Network competence: Its impact on innovation success and its antecedents

Past research has consistently shown that companies, which have close relationships with customers, suppliers, research institutions, and competitors are more likely to have higher product and process innovation success. But why and how are these firms able to build up and use technology-oriented interorganizational relationships, which give them a competitive advantage? The authors postulate that the underlying reason is a company-specific ability to handle, use, and exploit interorganizational relationships. We call this skill network competence. Drawing upon a sample of 308 German mechanical and electrical engineering companies, results of a LISREL analysis reveal that network competence has a strong positive influence on the extent of interorganizational technological collaborations and on a firm's product and process innovation success. Furthermore, four organizational antecedents have an impact on a company's network competence: access to resources, network orientation of human resource management, integration of intraorganizational communication, and openness of corporate culture.