Interfirm Collaboration Networks: The Impact of Network Structure on Firm Innovation

Schilling, Melissa A.; Phelps, Corey C.

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Interfirm Collaboration Networks: The Impact of Network Structure on Firm Innovation

Management Science, Vol. 53, pp. 1113-1126

41 Pages Posted: 14 Jul 2007 Last revised: 2 Apr 2020

See all articles by Melissa A. Schilling

Melissa A. Schilling

New York University (NYU) - Department of Management and Organizational Behavior

Corey C. Phelps

McGill University; University of Oklahoma - Michael F. Price College of Business

Abstract

The structure of alliance networks influences their potential for knowledge creation. Dense local clustering provides information transmission capacity in the network by fostering communication and cooperation. Nonredundant connections contract the distance between firms and give the network greater reach by tapping a wider range of knowledge resources. We propose that firms embedded in alliance networks that exhibit both high clustering and high reach (short average path lengths to a wide range of firms) will have greater innovative output than firms in networks that do not exhibit these characteristics. We find support for this proposition in a longitudinal study of the patent performance of 1,106 firms in 11 industry-level alliance networks.

Keywords: strategic alliances, networks, innovation

Suggested Citation: Suggested Citation

Schilling, Melissa A. and Phelps, Corey C. and Phelps, Corey C., Interfirm Collaboration Networks: The Impact of Network Structure on Firm Innovation. Management Science, Vol. 53, pp. 1113-1126, Available at SSRN: https://ssrn.com/abstract=1000686