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A Web of Alliances in the Global Telecommunication Industry
Unformatted Document Text:  Global Telecommunication 9 The Formation of Blocks: Partitioning Networks The dyadic research on the interorganizational network has also neglected the importance of linkage blocks in interorganizational networks. The overall structure of interorganizational networks may be understood by relational or structural blocks to which organizations are closely linked (Gomes-Casseres, 1996; Nohria & Garcia Pont, 1991). According to Madhavan et al. (1998, p.448), the concept of blocks is useful to understand the structure of interorganizational alliances because “(1) they represent relationships between rivals, which are acknowledged sources of influence on industry evolution, and (2) they represent flows of knowledge and access to markets, which have been key success factors in the industry”. Likewise, the formation of blocks through interorganizational networks shows two different kinds of ties: ties within blocks, and ties between blocks. Differentiating ties based on blocks can enable us to find the structure of relationships among organizations in a certain industry. Partitioning a network suggest that each block has a distinct pattern within its structural boundary (Doreian et al., 1994). From this perspective, Nohria and Garcia-Pont (1991) proposed a framework for understanding the structure of networks of strategic alliances in the global auto industries, considering strategic blocks as a way to gain access to resources. Gerlach (1992) also maintains that “detailed analyses of relationships within and between blocks also provide a parsimonious model of global structure, fully developed cliques are operationalized as blocks of actors” (p.120). Furthermore, due to globalization of industries, “competition between linkage blocks is a new form of rivalry: groups of firms link together for a common purpose, and competition between linkage blocks is superimposed on competition between individual firms”

Authors: Chon, Bum Soo. and Barnett, George.
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Global Telecommunication 9
The Formation of Blocks: Partitioning Networks
The dyadic research on the interorganizational network has also neglected the importance
of linkage blocks in interorganizational networks. The overall structure of interorganizational
networks may be understood by relational or structural blocks to which organizations are closely
linked (Gomes-Casseres, 1996; Nohria & Garcia Pont, 1991). According to Madhavan et al.
(1998, p.448), the concept of blocks is useful to understand the structure of interorganizational
alliances because “(1) they represent relationships between rivals, which are acknowledged
sources of influence on industry evolution, and (2) they represent flows of knowledge and access
to markets, which have been key success factors in the industry”. Likewise, the formation of
blocks through interorganizational networks shows two different kinds of ties: ties within blocks,
and ties between blocks. Differentiating ties based on blocks can enable us to find the structure of
relationships among organizations in a certain industry.
Partitioning a network suggest that each block has a distinct pattern within its structural
boundary (Doreian et al., 1994). From this perspective, Nohria and Garcia-Pont (1991) proposed
a framework for understanding the structure of networks of strategic alliances in the global auto
industries, considering strategic blocks as a way to gain access to resources. Gerlach (1992) also
maintains that “detailed analyses of relationships within and between blocks also provide a
parsimonious model of global structure, fully developed cliques are operationalized as blocks of
actors” (p.120). Furthermore, due to globalization of industries, “competition between linkage
blocks is a new form of rivalry: groups of firms link together for a common purpose, and
competition between linkage blocks is superimposed on competition between individual firms”


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