“Managing the strengths of ties for internationalization: lessons from four rapidly internationalized Chinese SMEs”, September 2006, Journal of Asia Business Studies
http://wf2dnvr3.webfeat.org:80/

This article examines the internationalization efforts of SMEs (”small and medium enterprises”, or small businesses) in China. Previous research in this field has focused only on the internationalization of large businesses, viewing SMEs as being disadvantaged in global expansion. Moreover, research on business network ties in China has been focused only on strong or ethnic-oriented ties. This article shows that contrary to these assumptions, Chinese SMEs have actively and successfully used weak-tie networks to expand internationally at a rapid pace.

On a national level, Chinese businesses have traditionally relied on strong-tie networks such as social and personal connections to make up for the lack of an established economic business structure. These strong-tie relationships allow business to have higher flexibility and lower costs in their activities because these interactions are based on trust. However, as China has recently been moving into the global market, its businesses have been forced to rethink their reliance on strong-tie networks. Many Chinese entrepreneurs are “self-made men” with “limited global exposure”, their strong-tie relationships are often with others similar to themselves. Thus, while strong-tie networks provide “high quality and dependable” information, they do not provide the “diversity of information” that weak ties would provide; this variety of information is crucial to having a “competitive advantage in [the] global market”. In interviews with the managers of four Chinese SMEs, it was revealed that using weak ties was what allowed these firms to begin establishing themselves in other countries such as the United Kingdom.

The idea of the global expansion of Chinese SMEs using weak-tie relationships is supported in “The Strength of Weak Ties”. On page 1366, Granovetter writes that “whatever is to be diffused can reach a larger number of people, and traverse greater social distance… when passed through weak ties rather than strong”. When a business is attempting to expand on an international rather than a national scale, it is evident that weak ties can in fact be more useful than strong ties. It is also interesting to note that weak ties can play an important role in interracial exchanges as well. This finding is supported in the Milgram “small-world” study mentioned in Granovetter’s article: here, completion of the network chain was almost twice as high when participants used interracial weak ties, “acquaintances”, rather than interracial strong ties, “friends”.

This article offers interesting insights on weak-tie networks in both a business and interracial context. As business development moves to a global level, this will clearly be a topic that is extremely relevant in our society today.