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Purpose – The purpose of this conceptual chapter is to discuss the limitations of the network organization in multinational corporations (MNCs). Since many IB/IM publications concentrate on the advantages of this organizational form, the focus of the chapter is on identifying the limitations that MNCs need to be aware of when they use network organizations.

Methodology – The analysis is based on a sound review of the literature that refers to the network organization in general and its application in MNCs.

Findings – The chapter shows that MNCs present a context that can aggravate the problems of a network organization. Four types of problems are identified: (1) knowledge transfer between MNCs’ subunits, (2) trust-building and corporate culture within MNCs, (3) subsidiary development and subsidiary managers’ stress, and (4) additional problems of a more general nature.

Practical implications – As a result of these problems, it is expected that the formal, hierarchical structure will remain an important organizational instrument for MNCs. The chapter specifies in which ways the formal organizational structure can help to reduce the limitations of the network organization. Finally, the chapter argues that, among the formal organizational models, the matrix structure should be considered more intensively in the future.

Originality/value of chapter – Since existing discussion of the network organization in MNCs tends to ignore the limitations and downsides of this organizational form, the chapter contributes to a more balanced understanding of the network organization.

Executives of network organizations seek to combine core competencies and talents of individual firms, along the various links of the value chain for a given project. These firms are brought together in alignment for the purpose of providing organizations a competitive advantage. Using multiple examples as well as results from an extensive research project, this chapter introduces a multidisciplinary model for leading network organizations. The model is informed by theoretical and empirical research and by executive practice. It includes consideration of an organization’s internal interactions as well as its interactions with the environment and with the external organizations within its network. The chapter provides leaders a set of four imperatives for achieving effective collaboration within networks.

Aims to explain the driving forces for networked inventory management. Discusses major developments with respect to customer requirements, networked organizations and networked inventory management. Presents high level specifications of networked inventory management information systems (NIMISs). Reviews some decision systems for inventory management, and compares traditional inventory management to networked inventory management. Uses these insights to outline NIMISs for several types of inventory management decision systems. Summarizes the results of the study, and provides an outlook on further research.

Long-standing traditions of long-distance collaboration and networking make scholars a good test case for differentiating hype and reality in distributed, networked organizations. Our study of Canadian scholars in the GRAND research networks finds that they function more as connected individuals and less as members of a single bounded work group, often meeting their needs by tapping into diversified, loosely knit networks. Their internet use interpenetrates with in-person contact: the more they use one, the more they use the other. Despite digital networking, local proximity is important for collaboration and seniority for inter-team and interdisciplinary boundary spanning.

Studies show that employability is fast becoming a significant subject when managing contemporary careers. Indeed, employee networking is a prerequisite for career success, but the literature lacks findings regarding the impact of networking on employability. Meanwhile, network organizations in the knowledge economy are gaining popularity and bringing rise to the number of knowledge workers in the labor force. The purpose of this paper is to show the impact of employee networking competence on the employability of knowledge workers, particularly in the wider context of network organizations.

In order to verify our theoretical model, data was collected among a controlled sample of 1189 knowledge workers using a Computer Assisted Web Interview (CAWI) surveying technique. Our model was verified through a series of structural equation models (SEM).

Results show positive effects of network organizations and knowledge work on the networking competence of knowledge workers. The employability of knowledge workers does not just increase as these workers perform high-quality knowledge work. In order for employability to rise, knowledge workers must also exhibit networking competence. However, our study findings show that networking competence plays only a mediating role in the employability of knowledge workers.

This study focuses on the employability of knowledge workers in network organizations, which is an increasingly important concept for contemporary management. The paper contributes to the literature through its furthering of network and career management theories.

Discusses possible future approaches to questions of industrial organization. Suggests a meta‐model of an organization producing goods which combines the information requirements of management and control functions and critical requirements of a holographic (heterarchic) organization. Suggests a conceptual framework that provides a method of linking information and communication. Makes a distinction between information‐network organization and communication‐network organization. Discusses various architectural designs in terms of how their properties can serve the governing mechanism of the organization. Argues that synergetic effects are, ideally, optimized through fully integrated communication networks. Also discusses advantages gained through the use of communication‐related technology with the aim of shortening idea‐to‐product time‐cycles. The questions of architectural design and the technological options cannot be treated separately or extracted from the organizational context. Successful implementation of such technology is dependent on simultaneous development of high‐level “communicative competence”, i.e. the ability to create and convey metaphoric knowledge in ways that enhance the holographic qualities of the organization.

In knowledge economy, companies and organizations build sustainable competitive advantages not only relying on their internal intellectual capital but also on the intellectual capital of other companies, organizations and institutions and specifically on those of the cluster, microcluster or territory where the company is located. This kind of intellectual capital, basically external and of a relational nature is one of the main constituents of the networked organization and from now on will be called as Social Capital because it is embedded in the social fabric (texture) of the nearby environment. Social Capital Benchmarking System is both a new management method and a new management tool, that identifies, audits and benchmarks the resources and capabilities or the social capital, existing in alternative cluster locations that are necessary to develop the specific network organization that each particular business model requires. The system has been successfully piloted in five European enterprises.

Examines the potential of logistics network organization to deliver synergy benefits by simultaneously improving flexibility and co‐ordination. The synergy effects of the new organization range from the economies of scale and scope in production and logistics to various “spill‐over” benfits attributable to shared skills and resources in networks.

This chapter examines key drivers of variation in adaptive capacity of project network organizations (PNOs). PNOs are defined as strategically coordinated sets of longer-term, yet project-based relationships, which provide for both stability and change in volatile project businesses. While prior research has emphasized the adaptive role of flexible structures and agency, the author focuses on the role of project variety and contextual embedding and disembedding in building adaptive capacity. Comparing two PNOs in TV movie production, the author argues that differences in adaptive capacity are a function of inter-context connectivity, that is, the level of task and team linkages among diverse project contexts, and the degree to which network ties and relational practices have “dual quality” in being valuable both within and beyond specific project contexts. Findings have important implications for project, network, and organization research.

The Globally Networked Organization (GNO) is an archetype of the geographically distributed, globally integrated, and organizationally networked information-age multinational enterprise. While its organizational form has been widely discussed, methods for providing strategic direction to all or part of a GNO have been largely overlooked. We propose the concept of strategic animation as an innovative leadership approach to strategic management in the GNO and offer a set of guiding principles for installing such a system in organizations. Strategic animation employs sophisticated incentives to motivate voluntary buy-in, utilizing principles of self-organization to replace the command and control of the unitary firm and the uncertainty and transactional costs of real markets. This makes possible virtual integration of the multiple highly separable businesses that comprise the value-added proposition of the firm and encourages the development of emergent processes for both exploitation and renewal of assets. From a scholarly perspective, this model suggests a new framework for studying the strategic direction of GNOs. For practice, it offers an organizational solution to conditions where process control is preferred, but command of resources is limited. Strategic animation, set in motion through multiple managerial actions, facilitates the timely and flexible responses to chaotic environments that are the sine qua non of today’s global businesses.