Reorganizing business networks and innovation: Two cases of Italian textile producers

This paper deals with innovation in business networks. Innovation is considered as a process emerging from the ever evolving interactions between firms and other actors, primarily customers and suppliers. The main aim of the paper is to analyze the effects of innovation on the reorganization of firms’ business networks. Empirically, the paper presents the data collected during a ten-year longitudinal case study of two Italian textile producers. The main findings of the cases analyzed suggest two potential effects arising from the interplay between innovation and business networks: “integration” and “substitution”. The various implications for business networks stemming from the two effects are described and discussed.