India-based versus UK-based SME owners’ perspectives on inter-firm collaboration
| DOI | https://doi.org/10.1108/JABS-01-2021-0011 |
| Published date | 27 July 2021 |
| Date | 27 July 2021 |
| Pages | 161-180 |
| Subject Matter | Strategy,International business |
| Author | Manish Unhale,André Slowak |
India-based versus UK-based SME owners’
perspectives on inter-firm collaboration
Manish Unhale and André Slowak
Abstract
Purpose –This study aims to inquire about pre-requisites and benefits of collaboration in the UK and
India, testingfor significance of country context.
Design/methodology/approach –The survey data set includes 118 UK-based and 175 India-based
small and mediumenterprises (SMEs). This paper appliesa grounded theory research design, given that
to date,no sufficient SME sector-specific,quantitative frameworks have beenpublished.
Findings –India-based SMEs are more inclinedtowards frequent collaboration. Soft variables such as
perceived trustworthinessor past commitment, appear to be significant when explainingwhether or not
SMEs in Indiaenter into a collaboration. Operations-drivenmotives play the most significantrole for them,
whereasfor UK-based SMEs, product design-relatedcollaboration motivesare of more importance.
Research limitations/implications –The developed cross-countryand country-specific collaboration
variableswill facilitate SME studies under a consistentand complete framework.
Practical implications –Business associationsand SME owners in the UK can use the research to gain
an Indian perspective and vice versa. This study concludes a stylised framework for SME owners and
managersto classify collaboration patternsin a country.
Originality/value –While previous research establishedconcepts and practices of SME collaboration,
this is the first paper that quantitativelyaddresses the attitudes and experiences that SME owners hold
when initialisinginter-firm collaboration.
Keywords Small and medium enterprise, Collaboration benefits, Collaboration motives
Paper type Research paper
1. Introduction
During past decades of management research, increased light has been put on the role of
external resources for growth; innovation; and the exploration of capabilities. There is rich
research published upon “open innovation” in the US, European (Vanhaverbeke, 2017;
Vanhaverbeke et al., 2018), Korean and Chinese small and medium enterprises (SMEs)
context (Hossain and Kauranen, 2016), while rather few studies are available on SME
collaboration in India.
Firstly, the different resource level available to SMEs, as op posed to large corporations,
justifies theory building based on SME data rather than relying upon predominantly large
corporations-informed collaboration theories and practice s. Singh et al. (2007,2008) find that
SMEs are under pressure to improve performance, namely, reduce costs ; improve quality;
widen their range of products; shorten delivery time; respond to suppl y chain changes and
satisfy the demand of delivering in small lots. Their study confirms these variables as
statistically significant. At the same time, a lack of resources such as, regar ding support from
customers; brand image; finance; human resources (training infrastru cture and technical
manpower) and governmental support are perceived to be intense constr aints.
Secondly, a country’s business culture may shape the ways decisions are made and how
businesses interact with one another. That implies cross-country studies of collaboration
Manish Unhale is based at
the Royal Docks School of
Business and Law,
University of East London,
London, UK.
Andre
´Slowak is based at
Business School, University
of Roehampton, London,
UK.
Received 10 January 2021
Revised 31 March 2021
Accepted 10 May 2021
DOI 10.1108/JABS-01-2021-0011 VOL. 16 NO. 1 2022, pp. 161-180, ©Emerald Publishing Limited, ISSN 1558-7894 jJOURNAL OF ASIA BUSINESS STUDIES jPAGE 161
perspectives can add knowledge to theory. “[Indian] firm culture seems to be high on
external focus, is market-driven, ad hoc and flexible (Rao, 2019, p. 98)”, which is why this
paper takes a broad and grounded theory approach to what constitutes “formal”
collaboration. Sakikawa et al. (2017) demonstrate that work practices’ link to performance
for the case of India is culture-led. That said, Western concepts of formal inter-firm ties and
their effect may or may not apply to Asian contexts. While the Journal of Asia Business
Studies has shed light on Indian SME management, policies towards SMEs and market
culture (Deb, 2017), this paper makes a new theory contribution to the area of SME
collaboration.
Our paper asks the research question of what SME inter-firm collaboration prerequisites
and benefits apply across a Western and Asian country, here UK and India and which are
specific to India as a proxy of Asian businesscontext.
This study is organised as follows. In Section 2, we summarise relevant streams of inter-firm
collaboration literature. Section 3 is written to derive hypotheses about the pre-requisites
and benefits of SME collaboration. It is followedby the methodology presented in Section 4.
Section 5 lays out our results. Section 6 discusses the paper’s main findings and
acknowledges the study’slimitations. Section 7 concludes the paper.
2. Literature review
2.1 Search strategy
We build upon the electic body of knowledge in collaboration and SMEs. There are few
review articles only that couldpotentially provide a complete theory frame. For instance,the
UK’s Small Business Service (Blundel and Smith, 2001) distinguishes between spatial
collaboration (in industrial districts and clusters); entrepreneurial/ego-centric networks;
supply chain networks; and innovation networks. Policy-induced SME collaboration has
been found to improve the firms’ long-term competitiveness: in terms of managementskills;
product quality; investment and strategic planning (Rosenfeld, 1996). Agostini and
Nosella’s (2019) review paper wellarticulates the importance of strategic motives, including
social capital, as an SME collaboration theme.Zahoor and Al-Tabbaa’s (2020) review paper
particularly demonstrates the importance of innovation as an SME collaboration theme.
Accordingly, our search strategy for this paper’s literature review is to explore the term
“inter-firm collaboration” and synonymous “inter-organisational collaboration” in SME
context for:
䊏strategy purposes including strategic planning;
䊏operational motives including supply chain-related; and
䊏innovation.
In addition, we did run a keyword-ledgeneral search query on SME and collaboration.
Much more systematic and large sample studies have been conducted on large
international firms than SMEs’ collaboration for strategy purposes, why we consider these
studies in the following subsection.
The body of SME literature which we systematically reviewed (Table 1) suggests no
coherent or dominant conceptual framework, which motivates thispaper to take a grounded
theory approach, taking any known potential business collaboration pre-requisites and
benefits into account for survey design.
2.2 Inter-firm ties for strategy purposes
Large international firms form strategic alliances to pool and align complementary resources
(Bretherton and Chaston, 2005;Da and Teng, 2000;Varadarajan and Cunningh am, 1995), to
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