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The growing complexity and instability of the worldwide market during the last years forced enterprises in every industry to undertake deep organizational and strategic changes (Tetteh, 1990). Companies had to find new ways to create value and innovate in an environment characterized by the evolving applications of information and communication technologies (ICTs), the development of extended supply chains and global e-markets, and the increasing customer knowledge intensity and sensitivity for time-to-market. Nevertheless, organizational and technological changes often require resources exceeding those available to small and medium enterprises (SMEs) (Buonanno et al., 2002; Fariselli, 1999; Tetteh & Burn, 2001).
It is well documented in literature that, for example, the investments required to meet most of the reorganization cost coming from the adoption of information and communication technologies (ICTs), and the risks involved in these projects, largely exceed the budget and the capabilities of an average SME (Buonanno et al., 2002; Fariselli, 1999; Fink, 1998; Poon, 1999; Tetteh & Burn, 2001). These circumstances suggest the feasibility of a broader approach to the implementation of ICTs in SMEs by examining the potential of inter-organizational (IO) ICT- supported relationships. The risk and the cost sharing coupled with the possibility to better utilize a combined competitive advantage should be able to overcome the typical constraints faced by single SMEs.
However, unless dealing with SMEs participating in supply chains of larger firms or tied in some sort of hubs, it is difficult to gather a sufficient number of enterprises able to leverage on an IO technological solution as a sustainable competitive advantage (Buonanno et al., 2002; Fariselli, 1999).
In this context, the many different forms of aggregation of enterprises—clusters, industrial districts, business associations, business park, etc.—described in the normative literature (Becattini, 1990; Bennett & Robson, 2001; Costa-Campi & Viladecans-Marsal, 1999; Enright & Roberts, 2001; Gordon & McCann, 2000; Markusen, 1996; Marshall, 1922; McDonald & Vertova, 2001; Roelandt & Hertog, 1998) could play a pivotal role in the development of successful ICT solutions that aim at creating value by improving collaboration, work specialization, information sharing, and responsiveness between SMEs.
Although all the forms of aggregations are interesting and suitable to be the subject matter, this chapter is going to focus only on one of them, namely, the industrial or business associations, as they are undoubtedly relevant forms of industrial aggregation: they provide companies with social activities and collective services and represent the interests of their members within specific domains; they can also take collective action on common problems (Alberti, 1998, 1999; Aldrich & Staber, 1988; Bennett & Robson, 2001). These specificities grant associations a unique competitive position in the market of business service providers (Bennett & Robson, 2001) and a potential key role in driving SMEs through the technological and organizational innovations they need. Associations could leverage on the “critical mass” constituted by associates and on ICT to provide collaborative value-adding solutions (i.e., logistic, procurement, internationalization, and technological innovation). However, the marketed collaborative platforms are specifically designed for large companies, thus making them inadequate to support industrial aggregations of SMEs (Consolati, 2000; Micelli & Di Maria, 2000; Poon, 1999).
Nevertheless, associations cannot expect to achieve any of such positive outcomes without a redefinition of their strategies and an expansion of the services offered, both new and high value and traditional (Alberti, 1998, 1999; Bennett & Robson, 2001).
The next section of this chapter provides an assessment of the main activities of a business association and describes the relevance of relationships management within a business association.
The third section (“Background on IO relationships”) will briefly review the main theories and models explaining cooperative behavior and the reasons for IO relationships development. The fourth section (“ICT and IO relationships”) will go further and will trace the link between ICT and IO relationships considering the implications deriving from the adoption of Internet technology. The fifth section (“The Virtual Association Platform Model”) will propose a framework for the identification of information requirements of a BA, based on the identification of the agents involved in the activities of the BA. Finally, in the last section (2Cities.com), such a framework will be applied to the case of the 2Cities portal, a platform designed to deliver services to BAs in Western Australia.
The Commission of European Community indicates that SMEs have less than 250 employees, an annual turnover not exceeding Euro 40 million, or an annual balance-sheet total not exceeding Euro 27 million and which are owned for less than 25% by non-SMEs, except banks or venture capital companies(European Commission, 1996).
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