Taggart, JDM 2010, 'Networking experiences of Australian home based businesses', DBA thesis, Southern Cross University, Lismore, NSW.
Copyright JDM Taggart 2010
This study investigated the world of Home Based Businesses and their experiences of trust, commitment and reciprocity in their networks.
Home Based Businesses (HBB) play a significant role in Western economics, particularly within the Australian economy in terms of number of businesses as a percentage of the total business sector, contribution to Australia‟s employment and GDP. Given this phenomenon of HBB this study sought to investigate the world of HBB and their experiences of trust, commitment and reciprocity in their networks. HBB require information and resource exchange to maintain and control their business, often in very turbulent environments. Networks, whether formal or informal, are environments that influence the quality and quantity of information and resource exchange. Additionally, HBB experiences of trust, commitment and reciprocity are built, maintained or dismantled within and between HBB network activity. Networks can be viewed as a modern form of marketing that has replaced the technique of cold calling for many micro businesses, including HBB in obtaining and maintaining information and resource exchange.
The current literature concerning HBB, networks and the relational components of trust, commitment and reciprocity have largely been studied in isolation to each other. The quality of information that stems from or lead into networks, is built on social network theory and network marketing. Networks are dynamic and complex. The level of trust, commitment and reciprocity in networks operates at different speed and direction, and therefore influences the experiences of the relationships in the network(s). Social Capital as distinct from human and physical capital, is the central pivot of any business relationship. The foundation of social capital is trust, commitment and reciprocity. Therefore understanding how people experience these components, is critical in assisting both the HBB and the network providers.
This study was an attempt to combine all the three areas of HBB, the experiences of trust, commitment, reciprocity and networks. Furthermore a sequential mixed method was implemented to explore these three areas in order to further understand the world of HBB by combining qualitative and quantitative techniques to gather and analysis relevant data, collected from the 25 semi structured interviews in phase 1 of this study, which formed the basis of the questionnaire used to survey a non random sample of HBB using internet technology to gather such data.
By applying factor analysis to the data collected from the questionnaire four constructs were identified. They were experiences associated with networks, informal networks, network belonging and network relationships. Each of these constructs revealed further the world of HBB and their experiences of trust, commitment and reciprocity in their networks. From this, a number of hypotheses were constructed and tested using bivariate testing. A number of significant findings were recorded and analysed.
Existing research has been limited concerning HBB in itself, but specifically limiting in terms of examining their experiences of trust, commitment and reciprocity. The findings of this research conclude that informal networks are an integral and vital source of information and resources that influence the ability to enhance the relational components of trust, commitment and reciprocity, particularly as they relate to their networks. By contrast, this research also found that HBB behaviour in formal networks as observed by the younger HBB was shallow and opportunistic suggesting that at the organisational level, people and HBB acted differently, reducing the potential to connect or build on social embeddedness.
Additionally, this research found that while HBB experiences were negative, older HBB were positive in attending formal networks with the hope of gaining a wide range of benefits. Interestingly, this research found that HBB networks, especially formal networks offered more than simply business and that older HBB and HBB that had operated for more than 10 years, looked for friendship and social relationships. This finding is worthy of further exploration and analysis. Policy makers, and executives, especially at the organisational level of HBB associations and other networks, need to carefully examine the procedural steps and processes of their networks in order to provide better experiences for their members. This research has future implications for all stakeholders in HBB, and networks, especially how, why and where the relational components of trust, commitment and reciprocity are developed. Further research surrounding such attributes as the HBB age, both in terms of cohort and length of time as a HBB as it is associated with the business phase of the HBB, may also be worthy of further research.
The identification and selection of key information exchange is paramount in network activity. Within formal networks, HBB often seek information from family and friends about developing their business, especially in the early stages of HBB growth. Formal networks on the other hand, generally environments of HBB associations and chambers of commerce develop relationships and social capital that provide information and resource exchange that has little relevance to business development and growth. This non-financial or lifestyle factor is a major finding of this study and suggests that formal networks can and do act as a conduit to create and build friendships for HBB.
Furthermore, in order to enhance the benefits of social networking, as they relate to HBB associations and chambers of commerce, the Executive of such organizations need to complete and implement a wide variety of strategies that help build and foster the development of social capital in individual HBB. The implementation of individual HBB activities, formulated and structured data bases for HBB, network Expos, a clear and concise Executive checklist for new and existing members all combine over time to provide a better and more creative environment to help build social networking for HBB and enhance their experiences in a positive way of trust, commitment and reciprocity.