Network Embeddedness

Network Embeddedness
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Embeddedness is a description of the networks of entrepreneurs within a given context. The social context does have an essential role in the growth and sustenance of networks amongst entrepreneurs. However, there still exists a minimized comprehension of the influence of the contexts within which the network behaviours and embedders of entrepreneurs occurs. Embeddedness is both a rational and structural property in all communication structures. The actors are integrated within interconnected relations of social networks that go through a set of opportunities as well as constraints in comparison to those who do not have the same connections. The features of a social relationship between the actors are also meant to serve as imperfect substitutes for the assurance that is provided money within an economic system. The rational exchange is also a method by which the relational norms exist amongst the actors. Rational instruments of embeddedness include commitment, mutuality, flexibility, trust, harmonized conflict, integrity and power restraints ((Uzzi, 1997)).
The lens of embeddedness can be used to explore the methods by which networking is meant to occur in a multinational context. Long lasting relationships develop with a certain number of counterparts. These relationships develop through the interaction and exchange processes that a certain frim may have with other counterparts as they gradually learn to adapt to the point that these relationships become difficult to substitute.

These relationships become complex patterns of social, technical, and economic dependencies that cannot be isolated from each other since they are interwoven and connected with different degrees (Kaufmann and Dant, 1992). The focus on the situated roles, relationships, and the methods by which these impact actions are generated from situational views. Moreover, context plays a major role in the sensitization factor that renders the insights of factors that bring out given circumstances. It is therefore critical to understand the direct and indirect influences that network embedders have on the multifaceted industries. There exist different attributes of multinational corporations regarding their characteristics which separate subsidiaries are embedded through the dependency on resources that are used for the operations.
Theory application
The notions that the multinational corporations are considered as interdependent sectors with the flow of knowledge does not come new considering the importance of network embeddedness. The environment and the resources also have a lot to do with the factor of network embeddedness. In contrast to this factor, the network theory acknowledges that important resources are interlinked with the subsidiaries that have an impact on the relationships with the counterparts of an enterprise and its customers. Therefore, the network theory provides a precise definition of the important resources, and the most essential of these resources are identified to be the primary web of the given relationships that it is involved. The perceptions granted to other subsidiaries and their relevant networks is also widened to include other counterparts that include the suppliers and legal borders of a multinational corporation. However, these cannot be interlinked with their relationships. The definition of the environment, on the other hand, identifies a direct exchange of relationships with the business partners and also the indirect relationships with the direct ones. This factor creates a perception of control and performance which influence the multinational corporation. Once the subsidiaries are embedded in the network structures, the abilities of the managers to come up with the correct evaluations of the performance of the subsidiaries is diminished since the managers may lack the knowledge of the operating environments that the subsidiaries have. Adaptation and interdependence then result in the exchange of business networks that are important to both sides enable them to practice a level of control over each other. A major consequence of this factor applies when the control of the subsidiaries competes with the influence of the subsidiaries exchange partners.
The example used to explain the effect of network embeddedness on multinational corporations has more to do with the dependency on resources perspective. There is an importance in using this approach because the networks within which various subsidiaries are embedded provides its characteristic of an ongoing social relationship that has a profound impact on the behaviours of the actors (McGinn and Keros, 2002). Despite this example being oriented to the embeddedness levels of the individuals involved, there is a credibility aspect of the collective behaviour brought about by the embeddedness in ongoing relationships. More so, the concept of embeddedness is used to identify the broad involvement of subsidiaries in the business network as well as the influence it creates on them. An embedded firm will have a recurrent exchange of knowledge with its counterparts and adapt to activities. However, it is known that it is quite impossible to obscure the impact of continuous social relationships while studying the behaviours of the social actors. Fact is, social and economic actions do indeed take place within the environments that consists of various relationships that make the concepts of network embeddedness more useful in comprehending the behaviour of the subsidiaries as well as further development. Embeddedness, therefore, becomes an approach that blocks the atomization of the actors all the while studying their behaviour.
References
Kaufmann, P.J. and Dant, R.P. (1999) ‘Franchising and the domain of entrepreneurship research’ Journal of Business Venturing vol. 14 No.1 pp.5-16
McGinn, K.L. and Keros, A.T. (2002) “Improvisation and the logic of exchange in socially embedded transactions” Administrative Science Quarterly, vol. 47 No.3, pp.442-473
Uzzi, B. (1997) “Social structure and competition in interfirm networks: The paradox of embeddedness” Administrative Science Quarterly vol. 42, No.1, pp.35-68