Theory of Interorganizational Systems: Industry Structure and Processes of Change

This paper outlines a multi-level theory of interorganizational systems (IOS) that explicitly recognizes the importance of the industry as a macrolevel unit of analysis in addition to the units (enterprises) at the micro-level. The roles of the external environment and the technology-based IOS are also recognized. Theories of intentional agency drawn from the areas of robotics, intelligent software agents and human-computer interaction are used to explain how industry-level activity occurs. Concerted activity is attributed to the reciprocal causal effect of the group upon the individual units, rather than to any form of regular group deliberation about action. It is expected that change at the industry level will tend to be incremental, building on routine, situated actions of different players. Propositions concerning industry structure, processes of change and the development of IOS are illustrated with case studies.