Networking and innovation in SMEs: evidence from Guangdong Province, China

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Abstract
Purpose: This paper aims to investigate structural characteristics of a business network comprising small and medium‐sized enterprises (SMEs), and to explore the relationships between such network characteristics and innovative capabilities of the participating firms.Design/methodology/approach: This paper adopts a survey approach and conducts empirical analysis by drawing data from 92 firms operating in the packaging and printing industry in Shantou City, Guangdong Province.Findings: In relation to the participating firms' innovative capabilities, density, reciprocity and multiplicity of the business network are figured out as factors with positive association, while hypotheses concerning intensity, non‐redundancy and betweenness of the network are not supported.Research limitations/implications: The authors only conducted a survey in a single industry in one location. Thus the extent to which the results of this study can be generalized remains to be further investigated.Practical implications: Small and medium‐sized enterprises can enhance their innovative capability by understanding and leveraging the structure of the business network in which they participate.Originality/value: This paper sheds additional insights to the relationship between a business network and firms' innovative capabilities in a Chinese context.

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