The Evolution of Enterprise Organization Designs

Jay R. Galbraith

Abstract


This article extends Alfred Chandler's seminal ideas about strategy and organizational structure, and it predicts the next stage of organizational evolution. Chandler described the evolution of vertical integration and diversification strategies for which the functional and multidivisional structures are appropriate. He also explained how the dominant structure at any point in time is a concatenation or accumulation of all previous strategies and structures. I extend Chandler's ideas by describing how early "structures" became "organizations" (people, rewards, management processes, etc.) and by discussing the more recent strategies of international expansion and customer focus. International expansion leads to organizations of three dimensions: functions, business units, and countries. Customer-focused strategies lead to four-dimensional organizations currently found in global firms such as IBM, Nike, and Procter & Gamble. I argue that the next major dimension along which organizations will evolve is emerging in firms which are experimenting with the use of "Big Data."


Keywords


Organization design; organization structure; strategy and structure

Full Text:

PDF


DOI: http://dx.doi.org/10.7146/jod.6342

This website uses cookies to allow us to see how the site is used. The cookies cannot identify you or any content at your own computer.
OK


ISSN: 2245-408X

Hosted by the Royal Danish Library