Managing business networks for value creation in facilities and their external environments

Abstract

Purpose The purpose of this paper is to increase understanding of the logic of business network formation among the co-located and external actors of a facility. Design/methodology/approach The research adopts a theory-building approach through developing propositions inductively from the empirical case study on four purposefully sampled modern service station facilities. The focus is on analyzing how a facility and its inherent co-located actors represent an entity that forms a business network with external actors in the facility’s environment. Findings The findings propose that when co-located with a large number of actors, the facility and its actors represent an entity that is connected to a wide business network of multiple external actors. On the other hand, when co-located with a small number of actors, the facility becomes a part of the overall supply in the surrounding business environment with a differentiated offering for competitive advantage. Practical implications The research suggests that an appropriate co-locating strategy, for example, when planning the tenant mix of the facility, can contribute to creating a vivid business network in the external environment, which raises the facility to a role of a central entity in such a network. Originality/value The findings explaining how co-location affects the businesses within the facility and within a wider networked environment are novel to the scholarly knowledge on co-location. The research bridges the theories of co-location and business networks that have been treated as separate discourses in previous research.