Our current understanding of interorganizational networks rests on a substantial body of empirical evidence predicated upon the implicit assumption that organizations may be adequately represented as unitary network nodes. Yet, the existence of differentiated and partially changeable internal structures is one of the defining features of organizations as collective social actors. Network representations of interorganizational relations that preclude the possibility of nodes with changeable internal structure are analytically convenient. They are also theoretically incomplete and empirically implausible. This paper goes beyond our current understanding by proposing a novel class of network models that explicitly recognizes this constitutive aspect of organizations as collective actors. The model posits that processes of (internal) organizational and (external) network change shape one another, coevolving over time. We demonstrate that a model where organizational and network structure coevolve can reproduce with considerable accuracy the structure of interorganizational networks, the internal structure of the network nodes, and the distribution of organizational activities at the field level. Additionally, we illustrate how the model may assist in identifying and apportioning the mechanisms behind the tendency of interdependent organizations to have similar internal structures that is frequently observed in studies of interorganizational networks. An analysis of data that we have collected on networks of collaborative relations within a community of health care organizations exemplifies the compelling theoretical and empirical possibilities afforded by abandoning the analytically convenient assumption of organizations as unitary network nodes.
