A Structural Analysis on Firm-Market Affiliation Networks in the Korean System Integration Industry

Abstract

This paper examines the market topology of the Korean System Integration (SI) industry and its diversified strategic groups using firm-market affiliation networks. The Korean SI market is fragmented into core, semi-core, and peripheral industries corresponding to the firm-market affiliation patterns. Given the fragmented market structure, the SI firms can be classified broadly into four types, according to their market strategies. Based on empirical research, this paper explores Korea's SI structure and the underlying relationships between Large Business Groups (LBGs) and Small and Medium Firms (SMFs), revealing the LBG-centered industrial organization of Korea's SI industry.