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Network Management Summary

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Network: any interconnected group or system, it comprises nodes and links. Networks are long-term, relationships between interdependent economic actors which are seeking for competitive advantage by forming the cooperation. More complex than alliances; bilateral relationship doesn’t qualify as network.
From left to right: Market: “buy”. Network: jv, licensing, outsourcing, equity share, contractual cooperation, joint R&D. Hierarchy: “make”
From left to right: Market: “buy”. Network: jv, licensing, outsourcing, equity share, contractual cooperation, joint R&D. Hierarchy: “make”

Types of Networks: X & Y: X: Alliances between partners with complementary skills/strengths “closing the gap”. Y: Alliances between partners with mutually reinforcing resources/skills/competences “critical mass alliance”; by joining forces you reach a critical mass. Horizontal, vertical & lateral cooperation: Horizontal: Companies within the same position of the value chain cooperate (e.g. alliance between airlines) Vertical: companies from different positions within the value chain cooperate (eg. Buyer supplier relationships along the supply chain) Lateral: across industries, different players from different industries. Stable & Dinamic: Stable: platform for cooperation. Dinamic: project-based. Virtual factory: dynamic, order processing. Competition: Networks compete to each other; network is the compeititive Unit.

Network main characteristics: Personal relationship. Basic common interests. Opportunity to recognize these common interests and work on them

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