Matching of Interfirm Network and Organizational Learning: Implications for Technological Innovation

There has been a burgeoning literature about interfirm network and innovative performance. However, in reviewing the extant literature we find different interpretations regarding how firms should be tied to one another in networks. The paper employs case study to explore and explain the relative propositions of interfirm network, different organizational learning and technological innovation. It addresses two critical research questions. First, strong ties or cohesive network are valuable in environments that require exploitation, while weak ties or sparse network would be more appropriate for exploration. Second, the benefits of each type of interfirm network vary across each other such that certain types of interfirm network will matter more or less under different conditions and objectives. Therefore, exploration and exploitation are two essential organizational learning models, under which firms need make a reasonable choice between them according the development stage, environment requirements and innovative targets. Key-Words: Interfirm network, Organizational learning, Exploration, Exploitation, Network Density, Tie strength, Technological innovation