The dark side of interorganisational relationships and its effect on SMEs’ international strategies

This study investigates the dark side of interorganisational relationships in SME internationalisation, drawing on Social Capital Theory. While prior literature has largely emphasised the positive contributions of structural, relational and cognitive social capital, this study shows how excessive or unbalanced social capital can paradoxically constrain SMEs’ international strategies. Responding to recent calls to integrate micro-level cognitive and emotional mechanisms into network analysis, we conducted in-depth qualitative research using a multiple-case study design involving internationally active SMEs. The findings reveal that overembedded networks, blind or inertial trust, and excessive cognitive alignment may emerge from a high level of social capital, leading respectively to isolation effects, strategic rigidity and cognitive lock-in. Importantly, relational features commonly regarded as strengths – such as long-standing ties, trust and interdependence – may cause decision-makers to overlook early warning signs of inefficiency and misalignment. By uncovering these underexplored dynamics, the study advances literature by clarifying when and how social capital shifts from a strategic asset to a constraint on SMEs’ international competitiveness. From a managerial perspective, the study highlights the need for SME decision-makers to actively monitor and rebalance their interorganisational relationships, avoiding uncritical reliance on trusted partners in international markets.