WHAT MAKES A FIRM INNOVATIVE? AN INTER-ORGANISATIONAL SOCIAL CAPITAL PERSPECTIVE ON EXTERNAL PARTNERS’ INFLUENCE ON A FIRM’S INTELLECTUAL CAPITAL

Abstract

This research investigates how and to which extent the social capital inherent in a firm’s external relationships to diverse business partners contributes to the firm’s intellectual capital and in turn fosters its innovativeness. We apply the Social Capital Theory to an inter-organisational context and show how a firm’s social relationships with its various external partners contribute to its intellectual capital, and how these contributions differ between different types of partners (e.g., customers vs. suppliers). In contrast to intra-organisational contexts, we show that the association between social capital and intellectual capital is positive, neutral, or even negative depending on the external partner’s position vis-à-vis a firm’s supply chain and the type of knowledge. Using data from 153 German manufacturing firms, the results of a PLS-based analysis provide important insights into how and through which mechanisms firms can become successful innovators.