NETWORK ORGANIZATIONS
Network Organizations and its Impact on the Environmental Process
Maria Franco-Cortes
Liberty University
Dr. Henry Kerich
April 28, 2021
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NETWORK ORGANIZATIONS
Network Organizations and its Impact on the Environmental Process
Organizations are recognized as being affected by present influences and pressures and
by past circumstances Scott and Davis (2007). Ecologists and institutionalists challenge the
assumptions underlying contingency and transaction cost analysts that organizations can readily
change their basic structural features. Ecologists attend to competitive processes shaping
populations of organizations dependent on the same kind of resources. The dynamic of
population processes, including founding, growth, and failure rates, are examined as these are
shaped by demographics, ecological, and environmental factors. However, recent efforts have
been devoted to reviewing the entrepreneurial processes and technological factors that give rise
to new organizations. Institutional theorists examine rules, norms, and beliefs that constrain and
support social structures and procedures, including organizations. Also, while economists and
political scientists stress the importance of rules and regulations, sociologists and organizational
theorists have emphasized the role of shared norms and beliefs that provide cultural foundations
of social orders. Network analysis offers a way to visualize and analyze patterns of relationships
among parts, including flows of information, resources, energy, and authority (Scott & Davis,
2007). The network resources that can access through its strategic alliances are critical precursors
to innovation (Aggarwal, 2019). Therefore, organization's leaders should understand the different
types of network organizations and how this can impact the environmental process.
Types of Network Organizations
Scott and Davis (2007) explain that a network consists of nodes and ties or relationships
among the nodes. Nodes can be actors, such as organizations, groups, or persons. Ties can take
endless forms, from physical linkages to personal relationships. Therefore, it is clear that
networks can be used to describe systems at all levels of analysis. Networks exist within, across,
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and between organizations. For example, all manner of ties exists among individuals within the
organization, like friendship and interdependence. Ties also exist between an organization and its
exchange partners, competitors, and regulators. Networks can be viewed at three analytical
levels. The first is the ego network which includes all a node's direct contacts. The second level
is the overall networks which included all actors and relationships within a particular domain. At
the third level, the network position identifies an actor's coordinates within that topography.
Stable networks, dynamic networks, and internal networks are the three main network
types describes by Miles and Snow (Scott & Davis, 2007). A core firm creates market-based
linkages to a limited set of upstream and downstream partners in a stable network. However,
these networks occur primarily in relatively mature industries. In contrast, dynamic networks are
seen in industries with relatively short product cycles. For example, independent business
elements and value chain-forming temporary alliances from among many potential patterns.
Finally, in an internal network, organizational units buy and sell goods and services among
themselves at prices established in the open market. In other words, market transactions are
brought inside the organization's boundaries.
In knowledge-intensive environments, strategic alliances are a must-Alliance Networks.
have tool for managers (Kelly et al., 2017). They allow firms to access diverse information and
know-how, which can be very important as inputs to an innovation process. Alliances can take
many forms and serve many purposes. For example, they reduce risk, attain economies of scale,
allow technology exchange, help overcome governmental barriers, and facilitate international
expansion (Scott & Davis, 2007). The propensity to form alliances can depend on the typical
characteristics of a potential pair, like having partners in the common or prior history of
alliances. On the other hand, alliances influence organizational performance, both in terms of
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innovation and speed. Innovation requires access to diverse knowledge, which serves as a factor
input to new knowledge production. For this reason, alliances are often pervasive in knowledge-
intensive settings as they facilitate the acquisition of knowledge and technological capabilities by
firms from external sources.
Industry and Sector Structure. There are networks among organizations and industry
exchange networks and the character of the overall economy. Firms have high structural
autonomy to the extent that their industries are concentrated, and the industry of their buyers and
suppliers is dispersed (Scott & Davis, 2007). Organizations located in industries fitting this
description have characteristically experienced higher profits. It is essential to combine data with
information about how concentrated industries analyze an industry's participants' structural
autonomy and define the ability to pursue interest without constraint from other actors in the
system (Kelly et al., 2017). Network analysis can also characterize relations among organizations
and agencies attempting to influence policy decisions in the public sector.
The Network Structure of the Economy. In today's economic ecosystems, network
platforms are becoming increasingly important (Xu et al., 2021). With organizations integrating
vertically and horizontally, organizational populations are becoming more mixed and varied.
Network platforms are playing an increasingly important role in the economic system. According
to the ecology theory, mutualistic and competitive mechanisms are critical mechanisms across
different community populations. Therefore, a symbolic relationship may tap into legitimating
benefits that include socio-political legitimations and cognitive legitimation of an emerging form
and the accrued benefits of a resource spillover. Network platforms are an essential setting where
the fuzziness is evident. At the same time, network platforms represent a new type of
organizational population whose role in the current global economic systems becomes
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increasingly important (Xu et al., 2021). Scott and Davis (2007) explain that the economic
importance of networks is revealed in situations of significant transition, such as the case of post-
socialist economies. For example, in post-socialist Eastern Europa, organizations are rebuilt not
on the ruins but with the ruins of communism as they redeploy available resources in response to
their immediate dilemmas.
Business Networks and Political Power. According to Scott and Davis (2007), political
sociologists have long viewed networks, particularly among business elites, as providing an
indicator of cohesion and potential political power. Service on multiple boards across different
industries promotes a more cosmopolitan political worldwide able to reconcile the divergent
interests pointed to by pluralists, and many directors are involved in public policy organizations.
Rydehell et al. (2018) reaffirm that business networks can offer firms access to necessary assets
and equipment for technology and the development of patents. Through business networks and
close localization with universities and industry intense regions, extant research has shown that
tangible resources which enhance a new firm's ability to operate also become easily accessed.
The business also networks essential as it enhances entrepreneur's ability to recognize
opportunities and their understanding of such opportunities, gain legitimacy in the market, and
gain access to scarce and vital resources and information.
How Can this Impact the Environmental Process?
The newly ecology approach to organizations and the refurbished new institutional
approaches to organizations examine broader systems compromised by similar organizations
(Scott & Davis, 2007). Ecologists analyze organization birth, change, and death as the most
informative dependent variables. Interorganizational relations (IORs) are defined by Knutsen
(2016) as relatively long-term transactions, flows, and linkages that occur among or between one
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organization and another in its environment. This concept agrees that collaboration should extend
beyond mere information sharing to mutual obligations involving organizational resources or
coordination of services. The ecological conception reaffirms the importance of the environment
and how it can hardly be more strongly underlined than it is in the population ecology
framework.
Creating new organizations. When talking about creating new organizations,
entrepreneurship is more associated with the founding of a new organization than its context.
Entrepreneurs establish what Scott and Davis (2007) call reproducer rather than innovator
organizations. Knutsen (2016) found that older and larger organizations tend to collaborate more
frequently, and they also establish more formal collaborations. The environment has consistently
been recognized as a significant contributor to an organization's decision to establish IORs. The
most recent work by economists and sociologists focuses on the importance of context and the
relational network of founders. Social networks vary greatly, but the diversity of one's ties is
especially critical since it increases access to a broader range of information.
Wei (2017) argues that the imprint from the dominant logic of organizing Imprinting.
during the founding period and the institution's institutional position at the founding influence
organizational response. New organizational forms must perforce draw on the existing stock of
resources, knowledge, and supporting structures and are always constrained by the conditions
presented in the environment at the time of the founding. The notion of institutional complexity
has been recognized since the introduction of institutional logic, which it defines as the taken-
for-granted principle of organizing that provides a prescription of actions to organizations (Wei,
2017). Organizational forms are imprinted, and because of their inertial properties, they are
likely to retain the features acquired at their origin. Ecologists regard resistance to change as a
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normal state for organizations. Initial organizational structures and features were shaped by the
socioeconomic conditions present at their founding and that these characteristics would persist
over time.
Technological Change. Azar and Ciabuschi (2017) help explain how new technologies
were primarily responsible for developing new kindness of organizations and industries. Changes
in the environment usually result in a shift in the firm's strategy. According to previous research,
organizational innovation can serve as both a prerequisite and a facilitator for the practical
application of technological innovation. Innovation is a multifaceted concept that includes the
conception, development, and implementation of a novel idea for the adopting organization. Azar
and Ciabuschi (2017) state that the technological, organizational typology is popular among
management researchers and refers to a general distinction between the firm's technological and
administrative systems. The former mainly produces changes in the firm's operating system, and
the latter influences its management systems. Established firms often fall behind start-ups in
adopting radical innovations because of difficulties in breaking away from rigid organizational
routines and cultures and transforming their current core capabilities into core rigidities.
However, pressures from the external environment, such as competition and customer demand,
are some of the primary antecedents of adopting innovations to ensure a firm's adaptive behavior
to maintain or improve its performance. Environmental changes influence organizational forms,
which also affect technical systems. The adoption of innovations results in changes in the
strategy, which improves teamwork, collaboration, and information sharing.
Personal Perspective and Biblical Component
There is no doubt that networks consist of relationships formed by people and
organizations to get things done. Networking supports the many functions that organizations or
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people need to fulfill, from competing transactions to socializing, innovating, learning, and
planning. Organizational networks influence everything organizations to do. For example, if
networks are effective, they can adapt quickly to change. An organizational network analysis
help leaders look for patterns within layers of organizational data. It also analyzes how
communications, information flows, and decisions throughout the organization. In other words,
networks and networking are essentials concepts that transform organizational, economic, and
social practices. Therefore, every organization must take advantage of networking to achieve
effective operations and innovate. Leaders should also pay attention to the organizational
environment as it composes forces that affect performance, operations, and resources. It also
includes all the elements outside the organization's boundaries and can affect a portion of the
organization.
When networking, organizations require managers to formulate objectives and work
through the coalitions, and networks need to sell ideas and compete or collaborate for resources.
All leaders need to build good working relationships with the people who can help them do their
jobs. Merida et al. (2015) mention how the wisdom and glory of the king speeded among the
nations. Solomon's rule extended over the kingdoms from the Euphrates River to the land of the
Philistines and as far as the border of Egypt, as Merida et al. (2015) explain. It is a clear example
of how Solomon used his networking and collaboration skills by taking advantage of his friendly
relationship with the next-door king, Hiram of Tyre, to help build the temple. Hiram was
previously involved in David's building project by supplying wood, carpenters, and stonemasons.
Solomon asks Hiram for skilled men and materials, especially the cedars, and promises to pay
Hiram's servants. Hiram negotiates, saying that his men should deal with cutting and transporting
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the wood. Then, Hiram tells him that he should pay his royal household. Solomon received trees,
and Hiram receives food. Therefore, this seems like a peaceful arrangement.
2 Corinthians 9: 6-9 support the fact that serving gives and attracts (King James Bible
Online, 2017). The best marketing plan for any product or business comes through genuine love,
care for others, and generosity. It is clear that when people build relationships based on these
values, they open up a stream of provision that flows both ways. This is a spiritual principle on
which people can stake their business, relationships, and life. Today, there is one common path to
achieve success: networking and cultivating relations to advance and move into higher positions.
Word count: 2,112
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