Inter-Firm Linkages and Learning. An Empirical Exploration of Firms in the Third World

Doctoral thesis, 1998

The main purpose of this study is to contribute to a better understanding of how inter-firm linkages determine the conditions for firm learning. The overall objective is to explore the relationship between the organizing of linkages and the process of accumulating capability. These goals are achieved by focusing on the analysis of how a firm's diverse set of linkages affects the conditions for learning. The conceptual framework developed differentiates between three types of inter-firm linkages; activity coordinating, resource combining, and actor connecting. Learning, defined as the process of capability accumulation, is assumed to be related to the nature and pattern of a firm's linkages. In order to link the framework with real life phenomena, the methodology of the study reflects a hermeneutic approach which emphasizes understanding and interpretation rather than verification of theories and hypotheses. For the sake of `understanding' three case studies from firms in Kenya and Tanzania are presented that explore the different roles of various types of linkages in determining conditions facilitating or constraining learning. The main assumption that a firm's linkages comprise a precondition for learning has proven fruitful, in the light of the study's empirical findings. The study points to the central influence on capability accumulation of establishing different types of linkages. The cases reveal that the firms had a diverse and differentiated set of linkages. These were typically manifested in market-like relationships with other local firms, whereas linkages to international firms were of relational nature. Actual linkage formation is explained as the result of firms' efforts, which in an interactive fashion, are linked to the type of opportunity provided to firms. However, this is to a great extent the perceived set of opportunity from the perspective of a firm rather than the actual reality. The study concludes that the prevalent way of organizing inter-firm linkages has created vicious circles which should be seen as a challenge to policy makers to counter negative effects.