Innovative organizational structures and performance

Abstract

Although there has been substantial academic and practitioner interest into innovative structural arrangements, the study of structural transformation and the structural practices of small to medium‐sized organizations in traditional industries has been relatively ignored. This article presents empirical evidence of a company that changed its organizational structure from a traditional bureaucracy to a structure that was fundamentally different from those of other firms within its industry. The changed structure was characterized by many novel attributes such as devolved responsibility, empowerment, community orientation and a lack of hierarchy. Although there was some evidence to suggest that the structure had positive performance implications, the study also finds that the content, context and process of change were influenced by a dominant managing director such that the outcomes masked underlying political issues. The article concludes by discussing the theoretical and practical implications of the findings.

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