Organizational Structures of the Future
1. Many of today’s companies are winding up the task of remodeling their traditional hierarchical structures once built around functional specialization and centralized authority.
CORE CONCEPT: Revolutionary changes in how companies are organizing the work effort have been occurring since the early 1990s.
2. The organizational adjustments and downsizing of companies in 2001-2002 have brought further refinements and changes to streamline organizational activities and shake out inefficiencies. The goals have been to make the organizations leaner, flatter, and more responsive to change. Many companies are drawing on five tools of organizational design:
a. Empowered managers and workers
b. Reengineered work processes
c. Self-directed work teams
d. Rapid incorporation of Internet technology applications
e. Networking with outsiders to improve existing capabilities and create new ones
3. The organization of the future will have several new characteristics:
a. Fewer barriers between vertical ranks, between functions and disciplines, between units in different geographic locations, and between the company and its suppliers, distributors/dealers, strategic allies, and customers
b. A capacity for change and rapid learning
c. Collaborative efforts among people in different functional specialties and geographic locations – essential to create organization competences and capabilities
d. Extensive use of Internet technology and e-commerce business practices – real-time data and information systems, greater reliance on online systems for transacting business with suppliers and customers, and Internet-based communication and collaboration with suppliers, customers, and strategic partners
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