Development mechanisms of strategic enterprise networks: Learning and innovation in networks

This study examines the developmental mechanisms of strategic enterprise networks, with a special emphasis on learning and innovation within networks. The aim of the study is to establish theoretical and practical bases for understanding and developing strategic enterprise networks. The study, carried out at VTT Automation using experimental development research methods, is based primarily on the analysis of case studies on the development of companies and enterprise networks. This research views the activities of companies and enterprise networks as activity systems. The developmental method demands that researchers use two "lenses". The activity system, when used as the unit of analysis, projects two complementary views: the system view and the subject's view. On the one hand, the researchers construct the activity system as if looking at it from above, i.e. from the system viewpoint. Furthermore, researchers examine the case from the outside when analyzing the findings of the case study and writing the study report. On the other hand, the researchers work together with the subjects of the case study to identify the participants or multiple different groups of the local activity, through whose "eyes" and interpretations the activity systems are constructed and developed. Thus, the researchers are themselves actively involved in the activity of the social systems under investigation. The study of activity systems becomes a collective, multivoiced construction of the past, present, and future models for developmental activity. Furthermore, the researchers participate in the development activity itself, as well as in the planning and realization processes of new models in the activity systems under examination. This study adopts the system view. The object of this study is the developmental processes within strategic enterprise networks and dilemmas of learning and innovation connected to networks. An analysis of the developmental problems of Finnish enterprise networks forms the starting point of the study. Special emphasis is placed on the needs of small and medium-sized enterprises (SMEs). The analysis of models of enterprise networks forms the theoretical basis for the study. The outcome of this study is the elaboration of a model of strategic enterprise networks. To understand the developmental mechanisms of strategic enterprise networks, it is necessary to analyze the activities and model of an individual network enterprise in terms of a model of a business activity system. By analyzing the model structure of thinking and activity within the multivoiced activity system of a company, it becomes possible to discover the development mechanisms of the organization. The quasi-firm model is taken to model the governance system of the strategic enterprise network. A management model for the enterprise network is created based on an analysis of this quasi-firm model. The development model of the enterprise network projects an activity system whose development is a disruptive process where different views and interests of the companies and their actors collide. The real problems that are regarded as needing future solutions and new opportunities provide the impetus to form and experiment with new cooperation patterns in networks. According to the quasi-firm model, strategy, organization and activity mode form the central elements of strategic enterprise networks and their activities. These elements are analyzed and modeled. The salient feature of the activities of strategic networks is multilateral activity among all companies belonging to the network. Work pair activities at different levels between companies are sites for operational cooperation in the network. The development of the way of acting in the network requires changes within the companies as well. The team and network organization of companies creates excellent preconditions for intensifying cooperation in the network. The planning approaches to the development of different kinds of networks are analyzed. Then the construction and development phases of strategic enterprise networks are described and analyzed. The model of this study is based on experimental development research methodology. Learning and innovation in strategic enterprise networks are then analyzed and modeled. This part of the study is based on the analysis and modeling presented in previous chapters of the study. Learning and innovation are analyzed in two connections with strategic networks. On the one hand, the building and development of networks requires learning and innovation within the network and its companies. On the other hand, activity within the strategic networks creates an environment for learning and innovating. In such environments learning and innovation processes are modeled and analyzed.