Final answer:
The network organization structure is flexible, decentralized, and reliant on technology, characterized by outsourcing, adaptability, and collaboration. While it offers benefits such as cost savings and access to a diverse skill set, it also poses risks of dependency, quality control issues, and management complexities.
Step-by-step explanation:
Network Organization Structure
A network organization is a contemporary type of organizational structure, characterized by a dynamic and flexible arrangement where individual companies or divisions focus on their own expertise and join forces with others for synergetic collaboration. The defining characteristics of a network structure include a reliance on technology for communication, decentralization of power, and flexibility to adapt to changing business environments quickly.
Characteristics of a Network Organization
- Decentralized decision-making
- Highly collaborative
- Core organization that outsources non-core activities
- Heavy reliance on technology for coordination
- Flexible and adaptable to change
Advantages of a Network Organization
- Increased flexibility
- Access to a wide range of skills and services
- Closer to customer and market needs
- Cost savings from outsourcing
- Potential for rapid expansion
Disadvantages of a Network Organization
- Dependence on partner organizations
- Potential issues with quality control
- Risk of information loss or miscommunication
- Challenges in maintaining a coherent corporate culture
- Complex management of contracts and relationships
Overall, network organizations can offer adaptability and access to diverse talents and technologies, but also come with risks regarding dependency and control.