Organizational Design Model Organizational Design Article Analysis:

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Organizational design article analysis: The future of organizational design

Theories of organizational design predate the Internet revolution. However, the article "The future of organizational design: A forecasting study" suggests that theories of organizational design have undergone major changes in the Internet age. Organizations have shifted away from functional and processed-based models of firm design to other, new design models (Yildiz 2012). The main reason for this is technology. "Depending on its own value chain, an organization can hand over operations that do not require direct control and that do not create a different value; to their business associates. Nowadays, information networks allowing fast and cheap communication with business associates can be created over the internet" (Yildiz 2012). Organizations can become highly specialized and delegate more and more of their functions to outside entities. In contrast to previous eras, they do not have to have face-to-face contacts with these individuals or brick-and-mortar connections. This gives them greater flexibility in how they delegate authority.

For example, in the new, 'hollow' design model, the organization designates its main, core competencies and tries to excel in those, while delegating the rest elsewhere to outside organizations save both time and labor. In the increasingly competitive economy, where consumers have a great deal of selection and there is often little differentiation between organizations, such a model 'makes sense.' In another organizational design model, known as "flat structured lattice organizations," there is almost no corporate hierarchy and almost everyone operates as an equal (Yildiz 2012). Particularly with smaller-to-mid-sized organizations, having a relatively nonhierarchical structure with focused business interests allows the organization to save on a number of structural costs. There is no need to spend money enforcing official corporate policies, no need to administer complex hierarchies designed to take care of bureaucratic measures -- employees can even work largely online in a relatively non-supervised context. In one Internet-based organization cited in the article, there are no official leadership titles -- all employees are 'associates' and the focus of the organization is upon fulfilling its mission, not upon reinforcing hierarchical divisions. This encourages information-sharing between employees, a vital component of the technology-driven economy, and discourages unhealthy workplace competition.

In another model, "chaordic organizations formed by the development of chaos and complexity theories are self-improving and self-organizing structures resembling a neural network instead of a hierarchical structure. Chaordic organizations have the capability to keep pace with the technological developments and globalization to the highest level" (Yildiz 2012). These organizations are made up of very separate parts that still work in a mutually beneficial and interdependent fashion. The goals of the organization are diverse, and may differ slightly between their distinct components, but through the connections of technology, mutual learning and service is possible.