Proceedings of the 37th Hawaii International Conference on System Sciences - 2004

Towards an ecology of inter-organizational routines: A conceptual framework for the analysis of net-enabled organizations
Brian T. Pentland Michigan State University, E. Lansing, MI, 48864-1032 2002). While technology adoption is generally treated as a firm level phenomenon, I argue that it is better understood as a population level or network level phenomenon. Thus, to understand the dynamics and adoption of inter-organizational technologies, an ecological framework is required. Ecological theory has been applied at the level of firms (Hannan and Freeman, 1989; Carroll and Hannan, 1995; Aldrich, 1999). In this paper, I explore the possibility of applying ecological analysis at the level of organizational routines – in particular, to interorganizational routines (Powell, 1998; Pentland, Kwon and Chung, 2002). I focus on routines because the adoption of technology is embedded in organizational routines – repetitive, recognizable patterns of interdependent actions carried out by multiple actors (Feldman and Pentland, in press). To the extent that these routines involve the creation and maintenance of interorganizational relationships, we can think of them as inter-organizational routines (Powell, 1998). The question is, if we consider the adoption of net-enabling technology as a population (or network or inter-firm) phenomenon, what theoretical and empirical tools can use to understand and study it? The goal of the paper is to define the concepts and the basic outlines of a framework for the study of populations of interorganizational routines and discuss its implications for future research. The paper begins with a brief explanation of why an ecological framework is appropriate, and offers a set of definitions for the main concepts.

This paper argues that the adoption of “net” technology by “net-enabled” firms can be viewed as a population or network level phenomenon, rather than a firm level phenomenon. Using organizational ecology as a starting point, this paper outlines a framework for studying the ecology of interorganizational routines. The paper defines key concepts and outlines some possibilities for applying this framework in empirical research. The framework emphasizes the role of network structure, technological interdependencies, and institutional factors (e.g., legitimation) in the long-run dynamics of technological change.

1. Introduction
The goal of this paper is to develop a framework for predicting the prevalence and impact of net-based technologies, such as ebXML, that are intended to facilitate the “net enabled” firm (Coyle, 2002; Wheeler, 2002). Net-enabled organizations use netbased technologies to support internal operations, as well as their relationships and transactions with customers, suppliers, and other organizations (Wheeler, 2002). There are generic systems and standards to support net enabled business, such as ebXML, as well as specialized collaboration systems that assume that a group of firms will adopt them (e.g., Kwon, Chung, and Pentland, 2002). Net-based technologies are distinctive because they require integration with the systems of other organizations, not just a firms own internal systems (Riggins, Kriebel, and Mukhopadhyay, 1994). It makes sense to study technology adoption at the firm level for technologies whose impact is limited to the boundaries of the firm. But for technologies ranging from EDI to ebXML and beyond, the main goal is to facilitate inter-organizational relationships (Riggins, Kriebel, and Mukhopadhyay, 1994; Kauffman, McAndrews and Wang, 2000; Coyle,

2. Why an ecology of routines?
Several well-known factors affect the adoption of technology across multiple firms, especially in the case of technology that supports inter-organizational relationships. These include the following: 1) Network effects can have a tremendous influence on the adoption of new technology when the returns to investment are positively associated with the number of current and future adopters (Economides, 1985; Katz and Shapiro, 1986; Kauffman, McAndrews, and Wang, 2000). FAX and email

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Proceedings of the 37th Hawaii International Conference on System Sciences - 2004

provide prominent examples, as do HTML, HTTP and the growing number of XML standards (Coyle, 2002). 2) Technical standardization can foster adoption of standard technology, even in the absence of strong network externalities. In some cases, these are open standards, such as TCP/IP. In other cases, such as rd credit card payment systems or 3 party logistics systems, the standards are created and enforced by the service provider (e.g., VISA, FedEx, etc.) (Kauffman, McAndrews, and Wang, 2000). 3) Mimetic pressures (as identified in institutional theory) can drive the adoption of a routine even when there is no technological imperative. Legitimacy depends on meeting expectations of customers and business partners, and firms tend to adopt organizational forms and routines that enhance their legitimacy (Hannan and Freeman, 1989; Plunkett, 2002). 4) Legal and regulatory requirements also enforce conformity on inter-organizational relationships. Procedures for issuing debt and equity, for example, are highly regulated. Privacy regulations also impose conformity at the population level. There are two key points to draw from these observations. First, the adoption of net-enabling technology is not just a decision made by individual, isolated firms. It is enmeshed in an on-going social and technological context that is distributed across some set of firms. In the discussion that follows, we will pay particular attention to the social network aspects of the phenomenon. Second, focusing on the technology per se also tends to misrepresent the phenomenon. Like any significant information system, the adoption of net-enabling technology involves significant changes to organizational procedures and practices; it is never just a question of putting some new hardware in the rack, or installing a new software package. As Zahra and George (2002) argue, a wide range of organizational and managerial factors affect the ability of firms to absorb and utilize the technology. What is adopted can be thought of as a complex bundle of technology, work practices and social relationships. To the extent that many of these practices and relationships involve actors from multiple organizations, they can be called interorganizational routines (Powell, 1998). Definition 1: Inter-organizational routines are organizational routines where participants are members of different formal organizations. The ecological perspective shifts the level of analysis from single firms (or routines), to populations of competing firms (or routines). Rather than studying the properties of a particular individual, an ecological perspective considers the viability of entire populations of individuals as they compete with other populations for scarce resources. Rather than asking,

“What factors led brewery X to begin brewing small batches?” organizational ecologists ask, “What led to the rise of microbreweries as an organizational form?” Similarly, in the realm of net-enabling technology, we can ask firm-level questions, such as “When should firm A adopt technology X?” or “How can firm A gain competitive advantage from technology X?” (Wheeler, 2002; Zahra and George, 2002). These are important questions, and can provide valuable guides to managerial practice. But the ecological perspective shifts the level of analysis and the time scale to questions like, “Why has technology X transformed (or failed to transform) certain sectors of the economy?” Steinfield (2002) poses this question in his discussion of structure and impact (or lack of impact) of B2B markets. But researchers in ICT have lacked empirical tools to study this kind of phenomenon. Empirically, ecological analysis focuses is on socalled “vital rates”: founding rates (or birth rates), transformation rates, and morbidity rates (Carroll and Hannan, 1995). These vital rates are a function of the interaction between the focal species, the environment, and other species that may be present. These rates are estimated using “hazard models,” (Tuma and Hannan, 1984) as demonstrated by Kauffman, McAndrews, and Wang (2000) in their study of ATM network sharing. These rates reflect the likelihood of foundings, mortality, and other events of interest in a given time period. The ecological perspective allows us to estimate hazard rates as a function of co-variates, such as population density and other environmental factors. In the sections that follow, I will lay out some of the problems involved in defining and studying the ecology of inter-organizational routines.

3. Organizational routines as a unit of selection
Plunkett (2002) discusses the complexities of translating external selection pressures (e.g., market competition) to the selection of routines within firms (intra-organizational selection of routines). So, for example, will a manufacturing firm maintain its current production methods in the face of increasing price competition, or will it change over to a lower cost technology? Plunkett (2002, p.2) notes that, ideally, “organizational survival and growth is enhanced with intra-organizational processes reflect external selection pressures.” At the same time, her analysis suggests that this translation is by no means perfect or automatic, since organizations have a variety of internal processes that may buffer or amplify the effects of external pressures. Unfortunately, routines are not a particularly easy unit of analysis to study. Pentland and Feldman (2002) discuss the issues involved in treating routines

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Proceedings of the 37th Hawaii International Conference on System Sciences - 2004

as the unit of analysis in empirical research. They note that organizational routines are difficult to pin down empirically because they have unclear boundaries and vary considerably from iteration to iteration. Like organizations, routines are complex social objects, but it is possible to develop indicators that are sufficient for the purposes of an ecological analysis. For example, Miner’s (1991) research uses formal job descriptions as an indicator of underlying organizational routines. Schulz (1998a, b) has studied the ecology of formal rules. The operationalization of the framework is discussed in a later section. In the case of inter-organizational routines, the participants engaged in the routine are distributed among different formal organizations. Payment systems, logistics systems, and other supply chain support systems make obvious examples of routines that are carried out by members of different formal organizations. Inter-organizational routines can also be seen as creating or sustaining network ties (Pentland et al, 2002). I use the term “network tie” as it is used in the study of social networks (Wasserman and Faust, 1994). While sociologists have operationalized this concept in many different ways, I refer here to behavioral interaction and transfer of material resources (Wasserman and Faust, 1994, p. 18). So, when two firms are engaged in a net-enabled transaction (e.g., automatic inventory replenishment), we can view them as having a tie in an appropriately defined social network. Just being plugged into the Internet does not create such a tie – it is the joint participation in the inter-organizaitonal routine that defines the tie. Thus, inter-organizational routines are particularly relevant to our concept of net-enabled and “virtual” organizations, who may participate in extensive inter-organizational networks. Pentland (1999) suggests that there is a duality between network ties (defined as behavioral interaction) and ties based on patterns of action, such as routines. Each tie reflects an instance of a routine and vice versa. Thus, a set of network ties represents a population of inter-organizational routines, and vice versa. Definition 2: Inter-organizational routines create and sustain social network ties between firms. To make this duality rigorous, we must recognize that there are different kinds of routines, and therefore different kinds of ties. Each kind of tie reflects a different aspect of the relationship between the entities in the network (Wasserman and Faust, 1994). For example, “automatic inventory replenishment” is different and more specific than just “purchasing.” Wasserman and Faust (1994) note that social ties can be multiplex: they can indicate more than one kind of relationship between two entities. In a supply chain

network, many firms would have multiplex ties, including purchasing, inventory replenishment, product development, and more. In mapping such a network, one needs to specify which ties (or combinations of ties) are included. The duality between network ties and routines will prove essential when we consider how to operationalize the ecological perspective in empirical research.

4. Definitions of key ecological concepts
To operationalize the ecological framework, we must define the core concepts. At a mimimum, we need to identify species, populations, and niches. I will use analogies to organizational ecology to help motivate these definitions. Like the analogy between biological organisms and organizations, the analogy between organizations and routines is not perfect or complete. In particular, the potential for complementarity between routines (Galunic and Weeks, 2002; Milgrom and Roberts, 1995) and their embeddedness in inter-firm social networks complicates the analogy considerably. Still, organizational ecology makes a reasonable starting point.

4.1 Species of organizational forms
Hannan and Freeman (1989) identify four “core features” of organizational forms that “serve as the organizational ecologists analogue to the biological ecologist’s species” (p. 29) These include: 1) mission (or goal); 2) form of authority or governancy (e.g., formal or informal); 3) basic technology; and 4) marketing strategy. So, for example, one can identify fast food restaurants as an organization form with the following core features (1) a food service mission; (2) formal governance; (3) standardized food preparation technology and (4) convenience-oriented mass marketing. In addition, there are “peripheral features” that may further differentiate organizations within a population (e.g., selling tacos versus selling hamburgers). Unlike most biological species, firms can be polymorphic: they can have more than one mission, more than one core technology and so on. This is particularly true of multi-divisional firms. Furthermore, unlike biological species firms can be transformed from one species to another. For example, they can change their mission or replace their core technology. While transformations are relatively rare and usually quite tumultuous, they are certainly possible. Polymorphism and transformation are two possibilities we need to allow for in species of organizational routines, as well.

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Proceedings of the 37th Hawaii International Conference on System Sciences - 2004

4.2 Species of routines
To identify species of routines, the four core features identified by Hannan and Carroll (1995) provide a reasonable starting point. At the minimum, we could identify species of routines based on (1) their goal and (2) their core technology. It may also make sense to include “governance” (informal vs. formal), but it is harder to see a meaningful analogy to “marketing strategy.” Functional or goal-based classification is probably the most common approach to classifying organizational work processes. In the MIT Process Handbook, for example, Malone et al, (1999) use a functional classification for a wide variety of business processes. The MIT Process Handbook also includes classifications based on core technology (“Sell how?). We can define species of routines as follows: Definition 3: A species of organizational routine includes all instances of a routine that have the same function (goal) and same core technology. In other words, a species of routine can be defined by the ends and the means. A taxonomy of interorganizational routines based on these two dimensions (goal and core technology) would be relatively straightforward. For example, some high –level categories are fairly well established, such as “purchasing” and “sales.” To the extent that we are interested in “net-enabled” technology, we might start by dividing the core technology into two categories (“net” or “not”). Further refinements (EDI, ebXML, etc.) are certainly possible. As discussed below, the appropriate structure of additional sub-categories should be a topic of empirical research.

4.4 Populations of routines
A population of routines is analogous to a population of organizations: “specific time-and-space instances of organizational routines.” So, one might include all of the sales routines in a particular segment of firms. In the sociological literature, there are some examples of research on populations of routines. For example, Anne Miner (1991) studied changes in the population of formal job descriptions. Consistent with the ecological framework, she examined variation and selective retention of jobs within a population. Shultz (1998b) looked at populations of rules within particular organizations (such as a German bank and an American university). He studies the vital rates for this population of rules: foundings (new rules), transformation (rule changes), and mortality (rule suspensions). These studies exemplify the idea of applying ecological concepts to organizational routines, but there has never been a study of interorganizational routines per se. The social network literature, however, is filled with studies of various kinds of inter-organizational ties (Gulati and Gargiulo, 1999). By definition 2, above, these ties reflect the presence of underlying inter-organizational routines. This suggests the following definition of a population of routines: Definition 4: A population of interorganizational routines includes a set of specific time-and-space instances of a given species, which can be operationalized as a set of ties in an appropriately defined social network. The phrase “appropriately defined” reflects the need to define what kind of tie is being graphed in the network. Each species of routine implies a different set of ties. This makes sense because each species of routine should have a distinct population. Networks of multiplex ties provide a convenient way to show multiple species of routines simultaneously.

4.3 Populations of organizations
Organizational populations are defined as “specific time-and-space instances of organizational forms.” (p. 29) A population consists of all members of a species who inhabit a particular niche or environment. In biological organisms, we might have a population of raccoons in the countryside, and a different population of raccoons in the city. They are all the same species, but it makes sense to study them as separate populations. Similarly, we might want to distinguish fast food restaurants in a distinct geographical locations (e.g., California vs. New York) as two different populations of the same species of organization. Indeed, studies in organizational ecology are often geographically bounded (e.g., hotels in Manhattan).

4.5 Niches for organizations
Carroll and Hannan (1995, p. 34) state that “the fundamental niche of an organizational form consists of the social, economic and political conditions that can sustain the functioning of organizations that embody a particular form.” Niches are important because they define the sphere of competition. The ecological similarity between two species can be defined as the extent of overlap in their fundamental niches. In general, the potential for two populations to compete is proportional to the intersection of their fundamental niches. Two populations compete if and only if their fundamental niches intersect. (Carroll and Hannan, 1995, p. 34)

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Proceedings of the 37th Hawaii International Conference on System Sciences - 2004

When two populations compete, each one will only occupy a portion of their fundamental niche that is called their “realized” niche, which is roughly analogous to an aggregate market share for all members of a population. In general, only the realized niche for a population can be observed. By analogy to the biological world, a niche is defined to have a carrying capacity, which is the number of members it can sustain.

4.7 Competition and complementarity
Competition between species occurs within niches. In my yard, for example, grass competes with weeds. Galunic and Weeks (2002) argue that routines can be viewed as competing with each other. Routine competition is present whenever there is risk to the survival of one routine because of the presence of another. The endgame is usually the supplanting of one routine by another, as one routine fulfills the same objectives but with greater effectiveness, efficiency, or legitimacy, or the dominant routine simply devours scarce resources leaving no life support for others. In turn, the losing routine may face inattention, relegation to some less significant use, or death (2002:81). Competition implies that routines would be considered substitutes or alternatives (Malone et al, 1999). For example, there may be alternative ways of recruiting new personnel, such as newspaper advertisements, campus interviews, and web-based services. At some point, web-based acquisition of candidates may come to replace the alternatives. Alternative payment mechanisms provide another example. Cash and personal check are increasingly being replaced by credit cards, but other forms of electronic payment have not been particularly successful. Unlike grass and weeds, routines may also be complementary with other routines. “Routines are complemented by another if the other’s presence contributes to the focal routine’s efficacy, development, and, ultimately, survival” (Galunic and Weeks, 2002:82). Milgrom and Roberts (1995) define complementarity in terms of marginal returns: doing more of one thing increases the returns for doing more of another. In practice, complementarity seems manifest itself as bundles that are self-reinforcing. In ecological terms, complementarity might be roughly analogous to symbiosis. Like interdependence, complementarity implies a specific organizational context. The statement “X complements Y” only makes sense in the context of a particular firm. X does not complement Y if they occur in different firms. This reinforces the need to treat the ecology of inter-organizational routines as a network phenomenon, so that the co-presence of particular instances of competing or complementary species within particular firms is explicitly represented.

4.6 Niches for routines
For a firm, a niche consists of the economic, physical and social resources required to survive. A routine needs all of that, plus it often has fairly specific requirements in terms of inputs and outputs, especially when supported by ICT. Interorganizational systems, from EDI to ebXML, all require the use of standardized data and document formats. Interdependence arises because routines are closely enmeshed in other routines (Feldman and Pentland, in press). Process interdependence (Malone et al, 1999) arises from the flow of material or information between processes. Malone et al (1999) identify three kinds of interdependence: flow, shared resources and common output. Flow dependencies occur when the input of one process is the output of another. Shared resources occur when two processes require the same inputs (e.g., same operating system). Common output occurs when two processes have to produce result that go together in some way. Interdependencies between routines are critical factors in defining a niche because a routine cannot survive unless these dependency constraints are met. Process interdependence enforces powerful constraints on the choice of technologies and inter-organizational routines. Flow dependencies are most important between organizations: you have to conform to the standard. Shared resource dependencies are likely to be important within the adopting organization. Definition 5: A niche is defined by the economic, physical, social and interdependencies required by a species of routine. It is important to realize that interdependence arises in the context of particular firms – between instances of a routine. Thus, it makes the most sense to operationalize a niche in terms of an appropriately defined social network of specific firms (suppliers, buyers, etc). The social network transcends immediate boundaries of geography and industry. For this reason, it can capture the set of places within which a given species of inter-organizational routine could be survive.

5. Research issues and possibilities
The framework presented here embodies a significant departure from the more familiar economic or managerial view that is typically applied to this

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domain. In contrast, it is more of a sociological view. First, what steps would be needed to begin a research agenda in this area? And second, what kinds of problems can we solve if we adopt an ecological approach to the study of net-enabled firms?

5.1 Classification of species
The first issue in carrying out research using this framework would be the classification of species. The MIT Process Handbook (Malone et al, 1999) provides an interesting model, but may be more elaborate than necessary. It might be that in early empirical work, a much simpler taxonomy would be adequate. The function of the routine (e.g., “purchasing”) provides the basic classification for the purposes of defining the population and the niche within which competition occurs. For the core technology, one might ask whether the routine based on (a) face-to-face; (b) “traditional” technologies (paper, US Mail), (c) telephonic technologies (phone, FAX) or (d) netenabled technologies.

5.2 Identifying niches: Interdependencies and complementarities
Given a taxonomy of species, we need to understand the interactions between them. Interdependencies and complementarities are likely to have enormous effects on the ecology of routines. Interdependencies define niches; the impose constraints on when and where particular species of routines can even begin to compete. Complementarities influence the ecology of routines by changing the returns to investment, which should tend to have a positive influence on the “birth rate” of the complementary species of routines. To operationalize this framework, we need to estimate these effects in some way. For example, which species of routines are interdependent? Which are complementary? At a minimum, we would need to identify context-independent factors that indicate the size of these effects. To the extent that interdependence and complementarity are most meaningful in the context of particular firms, it may be necessary to incorporate firm-specific information in the model. One can imagine a matrix of firm specific co-variates that identity the extent to which each firm in the network has the resources necessary to implement a given routine.

network ties between organizations. Thus, population dynamics in inter-organizational routines is directly connected to network dynamics. Vital rates for interorganational routines translate directly into network dynamics. Foundings (new routines) correspond to the initiation of new network ties. Transformations correspond to changing from one kind of tie to another (for example, when an purchasing process converts from FAX to EDI. Mortality corresponds to the termination of network ties. Macro-level studies and theories of network dynamics are based entirely on endogenous factors (e.g., using existing patterns of ties can be used to predict future ties). For example, Gulati and Gargiulo (1999) offer a theoretical framework for the formation of inter-organizational of strategic alliances. Their framework focuses on endogenous aspects of network structure that can influence formation (or dissolution) of ties over time. They note that organizations create ties with other organizations in order to acquire “resources and capabilities that can help them cope with exogenous constraints.” (Gulati and Gargiulo, 1999, p. 1440) Gulati and Gargiulo (1999) test a number of hypotheses concerning network structure and the formation of strategic alliances. They highlight the importance of interdependence, calling it “the most common explanation for the formation of interorganizational cooperative ties…” (p. 1443). In their view, the probability of tie formation increases with the level of interdependence. Thus, the distribution of resources and capabilities among firms, coupled with the set of economic opportunities in the environment, tends to drive the formation of ties. Given the difficulty of operationalizing interdependence on a global scale, they were forced to use rather distant proxies for this construct. Interdependence is an important, but somewhat elusive factor. While interdependence and exogenous constraints are important factors, Gulati and Gargiulo (1999) argue that they do not provide sufficient information about which specific firm should be chosen as a partner. In other words, technical and economic constraints typically under-determine the choice of partner, leaving many possibilities to choose from. Gulati and Gargiulo (1999) demonstrate that endogenous network effects have a significant effect on these residual choices. The ecological framework described here takes this a step farther by encouraging the examination of specific kinds of routines (rather than the broad category of strategic alliances).

5.3 Population dynamics



network 5.4 Field studies
The data requirements for research using this model would be formidable, to say the least. In order

As mentioned earlier, inter-organizaitonal routines can be seen as creating or reproducing

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Proceedings of the 37th Hawaii International Conference on System Sciences - 2004

to avoid the bias involved in studying and generalizing from a few successful (or unsuccessful) cases, organizational ecologists have a methodological imperative to study entire populations. Estimation of population level effects requires census data – not just sampling. To the extent possible, we need to get all the ties (inter-organizational routines) within a set of focal firms over time. And because we are interested in dynamics (changes of time), longitudinal data are required. Because of the complexity of the phenomenon, it may be helpful to conduct some simulation analysis to see what kinds of data are most important and what effects are strongest. In this way, simulation can hopefully guide the design and enhance the effectiveness of labor intensive field studies. One way to reduce the burden of data collection is to use ego networks (Wasserman and Faust, 1994) as the basis for analysis. In this approach, one collects network data about a set of firms and their ties, but does not attempt to interconnect them. In this way, network data can be added as an explanatory variable in what is otherwise a typical firm-level analysis.

6. Conclusion
Whether or not it proves feasible to conduct empirical research based on this model, I believe that an ecological framework provides a valuable counterpoint to traditional firm-level perspectives. The framework places emphasis on interdependence and complementarity, which constrain and enable the growth rates of certain “species” of routines, rather than the costs and benefits for particular firms. In doing so, it sacrifices the mathematical elegance of economic optimization, and to some extent, the ability to make straightforward managerial prescriptions for action. But unlike firm level models, it has the potential to explain the transformation (or lack thereof) of whole industries and ways of doing business.

7. References
[1] Aldrich, Howard. 1999. Organizations Evolving. London: Sage Publications. [2] Anderson, P. (1995) Microcomputer Manufacturers, in Carroll, G. R. and M. T. Hannan (Eds.) Organizations in Industry: Strategy, Structure and Selection, New York, Oxford University Press, p. 37-58. [3] Baum, Joel A. C. and Jitendra Singh (eds.). 1994. Evolutionary Dynamics in Organizations. New York: Oxford University Press. [4] Baum, Joel A.C. and Bill McKelvey. 1999. Variations in Organization Science: In Honor of Donald T. Campbell. Thousand Oaks, CA: Sage. [5] Campbell, Donald T. 1965. “Variation and Selective Retention in Socio-Cultural Evolution.” In H. R. Barringer, G. I. Blanksten, and R. W. Mack (eds.),

Social Change in Developing Areas: A Reinterpretation of Evolutionary Theory. Cambridge, MA: Schenkman. [6] Coyle, F. P. (2002) XML, Web Services and the Data Revolution, Addison-Wesley. [7] Economides, N. (1996) The economics of networks. International Journal of Industrial Organization, 14, 6, 673-699. [8] Feldman, M. S. and Pentland, B. T. (forthcoming) “Organizational Routines: Towards a Practice-based Theory of Routines, Flexibility and Change” Administrative Science Quarterly. [9] Hannan, M. T. and G. R. Carroll (1995) An introduction to organizational ecology, in Carroll, G. R. and M. T. Hannan (Eds.) Organizations in Industry: Strategy, Structure and Selection, New York, Oxford University Press, p. 37-58. [10] Hannan, M. T., and J. R. Freeman. 1983. “Structural Inertia and Organizational Change.” American Sociological Review 29: 149-164. [11] Katz, M.L., and Shapiro, C. (1986) Technology adoption in the presence of network extemalities. Journal of Political Economy, 94, 4, 822-841. [12] Kauffman, R.J.; McAndrews, J.J.; and Wang, YM. (2000) Opening the "black box" of network externalities in network adoption. Information Systems Research, 11, 1. [13] Kwon, P. M. J. Chung, and B. Pentland, (2002) "A Grammar-Based Framework for Integrating Design and Manufacturing," Journal of Manufacturing Science and Engineering. 124: 899-907. [14] Malone, T. W., Crowston, K. G., Lee, J., Pentland, B., Dellarocas, C.,Wyner, G., Quimby, J., Osborn, C. S., Bernstein, A., Herman, G., Klein, M., & O'Donnell, E. (1999) Tools for inventing organizations: Toward a handbook of organizational processes. Management Science, 45, 3 (March), 425-443. [15] Miner, Anne and Pamela Haunschild. 1995. “Population Level Learning.” Research in Organizational Behavior 17: 115-166. [16] Miner, Anne. 1991. “Organizational Evolution and the Social Ecology of Jobs.” American Sociological Review 56: 772-85. [17] Miner, Anne. 1994. “Seeking Competitive Advantage: Evolutionary Theory and Managerial Action.” In Baum and Singh (eds.), Evolutionary Dynamics of Organizations. New York: Oxford University Press. [18] Pentland, B. T. (1999) “Organizations as Networks of Action” in J. Baum and B. McKelvey, (Eds.), Variations in Organization Science: In Honor of Donald T. Campbell, Thousand Oaks, CA: Sage., pp. 237-253. [19] Pentland, B. T. (forthcoming) “Conceptualizing and Measuring Variety in Organizational Work Processes” Management Science. [20] Pentland, B. T., Kwon, P. and Chung, M. J. Networks of action in distributed manufacturing: Using process models to predict structural relationships, European Group on Organization Studies, Barcelona, Spain. July 2002. [21] Plunkett, Anne (2002) The role of selection in the evolution of organizational routines, Presented at the Workshop on Empirical Research on Routines in Business and Economics, University of Southern Denmark, Odense, Denmark, November 2002.

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[22] Powell, Walter W. (1998). Learning from collaboration: Knowledge and networks in the biotechnology and pharmaceutical industries, California Management Review, 40(3), 228-240. [23] Riggins, F. J.; Kriebel, C. H.; and Mukhopadyay, T (1994) The growth of inter-organizational systems in the presence of network externalities. Management Science, 40, 8, 984-998. [24] Schulz, Martin (1998a) A model of obsolescence of organizational rules, Journal of Computational and Mathematical Organization Theory, 4(3), 241-266. [25] Schulz, Martin (1998B) Limits to bureaucratic growth: The density dependence of organizational rule births, Administrative Science Quarterly, 43(4), 845-876. [26] Steinfield, C. (2002) Conceptualizing the role of collaborative e-commerce in geographically defined business clusters. Presented to the workshop on The Ambivalent Relationship Between IT and Social Capital, Vrije Universiteit Amsterdam, May 27-28, 2002, The Netherlands. [27] Steinfield, C. (in press) Geographic and socially embedded electronic transactions: Towards a situated view of business-to-consumer and business-to-business e-commerce. In Cooper, R. and Madden, G. (eds.), Frontiers of broadband, electronic and mobile commerce, Heidelberg: Physica-Verlag, forthcoming. [28] Tuma, Nancy B. and Hannan, Michael T. (1984) Social Dynamics: Methods and models. Orlando, Academic Press. [29] Wasserman, S. and Faust, K. (1994) Social Network Analysis: Methods and Applications. New York: Cambridge University Press. [30] Wheeler, Bradley C. (2002) NEDIC: A dynamic capabilities theory for assessing net enablement, Information Systems Research, 13(2), 125-146. [31] Zahra, Shaker A. and Gerard George (2002) The netenabled business cycle and the evolution of dynamic capabilities, Information Systems Research, 13(2), 147150.

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