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British Journal of Management, Vol. 32, 80–96 (2021)
DOI: 10.1111/1467-8551.12470
Towards a Theory of Network Facilitation:
A Microfoundations Perspective on the
Antecedents, Practices and Outcomes of
Network Facilitation
Elisabeth F. Mueller
School of Business, Economics and Information Systems, University of Passau, Innstrasse 71, Passau, 94036,
Germany
Corresponding author email: elisabeth.mueller@uni-passau.de
Firms cooperate in inter-rm networks to foster their competitiveness and improve their
innovation outcomes. In many cases, network facilitators who are either embedded in
a lead rm or a third-party organization manage the cooperation among the network
rms. This qualitative study adopts a microfoundations perspective to investigate the
behavioural antecedents of the network facilitators, their facilitation practices and the
related network-level outcomes. Results show that lead-rm facilitators more strongly
invest in trust-building measures since they are considered decient in benevolence and
integrity. Without these investments, they run the risk that conicts of interest hinder
the stimulation of positive network-level outcomes. Third-party facilitators, by contrast,
enjoy certain credits of trust and focus on balancing rm interests from the network’s ac-
tivation, but need to invest in enhancing their competencies and skills with regard to the
industry the rms operate in. The ndings contribute to developing a theory of network
facilitation by providing a nuanced understanding of how network-level outcomes can be
reduced to individual-level factors.
Introduction
Firms coordinate activities across organizations to
successfully cope with the challenges of today’s
business environments, such as rapid technologi-
cal changes, demand uncertainty and product ob-
solescence (Cravens, Piercy and Shipp, 1996; Lim,
Mak and Shen, 2017; Yusuf et al., 2014). Provan,
Sydow and Podsakoff (2017, p. 155) address this
phenomenon and state that ‘[m]anaging and work-
ing across organizations in a multi-organizational
network context has become a common practice’.
In recent years, the network metaphor has also
gained signicant importance in research on co-
operation and competition between rms (Ship-
ilov and Gawer, 2020). Networks are dened as ‘a
group of three or more organizations connected
in ways that facilitate achievement of a common
goal’ (Provan, Fish and Sydow, 2007, p. 482). Ear-
lier research agrees that rms cooperate but also
compete within networks to benet from network
externalities, such as technological innovation, low
transaction costs and access to complementary re-
sources or high-skilled employees (Gnyawali and
Park, 2011; Lavie, 2006; Powell, Koput and Smith-
Doerr, 1996; Ritala, 2012). Due to complex knowl-
edge exchange processes among network rms (e.g.
Easterby-Smith, Lyles and Tsang, 2008), inter-rm
networks are equipped with a network facilita-
tor, who is in charge of setting up network struc-
tures, orchestrating network activities and coordi-
nating knowledge transfer (e.g. Dagnino, Levanti
and Li Destri, 2016; Dhanaraj and Parkhe, 2006;
Mesquita, 2007; Paquin and Howard-Grenville,
2013). The purpose of this study is to advance our
understanding of how these network facilitators
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of Management. Published by John Wiley & Sons Ltd, 9600 Garsington Road, Oxford OX4 2DQ, UK and 350 Main
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Towards a Theory of Network Facilitation 81
actually manage inter-rm networks, with a par-
ticular emphasis on investigating their abilities and
motivations, their facilitation practices and the as-
sociated network-level outcomes.
It is well established that network facilitators
are embedded either in a lead rm of the network
or in a third-party organization (Bell, Tracey and
Heide, 2009; Human and Provan, 2000; Provan
and Kenis, 2008). In a network governed by a
lead rm, the lead rm usually sets the agenda
concerning relevant markets and technologies and
dominates the network’s strategy (Dhanaraj and
Parkhe, 2006; Jarillo, 1988; Provan and Kenis,
2008; Sanou, Le Roy and Gnyawali, 2016). For
example, the automotive company Daimler is the
lead rm of the automotive network near Stuttgart
in southern Germany. For many years, the re-
sponsible managers at Daimler, the lead-rm net-
work facilitators, have assembled the main sup-
pliers, complementors and research institutions in
their network and dominated the further develop-
ment of the network, enabling them to inuence
not only the lead rm’s but also the other network
rms’ strategic alignment. In a network governed
by a third party, which can be an institution like a
governmental agency or a business association, the
network facilitators employed by the third party
help to bring transaction partners together and
provide supportive network services, such as con-
sultancy services or legitimacy-building activities
(Howells, 2006; Human and Provan, 2000; Kirkels
and Duysters, 2010; Mesquita, 2007; Moretti and
Zirpoli, 2016). For example, the Pacic North-
west Aerospace Alliance, located in Redmond,
WA, is a third-party organization whose employ-
ees, the network facilitators, promote the growth
of the aerospace industry in the northwest region
of the United States. To accomplish this goal, they
provide networking opportunities, conduct educa-
tional seminars and inform rms about business
opportunities in emerging markets.
While prior research has created profound in-
sights into networks as an organizational form
(e.g. Cravens, Piercy and Shipp, 1996; Dyer, 1996;
Williamson, 1991), we lack knowledge of how
network externalities can be further reduced to
individual-level, behavioural antecedents of the
network facilitators and social interactions within
the network (Ahuja, Soda and Zaheer, 2012;
Müller-Seitz, 2012; Paquin and Howard-Grenville,
2013). Thus, we are ‘left with an understanding
of why networks may be a superior mode of gov-
ernance but not of how they are themselves gov-
erned’ (Provan, Fish and Sydow, 2007, p. 504).
However, understanding how networks are man-
aged (i.e. understanding the abilities and moti-
vations of network facilitators and the practices
that aggregate individual actions into network-
level outcomes) is important for establishing effec-
tive networks that foster positive externalities, and
for efciently allocating public network subsidies
(e.g. Kenis and Provan, 2009; Wincent, Thorgren
and Anokhin, 2013).
To ll this void, this paper adopts a microfoun-
dations perspective to develop a theory of net-
work facilitation that explains how network-level
outcomes can be understood in terms of the be-
havioural antecedents of different types of net-
work facilitators, the perceptions of trust that are
built upon these antecedents and the related prac-
tices of the facilitators. The microfoundations lens
provides a powerful analytical basis for this inves-
tigation, since it promotes our understanding of
how macro-outcomes, in this case network-level
outcomes, relate to the characteristics, actions and
interactions of micro-level entities, in this case net-
work facilitators (e.g. Contractor et al., 2019; Fe-
lin, Foss and Ployhart, 2015). Drawing on argu-
ments from agency and network theory and on the
analysis of 85 qualitative interviews with network
facilitators in ve countries, I carve out the be-
havioural antecedents for both the lead-rm and
the third-party network facilitators, the associated
facilitation practices and the network-level out-
comes, and develop propositions aimed at con-
densing the ndings to a theoretical model of net-
work facilitation.
This study contributes to research on network
facilitation in several ways. First, it uses the cur-
rent body of knowledge on the complexity of
knowledge transfer processes within networks
(e.g. Easterby-Smith, Lyles and Tsang, 2008) as
a motivation to shift the focus on those actors
that initiate, coordinate and support such complex
processes: the network facilitators. The results
foster a more comprehensive and at the same time
more nuanced understanding of the microfounda-
tions underlying the network facilitators’ practices
to stimulate the creation of positive network-
level outcomes in inter-rm networks. Using the
microfoundations perspective (e.g. Contractor
et al., 2019; Felin, Foss and Ployhart, 2015),
this investigation of the network facilitators’
practices answers a call for a more elaborated
© 2021 The Authors. British Journal of Management published by John Wiley & Sons Ltd on behalf of British
Academy of Management.
82 E. F. Mueller
understanding of the dynamics between
individual-level, behavioural factors and macro-
outcomes that unfold in inter-rm networks
(e.g. Bell, Tracey and Heide, 2009; Dagnino,
Levanti and Li Destri, 2016; Paquin and Howard-
Grenville, 2013; Provan, Fish and Sydow, 2007).
Specically, this study follows the call of Peng, Yen
and Bourne (2018, p. 352), who suggest that in the
context of simultaneous cooperation and competi-
tion between rms, ‘examining the how question as
to the stream of process, interaction and dynamics is
probably the most challenging theme’. The results
of this study reveal important nuances in the lead-
rm and the third-party facilitators’ abilities and
motivations, which inuence perceptions of trust
and social interactions between the facilitators and
network rms. Whereas lead-rm facilitators are
trusted to be competent but decient in benevo-
lence and integrity, third-party facilitators appear
more honest and benevolent but less competent.
Unequal levels of conict of interest result based
on these different perceptions, which therefore
require different facilitation practices to nurture
positive network-level outcomes – practices which
I investigate and discuss in depth in this paper.
Second, this study adds to the body of litera-
ture on trust dynamics in interorganizational re-
lationships. In a recent meta-analysis, Connelly
et al. (2018) nd that different dimensions of trust
(i.e. trust based on partner’s competence and trust
based on partner’s integrity) have asymmetric ef-
fects on the transaction costs, with integrity-based
trust being more potent for reducing these costs. I
build on this multi-dimensional view of trust and
emphasize, in the context of the relationships be-
tween network facilitators and network rms, how
the rms build perceptions of trust with regard
to the facilitator’s competence, benevolence and
integrity. I argue that both lead-rm and third-
party facilitators are able to effectively stimulate
positive network-level outcomes – albeit at differ-
ent levels of agency costs.
Theoretical context
Network facilitation is understood as a form of
network governance that ‘is necessary to ensure
that participants engage in collective and mutu-
ally supportive action, that conict is addressed,
and that network resources are acquired and uti-
lized efciently and effectively’ (Provan and Kenis,
2008, p. 3). The literature on network facilitation
agrees that the process of network facilitation is
complex, as network facilitators face ‘an evolving
set of dilemmas’ (Paquin and Howard-Grenville,
2013, p. 1623), need to deal with the ‘multiplex
nature of relationships’ in networks (Mesquita,
2007, p. 75) and ‘balance the tension between
organizational and network interests’ (Wincent,
Thorgren and Anokhin, 2013, p. 481). Prior re-
search has shown that individual characteristics
of the network facilitator inuence the processes
and outcomes of network facilitation (e.g. Gardet
and Fraiha, 2012; Paquin and Howard-Grenville,
2013). For example, Paquin and Howard-Grenville
(2013) highlight how the facilitators use their indi-
vidual knowledge (i.e. accumulated resources and
expertise) in developing networks over time. How-
ever, a microfoundations perspective that brings
into focus individual-level antecedents anchored
in the behaviours and motivations of the facil-
itators can further promote our understanding
of network facilitation. Specically, a microfoun-
dations approach allows investigating how these
individual-level characteristics of the network fa-
cilitators, their actions and interactions with net-
work rms are aggregated into macro-outcomes
such as network-level externalities (Felin, Foss and
Ployhart, 2015).
Behavioural antecedents
The microfoundations literature emphasizes that
macro-outcomes shall be decomposed in terms
of individual-level, behavioural antecedents (Con-
tractor et al., 2019). Mesquita (2007) highlights
two sets of abilities and motivations as impor-
tant individual-level antecedents that are neces-
sary for network facilitators to effectively sup-
port rms in their cooperation activities. First,
the facilitators need entrepreneurial skills to be
able to identify opportunities, evaluate benets
and risks, and support new ventures (Hitt et al.,
2001; Mesquita, 2007). Facilitators who possess a
strong entrepreneurial spirit or motivation, pro-
found market knowledge and a thorough un-
derstanding of market dynamics are better able
to facilitate superior knowledge-sharing processes
within the network and support the rms in
strengthening their competitive position and pro-
ductivity advantages (Dyer and Nobeoka, 2000).
Second, network facilitators should be motivated
to mediate conicts and arbitrate between network
© 2021 The Authors. British Journal of Management published by John Wiley & Sons Ltd on behalf of British
Academy of Management.
Towards a Theory of Network Facilitation 83
rms. Since they occupy an intermediary position
between the rms, they have to be able to assist
the rms in achieving voluntary agreements on
project plans or appropriation regulations (Con-
lon, Carnevale and Murnigham, 1994; Mesquita,
2007). Mediation and arbitration abilities are nec-
essary not only to solve conicts between the rms
in the network, but also to mediate negotiations or
shares of investments for joint projects, such as a
joint research laboratory (Mesquita, 2007). Medi-
ators or arbitrators are usually not biased towards
certain rms and are thus perceived as being neu-
tral (Mueller, 2012).
Network facilitation practices
The abilities and motivations of network facilita-
tors inuence what kind of practices they adopt
to strengthen cooperation between rms. In addi-
tion, based on the facilitators’ abilities and motiva-
tions, rms develop a certain level of trust in the fa-
cilitators, and form expectations regarding the fa-
cilitators’ actions that inuence social interactions
between the network facilitators and the rms. Jar-
illo (1988) argues that trust is a key mechanism
for achieving the goal of creating a network that
is both effective and efcient and has a positive
impact on the rms. Mesquita (2007) emphasizes
the role of trust by reasoning that network facili-
tators primarily are trust facilitators that work to-
wards (re)constructing trust among rms and sup-
port them in collaborating with each other, even in
gridlocked relationships.
Initially, the network facilitators’ reputation of
trust provides credible information that rms pro-
cess to assess the facilitators’ motivations and
make assumptions with regard to their trustwor-
thiness. Firms interpret the reputation but also
the institutional embedding of the facilitators as
signals of their competence, benevolence and in-
tegrity, and form trusting beliefs in these respects
(Mayer, Davis and Schoorman, 1995; Powell, 1996;
Sako, 1992). The trusting beliefs in the facilitators’
competence, benevolence and integrity are also in-
uenced by the assumptions that the rms make
about the facilitators’ motivations and abilities.
Competence refers to the extent to which network
actors believe the facilitator possesses the specic
skills and competencies, experiences and reliability
of performance that are necessary to full the tasks
(Connelly et al., 2018; Mayer, Davis and Schoor-
man, 1995; Mesquita, 2007). Benevolence refers
to the extent to which the network facilitator is
perceived as wanting ‘to do good’ (Mayer, Davis
and Schoorman, 1995, p. 718; Mesquita, 2007),
even if he or she is not rewarded by extrinsic re-
wards. The network facilitator’s integrity refers to
the consistency with which patterns of action are
regarded as fair, morally reliable and guided by ac-
ceptable principles (Dasgupta, 1988; Mayer, Davis
and Schoorman, 1995).
Prior research has shown, for interorganiza-
tional relationships, that the partners’ multifaceted
perceptions of trust have separate effects on reduc-
ing transaction costs (e.g. Connelly et al., 2018). In
this line of thought, this study argues that depend-
ing on the strength of the rms’ trusting beliefs
in the network facilitators’ competence, benevo-
lence and integrity, conicts of interest may oc-
cur between the facilitators and the network rms
and inhibit the stimulation of positive network-
level outcomes. Using an agency theory lens, these
conicts of interest become apparent in three ma-
jor elds of practice in which network facilita-
tors carry out activities: the selection of network
rms, the implementation of the network strategy
and the coordination of specic investments (e.g.
Harland, 1996; Harland et al., 2004; Meuleman
et al., 2010; Mueller, 2012; Paquin and Howard-
Grenville, 2013).
First, selecting or recruiting new rms secures
the viability of the network and thus constitutes
an important activity in network facilitation (Har-
land, 1996; Harland et al., 2004). Facilitators
use their industry knowledge and experience to
assemble the portfolio of network rms with re-
gard to the number and quality of network actors
and the elds the network is active in (Demirkan
and Demirkan, 2012; Harland et al., 2004). By
equilibrated selection procedures, they can con-
tribute to creating a transparent and trustworthy
atmosphere (Mesquita, 2007). However, agency
conicts originating from conicts of interest may
occur if the facilitators address their knowledge
to select rms that best t their own projects and
not necessarily those of other network actors.
Owing to these agency risks, network rms may
feel uncertain with regard to the real qualities
and efforts of the facilitators in the selection
process (Holmström, 1979). Mistrust can emerge
and bring the whole network to a halt (Adobor,
2006).
Second, network facilitators are responsible for
implementing the network strategy by organizing
© 2021 The Authors. British Journal of Management published by John Wiley & Sons Ltd on behalf of British
Academy of Management.
84 E. F. Mueller
network events, installing an information and
communication system, or initiating cooperation
projects. They are expected to process informa-
tion, coordinate social interaction and congure
demand-oriented measures that best advance the
network (Harland et al., 2004). However, conicts
of interest and thus agency conicts can emerge if
a facilitator is driven by a ‘hidden agenda’ of self -
interest and implements self-interested measures,
resulting in the risk of harm to other network
rms (Ahuja, Soda and Zaheer, 2012; Sanou, Le
Roy and Gnyawali, 2016; Yang, 2008).
Third, Bell, Tracey and Heide (2009) emphasize
the relevance of specic investments as an impor-
tant set of activities in the context of network gov-
ernance. They argue that the more network rms
specically invest and the greater the degree of
potential lock-in, the more network transactions
require hierarchical coordination via a network
facilitator. By coordinating specic investments
and allocating or integrating network resources,
network facilitators support rms in benetting
from knowledge spillovers and innovation activi-
ties (Harland et al., 2004). An example for specic
investments in an inter-rm network is a joint re-
search laboratory, where the rms’ resources are
pooled and where they specically invest by pro-
viding human capital. Granting interested rms
access to the laboratory could be a coordination
task of the network facilitator. Conicts of interest
will arise if the facilitators use the specic invest-
ments of the network rms to their own advantage
(Ahuja, Soda and Zaheer, 2012). Anticipating the
resulting hold-up situation, the remaining network
rms might underinvest, and the joint laboratory
might not generate the expected positive network
externalities.
Network-level outcomes
According to the microfoundations perspective,
the interplay of behavioural antecedents of the
network facilitators, the associated perceptions
of trust and the facilitation practices produces
network-level outcomes such as positive network
externalities. The network facilitators aim to stim-
ulate positive network externalities, such as re-
duced transaction costs, a higher productivity,
enhanced knowledge creation, or superior inno-
vation outcomes (Arikan, 2009; Dhanaraj and
Parkhe, 2006; Porter, 2000). To this end, they man-
age complementarities between the rms, their
suppliers, customers, complementors and even
competitors (Combs and Ketchen, 1999; Jarillo,
1988; Peng et al., 2012; Silverman and Baum,
2002). By initiating cooperation among the rms,
network facilitators help them gain access to re-
sources and advance in technological innovation,
which improves the rms’ competitive position
(Gnyawali and Park, 2011; Lavie, 2006). Firms are
likely to get involved with a network if they be-
lieve that it is orchestrated in a way that brings
a return (i.e. by developing superior technologies;
Dhanaraj and Parkhe, 2006), but not if they fear
losing their competitive advantage (i.e. by partner-
ing with a dishonest partner who behaves oppor-
tunistically; Connelly et al., 2018).
Methods
Research context
A qualitative study was designed to study how
network-level outcomes can be reduced to
individual-level factors, such as the network
facilitators’ behavioural antecedents, their actions
and social interactions with network rms. A
qualitative research design was chosen to take
account of the specic contexts of the investigated
networks (cf. Eisenhardt, 1989; see also Bansal
and Corley, 2012; Jack, 2010; Miles, Huberman
and Saldaña, 2014; Siggelkow, 2007). This ap-
proach allows for a rich and coherent analysis
of the network facilitators’ abilities and motiva-
tions, and the recognition of differences between
effective and ineffective networks with reference
to the facilitators’ incentives and behaviours. The
study’s sample aims to capture these differences
in a process-oriented manner and allows for the
study of networks with heterogeneous facilitators
and outcomes.
Data collection and sample
Semi-structured interviews. Together with a
team of research assistants, I conducted semi-
structured, guideline-based interviews with 85
network facilitators. Network facilitators are key
informants for the research question, since they
can report on their experiences, motivations and
activities as well as their perceptions of challeng-
ing issues, and can provide valuable information
on the context of the network. Interviewees
were selected by conceptually driven sequential
© 2021 The Authors. British Journal of Management published by John Wiley & Sons Ltd on behalf of British
Academy of Management.
Towards a Theory of Network Facilitation 85
sampling that is consistent with the idea of ‘the-
oretical sampling’ (Eisenhardt and Graebner,
2007, p. 27). A theoretical sampling approach
allowed adjustment and expansion of the sam-
ple throughout the data collection and analysis
process (Corbin and Strauss, 2008; Glaser, 1978).
To get towards a theory of network facilita-
tion, and to elaborate the conditions under which
such theory operates (Miles, Huberman and Sal-
daña, 2014), I needed to see different instances of
it, with different people, in different places and in
different industries, as prior research has shown
that these characteristics inuence network func-
tioning (e.g. Eisingerich et al., 2012). With this
rationale in mind, data collection began with in-
terviewing lead-rm and third-party facilitators of
publicly initiated networks of different industries
in Germanic European countries (Austria, Ger-
many, Switzerland). Publicly initiated networks
were easy to identify as they present themselves
in detail on their webpages. After an initial round
of coding, facilitators from privately initiated net-
works in the same area were surveyed in order to
enrich and contrast the gained insights with nd-
ings from networks that have emerged in a bottom-
up process. Data collection was then extended
to both publicly and privately initiated networks
in Anglo-American countries. Networks in these
countries are often gloried as best-practice exam-
ples. By extending the sample to Anglo-American
networks, I wanted to see whether insights into
network facilitation in these networks contribute
to clarifying the main patterns that have been
identied in networks in the Germanic European
countries. Thanks to the high number of cases, a
continuous comparison of patterns was possible
throughout the entire process of data collection.
The interview guideline emerged from a thor-
ough review of the relevant literature on network
facilitation and other documents, such as network
evaluation reports. The guideline comprises 22
questions, which are divided into ve thematic sec-
tions: (1) general questions about the network (e.g.
nancing, resources); (2) questions about manage-
ment and governance processes and practices; (3)
questions about how network rms are selected;
(4) questions about the success factors or success
stories of the network; and (5) questions about
how the network facilitators personally evaluate
the network and its development. Since the inter-
views were conducted in English or German, the
interview guideline was translated from English
to German and vice versa, following translation
and back-translation procedures (Brislin, 1980).
The average interview length was approximately
60 minutes and ranged from 32 to 120 minutes.
Interviews were audio-recorded and transcribed
verbatim.
The nal sample includes interviews with 85 net-
work facilitators, of which 31 are from Germany,
23 from Austria, 20 from the USA, 10 from the UK
and 1 from Switzerland. Of these 85 network facil-
itators, 15 are considered lead-rm facilitators and
70 third-party facilitators. Nine out of the 70 third-
party facilitators have personal experience with
lead-rm-governed networks. The mean age of the
network facilitators is 43 years, with 64 males and
21 females. With regard to education, 56 of the
network facilitators have a college/university de-
gree and 24 hold a doctoral degree. The analysed
networks cover several industries and organiza-
tional elds, ranging from low-tech (32%), mid-
tech (29%) to high-tech industries (39%) (classi-
ed according to OECD, 2009). This sample seems
to reect the heterogeneity of inter-rm networks
and represents the range of industries where net-
works can be found (Eisingerich et al., 2012). Ap-
pendix S1 gives an overview of the investigated
networks.
Additional data sources. The transcripts of inter-
views with network facilitators are the main data
source. However, I also drew upon other sources,
such as multiple archival and public materials, to
triangulate the ndings and avoid retrospective
bias (Golden, 1992). Archival materials enabled
me to acquire more background information on
the networks and the facilitators, as well as on
the rules and procedures and the activities within
a network. I used these materials in analysing
the interview transcripts to verify whether my im-
pressions are reected in these secondary data.
Importantly, I had access to network-level docu-
ments such as marketing materials, membership
agreements, or newsletters, which allowed a bet-
ter understanding of the context of the network
facilitators’ work. I also used materials supplied
by the informants, such as press releases or mis-
sion statements, as well as industry reports or fur-
ther academic publications (e.g. Falck, Heblich
and Kipar, 2010; Fromhold-Eisebith and Eisebith,
2005; Sanou, Le Roy and Gnyawali, 2016).
Expert validation. Observations, informal talks
and a close dialogue with network experts were
© 2021 The Authors. British Journal of Management published by John Wiley & Sons Ltd on behalf of British
Academy of Management.
86 E. F. Mueller
important to guarantee the validity of the re-
search. I participated at various events and con-
ventions within and across networks, where I pre-
sented the research and discussed the concepts and
results with the interviewees, as well as with non-
interviewed network experts. These on-site investi-
gations allowed further validation of the ndings
and conclusions.
Data analysis
Data analysis combined inductive and deductive
procedures (Miles, Huberman and Saldaña, 2014).
In a process of step-by-step abstraction, I em-
ployed coding procedures such as categorizing raw
data, linking rst-order categories to second-order
themes and aggregating themes into more abstract
concepts (Corbin and Strauss, 2008; Miles, Hu-
berman and Saldaña, 2014). These techniques are
suitable for research projects in which researchers
have prior knowledge of suitable theoretical con-
cepts but are open-minded concerning novel in-
sights (Miles, Huberman and Saldaña, 2014). I
used MAXQDA, a computer-assisted qualitative
data analysis software, to organize, structure and
code all empirical data, such as the interview tran-
scripts and the additional documents. MAXQDA
has particular strengths in inductive analyses, as
it supports the interrelationship among the data,
codes and memos (Corbin and Strauss, 2008).
Data analysis was conducted in three phases.
First, I analysed the transcripts line-by-line
and labelled relevant words, sentences or para-
graphs with codes developed on the basis of the
theoretical considerations (deductive theoreti-
cal coding), or derived from the conversations
with the interviewees (inductive open coding)
(Corbin and Strauss, 2008). In remaining close
to the data, I assigned descriptive codes to all
text passages that referred to the broader con-
text of network facilitation. The coding scheme
comprised a total number of 71 codes, such as ‘en-
trepreneur/businessman/businesswoman’, ‘domi-
nance/
self-interest’, ‘conict/dissent/tension’, ‘trust’,
‘non-disclosure agreements/monitoring boards’,
or ‘joint innovation’. Code denitions, key exam-
ples and coding rules for each code determined
under what circumstances a text passage could be
labelled with a specic code.
Second, I began moving back and forth between
data, literature and emerging theoretical insights
to condense the codes to rst-order categories
and second-order themes. Again, denitions, key
examples and coding rules for each rst-order cat-
egory and second-order theme were developed to
enhance the transparency of data analysis. The re-
sulting data structure has 16 rst-order categories
and 6 main second-order themes that I associated
with three aggregate dimensions: ‘behavioural
antecedents’, ‘network facilitation practices’ and
‘network-level outcomes’. These dimensions re-
ect the general logic of the microfoundations
perspective and encompass the different ways in
which network facilitators are enabled, motivated
and considered trustworthy to work towards the
stimulation of positive economic outcomes for
the network actors. Figure 1 presents the reduced,
more abstract data structure that resulted from
this step.
Third, once the data structure was dened, I
compared all text passages associated with each
rst-order category and second-order theme to
comprehend how and why they varied for a lead-
rm or third-party facilitator. Written summaries
and descriptions of observed patterns allowed me
to discover interrelationships between the cate-
gories and themes, and to develop a theoretical
model of network facilitation. Appendix S2 pro-
vides an overview of themes and categories, with
representative data. These data are exemplars of
typical ideas brought up by the interviewees and
thus serve as a pars pro toto.
In addition to the reported measures, I followed
the recommendations of Aguinis and Solarino
(2019) and Gibbert, Ruigrok and Wicki (2008) to
enhance the transparency and replicability of the
study. Table 1 shows detailed procedures to ensure
methodological rigour.
Findings and discussion
Presentation of the ndings is structured along
the behavioural antecedents of network facil-
itators, facilitation practices and network-level
outcomes, specically highlighting differences for
lead-rm and third-party facilitators. This sec-
tion discusses the identied patterns against the
theoretical background introduced at the out-
set and develops propositions aimed at condens-
ing the main ndings to a theory of network
facilitation.
© 2021 The Authors. British Journal of Management published by John Wiley & Sons Ltd on behalf of British
Academy of Management.
Towards a Theory of Network Facilitation 87
First-order categories Second-order themes Aggregate dimensions
Behavioural
antecedents
Network facilitation
practices
Network-level
outcomes
1. Abilities and motivations of
network facilitators
2. Trusting beliefs towards
network facilitators
3. Conflicts of interest in network
facilitation practices
4. Positive economic outcome
I. Reduced transaction costs
J. Higher productivity
K. Innovation outcomes
A. Entrepreneurial
B. Mediation/arbitration
C. Competence
D. Benevolence
E. Integrity
F. Selection of network firms
G. Strategy implementation
H. Coordination of specific
investments
5. Contextual determinants
L. Competitive intensity
M.Technological intensity
N. Mode of network initiation
6. Feedback mechanisms
O. Past experiences
P. Reputation of trust
Figure 1. Data structure
Table 1. Methodological rigour: a summary of the implemented procedures as recommended by Aguinis and Solarino (2019) and Gibbert,
Ruigrok and Wicki (2008)
Rigour criteria Implementation of recommended procedures in the present study
Internal validity Formulation of a clear research framework
Triangulation of theories (i.e. using agency theory, network theory)
Pattern matching (matching of the resulting patterns of network facilitation to those discussed in the
literature)
Adoption of multiple theoretical perspectives for interpretation
Construct validity Pre-test of the interview guideline (with academics, network facilitators, other experts)
Triangulation of interview data, secondary data, observational data
Explanation of data coding and data analysis procedures
Close dialogue with experts
External validity Selection of typical networks while allowing for heterogeneity within these groups of networks
Disclosure of sampling procedures
Description of the research setting
Reliability Careful documentation of data collection and data analysis
Database containing interview transcripts, secondary data and key informant data
Use of software package MAXQDA for data analysis
Disclosure of raw material
Behavioural antecedents: Abilities and motivations
of network facilitators
The interviews show differences in the behavioural
antecedents of the two types of network facili-
tators, as they seldom have equal levels of en-
trepreneurial and mediation or arbitration abilities
and motivations. Instead, there is a trade-off be-
tween these abilities and the associated incentives.
These ndings highlight different behavioural mi-
crofoundations of the network facilitators, extend-
ing the basic assumption that facilitators’ goals
© 2021 The Authors. British Journal of Management published by John Wiley & Sons Ltd on behalf of British
Academy of Management.
88 E. F. Mueller
and interests matter for overall network effective-
ness (Dyer and Nobeoka, 2000; Provan and Kenis,
2008).
On the one hand, the interviewees admit that
lead-rm facilitators could ‘drive the network to
new heights’ (Interview 61), as these in fact have a
strong entrepreneurial interest and ‘natural’ incen-
tives to positively inuence the development of the
network. However, lead-rm facilitators also have
a strong motivation to maximize lead-rm perfor-
mance because they receive incentive pay from the
lead rm. Such incentive pay leads them to capi-
talize directly on a positive lead-rm performance,
even if this performance results from exploiting
the dominant network position to the detriment
of other network actors. The interviewees inter-
pret this self-interest as the ‘natural responsibility’
(Interview 32) of lead-rm facilitators. Thus, lead-
rm facilitators are often considered to lack medi-
ation or arbitration abilities and to prioritize lead-
rm interests over network interests.
On the other hand, the interviewees emphasize
that third-party facilitators are not driven by nan-
cial performance incentives. They are not directly
paid by the network rms to which they deliver ser-
vices and do not take equity in these rms (Inter-
view 63). Nor are they offered performance-based
pay by the third-party institutions where they are
usually employed as civil servants. As they do not
nancially benet from a positive network devel-
opment, their impetus to maximize the network’s
performance is rather low. In addition, they lack
an entrepreneurial mind-set and show limited ‘nat-
ural’ entrepreneurial endeavours:
The rms need to design and organize their collab-
oration themselves. We only connect them, but it
is contingent on their entrepreneurial capabilities to
make the relationship protable. (Interview 13)
However, third-party facilitators are embedded in
an independent third-party organization, which
the interviewees perceive as an effective signal of
their motivation to act as a neutral broker (Inter-
view 18).
P1: Lead-rm facilitators have stronger en-
trepreneurial abilities and motivations,
whereas third-party facilitators show stronger
mediation or arbitration abilities and moti-
vations.
Network facilitation practices
Trusting beliefs towards network facilitators.
Results suggest that different trusting beliefs
regarding the network facilitators’ competence,
benevolence and integrity emerge from the net-
work rms’ assumptions about their abilities and
motivations. Prior research has stated that rms
trust in the network facilitators’ competence and
value their expert advice regarding new ventures
and opportunities, for instance, if the facilita-
tors have an entrepreneurial mind-set (Mesquita,
2007). On the contrary, if they show strong me-
diation and arbitration abilities, the rms trust
in their integrity and rely on their experience to
bring different collaboration partners together
(Mesquita, 2007). By carving out differences in
trusting beliefs with respect to lead-rm and
third-party facilitators, this study generates novel
knowledge of how these beliefs are formed.
The ndings show that lead-rm facilitators
are trusted to be competent since they show a
strong entrepreneurial motivation, are industry ex-
perts, have superior market knowledge and know
‘what makes the rms tick’ (Interview 12). How-
ever, lead-rm facilitators are not considered to be
benevolent or honest, since they supposedly follow
the lead rm’s interests, resulting in other rms’
mistrust of them (Interview 6; Interview 32). They
are presumed not to mediate conicts but to try
to push through their own interests and to neglect
other rms’ needs. Therefore, before being able to
bring the network rms together in a trustful at-
mosphere, they make up-front investments to build
integrity-based trust between the lead rm and
the network rms. Through a sequential process
of gaining reputation as an honest broker, lead-
rm facilitators may improve their perceptions of
integrity:
I think it could work if you are able to create an at-
mosphere, a relationship of trust, so that everybody
is convinced that he can benet. (Interview 6)
By contrast, third-party managers seem to enjoy a
certain credibility concerning benevolence and in-
tegrity, mainly owing to their institutional embed-
ding signalling neutrality. Thus, they are able to
concentrate on facilitating trust between the net-
work rms right from the start to ‘create the atmo-
sphere for good things to happen’ (Interview 67).
Accordingly, they invest less effort in signalling
their own trustworthiness. However, owing to their
© 2021 The Authors. British Journal of Management published by John Wiley & Sons Ltd on behalf of British
Academy of Management.
Towards a Theory of Network Facilitation 89
weaker entrepreneurial motivations, they are not
trusted to be as competent as lead-rm facilitators
(Interview 50), and thus require additional invest-
ments in developing their know-how and industry
knowledge.
P2: Owing to stronger entrepreneurial motiva-
tions and weaker mediation or arbitration
motivations, lead-rm facilitators are trusted
to be more competent but less honest and
benevolent than third-party facilitators.
Conicts of interest in network facilitation. Tr u s t
research has shown that the trusting beliefs of indi-
viduals affect their behaviours. For example, trust
enables more intensive cooperation between part-
ners (Gambetta, 1988), promotes the emergence of
networks as adaptive organizational rms (Miles
and Snow, 1992), or increases the likelihood that
actors choose risk-taking initiatives (Mayer, Davis
and Schoorman, 1995). In the same vein, the nd-
ings of this study show that, depending on the
trusting beliefs in the network facilitators’ compe-
tence, benevolence and integrity, the network rms
expect the facilitators to manage the network in a
specic way – one that entails conicts of interest.
These conicts of interest may become apparent
in major network facilitation practices, such as the
selection of new rms, network strategy and coor-
dination of specic investments.
When selecting new rms, the interviewees state
that lead-rm facilitators will not select rms neu-
trally (Interview 14). They may use their supe-
rior knowledge and competence to watch out for
rms that complement the lead rm’s know-how
or projects, but may not advocate for rms that
push the entire network (Interview 79). Neverthe-
less, while lead-rm facilitators seem to have large
discretionary freedom, they endeavour to signal
that they are selecting new rms diligently to keep
the network viable (Interview 28). This behaviour
resonates with prior literature (e.g. Delfgaauw and
Dur, 2007; Spence, 1973), which underlines the im-
portance of proving credibility and, in the context
of this study, of signalling the will to accept any
rm that contributes to reaching network goals.
However, since lead-rm facilitators cannot com-
pletely dispel the mistrust of the incumbent rms
and cannot fully convince them that they are acting
neutrally (Interview 16), monitoring mechanisms,
such as careful documentation of all procedures or
signing of ofcial agreements, seem to play an im-
portant role (Interview 54).
By contrast, third-party facilitators are said to
balance the portfolio of network rms and to con-
sider the network with regard to factors such as
size, interests and locations of the rms (Interview
6; Interview 77). Third-party facilitators seem to
have the advantage of being perceived as neutral,
which makes network rms condent that the fa-
cilitators’ selection procedures are not biased and
that they choose the optimal partner for the respec-
tive cooperation project:
I have the big advantage of being neutral. Everybody
can come to me, can give me their ideas and project
proposals condentially, and I will ideally acquire the
best partner in our network. (Interview 3)
Nevertheless, third-party facilitators do not take a
trustful atmosphere for granted and therefore em-
phasize signalling openness and sincerity (Inter-
view 67), but to a smaller extent than lead-rm fa-
cilitators.
With regard to network strategy, the interviews
indicate that lead-rm facilitators do not always
balance their portfolio of strategic measures, but
are tempted to pursue particular core themes that
primarily t the lead rm’s interests (Interview 11).
However, to counter possible reservations of the
network rms, lead-rm facilitators invest in build-
ing integrity-based trust, which was found to be
most effective in removing those concerns (Con-
nelly et al., 2018). They try to signal that they do
not exploit their discretionary freedom, for exam-
ple, by continuously passing out information to the
network rms, despite having some priority inter-
ests:
When an idea or a proposal comes in to me, and my
company is involved, I still must distribute it to my
competitors. … So, integrity is really an important
thing. If you do that just a couple of times, then peo-
ple know that you pass out information even though
you have a priority interest … They really appreciate
it when you put it out to everybody. (Interview 61)
(Correction added on February 11, 2021, after initial
publication on January 25, 2021; the displayed quote
in the section entitled “Findings and discussion”was
initially omitted due to a production error and has
been reinstated.)
Additionally, lead-rm facilitators install moni-
toring institutions, such as a management board
(Interview 62), which helps ensure that network
© 2021 The Authors. British Journal of Management published by John Wiley & Sons Ltd on behalf of British
Academy of Management.
90 E. F. Mueller
interests are sufciently reected in the imple-
mented strategy and that rents are not appropri-
ated only by the lead rms.
By contrast, third-party facilitators are careful
not to focus too much on single rms’ interests
when they moderate the process of strategy for-
mulation and implementation (Interview 7). Some
facilitators even report that they do not have to
sign non-disclosure agreements when they support
rms in starting innovation projects, because the
rms trust in their integrity and do not expect
them to exploit their information advantage or to
distribute the ideas to competitors (Interview 12).
However, institutions like general meetings, where
third-party facilitators are asked to give an ac-
count to the network rms, are installed to control
them (Interview 4).
Concerning the coordination of specic invest-
ments by lead-rm facilitators, the interviewees ex-
pect a high level of conict, since the facilitators
could try to pass the lead rms’ internal costs along
to the network and use network resources to en-
hance their own business (Interview 24). For ex-
ample, they could exploit intellectual or nancial
resources that other rms contribute to an R&D
project, which creates a certain hold-up potential,
hindering rms from investing in joint R&D activ-
ities (Interview 22). The problems resulting from
this hold-up potential can be solved by granting
contractual securities with regard to the use of the
pooled resources and the specic investments, or
by setting sanctioning mechanisms (Dyer, 1996).
The interviews underline that since underinvest-
ment would lead to a non-optimal output, lead-
rm facilitators seek to convince rms of the mu-
tual benets and agree upon certain review and
approval procedures which sanction hold-up ex-
ploitation (Interview 6; Interview 59).
The interviewees assure that third-party facili-
tators are not competing with the network rms in
any product or service markets. Hence, the rms
do not expect the facilitators to exploit network
resources to their detriment. Firms invest specif-
ically and the resources are provided to an opti-
mal extent. The network rms frankly discuss their
ideas and projects with the facilitators, hoping to
nd support in exploiting the full potential of their
ideas:
Ideas are … contributed freely, because the people
do not fear that we patent them immediately or ex-
ploit them for ourselves. I think … only the suspicion
would be fatal. … And this is what we are here for:
to tap the full potential. (Interview 18)
Overall, conicts of interest are more evident
in networks governed by lead rms than in third-
party-governed networks. To prevent negative
consequences from such conicts, lead-rm fa-
cilitators invest more in trust-building measures
and signalling activities and accept more intensive
monitoring procedures than third-party facilita-
tors, which leads to increased agency costs.
P3: Since lead-rm facilitators have stronger in-
centives not to select new rms neutrally,
to adopt self-interested strategic measures
and to exploit specic investments self-
interestedly, conicts of interest are stronger
in networks with lead-rm facilitators as com-
pared to networks with third-party facilita-
tors. Therefore, agency costs are expected to
be higher in networks with lead-rm facilita-
tors.
Network-level outcomes: A contingency-based
analysis
The results extend prior research (e.g. Dhanaraj
and Parkhe, 2006; Mesquita, 2007) by suggest-
ing that both types of network facilitators are
able to stimulate positive network-level outcomes,
even though they have different abilities and moti-
vations and utilize different facilitation practices.
Lead-rm and third-party facilitators effectively
foster network externalities, such as reduced trans-
action costs, higher productivity or superior in-
novation outcomes. For instance, the entire net-
work can benet from the lead rm’s ‘ties to the
nancial sector’ (Interview 24) and the associ-
ated reduced transaction costs, or take advantage
of the third-party facilitator’s brokering activities
that ‘stimulate innovation and entrepreneurship’
(Interview 67). However, the practices that induce
these positive economic outcomes involve different
levels of agency costs, as the preceding analysis has
shown.
P4: Both lead-rm and third-party facilitators are
able to stimulate positive network-level out-
comes, albeit at different levels of agency
costs.
The analysis further reveals three contextual
determinants (i.e. the network’s competitive
© 2021 The Authors. British Journal of Management published by John Wiley & Sons Ltd on behalf of British
Academy of Management.
Towards a Theory of Network Facilitation 91
intensity, technological intensity and mode of
initiation) that inuence the network facilitators’
effectiveness in stimulating positive outcomes.
First, the ndings suggest that lead-rm facilita-
tors might be suitable for coordinating vertical
networks with low competitive intensity that his-
torically emerged from cooperation between rms,
suppliers and customers:
It can work if you set the network up along the value
chain. Then, probably the largest player in the value
chain will be the network facilitator. (Interview 6)
Although the lead-rm facilitators could still act
self-interestedly and exploit their discretionary
freedom (Interview 83), the network rms tend to
accept their dependency, since they usually look
back on a history of cooperation in which certain
rules of conduct have emerged and trust has been
built. This nding speaks to the importance of re-
lationship duration and trust highlighted by the
literature on vertical buyer–supplier relationships
(Dyer, 1996; Squire, Cousins and Brown, 2009)
and emphasizes that more mature networks re-
quire less monitoring efforts as network rms be-
come more embedded over time (Wincent, Thor-
gren and Anokhin, 2013).
According to the interviewees, third-party fa-
cilitators are able to identify linkages between
rms of different industries. This makes them see
‘the larger picture’(Interview 42) in cross-industry,
horizontal networks where competitors are in-
volved. Since third-party facilitators act as neutral
brokers, they are capable of moderating innova-
tion projects, for example between competing orig-
inal equipment manufacturers, which might not be
successful if pushed by one of these players (Inter-
view 2). Lead-rm facilitators are ‘under the gen-
eral suspicion of pursuing own interests’, which
‘does not serve the goal of fostering innovation
and competitiveness within the network’ (Inter-
view 31). To counteract any negative consequences
resulting from this suspicion, interviewees call for
third-party facilitators when competitive intensity
is high.
P5: The stimulation of positive network-level out-
comes is enhanced if there is a t between the
network facilitator and the competitive inten-
sity of the network (i.e. lead-rm facilitators
lead less competitive, vertical networks and
third-party facilitators lead more competitive,
horizontal networks).
Second, the results suggest that lead-rm facili-
tators are effective in leading low-tech networks
but are unable to stimulate positive economic out-
comes for network members in high-tech networks.
In high-tech networks, where joint knowledge cre-
ation is fundamental to gain a competitive advan-
tage (Schilling and Phelps, 2007), rms are afraid
of being exploited by lead-rm facilitators who, as
the results of this study reveal, are under the sus-
picion of pursuing own interests. Thus, rms are
reluctant to participate in collaborative innovation
projects and eventually back out:
If you have a lead-rm facilitator and you want to
work on promising, high-tech innovations, how do
youwanttotellhimwhatyouareworkingon?I
had this experience in the past. … Back then, the
rms were instantly afraid. (Interview 12) (Correc-
tion added on February 11, 2021, after initial pub-
lication on January 25, 2021; the displayed quote in
the section entitled “Findings and discussion” was ini-
tially omitted due to a production error and has been
reinstated.)
However, to keep participation incentives high and
to effectively stimulate positive outcomes in high-
tech networks in spite of these reservations, lead-
rm facilitators seek to signal trustworthiness and
accept comprehensive monitoring procedures. In
particular, lead-rm facilitators emphasized not
being perceived as the dominant network leader
but rather as the network coordinator who is re-
sponsible for integrating all rms’ interests:
In my role as network facilitator I consider myself
not as a representative of my rm, the lead rm. … I
am responsible for all network rms. (Interview 26)
Third-party facilitators, by contrast, are trusted to
be honest and are considered appropriate to lead
high-tech networks that strongly ‘depend … on in-
novation and new technology’ (Interview 53).
P6: The stimulation of positive network-level out-
comes is enhanced if there is a t between the
network facilitator and the technological in-
tensity of the network (i.e. lead-rm facilita-
tors lead low-tech networks and third-party
facilitators lead high-tech networks).
Third, the interviewees report that lead-rm fa-
cilitators are particularly suited to stimulate pos-
itive economic outcomes in privately initiated net-
works that have emerged in a bottom-up process
© 2021 The Authors. British Journal of Management published by John Wiley & Sons Ltd on behalf of British
Academy of Management.
92 E. F. Mueller
Positive economic
outcome for
network actors
Phase 1:
Behavioural antecedents
Phase 3:
Network-level outcomes
Phase 2:
Network facilitation practices
Trusting beliefs
towards network
facilitators :
Competence
Benevolence
Integrity
Conflicts of interest in
network facilitation
practices:
Selection of network
firms
Strategy
implementation
Coordination of
specific investments
Abilities and motivations
of network facilitators:
Entrepreneurial
Mediation/arbitration
Trust affects level of conflicts in network facilitation
practices
Experiences/ Reputation of trust
P2
P1 P3 P4
Contextual determinants:
P5 Competitive intensity
P6 Technological intensity
P7 Mode of network initiation
Figure 2. A theoretical model of network facilitation
led by the lead rm itself and other companies (In-
terview 40). Typically, lead-rm facilitators have
in-depth industry knowledge and expertise, which
are important qualities for leading privately initi-
ated networks effectively (Dhanaraj and Parkhe,
2006).
By contrast, the interviewees emphasize that
in publicly initiated, so-called greeneld net-
works, where public money is invested but a
cooperative atmosphere and a mutual history are
lacking, third-party facilitators have the advan-
tage of leveraging their integrity and motivation
to promote the network as a whole (Interview 31).
They are more likely to be trusted to act as ‘honest
brokers’ and to support the emergence of positive
network-level outcomes.
While these ndings resonate with prior research
highlighting the role of the network facilitators’
embedding in a lead rm or a third-party insti-
tution for managing privately versus publicly ini-
tiated networks (Fromhold-Eisebith and Eisebith,
2005; Jungwirth and Müller, 2014), they provide
additional microfoundational insights into why the
motivations and behaviours of the facilitators mat-
ter in these regards.
P7: The stimulation of positive network-level out-
comes is enhanced if there is a t between the
network facilitator and the network’s mode of
initiation (i.e. lead-rm facilitators lead pri-
vately initiated networks and third-party fa-
cilitators lead publicly initiated networks).
Figure 2 depicts the resulting theory of network
facilitation, emphasizing the relationships between
the behavioural antecedents of the network fa-
cilitators, facilitation practices and network-level
outcomes.
Implications
This paper set out to develop a model that explains
how the behavioural antecedents of different types
of network facilitators are connected with their fa-
cilitation practices and positive network-level out-
comes. The results of this study advance knowl-
edge on network facilitation in various ways, rst
by using a microfoundations lens to offer a more
comprehensive understanding of the abilities and
motivations of different types of network facili-
© 2021 The Authors. British Journal of Management published by John Wiley & Sons Ltd on behalf of British
Academy of Management.
Towards a Theory of Network Facilitation 93
tators and how these relate to the rms’ trusting
beliefs vis-à-vis the facilitators. Lead-rm facilita-
tors are perceived as more competent than third-
party facilitators, but have the reputation of be-
ing less honest and benevolent. For this reason, to
succeed in stimulating positive economic outcomes
they make greater investments in trust-building
measures than third-party facilitators. By contrast,
third-party facilitators can rely on certain credits
of trust and on a positive perception of their ar-
bitration and mediation abilities and motivations.
Thus, they can focus on balancing rm interests
from the beginning.
In all, the results emphasize that trust dynamics
and trust-building practices in inter-rm networks
differ depending on whether lead-rm or third-
party facilitators manage the network. Whereas
in a sequential process lead-rm facilitators, who
are trusted to be competent but less honest and
benevolent, have to invest up-front in building a
perception of integrity-based trust before connect-
ing the rms with each other, third-party facilita-
tors, who are trusted to be honest and benevolent
but less competent, can skip the rst step. Hence,
agency costs are expected to be lower in third-
party-governed networks, which resonates with
Connelly et al.’s (2018) nding that trust based
on integrity is more powerful at reducing transac-
tion costs in interorganizational relationships than
competence-based trust. Also, rms’ positive expe-
riences with network facilitators’ practices work as
feedback mechanisms that contribute to network
facilitators’ reputation of trust. These feedback
mechanisms are particularly important to net-
works governed by a lead rm, since they have the
potential to lower the level of conicts of inter-
est between the facilitator and the rms and thus
reduce the expected level of agency costs in the net-
work. The study’s ndings in this regard are in line
with network research, which suggests that infor-
mal control mechanisms such as trust and norms
of reciprocity gain in importance as networks be-
come more mature (e.g. Dyer and Nobeoka, 2000;
Paquin and Howard-Grenville, 2013; Provan,
Fish and Sydow, 2007; Squire, Cousins and
Brown, 2009; Wincent, Thorgren and Anokhin,
2013).
In some ways, the ndings from this study ex-
tend the basic propositions of agency and network
theory. While the nding that lead-rm facilitators
per se are perceived as more self-interested than
third-party facilitators reects the basic proposi-
tions as brought forward by agency theory (e.g.
Holmström, 1979; Spence, 1973; Yang, 2008), it is
striking that lead-rm facilitators are very aware of
the risks associated with a lack of integrity-based
trust and practices inuenced by self-interest. De-
spite being both manager of the lead rm and
network facilitator, they ‘put emphasis on being a
neutral network facilitator’ (Interview 26), abstain
from acting self-interestedly or exploiting differen-
tials in bargaining power, and accept monitoring
mechanisms in order to build a reputation of trust
and to keep rms from leaving the network. Alto-
gether, a hybrid type of network facilitator emerges
that has not yet been discussed in the literature on
network facilitation (e.g. Mesquita, 2007; Provan
and Kenis, 2008): a lead-rm network facilitator
acting on a third-party facilitator maxim. Such an
interpretation of the results hopefully encourages
researchers to further investigate this hybrid type
of network facilitator – one that extends our cur-
rent understanding of how an inter-rm network
can be governed.
The results also hold practical implications.
Lead-rm facilitators can use the results regard-
ing the perceived shortcomings in benevolence and
integrity to adapt their behaviour and avoid net-
work failure. In particular, if the network was not
built on trustful, long-term relationships, lead-rm
facilitators know based on this study that to keep
the network viable, investing in gaining trust with
regard to benevolence and integrity is essential.
In practice, lead-rm facilitators are encouraged
to initiate collaboration projects outside the core
competencies of the lead rm to signal the will
to increase the success of not only the lead rm
but also the entire network. By contrast, third-
party facilitators are encouraged to invest in ex-
panding their competencies and skills related to
industry knowledge, trends and technologies – a
nding that endorses Kirkels and Duysters’ (2010)
call for network facilitators to extend their indus-
try knowledge in order to be able to steer the net-
work effectively.
Conclusion
This study develops a theory of network facilita-
tion that builds on the behavioural antecedents of
different types of network facilitators as a starting
point to provide insights into their practices and
effectiveness in stimulating positive network-level
© 2021 The Authors. British Journal of Management published by John Wiley & Sons Ltd on behalf of British
Academy of Management.
94 E. F. Mueller
outcomes. Results reveal important nuances. Lead-
rm facilitators invest in trust-building measures
to build a stronger perception of integrity. With-
out these investments, they risk strong conicts
of interest that would hinder them in stimulating
positive effects for the network rms. Also, to keep
participation incentives high, they are careful not
to dominate the network’s goals and activities. By
contrast, third-party facilitators focus on balanc-
ing rm interests from the outset, and make some
up-front investments in enlarging their competen-
cies and skills. Altogether, this study calls for fur-
ther research that deepens our understanding of
the microfoundations of network facilitation and
how these relate to macro-level network outcomes.
Acknowledgements
Open access funding enabled and organized by
Projekt DEAL.
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Elisabeth F. Mueller is an Assistant Professor at the University of Passau. She was also a visiting
scholar at the Wharton School. Elisabeth’s research interests lie at the intersection of strategic man-
agement and organization theory. Specically, the central themes of her work include questions related
to the governance of inter-rm networks and the organization of collaboration, as well as strategic
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Supporting Information
Additional supporting information may be found online in the Supporting Information section at the end
of the article.
Appendix S1. Sample descriptiona
Appendix S2. Dimensions, themes, categories and datab
© 2021 The Authors. British Journal of Management published by John Wiley & Sons Ltd on behalf of British
Academy of Management.
