The Nature Of The Network Of Corporate Strategy And Governance Mechanisms

In the ever-change business world, change is constant with economicenvironment, social dynamics, technological development, special for IT technologyand globalization. Each corporate or company faces the fierce competition not onlyfrom companies in one country, but from the whole world. It is impossible for onecorporate to keep its own competence independently even in one single sector of thevalue chain or in one segmented market. Considering the current and future issue,many theorists and scholars began to study and research the organizational structuresuit for the coming competition. As a milestone, the corporate strategic networkissued in special edition of Strategic Management Journal leads to the discussion andresearch for the hot topic. Yet, the nature of corporate strategic network still seemsunclear even if many scholars and researchers put much attention on it. But in theseresearches or studies, the "network effect" from economics is the core word leveragedto explain the key question, what is the nature of corporate strategic network. In suchbackground, this paper select "the nature and governance of corporate strategicnetwork" as the topic to discuss and study the important question further.In this paper, we reviewed and analyzed the relative researches and studies inthe past. Then based on the nature of corporate, we did some researches on the natureof corporate strategic network from both coherence and knowledge angle. Accordingto our researches, the nature of corporate strategic network is knowledge because thespecialty of knowledge, like specialization, specializing and complementarity createsthe coherence among companies. If the coherence among companies reaches orexceeds the critical intensity, it will become the necessary condition for strategicnetwork. If not, it is impossible to forge a strategic network. Once a companybecomes a member of corporate strategic network, it will play in a dynamic gamewith other members. With the specialty of knowledge like specialization andspecializing, the final result of the game-playing is improved inter-trust amongmembers, shared knowledge and maximized network value. In the next section, wecontinue to study the governance of strategic network with deep understanding aboutits nature. Corporate strategic network expand the traditional boundary betweencompanies while it can leverage the shared knowledge and resource from all networkmembers to create its core competence and to make innovation.