Are cooperative firms more agile? A contingency perspective on small and medium-sized enterprises in agglomerations and
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Are cooperative firms more agile? A contingency perspective on small and medium-sized enterprises in agglomerations and peripheral areas Elisabeth F. Mueller
&
Carola Jungwirth
Accepted: 5 October 2020 # The Author(s) 2020
Abstract In this study of small and medium-sized enterprises (SMEs) operating in German key technology industries, we investigate whether cooperating with others is an effective strategy for SMEs to enhance their organizational agility. Taking a contingency perspective, we are specifically interested in whether this effect depends on the firm’s location in an agglomerated or a peripheral area. Results show that a greater number of cooperative relationships with others is positively associated with SMEs’ organizational agility. This effect is stronger for agglomerated than for peripheral firms, suggesting that agglomerated SMEs can seize the abundant opportunities to cooperate in order to counter agglomeration diseconomies such as organizational inertia and mimetic behavior. This finding highlights the importance of absorbing external knowledge gained in cooperative relationships for SMEs’ organizational agility. Thereby, the study offers a novel perspective on how agglomerated SMEs can actively prevent being negatively affected by the downsides of agglomerations. Keywords Small and medium-sized enterprises . Organizational agility . Cooperation . Location . Agglomeration . Periphery . Contingency theory
1 Introduction In today’s heterogeneous, volatile business environments, firms face various challenges such as rapid technological changes, demand uncertainty, and product obsolescence. Organizational agility is seen as a key ability for firms to successfully deal with these challenges (Doz and Kosonen 2008; Tallon and Pinsonneault 2011). Organizational agility refers to a company’s ability to proactively drive its external environment and react flexibly to ever-changing customer demands, competitive moves, or continuous improvements along the value chain (Tallon and Pinsonneault 2011; Lim et al. 2017). In this regard, agile organizations manage both supply-side uncertainty and demand shocks, and adjust strategy and technology as necessary and desirable. While research has mainly focused on exploring the beneficial effects of organizational agility on firm performance, insights into the antecedents of agility are more limited despite their importance for creating the conditions necessary to survive in today’s competitive environment (e.g., Nemkova 2017). For example, Yusuf et al. (2014) are the first to highlight the role of partnering opportunities as a driver for organizational agility in a business environment that is characterized by
JEL classifications C12 . C83 . D83 . L26 . R12 E. F. Mueller (*) : C. Jungwirth School of Business, Economics and Information Systems, University of Passau, Innstrasse 71, 94036 Passau, Germany e-mail: [email protected]
C. Jungwirth e-mail: [email protected]
E. F. Mueller, C. Jungwirth
dynamic change and uncertainty. Cooperati
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