Networks, Persistence and Change—A Path Dependence Perspective

Abstract

The network form of organizing is usually considered to provide organizations with the strategic flexibility needed to survive in increasingly turbulent environments. At the same time, empirical research demonstrates that the network form—not least strategic alliances, regional networks and clusters, and global production and supply networks—runs the risk of becoming inert over time, reducing not only the networks’ strategic flexibility but also making organizational change increasingly difficult. Upon closer inspection, some of the structural inertia or institutional persistencies of this form may turn out to result from organizational path dependencies which are particularly difficult to detect and to overcome. It is argued that the emerging theory of organizational path dependence that builds on previous economic and institutional approaches in this field may be particularly helpful in this respect.