Trust, Network, and Market: Start-up Strategies of SMEs in Indian ICT industry

Abstract

It is well understood that market plays a determining role with reference to business development. However, the process through which an enterprise identifies and develops a market for its business offering varies contextually and therefore, involves uncertainty. Corporates adopt different strategies, involving innovation and brand-building, in order to address such uncertainty. However, often such strategies are resource-intensive where resource not only involves finance, but also time, and dedicated personnel. It is quite easily understandable that such strategies are seldom affordable for emerging small and medium enterprises (SMEs) which are often resource-constrained. However, what is interesting is that despite such obstacles a large number of SMEs get started on a regular basis and a good number of them do considerable business. This phenomenon takes a particularly interesting form in new economy which has witnessed mushrooming of new SMEs in the recent years. It is in this context it becomes important to explore the alternative resources that SMEs apply, particularly in the start-up stage, in order to develop a market for themselves and maintain control over it. The current paper attempts to explore the significance of collaboration emerging out of trust and network as an alternative resource. The paper bases itself upon interviews of entrepreneurs in Information and Communication Technology (ICT) industry in India.