Companies who have taken the small/large approach include Benetton, Nike,
Reebok, and many motion picture and entertainment industry companies. They have built
networks of many companies, each with a limited specific role. At the core of each
network is an organization that performs some key functions for the network and
coordinates the activities of the other members of the network. For example in the
fashion business, there is usually a large central entity such as Benetton that handles
design decisions for the network and coordinates manufacturing, advertising, marketing
and distribution for the network. The network in turn is made up of many small
manufacturing companies, retailers who actually distribute the products and the usual
array of advertising agencies, shipping companies, etc. who help move the product from
the factory to the store and ultimately to the consumer’s home. A similar approach has
been taken in the health care industry as hospitals’ physician groups and laboratory
businesses have developed coordination mechanisms that link them to HMOs and
insurance companies.