Adaptive Organizations

We consider organizations that optimally choose the level of adaptation to a changing environment when coordination among specialized tasks is a concern. Adaptive organizations provide employees with flexibility to tailor their tasks to local information. Coordination is maintained by limiting specialization and improving communication. Alternatively, by letting employees stick to some preagreed action plan, organizations can ensure coordination without communication, regardless of the extent of specialization. Among other things, our theory shows how extensive specialization results in organizations that ignore local knowledge, and it explains why improvements in communication technology may reduce specialization by pushing organizations to become more adaptive.

[1]  Walter J. Murphy,et al.  The Employment Outlook , 1947 .

[2]  Lawrence B. Mohr,et al.  Organizational Technology and Organizational Structure. , 1971 .

[3]  R. Radner,et al.  Economic theory of teams , 1972 .

[4]  A. V. D. Ven,et al.  Determinants of Coordination Modes within Organizations , 1976 .

[5]  Robert W. Zmud,et al.  Management of Large Software Development Efforts , 1980, MIS Q..

[6]  J. Crémer.  A Partial Theory of the Optimal Organization of a Bureaucracy , 1980 .

[7]  L. Argote.  Input uncertainty and organizational coordination in hospital emergency units. , 1982, Administrative science quarterly.

[8]  Joseph L. C. Cheng.  Interdependence and Coordination in Organizations: A Role-System Analysis , 1983 .

[9]  M. Aoki.  Horizontal vs. Vertical Information Structure of the Firm , 2013 .

[10]  James R. Lincoln,et al.  Organizational Structures in Japanese and U.S. Manufacturing , 1986 .

[11]  Paul R. Milgrom,et al.  Communication and Inventory as Substitutes in Organizing Production , 1988 .

[12]  Bill Curtis,et al.  A field study of the software design process for large systems , 1988, CACM.

[13]  Michael Hammer,et al.  Reengineering Work: Don’t Automate, Obliterate , 1990 .

[14]  Paul R. Milgrom,et al.  The Economics of Modern Manufacturing: Technology, Strategy, and Organization , 1990 .

[15]  Michael A. Cusumano,et al.  A quantitative analysis of U.S. and Japanese practice and performance in software development , 1990 .

[16]  Paul R. Milgrom,et al.  A theory of hierarchies based on limited managerial attention , 1991 .

[17]  R. Radner,et al.  Information Processing in Firms and Returns to Scale , 1992 .

[18]  O. Williamson,et al.  The firm as a nexus of treaties , 1992 .

[19]  Organizations , 1992, Restoration & Management Notes.

[20]  R. Radner.  The organization of decentralized information processing , 1993 .

[21]  D. L. Flarey.  Reengineering the Corporation , 1994 .

[22]  P. Osterman.  How Common is Workplace Transformation and Who Adopts it? , 1994 .

[23]  P. Bolton,et al.  The firm as a communication network , 1994 .

[24]  Paul Milgrom,et al.  The Firm as an Incentive System , 1994 .

[25]  Casey Ichniowski,et al.  The Effects of Human Resource Management Practices on Productivity , 1995 .

[26]  Enid Mumford,et al.  Reengineering the Corporation: A Manifesto for Business Revolution , 1995 .

[27]  Robert E. Kraut,et al.  Coordination in software development , 1995, CACM.

[28]  Vijay S. Mookerjee,et al.  Modeling Coordination in Software Construction: An Analytical Approach , 1995, Inf. Syst. Res..

[29]  Casey Ichniowski,et al.  The Effects of Human Resource Management Practices on Productivity , 1995 .

[30]  Paul Milgrom,et al.  Complementarities and fit strategy, structure, and organizational change in manufacturing , 1995 .

[31]  Thomas A. Kochan,et al.  What works at work : overview and assessment , 1996 .

[32]  J. Tirole,et al.  Formal and Real Authority in Organizations , 1997, Journal of Political Economy.

[33]  Kevin Crowston,et al.  A Coordination Theory Approach to Organizational Process Design , 1997 .

[34]  Timothy Van Zandt,et al.  Real-Time Decentralized Information Processing as a Model of Organizations with Boundedly Rational Agents , 1999 .

[35]  Wouter Dessein.  Authority and Communication in Organizations , 2002 .

[36]  L. Sproull,et al.  Coordinating Expertise in Software Development Teams , 2000 .

[37]  Dennis J. Snower,et al.  Multitask Learning and the Reorganization of Work: From Tayloristic to Holistic Organization , 2000, Journal of Labor Economics.

[38]  Luis Garicano,et al.  Hierarchies and the Organization of Knowledge in Production , 2000, Journal of Political Economy.

[39]  J. V. Reenen,et al.  Skill-Biased Organizational Change? Evidence from a panel of British and French establishments , 2001 .

[40]  Eve Caroli.  New technologies, organizational change and the skill bias: what do we know? , 2001 .

[41]  Vijay S. Mookerjee,et al.  A Dynamic Coordination Policy for Software System Construction , 2002, IEEE Trans. Software Eng..

[42]  Canice Prendergast,et al.  The Tenuous Trade‐off between Risk and Incentives , 2000, Journal of Political Economy.

[43]  Jan W. Rivkin,et al.  Balancing Search and Stability: Interdependencies Among Elements of Organizational Design , 2003, Manag. Sci..

[44]  Dimitri Vayanos,et al.  The decentralization of information processing in the presence of interactions , 2003 .

[45]  Wouter Dessein,et al.  The Demand for Coordination , 2003 .

[46]  Julie Wulf,et al.  The Flattening Firm: Evidence from Panel Data on the Changing Nature of Corporate Hierarchies , 2003, The Review of Economics and Statistics.