The Role of Networks for Micro Firms

Abstract: Introduction: Each year thousands of micro firms are established in Sweden, not all firms will survive and grow; instead many will be forced out of business. Possible explanations of this phenomena could lie in the personality of the entrepreneur, the network of the micro firm as well as support from society and so on. Problem: Prior research has showed that networks and networking are important for the establishment, development and growth of micro firms. The majority of prior research has been of a quantitative nature, which has resulted in great knowledge about structural dimensions while less is known about the interactional dimensions. It is because of the lack of qualitative knowledge that little is known about interactional dimensions in networks and networking activities. Purpose: The purpose of the study is to investigate the role of networks and networking activities for micro firms. Method: The research has the character of a qualitative case study. Data gathering has been done through six in-depth interviews with the founder or manager of six micro firms located in the facilities of Science Park in Jönköping. All information obtained from the interviews were transcribed and then analysed with a model developed by O’Donnell (2004). Summary of analysis: The role of networks and networking activities for micro firms are of great importance for generating business. Our analysis show that many of the micro firms are proactive towards their customers while their relationship with suppliers and competitors varies in characteristics.