Network Capability – Emerging as Part of an Industrial Firms Competence Configuration

The network capability refers to the firm’s ability to build, handle and exploit relationships. These capabilities are interwoven in the complex configuration with other capabilities and competencies of the firm and are, in practice, very difficult to separate from them. Rather than assuming that firms inherently possess network capability, our aim is to discover if this actually naturally occurs in the discourse of the top management teams. In order to understand how managers perceive, process and interpret network capability, the management teams of six industrial subcontractors were guided through a five-step process of introducing, identifying, critical screening, challenging and verifying the capabilities of the firm. The paper introduces strategic capability architecture and investigates how network capability emerges within the configuration of other capabilities in these firms. We found that in customer oriented capability sets, network capabilities are central to the formation this kind of capabilities. In other types of capability sets, networking capabilities play an important role as assets in the formation of the capability sets. Furthermore, we identified that the networking capabilities act in unison with other capabilities through three different logics, termed partnering, value streaming and horizontal allying.