Dual Signals: How Competition Makes or Breaks Interfirm Social Ties

Authors:
Denis Trapido
Affiliations:
The Paul Merage School of Business, University of California, Irvine, Irvine, California 92697-3125
Venue:
Organization Science
Year:
2013

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Abstract

Research has documented the benefits of social ties across boundaries of competing firms but has not specified when competition enables such ties or when it damages them. Ninety semistructured interviews sought to elicit answers to this question from leaders of drug development companies in the San Francisco Bay Area. The informants reported withholding social ties from counterparts in competing companies if these companies affirmed to them the goal conflict aspect of the competition relation; they reported social connectedness to individuals in competing companies if these companies affirmed to them joint professional affiliation, the other necessary aspect of competition. Unique quantitative data on competition and social relations in the Bay Area's drug development industry confirmed this pattern for weak social ties acquaintance. Strong social ties friendship were not affected by any examined organizational or interorganizational factors.