How Does Information Networking Create an Export Region?

Export driven economies fuel themselves through an octane boost of information. Information makes their way into opportunity finding, employment, and development. With the right methods of information transference regions can further develop their export driving economies by understanding how innovation fulfills demand-side and supply-side economics. Paul McPhee (2012) explores innovation strategy information spillover contributions as an important catalyst in simulating exports and employment. 

Local development exists within a national context. Local stakeholders and business members work together to create development. Local networks and supply chains also rely on greater information links in national networks to be successful (Bathelt, 2005).  In other words, there exists the tighter information transference within local networks and wider networks within the nation. Even though the author doesn’t state this it can also include information and resource vines throughout the globe.

This is demonstrated by international organizations that seek investment locations that have assets, organizational and institutional structures that support innovation information that fosters development (Paniccia, 2002).  As a bounded rationality such organizations draw in this information to create new products and services that have market relevancy. Without the information sources full development is not possible due to a lack of development feed.

We can find a number of examples within the market. In Australia clusters formed from networks of regionally based firms within the wine, fishing, film, education, and tourism industries that collaborate and innovate collectively and individually through alliance, commissions, federations, and associations (Roberts and Enright, 2004).  Each industry has the opportunity to work with other industries in both the local setting as well as the national setting to create new products and services. Local clusters exist within a wider national and international context.

The author found that information transference fostered exportation of products and services. A process of increasing the sourcing, generation, transferring, and sharing of information within regional networks is necessary to increase export related employment. This information is used for mutual development that impacts demand-side and then export-side growth.  When information transference speeds up the opportunities from growth and exportation also increase and this can lead to higher levels of regional employment.

Comment: The study lends support to the concept that tighter formations of economic vines exist in clusters and these clusters are woven into regional hubs that are connected to other hubs both within a nation as well as across the globe. The success of local economies is based in the ability to quickly and easily transfer information and resources through their economic hubs. These hubs use their resources to create newer and better products.

Bathelt, H. (2005) Cluster relations in the media industry: Exploring the ‘distanced neighbour’ paradox in Leipzig. Regional Studies, 39, pp. 105-127.

McPhee, P. (2012). Export driven regional development: a comparison of policies based on tiberi-vipraio-hodgkinson innovation strategies and networked information flows. Australasian Journal of Regional Studies, 18 (1). 

Pannicia, I. (2002) Industrial Districts: Evolution and Competitiveness in Italian Firms, Edwards Elgar, Cheltenham

Roberts, B. H. and Enright, M. (2004) Industry clusters in Australia: Recent trends and prospects. European Planning Studies, 12(1), pp. 99-121.

Enhancing Networks for Knowledge Creation

Knowledge diffusion is naturally affected by the quality of organizational information networks. These networks encourage the transference and use of higher levels of information that impact the service functionality of an organization. Dong, et. al. (2011) explores the need to understand these networks, enhance them, and effectively use them to develop organizations. Their explanation moves into the need to train workers on how to manage information in order ensure that information resources are fully utilized. 

Service and information systems are “value co-creation configurations of people, technology, value propositions connecting internal and external service systems, and shared information” (Maglio & Spohrer, 2008, pp. 18). Organizations that use information properly can ensure that they are receiving the right kind of information and putting that information to good use for service effectiveness. Each network has inherent value fostered by their ability to connect to rich elements within the internal or external environment. 

The success of an organization is based both on its employee’s talents and the way in which they interact (Hildalgo, 2011). Firms should ensure that productive interaction is fostered for greater growth and knowledge development. It is the process of obtaining information and applying it to constructive projects that encourages productive use.

There are three major types of networks. Networks can be random, small world, or clustered. Random networks are based in knowledge intensive industries, small world networks are used in focused intensive work environments, and clustered networks are common in organizations where people form knowledge sharing cliques. 

Developing industries need the larger random networks to obtain enough information to develop multiple areas within an industry. Organizations often cluster information based on how people relate to each other and which group they identify with. Small world networks can be used in inter or intra organizational development projects. Knowing which type of network does which function is helpful in using them properly. 

The researchers found that a stronger information network model is helpful in formulating the effectiveness of structures. The way in which information flows and is collected is important for overall utility. They also believe that improving upon randomness to include additional information into a more open system is beneficial for knowledge creation. Experienced information and network users are able to capitalize on these networks for growth but may need additional training to enhance skills. 

Dong, S. et. al. (2011) A benchmarking model for management of knowledge-intensive service delivery networks. Journal of Management Information Systems, 28 (3).

Hidalgo, C. (2011). The value in the links: Networks and the evolution of organizations. In P. Allen, S. Maguire, and B. McKelvey (eds.), Sage Handbook on Management and Complexity. London: Sage, 2011, pp. 257–569.

Maglio, P., and Spohrer, J. (2008). Fundamentals of service science. Journal of the Academy of Marketing Science, 36, (1). (Spring 2008)

The Cost of Embedded Group Networks within the Workplace

Workplace groups create their own values over time through social and economic associations that can damage the efficiency and financial viability of any organization. When organizations develop their own group standards, that lay in productive and accurate perceptions, their premises can encourage higher levels of organizational performance. Inappropriately socialized members often develop their own groups which influence the organizational culture and costs of transactions throughout their networks.  Left untouched the groups’ decisions become less logical and more damaging to the financial success of the total organization. It is important for executives to understand how they groups form and the potential wide reaching problems they can create.

It is first beneficial to define what a group is. Groups perceive themselves as belonging to the same social unit (Lawler, Thye, and Yoon 2008). Their place in society is defined by their shared experiences and understandings. To change a group member’s identity and perceived station in life requires the ability to change both self-perception and the members of their social group. This is one of the reasons why a poor organizational culture can be improved by moving employees to new locations and bringing in fresh members with outside perceptions.

When members see themselves as part of a group they begin to view each other as having similar characteristics and traits that bind them together. The group is a method of moderating self-interest and seeking positive perceptions of each other (Ellemers, Spears, and Doosje, 1997). Once initiated into a group, the members begin to view each other as more worthwhile and having more positive traits than those who exist outside the group.  Within an organization, in and out-group mentality can create encampment, hoarding of resources, and influence the financial success of the entire organization through poor decision making.

This can be expected as groups seek to create advantages for their individual members at the exclusion of competing organizational interests. They do this through the formation of a group network that continues to expand throughout the organization. According to Thye, Lawler and Yoon actors a) perceive the network as a group;  and , b) share rewards and resources with each other when opportunities arise (2011).  Such networks will continue to seek additional rewards and resources even at the expense of their employer and society.

Within the group certain behaviors will produce certain reactions and results from participating members. As long as these behaviors continue to produce the expected results the group members will remain entrusted to each other. The actions that become dependent on the response from other members are called social exchanges (Blau 1964). Groups live and breed these social exchanges and common rules of engagement. Outside intervention by managers and investors can be resented creating difficulty and passive resistance to requested changes.

Since such groups have social, as well as economic purposes, they create higher forms of identity the more these needs are gratified. Such relational commitment further solidifies the identity of group members which separates them from other groups (Cook and Emerson, 1984). Each group has their own relational commitment assumptions that help them define their distinct identities and existence. Outsiders may have difficulty understanding the unique set of underlining assumptions the group is using to define their identity and social interaction.

Over time the group becomes so distinct that their identity creates new realities of perceiving the world. According to social constructionists the group eventually uses their assumptions to create “objective” perceptions of the world (Berger and Luckmann 1966).  The person is thus fully embedded in the group and therefore sees their existence from the vantage point of the group assumptions and uses these assumptions to judge others and make strategic decisions. Any management team, new executive, or consulting firm is seen as an outsider attempting to intrude upon the groups identity which damages self-identity. This is one reason why outside intervention is often staunchly opposed.

Such similarity in subjective truth can define “stickiness” in economic decisions that are weighted and judged against societal norms. Independent objective thought becomes more difficult the more people define themselves based upon their distorted group identity. Such relational identities impact both the sociological and economic transactions of the members (Emerson 1981). Having two different economic approaches within an organization can damage that organizational viability through waste and inefficiency that is rooted in inappropriate premises.

At times the group identity can be so far removed from organizational and societal norms that they run counter to these wider expectations. Socially embedded market transactions can defy rational thought and logic (DiMaggio and Louch 1998). Such logic creates their own market influence based upon information sharing and thought patterns of members who interpret environment actions from a skewed lens. Changing the group identity and thought patterns requires exposing them to new people, methods of needs attainment, and ways of thinking.

Group identity can either encourage productive behavior or be destructive by nature. In organizations group identity that is stronger than organizational norms should concern both executives and investors. Such networks continue to expand their influence and waste of organizational resources by financially and socially feeding group members at the expense of more logical choices. It is through the development of strong cultural assumptions and organizational identity that more effective uses of organizational resources can be achieved.

Berger, P. and Luckmann, T. (1966). The Social Construction of Reality. New

York: Doubleday.

Blau, P. (1964). Exchange and Power in Social Life. New York: John Wiley.

DiMaggio, P. and Louch, H. (1998). Socially Embedded Consumer Transactions:

For What Kinds of Purchases Do People Most Often Use Networks? American Sociological Review 63:619–37.

Ellemers, N., Spears, R. and Doosje, B. (1997). Sticking Together or Falling Apart: In-group Identification as a Psychological Determinant of Group Commitment versus Individual Mobility.

Journal of Personality and Social Psychology 72:617–26.

Emerson, R. (1981). Social Exchange Theory. pp. 30–65 in Social Psychology: Sociological Perspectives, edited by M. Rosenberg and R. H. Turner. New

York: Basic Books, Inc.

Cook, K. and Emerson, R. (1978) Power, Equity, and Commitment in Exchange Networks. American Sociological Review 43:721–39.

Lawler, E., Thye, S, & Yoon, J. (2008). Social Exchange and Micro Social Order. American

Sociological Review 73:519–42.

Thye, S., Lawler, E. & Yoon, J. (2011). The emergence of embedded relations and group formation in networks of competition. Social Psychology Quarterly, 74 (4).