Phenomenon of network structure of companies: historical and economic backgrounds

Abstract

Introduction. In the conditions of market instability which is caused by various circumstances, special importance is given to the ability of economic agents to maintain the competitiveness of the business through flexible organizational structure. The above mentioned problem is solved within the optimum network structures, which have received considerable spread in the world. Therefore, depth study of the prerequisites of successful performance  of network phenomenon is essential to understanding the nature, specificity and major prospects for economic development.

Purpose. Aim of this article is to analyze the economic, institutional, social and historical factors that led to the emergence of the phenomenon of inter-enterprise networks, as well as the compilation and classification of the main reasons for an adequate understanding of the nature, limits, and areas of possible changes in conditions of optimum functioning.

Method (methodology). The  methods  of scientific analysis, extrapolation, classification, historical and logical analysis of evidence of economic practice of domestic and foreign businesses are used to determine the reasons of economic development and successful performance of network structures of enterprise.

Results. The main economic and institutional reasons are generalized. They contribute to the benefits of network structures. The specifics of  influence on the formation of network structures is analyzed using such main motives as the use of complementary resources to create a more saturated value for customers; reduction of all types of production costs, especially transaction; allocation of risk and reduce uncertainty; empowerment in education, exchange of information, knowledge and technologies; decrease bounded rationality and opportunism firms. The classification division of patterns of emergence of network structures in economic and socio-historic ones is proposed. The essence and mechanism of their influence on the object under study is revealled.