The global innovation networks and global production networks of firms: Conceptualization and implication

Abstract

Today’s developments in the literature about the global networks of firms emphasize not only global production networks (GPNs) but also global innovation networks (GINs). However, the differences, commonalities and interaction between firms’ GINs and GPNs have not been theoretically and empirically clarified. Using case studies and social network analysis, this paper aims to capture the network characteristics of two case study firms’ GINs and GPNs. The findings show that these firms’ GINs and GPNs interact and are different in terms of network composition and network centralization, but are similar in terms of pattern of ties. Despite this, the GIN-GPN interaction, differences and commonality of one firm clearly differ from that of the other. The paper argues that theoretically considering the GIN and GPN as two different but interwoven layers of a firm’s global value creation network may provide better conceptual clarity for understanding management issues in the context of globalization. In addition, this paper discusses management implications for simultaneously managing firms’ globalization strategy for innovation and production as well as the theoretical implication for international business and globalization studies. It also suggests a knowledge base perspective for future research to understand better the dynamics of firms’ GINs and GPNs.