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Introduction

Extending the business network approach involves the researcher’s reconsideration on what assumptions should be employed when determining what is within the boundaries of the network and what is left outside. Extending also implies that something ‘new’ is presented to the business network. What is considered ‘new’ though depends on what is recognised as established within a research field. This means that ‘new’ is not necessarily novel per se, but represents a ‘new’ direction in extending the business network approach. ‘New’ in that sense is something that provokes the researcher to challenge the assumptions on boundary-setting in the business network approach, and consequently offers alternatives supported by empirical studies or conceptual reasoning. ‘New’ can involve embarking into previously unchartered territories where the business network approach allows for alternative explanations. ‘New’ can also be what the rapid technological development brings, and where the business network approach provides deeper insight into the consequences. Furthermore, ‘new’ can be altered terms for firms and markets where research following the business network approach offers complementary views on business effects.

The assumptions behind the researcher’s choice of boundary-setting within the business network thus involve more complex stances, over and above drawing geographical boundaries on a map, or setting the demarcation line between two entities. In the business network approach, boundary-setting involves deciding on a reason for the existence of networks, as well as determining what kind of relationships, and with whom, the researcher chooses to include or exclude. Furthermore, it concerns which situations the researcher deems to be appropriate venues for the business network approach and which are not. It involves what concepts the researcher decides should be part of the explanation and what are to be omitted. The assumptions on where the boundaries for the business network have been set, and reshaped during the years due to different research trends, have taken the approach in varying directions. The three directions discussed in the contributions in this volume, that is, new territories, new technologies and new terms, are chosen to represent some current trends in research following a business network approach.

The initial inspiration for the main theme of this volume, extending the business network approach, comes from the results of a study of firms’ marketing behaviour in a new situation, not encountered in prior research. In this study, the focus is on Swedish firms’ behaviour during the political crisis in Iran in the 1980s and 1990s. In the concluding discussion, regarding the theoretical implications of the study, it is noted that among the findings, one central notion is that ‘…the business network extends its boundary and includes actors from the intermediary and political systems’ (Hadjikhani 1996a: 208). The results provide evidence of the viability of adjusting the assumptions on the network boundary, that is, redefining what is included within the boundaries and thus is subject for analysis. The contributions directly related to this study (e.g., Hadjikhani 1996b, 1998; Hadjikhani and Håkansson 1996; Hadjikhani and Johanson 1996) have been characterised by Mattsson (2009: 64), in his analysis of research in Uppsala, as ‘extending the business network approach’ by incorporating the effects of politically unruly times on firms’ business relationship behaviour. This provides a good example of what extending the business network approach entails. The initial seeds planted by Hadjikhani (1996a) have over the years been cultivated, grown, and today the harvest is substantial.Footnote 1 Apart from engendering and provoking additional research in a new direction, the notion of questioning and challenging the assumptions of the boundaries of the business network approach is inspiring and has proven to be fruitful. In that vein, the contributions of this volume take their departure from the received view of the business network approach and build further, thereby extending the boundaries of analysis in new directions.

The origins of the research following the business network approach have been traced back to the 1960s, and development since then has been described and analysed (cf. e.g., Engwall 1984, 1998; Thorelli 1994; Mattsson and Johanson 2006; Mattsson 2009). According to Johanson and Mattsson (2006), two books,Footnote 2 both published in 1982, can be viewed as a starting-point for the business network approach. Following these inaugurating publications, many have followed, and in Chap. 2, by Lars Engwall, Cecilia Pahlberg and Olle Persson, an interesting view on the most influential contributions in terms of citation is presented. Over the years, the business network approach has developed into a set of international research streams with high vitality, covering a wide range of topics and with a rich collection of contributions all extending the business network approach.

The chapter proceeds with a section where some aspects of approaching business networks will be outlined. This is followed by a short retrospect to highlight what extending the business network further entails. The next section presents the volume’s structure, before the chapter concludes with an agenda for new research challenges calling for the further extending of the business network approach.

Approaching Business Networks

The researcher approaching business networks must, as indicated above, decide on where to set the boundaries for the network view before performing a single study. ‘Business network’ is in essence a metaphor allowing the researcher to conceptualise, analyse and understand the ramifications of firms’ business undertakings. It is the researcher’s application of this metaphor that decides what a business network becomes. Without dwelling further into the more philosophical aspects of the metaphor, it allows the researcher to develop analytical tools, which can be helpful in describing, explaining and understanding various aspects of business. The expansion of new, as well as the revision of existing, analytical tools offers further insights that extend the business network approach. However, the fact that ‘business network’ resides in a metaphor also implies that it does not exist in reality; that is, there is no actual ‘business network’ that can be studied. The business networks studied are the result of analytical efforts founded in the researcher’s choice of assumptions. To study business networks, the researcher needs to decide on these conjectures before approaching the business network to determine what it is, and what should be considered parts of it. This challenge has resulted in research which has taken different directions within the business network approach. In discussing the starting points and associated assumptions for any research following the business network approach, a representation of the metaphorical ‘business network’ can be useful. Figure 1.1 below depicts a business network illustrated as a topology of nodes connected with lines,Footnote 3 which in the business network approach is a rather commonly used figuration.

Fig. 1.1
figure 1

A business network

Full size image

Looking at the picture of the business network from a simplistic viewpoint, the researcher who wants to approach the network is faced with two crucial concerns. The first concern is what assumptions are to be applied regarding the composition of the network; that is, what is the overall raison d’être of the business network, what does it signify and what are the accompanying implications for boundary-setting? With reference to the business network as illustrated (Fig. 1.1), the questions might be, what business is depicted, should all nodes be considered as the ‘business network’ or should a boundary be set somewhere (and if so, on what grounds), and are there reasons to include or exclude the denser cluster in the upper part of the figure? The second concern is, what assumptions are to be applied regarding the components of the network, that is, what is the network composed of and how are the boundaries for those components set? Relating again to the network pictured in the figure, questions could be, what do the nodes represent and how are they delimited (i.e. is it firms [only] or other organisations as well), what are the lines representing, are they relationships of the same, or different, types, how are those relationships understood (as pure exchanges or by employing concepts such as trust and commitment) and what (if any) are the effects of the lines on the nodes, or on other lines?

Despite many commonalities, researchers take different angles on the two concerns within their specific business network approach. Judging from the frequency of citations (see Chap. 2), two notions have been more influential in how to approach business networks. The first, and most frequently cited, is that the business network might be tackled as ‘sets of two or more connected business relationships, in which each exchange relation is between business firms that are conceptualised as collective actors (Emerson 1981)’ (Anderson et al. 1994: 2), thus promoting what can be considered an ‘atomistic’ view on the network. Put simply, the business network is approached from its components, and the network is analysed by connecting the components in patterns, thereby forming a complex interdependent network context, surrounding a focal starting point.

The second frequently citedFootnote 4 approach departs from an abstract view of business networks as ‘a number of nodes [that] are related to each other by specific threads’, Håkansson and Ford (2002: 132) Consecutively they define nodes as ‘business units - manufacturing and service companies’ (p. 133) and threads as representing relationships which ‘are “heavy” with resources, knowledge and understanding’ (ibid.). The relationships are the result of complex interactions and mutual investments rendering a more ‘holistic’ view on the network composition, albeit specific and intense with economic, technical and social dimensions. Interpretably, the business network is approached as a whole and the network is analysed by detangling or deconstructing various aspects of it, where the result is contingent on that whole.

Following these alternative approaches, different studies, implicitly or explicitly, select an angle on the ‘business network’ by taking primary interest in issues relating to the network’s overall composition and effects thereof, or by paying main attention to issues concerning the interplay of components and the consequences therein. Furthermore, as the composition of the network relies on the inherent components which consequently affect the composition, research may also be concerned with such effects. Extending the business network by introducing it to the ‘new’ analytical tools can thereby engender research that deals with effects of those on the network’s composition or components, as well as the understanding on how these relate to each other, following one of two main approaches. Relating back to the business network depicted in Fig. 1.1, extending the business network approach is not only a choice of angle or a simple decision on increasing the perimeter of the network; additionally it concerns what issues should be incorporated within the perimeter and what should be included (or excluded) as part of the set of explanatory concepts used in analyses.

Extending Business Networks

Research during five decades has followed the business network approach and contributed to extending it in new directions, albeit, extending means having a standpoint from which to extend. Today, the standpoint for the business network approach is carried by a large number of researchers, publishing a substantial amount of contributions in a wide variety of journals and books. In the early years, the contributions were considerably fewer. However, the gist of the business network approach was indeed evident. Before moving forward, a cursory look at these foundations allows for better understanding of what extending the business network approach further entails.

Mattsson and Johanson (2006) highlight, in their overview on the annals of business network research, two contributions (Hammarkvist et al. 1982 and Hägg and Johanson 1982) as conveying the first comprehensive views on the business network approach. Common in these two inputs is the closeness to industrial production in the rendering of relationships and networks. In the contribution by Hammarkvist et al. (1982), the industrial business network is looked upon from an industrial marketing stance and the network is characterised in terms of bondsFootnote 5 between firms creating long-term orientation and stability, with a structure ranging from tight to loose. This view contemporarily represents much of the core of the business network approach, although years of research have refined the view in various directions. In furthering the discussion on industrial business networks, Hägg and Johanson (1982) focus on issues of heterogeneity and the composition of the network characterised as boundless and all-encompassing, while the structure is associated with interests and power. The main notion is that in industrial markets, relationships between firms form networks that are essential for the firms’ competitiveness. This closeness of the business network approach to industrial production is augmented by Johanson and Mattsson (1985: 3), who depart in their view from an industrial system as ‘… composed of firms engaged in production, distribution and the use of goods and services’ and describe it ‘… as a network of exchange relationships between these firms’, implicitly relating it to the inter-firm coordination due to distribution and production.

Business networks were initially described as ‘a form of organising that is neither firm nor market but “something” in between’Footnote 6 (Hägg and Johanson 1982: 15). In the English translation a decade later, the discussion was rephrased and the term ‘governance’ used instead of ‘organising’ (Forsgren et al. 1995: 10), thereby disclosing one aspect of the development of the business network approach. Hägg and Johanson (1982) discuss that networks have densifications (denoted nets) characterised by ‘… a relatively high level of complementarity between companies, companies that are interconnected in relatively well-developed relationships’ with ‘seldom clear boundaries and even more rarely fixed ones’ (Hägg and Johanson 1982: 47). In the later translation and revision, this view is refuted in favour of a more analytical approach involving the researcher’s choice of boundary-setting based on ‘focus, interest, knowledge, intentions, etc.’ (Forsgren et al. 1995: 36), thus demonstrating yet another aspect in the development of the business network approach. Besides verifying that the early views on business networks are still central for the approach, these exhibits can very well serve as a bridge, back to the main theme of this volume. Extending the business network approach involves the researcher’s ambition to challenge an existing view and possibly bring more elaborated alternatives by introducing something ‘new’, for example, by including the concept of ‘governance’ within the boundaries of the network, or highlighting the role of the researcher in boundary-defining.

The motives for extending the business network approach can thus be described to encompass research efforts aimed at enriching the understanding of business networks by adjusting boundaries. The motives to adjust boundaries can be refinements which allow deeper insight, or reconsiderations due to aspects that hitherto have been considered uninteresting, irrelevant or merely neglected. There are several examples of research streams, all providing invaluable contributions that can be considered important steps in extending the business network approach. The scope of these research streams is unfortunately beyond the scope of this chapter. As indicated above, extending the business network approach involves the researcher’s motives, stemming from the introduction of something ‘new’, thereby provoking the researcher to adjust boundaries in order to re-search, re-think, re-consider, re-define or re-fine notions of the business network. The next section will introduce the three ‘new’ directions as well as the contributing chapters, which extend the business network approach in this volume.

New Directions

This volume consists of 20 chapters divided into five parts. In this introductory section, besides this opening chapter, Chap. 2 by Lars Engwall, Cecilia Pahlberg and Olle Persson provides an overview of the emergence of the business network approach, building on publication data in 156 international journals. These data highlight the concept from its introduction to it becoming fundamentally established at the beginning of the 1990s, where from it has gained increasingly in popularity, especially throughout the last decade. Furthermore, the chapter notes that the research at the Department of Business Studies in Uppsala has been quite influential. This introduction is followed by three parts where emphasis is on the main directions in extending the business network approach. Part II deals with New territories (Chaps. 3, 4, 5, 6, and 7), Part III focuses on New technologies (Chaps. 8, 9, 10, 11, 12, and 13) and Part IV emphasises on New terms (Chaps. 14, 15, 16, 17, 18, and 19). The conclusion, New times, provides a reflection on the history of boundary extension for business networks.

New Territories

The business network approach can be traced back to studies of industrial firms. Focus has traditionally been on business firms and their interactions with others, meaning that relationships with customers and suppliers have dominated. However, there are also other vital counterparts such as non-business actors, for instance, political actors, non-governmental organisations (NGOs) and consumers. Earlier research has also had a strong emphasis on Western Europe, while neither emerging markets nor transition economies have received the same attention. In this section, firms in Russia, some Eastern European countries and Brazil will be involved. In addition, the network perspective would also benefit from studies on other types of firms which are outlined in one of the chapters where the complex networks of the financial sector are in focus. Another interesting, albeit under-researched, territory is the role of the individual in a business network analysis.

In Chap. 3, Martin Johanson and Jan Johanson conceptualise the network process when former planned economies change into more open market economies. They propose three movements from static to turbulent networks, whereby network stability is the outcome as the actors involved interactively learn and mutuality develops. The authors conclude that this transformation leads to identity replacing the anonymity of the firms. In Chap. 4, Jimmie G. Röndell and David Sörhammar approach another new territory for the business network as they focus on the end users/consumers. They stress that the increasing use of information technology, with interactive online forums and consumer communities, has given the consumer a much more influential role. This implies that there is a need to extend the business network approach to include consumers as active actors in the network. The business network view is also extended in Chap. 5 wherein Emilene Leite and Mohammad Latifi show the importance of including relationships with non-business counterparts in the analysis. A case study is presented highlighting the interaction between firms, political units and NGOs in Brazil. The chapter highlights that the NGO has a central role as an intermediary between the firms and the political actors in the development of a complex technical solution. The business network perspective has had a very limited focus on the individuals, but in Chap. 6, Martin Johanson and Heléne Lundberg use interviews from Russia to demonstrate that expatriates’ private relations matter in professional life, as they can be used as a way to gain knowledge, but they also offer support, which is crucial when living and working in a turbulent market. Concluding Part II in Chap. 7, Pervez Ghauri, Annoch Isa Hadjikhani and Andreas Pajuvirta discuss how the business networks within the financial sector relating to corporate customers have affected the internationalisation process of the four leading Swedish banks. They relate the discussion to push and pull factors emanating from corporate customers’ business networks and how these affect the banks’ market commitment and market knowledge.

New Technologies

The introduction of new technologies for information exchange has, during the last decades, to a large extent, changed the way of doing business. There are some common traits among the chapters in this section of the volume. The first two chapters relate new information technology to issues on innovation and network. The next two have a common stance on business relationships in an industrial setting, and study how information technology can reshape the business situation between suppliers and customers. The final two have a more network-wide approach on how technology affects consumers’ behaviour and transfer of knowledge.

Chapter 8 relates the business network approach to service innovation as Per Andersson and Lars-Gunnar Mattsson discuss how digitalisation, especially technical platforms, enables service innovation. The chapter elaborates on the role of technical platforms as new intermediaries and suggests that intermediation should be formulated in terms of processes of intermediating. In Chap. 9, Helén Anderson, Mike Danilovic, Diana Chernetska and Steinthor Oskarsson illustrate how Web 3.0 technology can contribute to innovation by facilitating interaction on the internet with customers. The Web 3.0 technology can also be used for analytical purposes, helping companies to trace new trends faster. The chapter elaborates especially on managers’ resistance towards new technology adoption. The use of information technology and the impact thereof on business relationships between industrial firms are elaborated upon in Chap. 10 by Cecilia Lindh and Peter Ekman. In this chapter, the integration of information technology within business relationships is discussed by relating to behavioural elements such as adaptation, commitment and cooperation. The integration of such new technology brings changes to the business situation beyond the mere use of it, thereby revising the boundary of the business relationship. In Chap. 11, Cecilia Erixon and Peter Thilenius consider information systems (IS)-providers, that is, the external parties operating and maintaining outsourced information systems, and the impact on business relationships. Three parties are approached as a business-relationship triad, and the chapter shows the impact of IS-providers as interlinked and forming complex sets of multiple triads, indicating that the business network boundary should be redefined. The business network approach has also extended to include consumers as Aswo Safari and Mohammad Yamin discuss in Chap. 12 on the effects of firms’ online internationalisation from the consumer perspective. By inventorying different alternatives when customers are involved in exchange relationships with foreign online vendors, propositions regarding search, deliberation and risk are presented. In the last chapter, extending the business network approach in the direction of the new technologies, the transfer of technological knowledge is highlighted. In Chap. 13, Anna Bengtson and Susanne Åberg redefine the boundary of the business network by the introduction of a new actor: the scientific organisation. In the chapter, the authors stress that the transfer of technological knowledge between science and industry is a translation and interaction process where learning about each other and the development of trust are essential for knowledge transfer.

New Terms

The change of firms’ environment, such as entering new markets or the introduction of new technologies, means that they must adapt to new conditions/terms, yet also that these new concepts/terms are needed to capture change. In this section, both these aspects of new terms are presented and discussed. In some of the following chapters, phenomena such as competition, strategy, increased regulations and ethics, which have received more attention in other areas, are in focus, and in other chapters, new concepts are introduced or are reactivated to be used in a business network setting.

In Chap. 14, Johanna Dahl, Sören Kock and Eva-Lena Lundgren-Henriksson elaborate on coopetitive relations, that is, relations between competitors that contain both competitive and cooperative interaction processes. In the chapter, they discuss the concept of coopetition from a strategy-as-practice perspective, and extend our understanding of coopetition as a strategising activity. Few studies within the business network tradition focus on reactivation of former business relationships. In Chap. 15, Mikael Gidhagen and Virpi Havila introduce the term ‘business remains’ to capture the possible influence from the terminated business relationship to the reactivation process. Anna-Karin Stockenstrand and Fredrik Nilsson in Chap. 16 reflect on the effects of the new International Financial Reporting Standard implementation for the banking sector within Sweden. The chapter addresses how networking becomes of essential importance and a base for learning, also giving the possibility of voicing an opinion within an increasingly international context. In Chap. 17, Sabine Gebert-Persson and Enikö Káptalan-Nagy reintroduce legitimacy within the business network approach. Although the concept was presented in business network studies in the 1990s, it has received far less attention than the rather similar concept—trust. The chapter proposes a theoretical model that highlights how legitimacy is shaped and reshaped via interactions within the business network. Business network dynamics is the main topic in Chap. 18 by Peter Thilenius, Virpi Havila, Peter Dahlin and Christina Öberg. In the chapter, ‘business netquake’ is introduced as an analytical tool to enhance our understanding of spread of change in business networks. The chapter proposes that business netquakes are a way to capture relatedness of events occurring in business networks. Chapter 19 deals with the important issue of ethics. After a thorough literature review, Aino Halinen and Päivi Jokela conclude that there is no theoretical model for ethical behaviour in business networks. Although ethical behaviour is likely to strongly affect business networks, for instance when it comes to relationship stability, reputation and performance, there is still limited empirical evidence. Hence, they suggest that to include ethics in business network studies is timely and highly relevant.

New Times

In the final chapter, Chap. 20, Amjad Hadjikhani and Peter Thilenius reflect upon the development of business networks over time. In the chapter, the ‘business networks’ existing since centuries due to business peoples’ pragmatic approach to doing business are discussed and compared to the development of the business network approach as a field in science contemporarily. The main concern is the boundary-setting which implicitly or explicitly determines what the business network is, both for the practitioner and the researcher. The chapter is concluded with a request for an updated research agenda for the business network approach in the new times.

An Agenda for New Research Challenges

This volume contains examples of some recent new directions that have inspired researchers in extending the business network approach. The researchers have brought findings that allow further understanding of business networks, originating from what is considered as ‘new’, relating to territories, technologies and terms. The contributions within the chapters of this volume are substantial, yet an agenda for the new research challenges within extending the business network approach is always called for. Of course, there is a wide range of possible new directions for research, and the interesting and challenging question for all business network researchers is, what will be the next ‘new’?

Judging from prior research contributing to extending the business network approach, there is a strong link to contemporary issues debated in business and society at large. In this volume, this is, for example, reflected by research on the new territories of emerging markets, the impact of information technology on innovation in business relationships between firms or between firms and consumers, and the formation of new terms for the business network approach such as legitimacy and ethics. The research agenda for extending the business network approach in the ‘new’ time will most likely be set by current and future topics provoking discussions among people in business, research and society. A contemporary shortlist of topics could include the effects of globalisation on industries, the changes in markets and marketing due to migration, issues relating to the integrity and involvement of individuals, the increasingly rapid technological development, as well as the importance of environmental changes and altered consumption patterns for overall business conditions. All these topics can potentially bring something ‘new’ into the business network approach, inspiring researchers to make additional studies in new directions.

The introduction to this chapter mentioned the work of one researcher as the initial inspiration for the theme of this volume. It was said that one researcher could plant some seeds that, if cultivated, would form roots, grow and yield rich harvests in the years to follow. One prerequisite though is that the researcher generously invite others to be part of the collaborative work of research. Just as the main notion of the business network approach is that business is performed in relationships, research is created in a network context, whereby the effort of one researcher echoes through his or her relationships with others, thus forming a stronger research stream. This adheres to a central notion for research within the business network approach: there is no overall agenda set by a single or a few researchers. The research agenda for new challenges is set by the collective efforts of all researchers following the business network approach.