Title: Relational capital and SME collaborative strategy in the Malaysian service industry

Authors: Alan G. Downe; Siew-Phaik Loke; Murali Sambasivan

Addresses: School of Business, Curtin University Sarawak, CDT 250, 98009 Miri, Sarawak, Malaysia. ' Faculty of Business Management, Universiti Teknologi MARA (UiTM), Campus Sri Iskandar, 32610 Bandar Baru Seri Iskandar, Perak, Malaysia. ' Graduate School of Management, Universiti Putra Malaysia, 43400 UPM Serdang, Selangor, Malaysia

Abstract: Effective management of collaborative relationships requires an in-depth understanding of constructs contributing to the performance of the collaborating firms. Using structural equation modelling (SEM) approach, we explored the interfirm relational capital leading to more successful strategic collaborative outcomes. Drawing on social exchange theory, trust, interdependence, and participative communication are used to describe interfirm relational capital. We hypothesised that this relational capital affects collaborative performance in terms of perceived value, overall success, relationship-specific investment and continued commitment toward the collaboration. The results of this study suggest that interfirm relational capital enhances and perpetuates strategic collaborative outcomes through strengthened ties and greater integration between collaborative firms. This research represents an important and novel theoretical contribution to the alliance literature with conceptualisation of interfirm relational capital and, at the same time, provides empirical evidences to support the proposed framework. The limitation of the study and direction for further research are discussed.

Keywords: relational capital; trust; interfirm linkages; collaboration; Malaysia; SMEs; service industry; services; small and medium-sized enterprises; collaborative strategy; structural equation modelling; interdependence; participative communication.

DOI: 10.1504/IJSEM.2012.047055

International Journal of Services, Economics and Management, 2012 Vol.4 No.2, pp.145 - 166

Received: 23 Mar 2012
Accepted: 30 Mar 2012
Published online: 15 Nov 2014 *

Full-text access for editors Full-text access for subscribers Purchase this article Comment on this article