Network Theory
Overview
Network theories of organization occupy a middle ground between the study of organizations as command hierarchies on the one hand and on the other, market theories which portray organizations as atomized rational decision-makers optimizing utility (see Powell, 1990). As such, network theory is consistent with long-standing schools of thought in political science, such as pluralism, which emphasize alliance-building, negotiation, and partnerships. It is also related to systems theory and governance theory, both of which emphasize the study of networks. There is also renewed interest in network theory simply because information technology promotes networking, ranging from the personal networking of MySpace to corporate networking to achieve competitive advantage to governmental networking of states on policy issues to global networking through international organizations.
See also: actor-network theory, network analysis.
Key Terms and Concepts
- Vantage points. La Porte (1996) argues that network theory depends on which of three vantage points networks are considered:
- Within-network. This is the viewpoint of organizational behavior theory, concerned with how organizations seek to reduce uncertainty (Thompson & McEwan, 1958; Thompson, 1967) by participating in networks characterized by loose coupling (Cohen & March, 1986).
- Above-network. This is the viewpoint of institutional theory, concerned with how patterns of cooperation and networking are institutionalized.
- Beside-network. This is the viewpoint of federalism and intergovernmental relations, concerned with how policy networks operate and with policy implementation.
- Interdependency. Network relations arise because organizations are interdependent. Victor and Blackburn (1987) define two major types of interdependency, each associated with different network forms.
- Resource interdependency involves the exchange of resources and is characterized by loosely coupled networks (see below) in which each organization seeks to reduce uncertainty by minimizing its resource dependence on others.
- Workflow interdependency involves the division of labor and is characterized by more integrated networks in which each organization seeks to become more goal-effective by rationalizing its work processes.
- Loose coupling and weak ties.
- Loose coupling may refer to weak linkages among units in an organization or network (Simon, 1976) or to weak linkages between levels of decision-making: "In actual organizations, the decision-making mechanism is a loosely coupled, partially decentralized structure in which different sets of constraints may impinge on decisions at different organizational locations" (Simon, 1964: 1). In particular, loose coupling often refers to the disjunction between plan and implementation. Loose coupling may be associated with policy failure (the inability to effect plans made at the top into outcomes at the bottom) but may also be adaptive for organizations. For instance, loose coupling may function to protect organizational legitimacy by reducing evaluability and hiding disjunctures between political claims and actions (Welsh & Pontell, 1991). From a management viewpoint, Spender (1995) demotes "shared values," instead emphasizing the active role of an organization's top management in shaping the loosely coupled organization's patterns of practice.
- Weak ties. Granovetter (1983) noted that at the individual level, it is weak rather than strong ties which become important in terms of policy influence. Strong individual ties, such as family, lack the capacity to become generalized to large groups. Multiple weak ties, in contrast, serve as bridges between network segments (p. 229). Granovetter gives the example of the Charlestown and the West End neighborhoods of Boston, where the former successfully fought urban renewal but the latter did not, a difference attributable to Charleston's much richer organizational life and (weak) connections. Granovetter's thesis about weak ties is thus similar to the social capital thesis of , which also emphasizes organizational richness as a prerequisite for policy efficacy (Lin, 1999).
- Administrative conjunction refers to a network theory advanced by H. George Frederickson (1999: 708-710) to explain interjurisdictional cooperation in metropolitan areas. Frederickson considered functional professionals carrying out conjunction activities to be performing a form of what Likert (1967) called the linking pin function in loosely coupled networks. Frederickson argued that network/cooperation models better explained the interjurisictional activities of municipal administrative officers than did market/competition models. His theory of administrative conjunction was set forth in a set of 15 hypotheses, all supported by Frederickson's case study of Kansas City:
- Institutions are a precondition to administrative conjunction. (That is, though administrative conjunction is non-hierarchical, it requires hierarchical institutions as a setting).
- Politics (campaigns, elections, etc,) is deeply jurisdictional.
- While jurisdictional politics serves as the context for administrative conjunction, elected officials have little to do with administrative conjunction. (That is, political influence is not critical for activities associated with administrative conjunction. However, Frederickson noted that while political influence on administrative conjunction is low, functional professionals carrying out conjunction activities avoid being at odds with political leadership).
- Administrative officials take conjunction activities to elected officials when they need to be formalized and ratified.
- Interjurisdictional conjunction itself is mainly carried out by administrative officials.
- Functional professionals carry out administrative conjunction with other functional professionals, based on mutual expertise, shared beliefs, and sense making.
- Functional professions carry out administrative conjunction activities when problems cannot be jurisdictionally contained and these activities will reduce uncertainty.
- Although functional professionals work for particular jurisdictions, nonetheless they appear to serve public interests beyond their jurisdiction.
- Functional professionals carrying out conjunction activities appear to practice a form of "representation" of a generalized "public interest." (They do not require hierarchical command or market pressure to carry out conjunction activities).
- Functional professionals carrying out conjunction activities take time away from their hierarchical duties in order to devote time to interjurisdictional administrative conjunction activities.
- Conjunction activities is almost completely delimited by function, within semiautonomous policy subject domains.
- Functional professionals carrying out conjunction activities engage in multijurisdictional conjunction more than cross-functional coordination within their own jurisdiction.
- Administrative conjunction functions to address cross-jurisdictional problems while preserving jurisdictional boundaries.
- Administrative conjunction leaves in place interjurisdictional inequities.
- Central governments can induce subgovernments to practice administrative conjunction.
Frederickson believed that the nonhierarchical networking activities associated with administrative conjunction served to reinforce hierarchical municipal departments and their respective policy "silo" autonomy.
- Correlates of networking salience. A number of factors have been found to be correlated with organizational forms oriented toward networking rather than hierarchy.
- Exchange transactions. To the extent that exchange transactions are part of the core mission of the organization, making horizontal forms of exchange paramount, networking will be emphasized (Powell, 1990).
- Task complexity, demand uncertainty, exchange frequency, and asset specificity are identified by Jones, Hesterly, & Borgatti (1997) as conditions which jointly make network rather than hierarchical or market forms of organization more adapted to managing exchange transactions.
Assumptions
- Rational models used as "straw men". Network theorists contrast network (coalitional) models of organizations with earlier rational (hierarchical) models. However, as Astley & Zajac (1991) have emphasized, the contrast can be easily exaggerated as both types of model treat political dynamics and power, concepts that are as central to traditional theories as to network theories. Astley and Zajac reconcile network and rational theories through the "adaptive rationality" model of organizations, referring to meeting the task requirements of the organization (a concern of rational models) through political dynamics (a concern of network theory).
Illustrative Hypotheses
Hypotheses below are illustrative and not all authors associated with this theory would subscribe to all hypotheses listed.
- The more central exchange is to the organization's core mission, the more networking will displace hierarchy.
- The more the resource interdependency, the more the networking.
- Networks based on resource interdependency will tend to display more loose coupling and less integration.
- Networks based on workflow interdependency will tend to display less loose coupling and more integration.
- The interaction of task complexity, demand uncertainty, exchange frequency, and asset specificity promotes a preference for networking over hierarchy or markets.
Frequently Asked Questions
- What is some of the political science literature emphasizing networks?
Networking has been emphasized by political scientists both to describe domestic politics and also international relations. Studies of networking at the domestic level include work by Kettl (1993), Milward (1994), Milward & Provan (1998, 2000, 2003), Provan & Milward (2001), O'Toole (1997a, 1997b, 1997c), and Damgaard (2006). Studies of networking at the international level include work by Scharpf (1993) and Hanf (1994).
- What is the cybernetic model of organizational networks?
As described by Birnbaum (1989), the cybernetic network model sees organizations as composed of bureaucratic, collegial, political, and anarchical subsystems which function simultaneously to create a self-correcting institutional system. Administrators institute control systems based on sensing mechanisms which monitor subsystems and enable administrators to institute negative feedback loops to encourage subsystems to return to acceptable levels of functioning. The major function of the cybernetic administrator is to coordinate and balance the various subsystems within the organization, with a view to optimizing top management values. In this way, the cybernetic model is another effort to reconcile traditional hierarchical organizational models with network models.
- Are there other network theories than those listed here?
Of course. Wherever there is are possibilities of communication, interfacing, or exchange, there can be network theory. Quite different forms of network theory exist in such fields as epidemiology, design of city streets, software systems design, and statistics, to name a few.
Bibliography
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@c 2006, 2007 G. David Garson