The Roles of Knowledge Providers, Knowledge Recipients, and Knowledge Usage in Bridging Structural Holes

Abstract

Studies have suggested that firms can benefit from bridging two or more otherwise disconnected firms in their ego networks (i.e., structural holes) as a potentially useful source of external knowledge for innovation. However, past research also noted that the relationship between bridging structural holes and firm innovation varies significantly. Building on the earlier research that has examined the industrial, structural, and institutional dimensions of this relationship, the purpose of this research is to study how the different characteristics of the external knowledge provided by bridging structural holes in a focal firm’s ego network might moderate the relationship between bridging structural holes and firm innovation. Using longitudinal data from the U.S. computer industry, this study showed that focal firms that bridged otherwise disconnected firms in their ego networks enjoyed higher levels of innovation. In addition, it showed that this relationship was particularly stronger when the focal firms and the disconnected firms that they bridged operated in similar rather than different markets but when the focal firms and the disconnected firms worked on different rather than similar technological domains. The results also revealed that the relationship was stronger when the focal firms’ knowledge specialization was low rather than high and when the focal firms emphasized incremental rather than breakthrough innovation. These findings show companies how they can benefit from bridging otherwise disconnected firms in their ego networks and help them make more informed decisions pertaining to such bridging activities.

Beyond direct relationships

“…Fifth, following previous studies (e.g. Chung et al , 2018; Fukugawa, 2017; Lee, 2018; Laplume et al , 2015; Leone et al , 2016; Lin et al , 2015; Ozer and Zhang, 2019), we used the NBER patent database to obtain data on the number of patents and citations. Future studies on dependence asymmetry should use other patent databases that provide recently updated information on patents granted.…”

Standardization Alliance Networks, Standard‐Setting Influence, and New Product Outcomes*

“…First, this study enriches the social network perspective by examining the differential effects of an SA network position on two types of new product outcomes. Previous studies on a network position as related to innovation performance provide conflicting results (Ahuja, 2000;Burt, 2004;Ozer and Zhang, 2019;Wang et al, 2014), which may stem from assumptions that the nature of ties between firms does not vary significantly in a different network context and that different types of innovation outcomes have similar requirements for knowledge and knowledge integration. This study addressed this limitation by emphasizing the importance of the network context (SA network) and firm NPD strategic purpose (new product introduction rate and new product introduction speed) in explaining the competitive advantage secured from a network position (hole position or central position).…”

“…Research also has argued that structural holes create information asymmetry risks, information flow bottlenecks, and absorptive capacity overloads for firms due to the absence of effective interaction between unconnected partners (Long, Cunningham, and Braithwaite, 2013;Phelps, 2010). Whether structural holes will promote or inhibit a firm's new product outcomes depends on network knowledge (Ozer and Zhang, 2019), exchange characteristics (Rodan and Galunic, 2004), and performance focus (e.g., exploration or exploitation, NPD quantity or NPD speed; Rowley, Behrens, and Krackhardt, 2000). Consequently, the impact of structural holes can be understood only relative to a particular context (Ahuja, 2000).…”

How the egocentric alliance network impacts firm ambidextrous innovation: a three-way interaction model

“…Extant research on nodal network characteristics in collaborative innovation mainly investigates the knowledge dissimilarity and asymmetry between the focal firm and alters (Hahl et al, 2016;Ozer and Zhang, 2019). According to their findings, the benefits of spanning SH would be increased when the focal firms and the disconnected alters that they bridged operated in heterogeneous rather than similar technological domains (Hahl et al, 2016).…”

“…According to their findings, the benefits of spanning SH would be increased when the focal firms and the disconnected alters that they bridged operated in heterogeneous rather than similar technological domains (Hahl et al, 2016). Spanning SH under the condition of high knowledge asymmetry, that is, focal firms know about the SH but alters do not, would help reduce the likelihood of disintermediation among alters and increase the returns for the focal firm's brokerage position (Ozer and Zhang, 2019). Until now, the collective nodal characteristics of alters that opposite the SH have not received research attention.…”