Governance is a pluriform concept. Following literature, we distinguish three governance modes: hierarchy, market and network. For each mode relations between actors are shaped differently. For complex features, such as mobility data platforms, different governance modes are visible at the same time. Moreover, to be effective, governance modes should fit their context. At the same time, they may influence their context as well.
Key words: market, hierarchy, network, governance mode
Mobility data platforms can include a great variety of products and services. A recurring question is whether to make or buy a particular product or a service. This is a good example of a governance decision: when the function is carried out by the organization itself, it becomes part of the governance of that organization and it is included in the hierarchical structure of the organization. This can be the case for both permanent organizations or more temporary projects.
When the function is bought, there is no continuous hierarchy, however. The choice for a provider and the competition between providers allows the client – the buyer – of the function to have the provision of the function align with his needs. At the buying decision, the client of the function has a great deal of control, which is reduced once the decision has been made. The coordination between the client and the provider of the function is done through different forms of governance, hierarchy through a visible hand – being the contract and the buying decision – and a market via the famous invisible hand.
This in the literature leads to two main governance modes: market and hierarchy. Two important bodies of literature in economics and administrative science show the limitation of this dichotomy.
In the literature, Powell (1990) showed the dichotomy at two sides of a scale to be too simplistic. A third potential mechanism for coordination was labelled as ‘network’. Here, the coordination is shaped by mutual dependency. Power sources one may depend on are very diverse. It could be formal authority, knowledge, scarcity of resources, etcetera. Relations are ultimately reciprocal: give and take. Governance in this case can be relatively invisible. Powell claims that networks are especially useful in those situations where “qualitative matters as know-how, technological capability, a particular approach or style of production, a spirit of innovation or experimentation, or a philosophy of zero defects are very hard to place a price tag on. (1990, pp. 304)”
As most authors in the field of economics and administrative science show, all three mechanisms for coordination between various players can coexist. A service can be procured on the market, after which it is provided for a prolonged period of time. During that a hierarchy can be used, based on the contractual obligations. In addition, normal day-to-day governance might rely more on the relations that exist between the service provider and the user of the service.
In the world of data platforms, all three, markets, hierarchies and networks, play important roles. Governments and also some companies internally could rely heavily on hierarchy, when a specific service branch is expected to deliver data to that platform and align its data protocol to the platform. Between different governmental jurisdictions, networks might be the key mode, as they are mutually dependent on participating and creating to overall value of the platform to their area and that of the neighbouring jurisdictions. Finally, data and data services can be bought and added to the value of the data platform.
The context determines the governance modes that can be used. When developing a metropolitan data platform for mobility, the existence of a jurisdiction on metropolitan level with enough agency is required to be able to rely on hierarchy. When such an entity does not exist, municipalities will have to cooperate, having to rely on cooperation in existing networks to make the platform work. When external supply and demand for certain data types exist, supply into the platform and demand out of the platform, markets can be used to acquire or sell that data under a market oriented licence. When the external supply and demand are limited, market mechanisms will play a lesser role.
That being said, this context is not just a given. The design of a platform can also trigger this context to change. For example, the lack of a network or hierarchical structures in the area will hamper the development of a government-driven data platform for mobility, because there are no incentives to start. If there are no cooperating municipalities, the platform could trigger the need for it and let municipalities set up a cooperating governance structure responsible for the platform, moving beyond pure network governance by adding a new structure with hierarchical elements.
Governance is never singular, in that it doesn’t use only one mode: only markets, hierarchies and networks. Data can be procured on the open market, by a hierarchically controlled department of a metropolitan jurisdiction that is set up to be cooperatively governed by the municipalities in the area. These hybrid forms allow for the use of strengths and weaknesses of the various governance modes when designing the governance, or evaluating it.