Network Organizations: Symmetric Cooperation or Multivalent Negotiation?

Abstract

The network model of organization plays a central role in recent sociological accounts of the information economy. This model is also often presented in organization and information and communication technologies (ICT) literature with an air of enthusiasm that underscores its advantages—flexibility, cooperative culture, innovativeness, and knowledge and technology intensity. Such themes are usually based on a “networking logic” that assumes the trustful cooperation of large and small production firms in a rapidly changing economic environment. We believe that both the logic and the themes based upon it are too narrow to be able to explain the complex dimensions of interorganizational networking. Using Enron as a case study, our goal in this article is to enrich the logic just described and to develop an extended model of the network enterprise. We argue that this is only possible by extending the unit of analysis beyond the production firm, to include, among others, subsidiaries, banks, investors, auditors, and government agencies. The proposed extended model allows the broadening of many of the aforementioned themes, making it possible to arrive at a realistic picture of the complexities of the network enterprise. The managerial advantages of the model are also discussed.

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