Assessing the Importance of Local Supporting Organizations in the Automotive Industry: A Hybrid Dynamic Framework of Innovation Networks

Abstract

The advancement of knowledge on networks entails acknowledging the heterogeneity of their participants, more precisely, the organizations that lie beyond the scope of the activities of firms. Adopting a dynamic perspective of networks, and considering different types of innovation exchanges, we propose a hybrid and wider notion of industry which implies taking account of a set of local supporting organizations (LSOs) in domains such as research and technology, production factors, consultancy and training, and public support. Based on a rich data set built from face-to-face interviews with Portuguese automotive organizations, which resulted in a network comprising 867 organizations, we apply social network analysis techniques to analyse the structure, content and dynamics of the networks. The evidence gathered unveiled huge industry turbulence and significant changes in the boundaries of the Portuguese automotive networks over a 20-year period, with the emergence (and decline) of different prominent organizations. Specifically, following AutoEuropa major foreign direct investment (in 1995), the analyses reflect a clear increase in connectivity within the industry (from 524, before 1995, up to 2327 connections after 1995), with greater involvement among suppliers and between suppliers and LSOs, with the latter achieving top positions in the ranking of innovation networks.