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Below the tip of the iceberg: the co-evolution of formal and informal interorganizational relations in the wireless telecommunications industry

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  • Lori Rosenkopf

    (The Wharton School of the University of Pennsylvania, Philadelphia, PA, USA)

  • Thomas Schleicher

    (TNS Infratest, München, Germany)

Abstract

We examine how alliances-formal, contractual interorganizational relations-co-evolve with emergent, informal interorganizational relations. To form alliances, firms must acquire information on potential partners, and the acquisition of this intelligence occurs through both formal and informal channels. Here we evaluate the effects of two of these informal channels: joint participation in cooperative technical organizations (CTOs) and director interlocks. Since director interlocks connect firms through the highest managerial levels while joint CTO participation connects firms through mid-level technical personnel, we examine whether each type of informal tie contributes to alliance formation as well as whether ties at multiple levels serve as complements or substitutes for this purpose. We also examine whether all types of ties-alliances, interlocks and CTO participation-co-evolve endogenously or whether there are more direct causal relationships between and among these various types of networks. We find that both interlocks and CTO participation facilitate alliance formation, yet interlocks only facilitate alliance formation when the common director serves as an officer in one of the firms. An additional distinction between the role of interlocks and CTO participation is that the relationship between interlocks and alliance formation appears endogenous, in contrast to CTO participation, which causally precedes alliance formation. Copyright © 2008 John Wiley & Sons, Ltd.

Suggested Citation

  • Lori Rosenkopf & Thomas Schleicher, 2008. "Below the tip of the iceberg: the co-evolution of formal and informal interorganizational relations in the wireless telecommunications industry," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 29(5), pages 425-441.
    • Handle: RePEc:wly:mgtdec:v:29:y:2008:i:5:p:425-441
    DOI: 10.1002/mde.1403
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    References listed on IDEAS

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    Cited by:

    1. Haifeng Wang & Longwei Tian & Yuan Li, 2019. "A tale of two cultures: Social networks and competitive advantage," Asia Pacific Journal of Management, Springer, vol. 36(2), pages 321-347, June.
    2. Julia Brennecke & Irena Schierjott & Olaf Rank, 2016. "Informal Managerial Networks and Formal Firm Alliances," Schmalenbach Business Review, Springer;Schmalenbach-Gesellschaft, vol. 17(1), pages 103-125, April.
    3. Olga A. Novoselova, 2022. "What matters for interorganizational connectedness? Locating the drivers of multiplex corporate networks," Strategic Management Journal, Wiley Blackwell, vol. 43(4), pages 872-899, April.
    4. Shiu, Jing-Ming & Dallas, Mark P. & Huang, Hui-Hsuan, 2023. "A friend of a friend? Informal authority, social capital, and networks in telecommunications standard-setting organizations," Technological Forecasting and Social Change, Elsevier, vol. 189(C).
    5. Kim, Dennie & Funk, Russell & Zaheer, Aks, 2020. "Structure in Context: A Morphological View of Whole Network Performance," SocArXiv x6q7g, Center for Open Science.
    6. Anupama Phene & Stephen Tallman, 2014. "Knowledge Spillovers and Alliance Formation," Journal of Management Studies, Wiley Blackwell, vol. 51(7), pages 1058-1090, November.

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