Which statement about network organizations is most accurate?

• A. Its role is to coordinate outsourced activity
• B. It performs all tasks internally
• C. It avoids outsourcing entirely
• D. It operates only in one country

Answer: (A)

Network organizations coordinate outsourced activity, drawing on a web of external suppliers and partners to perform different tasks. The firm focuses on orchestrating these activities—managing contracts, quality, and information flows—while leaving specialized work to others. This contrasts with doing everything in-house, which would be a more traditional, vertically integrated structure. Outsourcing is central to a network model, so avoiding it entirely would miss the point, and operating only in one country isn’t a defining feature since network organizations often span borders to access global capabilities.