professional or informal advisor affects the relationship between the advisor's recent performance and the owner-manager's perceptions of the advisor's trustworthiness in terms of ability, benevolence and integrity. A negative moderating effect could point to a ‘tie that blinds’: the owner-manager may be less critical in evaluating the advisor's perceived trustworthiness in light of their recent performance, because of the existing personal relationship. A conceptual model is constructed and examined with survey data comprising 153 young Finnish businesses. The results show that strong ties increase the owner-manager's perception of the advisor's integrity, disregarding their recent performance. For professional advisors, strong ties reduce the impact of recent performance in the owner-manager's evaluation of their ability. For informal advisors, a strong tie makes it more likely that their benevolence will be evaluated highly in light of their recent performance. While the results show that ‘ties can blind’ under certain circumstances, the limitations of the study raise the need for further research to specify these contextual factors and examine the causal link between the choice of advisor and business performance.

Suggested Citation

  • Teemu Kautonen & Roxanne Zolin & Andreas Kuckertz & Anmari Viljamaa, 2010. "Ties that blind? How strong ties affect small business owner-managers’ perceived trustworthiness of their advisors," Entrepreneurship & Regional Development, Taylor & Francis Journals, vol. 22(2), pages 189-209, March.
    • Handle: RePEc:taf:entreg:v:22:y:2010:i:2:p:189-209
    DOI: 10.1080/08985620903168265
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    Cited by:

    1. Smith, Daniel & Old, Kevin & Renwick, Alan & Westbrooke, Victoria, 2023. "The Characteristics, Challenges, and Resilience of Small Rural Farm-Support Agribusiness: A systematic literature review," Australasian Agribusiness Review, University of Melbourne, Department of Agriculture and Food Systems, vol. 31(1), April.
    2. Thanh Huynh, 2016. "Early-stage fundraising of university spin-offs: a study through demand-site perspectives," Venture Capital, Taylor & Francis Journals, vol. 18(4), pages 345-367, October.
    3. Kevin Mole & Robert Baldock & David North, 2013. "Who Takes Advice? Firm Size Threshold, Competence, Concerns and Informality in a Contingency Approach," Research Papers 0009, Enterprise Research Centre.
    4. Zolin, Roxanne & Kuckertz, Andreas & Kautonen, Teemu, 2011. "Human resource flexibility and strong ties in entrepreneurial teams," Journal of Business Research, Elsevier, vol. 64(10), pages 1097-1103, October.
    5. Kevin Mole & David North & Robert Baldock, 2017. "Which SMEs seek external support? Business characteristics, management behaviour and external influences in a contingency approach," Environment and Planning C, , vol. 35(3), pages 476-499, May.
    6. Buvár Ágnes & Gáti Mirkó, 2023. "Digital marketing adoption of microenterprises in a technology acceptance approach," Management & Marketing, Sciendo, vol. 18(2), pages 127-144, June.
    7. Kuckertz, Andreas & Kollmann, Tobias & Röhm, Patrick & Middelberg, Nils, 2015. "The interplay of track record and trustworthiness in venture capital fundraising," Journal of Business Venturing Insights, Elsevier, vol. 4(C), pages 6-13.
    8. Chris P. Eveleens & Frank J. Rijnsoever & Eva M. M. I. Niesten, 2017. "How network-based incubation helps start-up performance: a systematic review against the background of management theories," The Journal of Technology Transfer, Springer, vol. 42(3), pages 676-713, June.
    9. F. Xavier Molina-Morales & Josep Capó-Vicedo & M. Teresa Martínez-Fernández & Manuel Expósito-Langa, 2013. "Social capital in industrial districts: Influence of the strength of ties and density of the network on the sense of belonging to the district," Papers in Regional Science, Wiley Blackwell, vol. 92(4), pages 773-789, November.
    10. Capelleras, Joan-Lluis & Mole, Kevin F., 2012. "How ‘buzz’ reduces uncertainty for new firm founders," MPRA Paper 38170, University Library of Munich, Germany.
    11. Kevin Mole & Joan-Lluís Capelleras, 2018. "Take-up and variation of advice for new firm founders in different local contexts," Environment and Planning C, , vol. 36(1), pages 3-27, February.
    12. Kuhn, Kristine M. & Galloway, Tera L. & Collins-Williams, Maureen, 2017. "Simply the best: An exploration of advice that small business owners value," Journal of Business Venturing Insights, Elsevier, vol. 8(C), pages 33-40.
    13. Katarzyna Łobacz & Paweł Głodek & Edward Stawasz & Piotr Niedzielski, 2016. "Utilisation of Business Advice in Small Innovative Firms: the Role of Trust and Tacit Knowledge," Entrepreneurial Business and Economics Review, Centre for Strategic and International Entrepreneurship at the Cracow University of Economics., vol. 4(2), pages 117-138.

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