Section TwoFortress. Companies in this category are in highly
competitive markets and are at the mercy of their
environments. Examples of the types of companies in this
category include those in hotels, retailing, publishing, textiles,
and natural resources.^85 Because companies in this category are
essentially reactive, there are few systematic strategic
implications.
NETWORK ORGANIZATIONS AND STRATEGY
Network organizations are an important development in the
human resource environment. Such organizations have
developed as a result of advances in communications
technology, desires for workforce flexibility, and intensified
worldwide competition brought about by financial and economic
deregulation. Network organizations readily acquire or divest
their organizational units based on their return on assets and
outsource activities that other companies or venture partners
can produce at a lower cost in less time. Outsourcing enables
network organizations to maintain an optimal size and lower
economic risk of ventures into new markets. Essentially,
network organizations retain for themselves only those
activities in which they have expertise. Several different firms
may be involved in a network, with the activities of product