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Essay from the year 2014 in the subject Business economics - Business Management, Corporate Governance, grade: 1,0, University of London, course: Innovation Systems, Networks and Social Capital, language: English, abstract: Innovation processes often mainly consist of the creation of genuine new knowledge or the recombination of existing knowledge in a new context. These processes are managed by people, who are also the carrier and translator of knowledge. As knowledge creation is only partially accomplished by one person on its own, and nearly all economic activities is embedded in social systems, the inter-communication between individuals within a firm or across firm boundaries must be acknowledged as equal important in the process of innovation. Network theories must be seen at the blurred boundaries between sociology, trying to understand which social layers are (positively) affected by having a broad and diverse or closed and narrow social nexus, and management theory, trying to understand the organizational implications of the nexus of the firms' stakeholders. Therefore this essay will elaborate on the role of ties, in its different shapes from weak to strong, within the innovation process. It will particularly focus on when which shape of tie is particularly important for which kind of successful innovation (incremental versus radical). It will also show how the focus on knowledge developed in management theory and how certain theories implicitly use the notion of networks to explain innovation processes.
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