Figure 1. The content of the toolbox in context.

Introduction to the Toolbox

The main purpose of this booklet is to present some tools for developing functional and innovative business networks. A business network is quite simply a set of actors (e.g. from companies, academia, public sector, investors and others) with collaborative relationships among themselves. We imagine this collaboration is formalized by the presence of certain objectives and guidelines for this collaboration, as well as management of the network. By innovative networks we mean networks of businesses that drive innovation and which contribute to economic development in a way that wouldn’t be possible if the businesses operated separately. Examples of innovations may be new or better products, new markets, new inputs, new processes or forms of organization. “New” may in this context imply varying degrees of novelty, from rather small to revolutionary changes. The former is more common than the latter.

The contents of the toolbox, which is inspired by Bergek et al. (2008), is shown in figure 1. We suggest four phases in a network development process: Network status initially, development of network functions as dynamics in the network, identifying obstacles and driving forces, and strategy development which should lead to a new and better status of the network.

Defining the network’s status implies securing an overview of who takes part, the relations between these, objectives and policies, organization and network management. Goals can be related to quantitative measures like total value creation in the network, number of participants or number of successful innovations. But also qualitative goals as e.g. having a culture for sharing knowledge and other resources is important for network success (Larsen & Nesse, 2017).

In the VRI2 Sogn og Fjordane research project we focused on the following functions, which we consider important to promote successful network cooperation in an innovative ecosystem (Bergek, 2008; Nesse, 2017):

1. Membership benefits: Joining and participating must be seen as attractive.
2. Knowledge development and sharing: The network needs to develop new knowledge and share it among its participants.
3. Innovation: It is necessary that innovation actually occurs through the network. In other words, something new needs to be produced by the network, something that would not have been possible without the network – for instance, products, procedures or ways of organizing.
4. Networks in the network: Actors in the network need to be tied together by developing the relational resources – by connecting the right people.
5. Resources: The network needs the ability to obtain funding, build contacts and knowledge in a more effective way than what the single participant would be able to do.
6. Legitimacy: The network needs legitimacy. Participants and others outside the network alike have to see the network as credible and positive.
7. External benefits: The network needs to be useful beyond the ones who participate. The knowledge and products that is developed should be useful also to others. If a freeloader is discovered, this is a sign that the network has been a success.

The network dynamics involve the above mentioned functions. By working on the network’s functions, the network will be developed and one will also get a clearer idea of what the driving forces are, and what the barriers to collaboration in the network are. Such experiences could be summed up by using a SWOT analysis; a brief overview over the network’s internal strengths and weaknesses, and the external opportunities and threats. We do not present SWOT analysis in detail in this toolbox, but more information about SWOT can be found in nearly any textbook in business strategy, or by searching the internet.

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