HARNESSING THE POTENTIAL OF SOCIAL CAPITAL FOR INCREASING INNOVATION CAPABILITY: BENEFIT FOR MAINTAINING SUPPLIERCUSTOMER RELATIONSHIP

摘要

Innovation has widely been regarded as one of the main drivers of economic growth in the knowledge economy. Therefore, it is important for firm to maintain its innovation capability by implementing various strategy. This paper analyze the role of social capital to absorptive capacity and innovation capability in Indonesias automotive companies which have supplier-customer relations. It shows that the social capital between and within the supplier-customer firms has a role in increasing innovation capability. Social capital has a role in boosting potential and realized absorptive capacity and also direct impact on the innovation capability. The similarity of the model from both companies indicates that there is a mimetic isomorphism in the innovation capability building strategy. To build the strategy, there are some condition needed as requirements.