Three Order Network Governance Framework and Public Network Development

Community-based care networks have become more prevalent in health and human services over the past twenty years (Rice 2001; Romzek and Johnston 2002; Smith and Smyth 1996; Provan and Milward 1995, 2001; Lynn 1996), spurred on by the twin trends to privatize substantial service delivery and decentralize social services to local communities. Research has flourished to study how these networks operate and what types of performance outcomes result from their operation. Within the field of public management, network research has evolved from a study of policy implementation to discussing types of networks, management skills, and even the impact of networking on broader agency goals. While researchers who study interorganizational relationships provided new insights into the design of public networks (e.g., Goldsmith and Eggers 2004; Keast et al. 2004; Klijn and Koppenjan 2006) or suggested approaches to managing the coordination process in network-settings (e.g., Whetten 1981; Kickert et al. 1997; Lynn, Carolyn, and Hill 2001; Agranoff and McGuire 2003), their analysis has generally failed to capture empirically the dynamic processes of network development although there are exceptions (e.g., Ring and Van de Ven 1992; Romzek and Johnston, 2002; Agranoff and McGuire, 2003; and Mandell and Keast, 2008). Through extensive fieldwork and using a variety of theoretical literatures, this study develops a framework of three stages of network development, using the example of community-based care (CBC) networks in Florida that deliver children's welfare and protective services. In Florida, the state Department of Children and Families has awarded contracts to formally designated lead agencies (including nonprofit, private and public sector agencies) in twenty two districts to coordinate and manage the delivery of services through service providers that contract with the lead agency. This CBC network has existed since 1997 and thus a comparative case study assessment of that development process is timely and able to capture the dynamic development of the CBC networks. This dissertation builds a comprehensive framework for community-based network governance. I posit that there are three orders of the network development process: Order One is network configuration; Order Two is network coordination, and Order Three is network self-regulation. In the first sage—network configuration—the network managers focus on assessing the internal and external conditions of the potential network, and then selecting the best fitting network governance structure to fit those conditions. Important conditions related to the external community include market competition and community resources, while the internal conditions include prior cooperation experience, resource dependence, and homophily. Theoretical insights from population ecology and transaction cost economics are used in this framework. In the second stage—network coordination—managers draw upon incentives and sanctions from theories of performance management, psychology, principal agency theory, social coordination, and stewardship theory to build strong coordination and performance mechanism so the network achieves is goals. The third stage is called network self-regulation, and draws on social capital and public management theories for how lead agency managers involve middle managers, attend to network stability issues and bring all the service provider partners into a close working relationship to continue improving operations and strategic goal achievement. The study answers three major questions that relate to the three order network governance framework: 1. How does one understand and describe the three stages of network development, the network configuration order, the network coordination order, and the network self-regulation order as they are linked together in a CBC network system? 2. What are the critical internal and external conditions of the CBC networks affecting network development direction as well as network configuration? What type of network configuration and what modes of network coordination are important for explaining how and why CBC network systems developed and are maintained over time? What relationships exist among these factors that impact the CBC network development over time? 3. What network developmental strategies and managerial approaches are used to drive the network development process from one stage to another? The dissertation finds empirical support for the three network development stages, and includes the development of twelve propositions that should be further tested through larger samples of networks and with different types of networks. The case studies allow us to detail a variety of coordination activities that are crucial for the successful achievement of the second order network coordination stage and the subsequent development of the third order network self-regulation stage. Finally, the dissertation develops two typical process frameworks called the linear development process, and the recursive development process, that describe the issues and tribulations that networks face depending on whether they begin with weak and/or strong internal and external conditions as they develop towards having both internal and external conditions strong which should result in the best functioning and performing community-based care networks.