Findings and Discussion

In the chapter, the study first conducts the characteristic analysis of responding firms. Next, the findings of network analysis will be explored in the following section.

Moreover, four hypotheses can be responded to some empirical findings, and finally turn to theoretical and managerial implications.

6.1.1 A-TEAM is not an Exclusive Network for Large Firms

From the aspect of sample characteristic, most of the firms’ scale are less than 500, and theirs capital are less than 0.5 billion dollars whether a firm jointed in A-TEAM or not. It is obvious that the particular join-in condition of A-TEAM did not hedge SMEs to be its members. That is, while firms approved and committed the ideals of A-TEAM, it was getting much more firms join in A-TEAM.

Additionally, the partial reason is decided by the age of firms’ foundation. As soon as the age of new firms that intend to join A-TEAM approximates the age of 23 members in A-TEAM. It potentially means that the new member is a firm of stable character. Therefore, the 23 members within A-TEAM will welcome the new partner to take participate in the association..

6.1.2 The Key Player

Besides, according to the results of 49 components firms’ questionnaire, the

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higher opportunities of cooperating with Giant or Merida reveal two firms’

importance in network position. No matter what network firms belong to, two key players keep relationships with other components firms and nearly form the whole industrial cluster. In other words, if a firm possesses higher networking capacity, which means the close interaction with other partners and standing on the position near the network anchor, it would significantly influence its network position because the sub-construct of networking capacity is connected with other partnership or level of communication. It is the reason that two key players ask 11 components firms, which are the first or second ranking in each component field to be the loyal members in the early phases of A-TEAM formation. The two key players have approved that the closer business partnership firms maintain, the higher network capability they will be. Similarly, firms’ network positions within TCN are also the top class in CCNI.

Except for some firms (GC_01, GC_02, GC_11, and GC_17) which are not intended to take participate in A-TEAM, almost 21 critical components firms are asked to invest lots of time, money, efforts in pushing industrial growth. Therefore, as for components firms, in addition to formal contracts, once firms gather friendships of business partners through informally cooperative network, it will be good news for business partners of possessing the same ideals.

6.1.3 Network Characteristic

Taiwan’s bicycle industry is not similar to Japan’s automobile industry which is the Keiretsu System. A common perception of the Keiretsu System is that relatively exclusive interfirm relationships facilitate closely interfirm ties, which benefit both assemblers and suppliers (Nobeoka, Dyer, & Madhok, 2002). Hence, those components

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firms are irresponsible for supporting specific bicycle firms. That is, it will not have big conflicts to hinder components firms from selling to different segments (mass markets or specialty bicycle retailers) and to provide foreign and domestic assemblers better products/ services.

6.1.4 Facilitate Collective Knowledge Transfers

Subsequently, the results of hypotheses test are going to be reviewed and then offer some insights. The claim that relationship quality is an important facilitator in organizational learning was supported by the findings. It is consistent with Nobeoka’s (2002) statement that buyer which possesses close interactions with supplier is an important source of valuable re-deployable knowledge. With positive motivations from interorganizational trust and commitment, firms in bicycle industry are willing to facilitate knowledge transfers and participate in the knowledge-sharing activities. It implies that the above statement becomes easier as a result of better assembler-supplier relationships. Recently, Giant and Merida assist A-TEAM members to enhance theirs business partners’ capabilities of management and exploration; therefore, each year specific firm’s factory will be collectively visited by other A-TEAM members. In the end of visit activities, not only does the firm’s factory be checked and monitored, but also the firm is capable of accepting others’

brainstorming and suggestions.

6.1.5 The Motivations of Joining in A-TEAM

Organizational performance was hypothesized to be positively affected by relationship quality. Most remarkable research results, as Rauyruen and Miller (2007)

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put it, indicate that only the organizational level of relationship quality influences customer loyalty. Simultaneously, academics and practitioners consider that customer loyalty have a powerful impact on organizational performance. Besides, the product and process technologies for both cooperative components and bicycle firms are vital factors in determining the nature of buyer-seller relations.

Be one of the A-TEAM association members, a bicycle firm, for a start, will consider components firms whether have efficient management skills, such as the Toyota Production System (TPS) and Total Quality Management (TQM), to reach the goals of “zero inventory” and “just-in-time” delivery. Moreover, the most important is the specialized skills, including manufacturing technologies and incremental product innovation, which are the prior consideration for choosing long-term business partners.

Afterward it will be beneficial for components firms to obtain the opportunities of preferentially being purchased. Moreover, possessing a higher relationship quality with Giant and Merida, components firms might indirectly receive more OEM/ODM or OBM orders from foreign assemblers.

6.1.6 Lacking Learning Inventiveness

Organizational learning has a positively effect on organizational performance.

Empirical analysis in bicycle industry indicates that one force pushes the prosperity of Taiwan’s bicycle industry: accumulated learning by exporting. Even now components and bicycle firms generally obtain market and technology knowledge from the long-term interactions with multiple customers and competitors. The A-TEAM’s e-paper or cycle press also plays a crucial role in disseminating each firm’s growth

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dynamics and in exchanging industrial news. Moreover, in view of facilitating firms’

continuous innovation, Taiwan Creative Bicycle Design Competition was launched and has been successfully held on an annual basis ever since. Similarly, International Cycle Show and cycle race hold in Taiwan are benefits to promote the slogan “think bicycle, think Taiwan” in domestic and foreign markets.

In addition to the source of external knowledge, the knowledge came from internal is also an important resource. Knowledge sharing among employees is often viewed as the most crucial process for knowledge accumulation within firms and will facilitate the formation of organizational knowledge. By doing this, it can avoid inefficient reinvention and then maintain competitive advantage. Although organizations can improve their innovative capabilities by efficient knowledge sharing, member does not have all essential skills and knowledge for innovative tasks.

In Taiwan’s bicycle industry, most internal knowledge comes from the individual efforts. Due to the lack of active and appropriate incentives, an individual can’t contribute his knowledge or working thoughts, and is even unable to obtain newly R&D or marketing information from his colleagues.

6.1.7 The Overlapped Network Structure

The research outcome shows that organizational performance was partially supported by network position. The analysis results of direct ties are inconsistent with Nooy (2005) statement that it is easy to access a pivotal position if possess multiple sources, and even easily obtain information as well. The reason is that most components firms’ partners are not all domestic assemblers; on the contrary, 50% sale

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volume is achieved by famously foreign assemblers. Therefore, components firms with loosing direct ties do not mean the very lack of knowledge/information source from business partners and not emphasize the importance of knowledge sharing and knowledge interpretation within the organization. In respect of assemblers, they are the critical actors in network, therefore, it must be accepted more sources than general components firms.

Besides, the analysis results also can’t accord with the betweenness centrality, which means to what extent an actor dominate the flow of information because of his position within a network. As for the bike-industry cluster concentrated in the central part of Taiwan, it is found that the social structure belongs to open network, rather than closed network (Wen and Amsden, 2003). Any components firms can simultaneously freely offer several assemblers, thus, the degree of dependence on a particular supplier or buyer is not particular high. Moreover, the industrial structure is overlapped by several assemblers’ networks. It is not obvious that some market information or technical knowledge can’t help but control by specific actors.

6.1.8 Bike-industry Cluster

Closeness centrality has a positively effect on organizational performance. It is undoubted that the closer a vertex is to all other vertices, the easier information may be acquired, the higher its centrality is (Nooy, 2005). In reality, bicycle manufacturers mostly concentrate in the central Taiwan, the distance between any two firms within A-TEAM is so close that it can reach in three steps, even the farthest distance between any two general firms are only four steps. For a long time, the mysteries in the air

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(Marshall, 1890/1961) and collective benchmarking exist in the locally industrial cluster. That is, the mysteries of industry “become no mysteries; but are as it was in the air, and children learn many of them unconsciously”. Mutual learning usually takes place through a concentration of workers engaged in similar and related manufacturing and are therefore using and exchanging workers with similar skills and experience (Feser, 2002). Compared to the skilled labors in bicycle industry, workers in other fields will not understand the specialized skills and industrial knowledge.

However, the interaction among firms is so intensive that the bicycle cluster is filled with the “about the firm” knowledge. People will clearly know their competitors’

recent conditions and the specific tasks which are the most appropriate businesses to deal with, even speedily judge the accuracy of industrial news that are recently disseminated by any firms. In words, business can know whether some knowledge or methods are indeed innovative and then worthy to pursue in the future.

In respect of collective benchmarking, it will be beneficial for manufacturers to raise the level of knowledge. Due to living in the specific area, their life styles are very similar. Additionally, formal product presentation or investor conference will persuade each firm to notice other competitors’ recent actions, therefore, easily raise market share rate or obtain margins. It is clear that firms proceed to innovation in order to collectively come out on top. All in all, the feature of collective benchmarking comes from the forming of close bicycle cluster. Closeness centrality is more suitable to affect organizational performance.

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