Network Organizations and Impact on the Environmental Process
Introduction
Debate on the relevance of network organizations has prevailed in the business and economics sphere for a long time. The notion of network organizations operates because big and small organizations do not function in socially unstructured environments. Instead, they are intertwined in the social network web (Ahmady, Mehrpour & Nikooravesh, 2016). Since the emergence and realization of empirical evidence, different types of networks and their impacts on organizations have been identified. Network organizations must be ready to change and adapt to the prevailing environmental considerations. It is also vital for such organizations to look at adaptability areas and the time taken for changes in a given organization. This study aims at evaluating the types of network organizations and their impact on environmental processes.
Types of Network Organizations
Network organizations refer to systems that follow up on the devotion of business organizations in sustainable projects such as protection of the environment, thus the relationship between the policies and process of environmental protection (Gray, 2016). Besides, network organizations refer to the surrounding environment where individuals organize and plan themselves to achieve common objectives. They are defined by purpose, process, and structural elements. It is important to note that network organizations combine both possible intangible and specialized assets in their structure under shared control. They also emphasize joint ownership that helps achieve integration of intercommunication and support in an effective, flexible, and efficient manner. Network organizations can be viewed as a mix of firm and market and between market disaggregation and vertical integration (Scott & Davis, 2016). Today, several network structures exist, distinct and characterized by stable, dynamic, and internal labels.
The internal network structure exists in organizations based on the fundamental premise that if internal units are exposed to the competitive market, they remain innovative and attract market and entrepreneurial benefits without outsourcing funds or resources. It manifests when organization units buy and sell goods and services by prices tagged by the open market within themselves. Dynamic network structures make use of extensive outsourcing funds to support their operations (Gray, 2016). A dynamic network entails the establishment of temporary alliances between the potential partners and the independent organization operating within the value chain. This network manifests in the fashion industry, which displays short-cycle products. For instance, a prominent fashion industry gathers all specialists to develop a clothing line for the season. However, the specialist may not participate in the production of the clothing line of the following season. This network also involves the production of Hollywood films and also high-end technological firms.
Stable networks utilize outsourcing to maximize value chain flexibility. With a stable network, big firms take a primary role pf developing market-based connections for investors found within the network even when these investors or partners continue serving in other firms outside the network (Scott & Davis, 2016). This keeps partners competitive in the market, especially the small firms. For instance, Nike company channels its resources towards research and marketing and at the same time allows other firms to proceed with production. These firms are permitted to produce for other competitors by Nike. Such networks are considered long-lasting and very stable in comparison to dynamic and internal networks.
Organization networks exist under three analytical levels, including ego network, overall network, and network positions. The ego network is the simplest but very vital in determining acquaintances, their diversity, and knowledge. It aims at the direct organization’s contact in relation to other organizations. The overall network is broader and encompasses all participators existing in a particular network. They assess and determine network density and whether the networks are balkanized or centralized. Such organizations are considered to be flat of hierarchical, matrix, or silos depending on their centrality. The network position seeks to recognize the position of actors within the organizational network level. Besides the analytical levels, networks can be measured using distance, centrality, structural and clustering holes, which determine cohesion within a network.
Institutionalists and ecologists challenge the assumption concerning contingency and transaction costs analysts that businesses can easily change their fundamental structural features. These two groups argue that institutions are static and inertia structures, and therefore it is not difficult to modify or change them. Changing the organization’s network is perceived as something difficult, rare, and dangerous to an organization’s viability. Ecologists assess the organization’s birth, change, and death as the most dependent informative variable (Scott & Davis, 2016). However, there exist differences in how much time and attention is given to existing external conditions. Evolutionary models can be integrated at all network levels, but many studies have put more attention at the population level.
Organizational populations consist of all organizations dividing general forms within themselves. The primary purpose of the evolutionary principle model is to explain the diversity of the organization. Diversity manifests partly in an organization because they change their features through adaptation with time (Carroll & Hannan, 2018). In-network evolution organizations, environments select organizations differentially based on their suitability to environmental characteristics and organizational forms. There exist different processes in the evolutionary analysis. This includes variety creation, selection of forms as well as diffusion and retention of these forms. Organizations are created by variety which is then formed by some process that may be planned or unplanned. They are followed by differentiated selection for their survival. Lastly, the organizations are preserved through duplication or reproduction. The ecological model is firmly based on an open concept where the significance of the environment is strongly considered. This is because it is a natural system approach and that the bottom line is not effective.
Impact of Network Organizations
Participation in organization networks comes with a blast of influences, especially in relation to the environmental process. This includes ecological processes and technological changes. Organizations operating within a network get better opportunities of sharing the limited available resources. These resources may consist of the creation of new organizations, financial support through access to capital relevant to manage the organization. This would protect the organization from relying on banks that offer capital with high-interest rates. This would, in turn, lower transaction costs thus low production.
Creation of New Organizations
One of the most significant of entrepreneurship is its relationship with the establishment of a new organization. In the early 20th century, many people experienced difficulties establishing new organizations or firms. Trying to create a new firm requires buying facilities, planning, hiring employees, or equipment. The creation of organizations was focused on the traits and dispositions of entrepreneurs. They assessed factors such as risk-taking and the need for achievement (Sanchez‐Bueno & Suarez‐Gonzalez, 2020). Research from sociologists and economists has focused more on the significance of the founder’s context and relational network. Their analysis revealed that creating an organization does not have a playing field level. Besides, many differences exist in structural opportunities and individuals’ capacity to take advantage. Three facets influence new organizations: resources, networks, and knowledge (Sanchez‐Bueno & Suarez‐Gonzalez, 2020). Networks have variations, but diversification of one network is essential as it increases the chances of access to information.
On the other hand, knowledge is a social and individual variable that is impacted by an individual’s intelligence, job experience, and education access. The structure of an organization is essential as it plays a part in decision making, coordination, communication, managing, specialization, knowledge, and sharing. In creating new organizations, there are a lot of false starts and dead ends (Scott & Davis, 2016). Moreover, setbacks usually occur frequently. It is important to note that many organization exploits and benefit from first mover’s innovative work.
Technological Changes
Network organizations may also be alleviated from spending much capital on technology whenever technological changes occur. This is common, especially with small organizations with financial weakness and small budgets, to compete in the stiff dynamic market. Such start-ups and small organizations can survive in places where they share a network with larger firms. Some theories suggest that the creation of new organizations, industries, and populations resulted from new technologies (Haapakorpi & Alasoini, 2018). Two types of technological innovations encouraged the existing partners’ competency and those that demolished their competence (Stavropoulos, Wall & Xu, 2018). Destructive innovations were more linked to creating new organizations.
Organizational Populations
Organizational populations refer to aggregates of populations similar in some respect. A good example is the case of higher learning institutions or newspapers. Organizational ecologists insinuate that the early organizational formations were based on genetic structures. They also proposed that it should be defined in terms of organizational action blueprint in transforming inputs into outputs—the fundamental key to recognizing population is possessing an ordinary organizational form (Carroll & Hannan, 2018). There has been extensive research on the issue of defining organizational populations leading to the emergence of various approaches. First, one can use the native method of categorizing organizations such as universities, hospitals, and business enterprises. Another process depends on how organizational forms change over time. Organizational forms have inertia properties that make them imprinted. Besides, they are likely to retain the characteristic acquired at their emergence (Feng & Chen, 2018). Organizations established under a given period tend to have the same structural features. In the early 20th century, organizations were structured based on their functionality. The functional units included finance, engineering, production, sales, and marketing, among others—most organizations began to focus on diversification strategies that led to increased administrative decisions.
Ecological Processes
Firms or organizations within a network benefits from the ecological process that demands knowledge and information resources. Networks, in this case, serve as essential conduits that spread the existing and new information. This means that organizations within a network can benefit from accessing the information and knowledge that would otherwise be impossible if they were not in the network. Accessibility to information helps organizations manage ecological changes such as shifting customer demands (Gibson, Hardy & Buckley, 2017). Ecologists elaborate on two types of organizational survival strategies. The specialist strategy entails a limited capacity of environment variation tolerance. The generalist approach entails the ability to reproduce and thrive under various environmental conditions. Organizations can cope with the unconducive ecological fluctuations. These two aspects are interrelated and help in creating suitable conditions under which organizations can exist.
However, being in-network can negatively affect organizations. Even though organizational networks provide many opportunities, they may also serve as limitations to the network’s partners. For instance, the partners can be locked within a network, restricting them from joining alternative networks that could be more beneficial. This will affect organizational performance within the network and the production and contribution to the sector. The partners of the organization may also disclose sensitive information to the enemies. This restricts them from acquiring s sustainable advantage in the competitive market (Feng & Chen, 2018). Besides, network membership may trigger the established firms to follow the norms and values below their standards. Such values and norms may impact the organization’s performance by destroying the organization’s structure.
Biblical and Personal Perspectives
Organizations are dynamic are constantly changing to get momentum in the environment. Environmental change calls for a change in an organization’s operations to suit such an environment. The change or modification may involve changing procedures, policies, culture, technology, strategy, or company structure (Kitsios, Kamariotou & Talias, 2020). An excellent biblical example of network organization is the case where king Solomon built God’s temple. This work involved many workers who worked together towards achieving the same objective. This means that if people and organizations work together, they can accomplish their goals. In 1 Corinthians 12:4–7 (NIV): “There are different kinds of gifts, but the same Spirit distributes them. There are different kinds of service, but the same Lord. There are different kinds of working, but it is the same God at work in all of them and everyone. Now to each one, the manifestation of the Spirit is given for the common good”. This focuses on our mutual dependence and unity and what we all contribute when practicing different callings and gifts God has given us. Besides, all organizations are open system forms because if they were not, they would not consider the safety of the external environment.
It is also important to note that organizational members also affect the organization and the environment. Social norm plays a role in shaping the behavior at the workplace. The social norms are disseminated to members through procedures and a set of rules that should be adhered to. In any organization, social norms exist that are either a product of the natural, rational, or open system (Scott & Davis, 2016). Organizations should focus on creating resources for the benefit of others, including customers, shareholders, business partners, and their employees. In genesis 2:15, Moses emphasizes the call for human beings to work and safeguard the earth. In Leviticus 25:14, “when we make a sale or buy from our neighbor, you shall not wrong one another.” This means that building customer confidence and fair dealings will lead to the growth of organizations.
Conclusion
There exist different types of network organization that has been discussed in this paper. These networks may be beneficial to some organizations and also detrimental to others. Besides, the networks affect the performance and contribution of a particular organization. Organizations and companies need to focus on societal and environmental protection due to the increased effects of industrialization on people’s health. Organizations should also adhere to environmental protection laws and regulations. Institutions should help in spreading an environmental-protection culture. This can be achieved through the internal laws implemented to ensure the conservation of the environment. Despite such environmental protection implications, these interventions must positively impact sustainability, protecting human beings from exposure to hazards.
