Integrating Effort across Institutional Borders: A Case Study of Turkmenistan – China Gas Pipeline

Abstract

In this study we investigate the role of organizational structure in integrating effort across institutionally underdeveloped environment. We ground our study in the case of the Turkmenistan – China Gas Pipeline Project, one of the first infrastructure developments of China´s Belt and Road Initiative. We reveal the impacts of distinct institutional environment on the integration of effort via the form of organizing projects. We analyze how the capital-intensive project organization was decomposed into three legally independent entities by geographical zones despite the limited decomposability of the pipeline system itself. Specifically, we identify a new type of institutional voids for cross-border project development that originates from plural, often contending, institutional arrangements. We then trace the choice to create a nearly decomposable project organizational system (as opposed to using hierarchical or market governance) to a search for an organizational structure that was flexible enough to navigate the institutional voids in the environment and thus facilitate the integration of effort. We find that by creating an array of overlapping joint ventures with key local partners at the planning and implementation stages, the system architect was able to mitigate cooperation hazards, whilst facilitating coordination through complementary coordination structure once entering the operation phase. We discuss implications for theory and practice of organization design in institutionally underdeveloped environment.