Analyzing the Impact of Firm’s Embeddedness in a Centralized Supply Network Structure on Relational Capital Outcomes

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Abstract

This research looks at the different effects of firms’ network structural positions in an upstream supply network upon the firms’ level of relational capital outcomes. Previous research largely focused on the context of decentralized network structure. However, the supply network is a centralized network because of the existence of the focal firm. The existence of the focal firm may influence the impact of relational capital outcomes. Hence, the objective of this research is to determine the type of network structural positions required to obtain a reasonable relational capital outcome in upstream supply network. This study found that network structural positions, i.e. degree centrality contributed to firms’ level of relational capital trust. Hence, a firm embedded in upstream supply network benefits differently in terms of relational capital through different degree of embeddedness. The firm resources should be re-aligned to match the benefits of the different network structural positions.

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