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Future of Organizational Design

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Future of Organizational Design

Organization design refers to the structure of an organization. It is the manner in which the

leadership directs the people in the organization and other organizational and operational

process. In the article The Future of Organizational Design the author Jay R. Galbraith

discusses strategic organizational design with a top down design as being the future. In order for

the structural design to be effective it begins with creating a strategy and then structuring the

strategy.

The article begins with a discussion on the shapers of organizational design. According to

Galbraith (2012) organizations are shaped by three phenomena which are concatenation, law of

requisite variety, and enabling technologies resulting from the Third Industrial Revolution.

Concatenation refers to interconnections. In organizational design these connections are

becoming more and more strategic. Strategies are still designed to reach organizational goals but

with a greater emphasis on technology and the data it generates.

The second shaper or organizational design according to Galbraith is the law of requisite

variety. This law states that as the number and variety of relevant entities in the stakeholder

environment increases, the number and variety of units inside the enterprise must increase in

order to manage these entities (Galbraith, 2012). In other words when the organization must add

a new entity to the organization the strategic planning must include measures to manage the new

entity. In current society new and evolving technology would have to be properly managed as

well as its effect on the people in the organization.

The third shaper, enabling technologies resulting from the Third Industrial Revolution, would

be a continuation of the second shaper in that the new strategic plan must include this new

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technology in both communication and operations. For example if the company employs new

computerized machinery to simple the ultimate goal of the company to make a specific product

the resources needed to purchase the equipment, appoint someone to manage its implementation,

and train employees.

Next the author goes on to discuss adding strategic dimensions to the organizational design.

The new dimensions refer to the organizational design going from two dimensional to three

dimension design. The two dimensional design was focused on people and profit. In the

Technological Revolution the organization now has a three dimensional design which includes

technology. Since technology is now interconnected into every aspect of the organization it

requires a strategic response. These new complex dimensions require coordination and stretgic

planning.

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References

Galbraith, J. (2012). The Future of Organizational Design.Journal of Organizational Design,

1(1): p. 3-6