Social Capital and Information Sharing: Impact on Firm Performance

Abstract

SMEs forge relationship with actors in their environment to obtain necessary resources, support and information which they may be unable to generate by themselves. These relationships are born out of linkages through formal and informal networks. Social capital of SMEs evolves out of these networks and generates scarce benefits. Literature provides that information sharing is widely regarded as one of the key returns of social capital which has a significant impact on firm performance (Wu 2008). Various dimensions of social capital in the form of network ties, trust and shared vision in strategic alliances and social alliances of SMEs have unique influences on information sharing among their exchange partners. This study attempts to examine the effects of the dimensions of social capital on information sharing advantages of the SMEs and its influence on firm performance, while drawing a comparison between firms engaged in strategic and social alliances. Analyzing the data from 100 small firms in West Bengal largely support the hypothesis that social capital contributes significantly towards information sharing, the effect of which is consequently translated into firm performance. The influence is found to be more pronounced for firms embedded in strategic alliances as compared to other firms.

Social capital and firm performance: A study on manufacturing and services firms in Vietnam

“…Similar to other existing literature, the results show that the significance of these three factors of SC was high during the knowledge transfer process (Davenport & Prusak, 1998;Saha et al, 2015). It later indicates how it influenced the organizational and financial performance of the firms (Nelson & Cooprider, 1996;Nguyen & Ha, 2019;Wang et al, 2012;Saha et al, 2015). As regards the network ties, this study shows that it had a positive relation with knowledge transfer, similar to the researches of Hansen (1999) and Uzzi (1997), which stated that strong ties result in better knowledge transfer.…”

“…Similar to other existing literature, the results show that the significance of these three factors of SC was high during the knowledge transfer process (Davenport & Prusak, 1998;Saha et al, 2015). It later indicates how it influenced the organizational and financial performance of the firms (Nelson & Cooprider, 1996;Nguyen & Ha, 2019;Wang et al, 2012;Saha et al, 2015).…”

“…To obtain a measure for network tie, this study focused on the strength of ties, which is similar to many other pieces of research (i.e. Dato-on et al, 2017;Saha & Banerjee, 2015). The responses were tested about three items evaluating the closeness of the relationship, the duration of a network, and the frequency of contact (Saha et al, 2015).…”

“…Dato-on et al, 2017;Saha & Banerjee, 2015). The responses were tested about three items evaluating the closeness of the relationship, the duration of a network, and the frequency of contact (Saha et al, 2015). Beside network ties, another factor taken to represent for SC was trust (i.e.…”

“…The questionnaire was designed before information collection to capture the relationships between SC and business performance, according to previous empirical studies ( Dato-on et al, 2017;Saha et al, 2015;Wang et al, 2012). Then it was piloted to a small, representative sample of participants (n= 15) who had been requested to fill in and submit with their comments and feedbacks (Hair, Bush & Ortinau, 2003).…”