SME dependence and coordination in innovation networks

Purpose: The objective of this research is to identify and characterize the coordination systems used by SME hub firms that are in a situation of dependence with respect to other members of their network, taking into account the influence of hub firm size. Design/methodology/approach: Seven case studies were carried out: six innovation networks in which SMEs play a central role are compared with a “reference” case, in which the hub firm is a large company. Findings: Our qualitative empirical analysis of seven innovation projects showed that (1) the sharing of benefits and the guarantees that are implemented vary depending on the hub firm’s degree of dependence, (2) trust and recourse to formal agreements differ according to hub firm size, and (3) conflict solving is influenced by both hub firm size and degree of dependence. Practical implications: Results have important implications for the management of innovation networks which are increasingly important for the development of SMEs. The knowledge of the adequate coordination mechanims is central for a SME hub firm and the success of the innovation project. Originality/value: Investigations into the internal operation of inter-organizational networks have become increasingly common. Nevertheless, empirical studies are still rare, particularly in the field of innovation networks and even more in the case of networks set up by small firms. This article partially fills this gap.