Personal relationships and innovation diffusion in SME networks: A content analysis approach

Networks have been hailed as a third organizational form, between markets and hierarchies. One of the main characteristics of networks is the coexistence of different kinds of relationships, personal and professional among these. The presence of multiple types of relationships modifies inter-firm dynamics, creating a space where traditional innovation activities take place in an unusual way. The present paper investigates the role played by personal relationships within networks, addressing the following research questions: how do different types of relationships existing in a network of SMEs favour the development of economic activities? And do personal relationships play a role in supporting innovative activities? To answer our research questions, we analyzed qualitative data using content analysis methodology. Content analysis allows researchers to obtain an objective, systematic, and quantitative description of the manifest content of a communication. Based on this analysis, we conclude that the coexistence of personal and professional relationships shapes a unique context that alters the usual dynamics of innovation diffusion.

► Diffusion of innovation is enabled by personal relationships.
► Strategic and innovative activities take place in different networks: the locus of innovation is not the locus of strategy.
► Innovative activities are widely distributed within networks involving multiple network dimensions.
► Content analysis to analyze data, a research method scarcely deployed in management studies.