Abstract

The purpose of this research is to provide a greater understanding of the impact of social networks on the building of control mechanisms of petitioner in logistics services cluster in an emerging market. An in-depth case study was conducted in one of the most successful Chinese logistics services cluster. The data was analyzed first by a typology of coopetitive relationships between logistics service providers in the cluster which is based on the different Guanxi base. Then with the assumption that social networks “Guanxi” could be encouraged by the cluster’s geographical proximity and the government’s intervention, a theoretical framework is formulated and indicates three main impacts of social networks “Guanxi” which contribute to control risks in the coopetition: reduce the information asymmetric, increase the concern of “Renqing”/favor and the concern of reputation. The results show also that the interaction between leadership, communication and trust is crucial to the building of control mechanism, and the concern of reputation in the social network is the most crucial factor for the control of coopetition inside the cluster. With empirical study from an uncertain and turbulent market, which has a strong social-culture context of Confucianism, this study suggests the necessity of researchers and practitioners to consider the potential role of social networks in control risks of coopetition relationship.