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qdwqewevwemany cases, has led to the development of network forms of organization.” (Veludo,

Macbeth, and Purchase 2004, p.143)

Podolny and Page (1998), in their definition of inter-organizational networks they

presented a variety forms of cooperation should be included, such as joint ventures,

strategic alliances, collaborations, and consortia. Later, in 2000, Barringer and

Harrison (2000) give a more detailed description about how inter-organizational

relationships differ from each other. For example, “they somewhat narrowly define

networks as constellations of organizations that come together through the

establishment of social contracts or agreements rather than legally binding contracts.”

(Provan, Fish and Sydow 2007, p.481)

In the inter-organizational network, the word “density” is just a measurement of the

extent to which actors in the market are connected to one another. “The density of ties

within each of the local organization sets as within density.” (Ghoshal and Westney

2005, p.612) In the situation of low within density, it is easy for headquarter to make a 14

direct control to its subsidiaries.

But, in many situations, due to the long geography distance and great culture

difference, it is hard for a company’s headquarter have a tightly control with all its

subsidiaries which already spread all over the world. Therefore, distribution of power

within the network is necessary.

The following picture is the inter-organizational network of N. V. Philips.

Figure3. Inter-organizational network of N.V. Philips

(Source: Ghoshal and Westney 2005, p.605)

In the picture above, we can see that the Philips’ headquarter is in Holland, and its

subsidiaries nearly exists every continent. Both the geography distance and the high

within density of subsidiaries of Philip require headquarter to distribute the power.

So the USA, UK and Japan became three market centers under the direct control of

headquarter and each centre...