EXPLORING THE FIELD READINGS (LECTURE 1.1)
- Sydow, J., Schüβler, E. and G. Müller-Seitz (2016). Managing Inter-organizational Relations.
Debates and Cases. London: Palgrave: 3-24.
- Kilduff & Brass (2010). Organizational Social Network Research: Core Issues and Key Debates.
Academy of Management Annals, 4(1): 317-357.https://doi.org/10.1080/19416520.2010.494827
- Provan, K. G., and P. N. Kenis. (2008). Modes of Network Governance: Structure, Management,
and Effectiveness. Journal of Public Administration Research and Theory 18: 229-252.
https://doi.org/10.1093/jopart/mum015
- Raab, J. (2017). Interorganizational Networks, in: Alhajj, R. and J. Rokne (Eds.). Social Network
Applications in Business, Organizations, Industry and Case Studies” as part of the Encyclopedia on
Social Networks and Mining (ESNAM).
SYDOW ET AL. (2016)
The introductory chapter establishes the foundation for understanding how and why organizations
engage in inter-organizational relations (IORs), cooperative arrangements between organizations
that aim to achieve common or complementary goals. It explores their forms, reasons, management
functions, and inherent tensions, offering a framework for managing such relationships effectively.
The Rise of Inter-Organizational Relations
IORs as a dominant organizing form: Organizations increasingly collaborate with others to
achieve goals they cannot reach alone: sharing resources, knowledge, and risks.
Shift in competition: Competition now occurs between networks or alliances (e.g., airline
alliances like Star Alliance, OneWorld, SkyTeam) rather than between individual firms.
IORs across industries: Seen in airlines, semiconductors (SEMATECH), biotechnology (Big
Pharma–university collaborations), and public–private partnerships.
Reasons for Engaging in IORs
Organizations collaborate for overlapping motives categorized into costs, benefits, and risks:
Focus on costs is to achieve economies of scale and specialization, to save coordination costs,
and to monitor or block competition.
Focus on benefits is to combine complementary resources, to overcome trade or investment
barriers, and to stimulate creativity and learning
Focus on risks is to reduce uncertainty, and to trade external risks for internal control
These motives connect to several theoretical lenses:
Transaction Cost Economics: minimizing coordination and production costs
Resource-Based View: gaining access to valuable, rare, inimitable, non-substitutable resources
Relational View: developing relational advantages through collaboration
Social Capital Theory and Structural Hole Theory: leveraging relationships and network
positions.
Management as Function, Institution, and Practice
Function: traditional management theory (Fayol, Gulick, Urwick) viewed management as performing
fixed functions: planning, organizing, leading, and controlling. However, modern management
recognizes fluid and situational processes, emphasizing communication, adaptation, and learning.
Institution: management is also an institution, embedded in social structures, norms, and values.
Institutions guide how management is practiced, varying across contexts (e.g., Pfizer vs. Bayer have
distinct organizational systems and management logics due to national differences).
,Practice: a practice perspective (inspired by Giddens and structuration theory) views management as
recurring, socially embedded actions that reproduce or transform structures. Managers engage in
activities like partner selection, negotiation, coordination, and evaluation, which continuously shape
networks.
Forms, Qualities, and Levels of IORs
Forms (Governance Types) - IORs differ by how they are governed:
Markets: transactions based on price (buy/sell)
Hierarchies: authority and command within organizations
Networks: collaboration and trust among autonomous actors
Most IORs are hybrids, combining market and hierarchy elements (e.g., strategic alliances).
Qualities - IORs vary by:
Tight vs. loose coupling
Dyadic (two-party) vs. multiplex (multi-party) relations
Network size, diversity, centrality, and density (structural properties influencing coordination).
Levels - six levels of analysis for IORs: Individual, Group, Organization, Dyad (two organizations),
Network, and Societal or field level
Core Management Practices
Management in IORs is process-oriented, emphasizing selection, allocation, regulation, and
evaluation as interlinked activities. They identify four key management practices in IORs, which are
recursively related:
Selection: choosing appropriate partners (strategic fit, shared goals, capabilities).
Allocation: distributing resources, roles, and responsibilities across partners.
Regulation: establishing formal or informal rules, contracts, and trust mechanisms.
Evaluation: assessing partner contributions, outcomes, and overall performance, leading to
adaptation or re-selection.
These practices ensure coordination and adaptation while balancing autonomy and control.
Managing Tensions and Contradictions
Tensions and contradictions are inherent in interorganizational relationships and actually drive their
development. In managing interorganizational relationships (IORs), organizations constantly face
contradictory demands. These contradictions, instead of being problems to eliminate, are key drivers
of change, adaptation, and innovation.
Sydow et al. explain this using a dialectical perspective: opposing forces interact over time, shaping
how networks evolve.
Example The Star Alliance case is used throughout the chapter
to illustrate these dynamics.
Tension 1: Innovation vs. Control
When major airlines (like Lufthansa, Air Canada, United, and
Thai Airways) formed Star Alliance, they aimed to innovate
by offering customers a seamless global travel experience:
shared booking systems, joint marketing, lounge access, etc.
But to make this innovation work, the alliance also needed
control: standardized rules, shared IT systems, coordinated
schedules, and uniform service standards.
,How this tension drives evolution:
Too much innovation → chaos and inconsistency between partners.
Too much control → rigidity and loss of flexibility.
Over time, the alliance evolved mechanisms (joint committees, shared governance rules, alliance
management offices) to balance both forces.
o This dialectical adjustment led to organizational learning and gradual improvement in
collaboration.
Tension 2: Expansion vs. Consolidation
After its founding, Star Alliance faced another contradiction: whether to expand by adding new
airlines or to consolidate to strengthen coordination among existing members.
Expansion offered access to new markets and routes.
Consolidation allowed deeper cooperation and more efficient management.
How it played out:
The alliance grew rapidly to nearly 30 members, but managing such diversity became challenging
(different national regulations, IT systems, service levels).
To handle this, the alliance developed more formal governance mechanisms (e.g., a network
administrative organization, Star Alliance GmbH in Frankfurt) to centralize some decisions while
preserving member autonomy.
So, the network didn’t “resolve” the tension, it learned to manage it dynamically, shifting between
phases of growth and stabilization.
KILDUFF & BRASS (2010)
The paper reviews the development, coherence, and current debates in organizational social
network research, a rapidly growing field within management studies. The authors identify the core
ideas that unify diverse strands of research and discuss key controversies shaping the field’s future.
Core Ideas of Organizational Social Network Research
Kilduff and Brass identify four leading ideas that define the field:
Relations Between Actors
o Networks emphasize relationships (e.g., friendship, advice, communication) rather than
isolated individuals.
o Social ties are central to understanding behavior and outcomes in organizations.
Embeddedness
o Economic and organizational actions are embedded in social relationships.
o Trust, repeated transactions, and community ties influence organizational performance and
interfirm collaboration.
Structural Patterning
o Beneath social complexity lie enduring patterns of connectivity and cleavage (e.g.,
clustering, centralization).
o Network structures (like density or small-world effects) shape communication, influence,
and cohesion.
Utility of Network Connections
o Network positions facilitate or constrain individual and group outcomes (e.g., performance,
innovation, power).
o The structural hole vs. closure debate contrasts brokerage (diverse, non-redundant ties)
with cohesion (trust and collaboration).
, Key Debates and Controversies
The authors highlight five ongoing debates:
Actor Characteristics
o Traditional sociology emphasized structure over individual traits.
o Recent work integrates personality (e.g., self-monitoring) and organizational attributes
(e.g., absorptive capacity) into network analysis.
Agency
o Critics argue that network research has been overly deterministic, ignoring how actors
actively shape and exploit networks.
o Calls exist for models incorporating choice, strategy, and network evolution.
Cognition
o Introduces the idea of cognitive social networks—how people PERCEIVE and INTERPRET
network ties.
o Perceived networks often differ from actual ones but still influence power, reputation, and
behavior.
Cooperation vs. Competition
o Contrasts the cohesion (trust-based) view with structural equivalence (competition-based)
perspectives.
o Both cooperative and competitive dynamics influence diffusion, performance, and
innovation.
Boundary Specification
o Questions how far networks should be traced: direct vs. indirect ties, and which types of
relationships (positive, negative, multiplex) should count.
o Indirect ties may have significant but underexplored effects (e.g., emotional contagion,
resource access).
Implications and Future Directions
The field is progressive, generating theory that spans micro (interpersonal) and macro
(interorganizational) levels.
Future research must balance theoretical development with the growing tendency toward
descriptive big-data analysis.
Integration with psychology and economics is expected to deepen understanding of how
networks influence behavior and performance.
Contribution
Kilduff and Brass provide a conceptual map of organizational network research:
Reaffirming its distinctive core ideas (relations, embeddedness, structure, utility).
Clarifying current tensions that drive theoretical innovation.
Offering a glossary of network terminology for scholars entering the field.
PROVAN & KENIS (2008)
This paper examines how organizational networks, groups of three or more autonomous
organizations collaborating to achieve shared goals, are governed, and how governance structures
influence network effectiveness. The authors propose a typology of network governance forms,
identify conditions under which each is most effective, explore inherent tensions in governance, and
discuss how governance evolves over time.
Three Forms of Network Governance
Provan and Kenis identify three main modes of network governance, differing by the degree of
centralization and presence of a broker organization:
- Sydow, J., Schüβler, E. and G. Müller-Seitz (2016). Managing Inter-organizational Relations.
Debates and Cases. London: Palgrave: 3-24.
- Kilduff & Brass (2010). Organizational Social Network Research: Core Issues and Key Debates.
Academy of Management Annals, 4(1): 317-357.https://doi.org/10.1080/19416520.2010.494827
- Provan, K. G., and P. N. Kenis. (2008). Modes of Network Governance: Structure, Management,
and Effectiveness. Journal of Public Administration Research and Theory 18: 229-252.
https://doi.org/10.1093/jopart/mum015
- Raab, J. (2017). Interorganizational Networks, in: Alhajj, R. and J. Rokne (Eds.). Social Network
Applications in Business, Organizations, Industry and Case Studies” as part of the Encyclopedia on
Social Networks and Mining (ESNAM).
SYDOW ET AL. (2016)
The introductory chapter establishes the foundation for understanding how and why organizations
engage in inter-organizational relations (IORs), cooperative arrangements between organizations
that aim to achieve common or complementary goals. It explores their forms, reasons, management
functions, and inherent tensions, offering a framework for managing such relationships effectively.
The Rise of Inter-Organizational Relations
IORs as a dominant organizing form: Organizations increasingly collaborate with others to
achieve goals they cannot reach alone: sharing resources, knowledge, and risks.
Shift in competition: Competition now occurs between networks or alliances (e.g., airline
alliances like Star Alliance, OneWorld, SkyTeam) rather than between individual firms.
IORs across industries: Seen in airlines, semiconductors (SEMATECH), biotechnology (Big
Pharma–university collaborations), and public–private partnerships.
Reasons for Engaging in IORs
Organizations collaborate for overlapping motives categorized into costs, benefits, and risks:
Focus on costs is to achieve economies of scale and specialization, to save coordination costs,
and to monitor or block competition.
Focus on benefits is to combine complementary resources, to overcome trade or investment
barriers, and to stimulate creativity and learning
Focus on risks is to reduce uncertainty, and to trade external risks for internal control
These motives connect to several theoretical lenses:
Transaction Cost Economics: minimizing coordination and production costs
Resource-Based View: gaining access to valuable, rare, inimitable, non-substitutable resources
Relational View: developing relational advantages through collaboration
Social Capital Theory and Structural Hole Theory: leveraging relationships and network
positions.
Management as Function, Institution, and Practice
Function: traditional management theory (Fayol, Gulick, Urwick) viewed management as performing
fixed functions: planning, organizing, leading, and controlling. However, modern management
recognizes fluid and situational processes, emphasizing communication, adaptation, and learning.
Institution: management is also an institution, embedded in social structures, norms, and values.
Institutions guide how management is practiced, varying across contexts (e.g., Pfizer vs. Bayer have
distinct organizational systems and management logics due to national differences).
,Practice: a practice perspective (inspired by Giddens and structuration theory) views management as
recurring, socially embedded actions that reproduce or transform structures. Managers engage in
activities like partner selection, negotiation, coordination, and evaluation, which continuously shape
networks.
Forms, Qualities, and Levels of IORs
Forms (Governance Types) - IORs differ by how they are governed:
Markets: transactions based on price (buy/sell)
Hierarchies: authority and command within organizations
Networks: collaboration and trust among autonomous actors
Most IORs are hybrids, combining market and hierarchy elements (e.g., strategic alliances).
Qualities - IORs vary by:
Tight vs. loose coupling
Dyadic (two-party) vs. multiplex (multi-party) relations
Network size, diversity, centrality, and density (structural properties influencing coordination).
Levels - six levels of analysis for IORs: Individual, Group, Organization, Dyad (two organizations),
Network, and Societal or field level
Core Management Practices
Management in IORs is process-oriented, emphasizing selection, allocation, regulation, and
evaluation as interlinked activities. They identify four key management practices in IORs, which are
recursively related:
Selection: choosing appropriate partners (strategic fit, shared goals, capabilities).
Allocation: distributing resources, roles, and responsibilities across partners.
Regulation: establishing formal or informal rules, contracts, and trust mechanisms.
Evaluation: assessing partner contributions, outcomes, and overall performance, leading to
adaptation or re-selection.
These practices ensure coordination and adaptation while balancing autonomy and control.
Managing Tensions and Contradictions
Tensions and contradictions are inherent in interorganizational relationships and actually drive their
development. In managing interorganizational relationships (IORs), organizations constantly face
contradictory demands. These contradictions, instead of being problems to eliminate, are key drivers
of change, adaptation, and innovation.
Sydow et al. explain this using a dialectical perspective: opposing forces interact over time, shaping
how networks evolve.
Example The Star Alliance case is used throughout the chapter
to illustrate these dynamics.
Tension 1: Innovation vs. Control
When major airlines (like Lufthansa, Air Canada, United, and
Thai Airways) formed Star Alliance, they aimed to innovate
by offering customers a seamless global travel experience:
shared booking systems, joint marketing, lounge access, etc.
But to make this innovation work, the alliance also needed
control: standardized rules, shared IT systems, coordinated
schedules, and uniform service standards.
,How this tension drives evolution:
Too much innovation → chaos and inconsistency between partners.
Too much control → rigidity and loss of flexibility.
Over time, the alliance evolved mechanisms (joint committees, shared governance rules, alliance
management offices) to balance both forces.
o This dialectical adjustment led to organizational learning and gradual improvement in
collaboration.
Tension 2: Expansion vs. Consolidation
After its founding, Star Alliance faced another contradiction: whether to expand by adding new
airlines or to consolidate to strengthen coordination among existing members.
Expansion offered access to new markets and routes.
Consolidation allowed deeper cooperation and more efficient management.
How it played out:
The alliance grew rapidly to nearly 30 members, but managing such diversity became challenging
(different national regulations, IT systems, service levels).
To handle this, the alliance developed more formal governance mechanisms (e.g., a network
administrative organization, Star Alliance GmbH in Frankfurt) to centralize some decisions while
preserving member autonomy.
So, the network didn’t “resolve” the tension, it learned to manage it dynamically, shifting between
phases of growth and stabilization.
KILDUFF & BRASS (2010)
The paper reviews the development, coherence, and current debates in organizational social
network research, a rapidly growing field within management studies. The authors identify the core
ideas that unify diverse strands of research and discuss key controversies shaping the field’s future.
Core Ideas of Organizational Social Network Research
Kilduff and Brass identify four leading ideas that define the field:
Relations Between Actors
o Networks emphasize relationships (e.g., friendship, advice, communication) rather than
isolated individuals.
o Social ties are central to understanding behavior and outcomes in organizations.
Embeddedness
o Economic and organizational actions are embedded in social relationships.
o Trust, repeated transactions, and community ties influence organizational performance and
interfirm collaboration.
Structural Patterning
o Beneath social complexity lie enduring patterns of connectivity and cleavage (e.g.,
clustering, centralization).
o Network structures (like density or small-world effects) shape communication, influence,
and cohesion.
Utility of Network Connections
o Network positions facilitate or constrain individual and group outcomes (e.g., performance,
innovation, power).
o The structural hole vs. closure debate contrasts brokerage (diverse, non-redundant ties)
with cohesion (trust and collaboration).
, Key Debates and Controversies
The authors highlight five ongoing debates:
Actor Characteristics
o Traditional sociology emphasized structure over individual traits.
o Recent work integrates personality (e.g., self-monitoring) and organizational attributes
(e.g., absorptive capacity) into network analysis.
Agency
o Critics argue that network research has been overly deterministic, ignoring how actors
actively shape and exploit networks.
o Calls exist for models incorporating choice, strategy, and network evolution.
Cognition
o Introduces the idea of cognitive social networks—how people PERCEIVE and INTERPRET
network ties.
o Perceived networks often differ from actual ones but still influence power, reputation, and
behavior.
Cooperation vs. Competition
o Contrasts the cohesion (trust-based) view with structural equivalence (competition-based)
perspectives.
o Both cooperative and competitive dynamics influence diffusion, performance, and
innovation.
Boundary Specification
o Questions how far networks should be traced: direct vs. indirect ties, and which types of
relationships (positive, negative, multiplex) should count.
o Indirect ties may have significant but underexplored effects (e.g., emotional contagion,
resource access).
Implications and Future Directions
The field is progressive, generating theory that spans micro (interpersonal) and macro
(interorganizational) levels.
Future research must balance theoretical development with the growing tendency toward
descriptive big-data analysis.
Integration with psychology and economics is expected to deepen understanding of how
networks influence behavior and performance.
Contribution
Kilduff and Brass provide a conceptual map of organizational network research:
Reaffirming its distinctive core ideas (relations, embeddedness, structure, utility).
Clarifying current tensions that drive theoretical innovation.
Offering a glossary of network terminology for scholars entering the field.
PROVAN & KENIS (2008)
This paper examines how organizational networks, groups of three or more autonomous
organizations collaborating to achieve shared goals, are governed, and how governance structures
influence network effectiveness. The authors propose a typology of network governance forms,
identify conditions under which each is most effective, explore inherent tensions in governance, and
discuss how governance evolves over time.
Three Forms of Network Governance
Provan and Kenis identify three main modes of network governance, differing by the degree of
centralization and presence of a broker organization:
