In a world of increasing globalization, companies of all sizes need to stay attuned to new developments and currents of innovation beyond their core markets. Now more than ever, managers need to be aware of the dangers of dependence on entrenched beliefs and technologies. This article highlights an intriguing way in which managers at smaller regional companies in the United States improve their ability to stay abreast of industry trends: with the help of networks of non-competing peers from other geographic areas. We call these networks industry peer networks (IPNs).
While trade associations are the best-known venue for interaction among companies in the same industry, industry peer networks comprise small groups of noncompeting peers who gather regularly, in an atmosphere of significant intimacy and trust, to exchange information and discuss matters of company performance. The group members come from companies that provide similar services but operate in different regional markets and compete for different customers. Although industry peer networks have not received very much attention in the business press, thousands of U.S. companies in dozens of industries participate in them.
IPNs help members learn vicariously from the experiences of their peers and address deep-rooted problems common to many companies. These problems assume various forms, but the most important can be categorized as myopia and inertia. In a strategic context, myopia refers to managers’ tendencies to emphasize... To read the complete article, login or sign-up using the form below.
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