Introduction
Innovation performance in business significantly enhances consumer satisfaction with services and products offered by an organization. For a business to remain competitive in its market environment, the managers must proactively identify and implement innovative ideas to enhance performance. These ideas can be derived from various sources associated with the organization, especially the business networks. As Ostendorf et al. (2014) indicate, business networks are a complex web of company relationships in which exchanges are performed (p. 504). These networks allow businesses to connect with each other to share information, best practices, and resources, as well as to build relationships and create new opportunities. They enable businesses to quickly and easily find new partners, suppliers, and customers (Öberg, 2019, p. 126). Thesis Statement: Organizational networks play a crucial role in innovation performance since companies are able to leverage on the social capital, resources, expertise, and information drawn from such networks, which are critical in decision-making and implementation of new ideas.
The Role of Business Investment Networks in Innovation Performance
Business Investment Networks (BINs) are organizations that help entrepreneurs and investors connect to potential partners and resources. These networks often provide access to capital, mentoring, educational resources, and other support services to help entrepreneurs grow their businesses (Huang et al., 2012, p. 321). They may also provide introductions to potential investors, partners, or other resources to help entrepreneurs get the needed funding. BINs provide organizations with access to a larger pool of investors and enable them to more easily identify potential backers for their projects (Möller, 2010, p. 127). By connecting companies with investors, these networks help organizations secure investments for product and service innovation through shareholding and partnership schemes.
BINs help companies to seek funding and expertise that can help them better understand the investment landscape. By leveraging these networks, organizations can quickly identify potential financers and secure the necessary funds to pursue new innovations (Eklinder-Frick et al., 2014, p. 468). For instance, commercial banks and other loaning facilities like microfinance, as part of the BINs, usually offer capital financing for innovative ideas likely to grow exponentially as part of their credit-borrowing policies. The banking institutions conduct detailed checks on the presented innovative ideas to determine their viability in the said market and evaluate the likelihood of profitability, including the expected interest in loaning (Pulles et al., 2014, p.411). Hence, BINs are important in soliciting the financial resources required to enhance enterprise innovation performance.
Furthermore, BINs offer organizations access to a large pool of potential investors to increase investment portfolios. They enable organizations to search for potential investors and establish contact with them easily (Wang et al., 2015, p. 697). Through these networks, organizations can quickly and easily identify potential investors with specific criteria that match their investment needs. They can also quickly identify any potential conflicts of interest between the organization and the investor, and take steps to avoid them. BINs further provide organizations with access to resources such as investor profiles, trends and insights, and contacts (Kamalian et al., 2015, p. 238). This information can help organizations make informed decisions about potential investments and increase their chances of making successful investments for enhanced innovation performance. Hence, BINs play a fundamental role in identifying the right investors who play a crucial role in supporting innovation performance.
BINs also play an essential role in managing innovation ventures of a company for sustained profitability. BINs are mostly composed of investors, venture capitalists, entrepreneurs, and other industry professionals who help organizations assess the potential for success of a venture for innovation performance (Landry et al., 2002, p. 700). By leveraging their collective expertise, networks can provide independent and objective feedback on a venture’s market opportunity and competitive landscape, as well as provide insights into the company’s financials, technology, and team (Kamalian et al., 2015, p. 241). Additionally, these networks can provide access to resources and connections that can help the organization build a strong foundation for its venture. Connecting with experienced and knowledgeable professionals help organizations gain valuable information on the likelihood of success of their venture. This may include information on the competitive landscape of the industry, customer feedback, and valuable industry insights.
Moreover, the feedback and advice provided by the networks can help the organization refine their strategies and adjust their business plans to ensure that the venture is viable and has a greater chance of success. In utilizing an investment network, organizations can benefit from access to resources and connections that can help them assess the potential of their venture and make informed decisions. This association helps such companies achieve their goals of innovation performance and increase the likelihood of success. Consequently, BINs are essential in providing the necessary venture expertise that is critical in enterprise innovation performance for sustained growth and profitability.
Role of Business Social Networks in Innovation Performance
According to Eklinder-Frick et al. (2014), business social networks (BSNs) can positively influence innovation performance, helping organizations to foster a culture of creativity and collaboration. By providing a platform for employees to connect, share ideas, and collaborate, business social networks can help organizations to identify and capture opportunities for innovation (p. 469). BSNs help company employees to be updated with industry trends, as well as connect with experts from other fields, which can lead to new and innovative solutions. The BSNs further help in creating a sense of community among employees, which can help to foster an open and collaborative environment where innovation can thrive (Pulles et al., 2014, p.416). Social networks such as team building sessions often help workers to interact, share their challenges at work, and develop innovative solution that enhance their performance in the companies. Hence, organizations are encouraged to create social environments for their staff to enable them to interact freely and develop new ideas that enhance innovation performance for their organizations.
Besides, BSNs facilitate communication between managers and employees, allowing for quicker decision-making and idea implementation. BSNs promote communication among staff, especially in public forums, which helps in fostering collaboration and increases the interactions between managers and their staff (Wang et al., 2015, p. 699). Additionally, BSNs promote the recognition of staff members. Managers can use the platform to recognize staff for their accomplishments and hard work, creating a more positive work environment and encouraging people to work together. The social networks further facilitate professional development. Managers can use available social platforms to provide employees with resources and tools to help them improve their skills and knowledge (Huang et al., 2012, p. 316). This process could help to encourage learning and growth within the organization, resulting in a more productive working environment. Consequently, BSNs are fundamental in enhancing the connection between employees and managers, which improves innovation performance based on the created friendly environment.
References
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