Another theoretical explanation behind the governance
transformation is based on the argument by management
literature that networks create organizational
synergies (Deloitte, 2004). Networks provide various
forms of political, economic and social benefits to constituents
since they share goals and utilize collective
strengths. Peters (1998) bases arguments on the ability
of networks to pull resources that “would not be at its
disposal were it to remain on its own side of the divide
between the two sectors.” Such views based on the
resource dependency perspective have also been
advanced by Galaskiewicz (1985). Pfeffer and Salancik
(1978) also provide a review of alternative forms of
inter-firm networks and the empirical research relevant
for predictions on the resource dependency perspective.
Inter-organizational networks formed to achieve synergistic purposes are proven to work effectively (Luke et
al., 1989; Provan & Milward, 2001).