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A Relational Approach to Organization Design

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  • Anna Grandori
  • Giuseppe Soda

Abstract

The paper criticizes the currently dominant view of organization forms as “discrete alternatives” and “coherent” set attributes, and proposes a more refined and micro-analytic view of organization forms as particular combinations of coordination mechanisms and rights allocations. This view is relevant for understanding and devising “new” forms and proposing solutions for governing the composite and fast changing systems of today. The view is “relational” as it offers a procedure for devising “superior” configurations as combinations—relations between organizational components—in a quasi-continuous space of possibilities. The approach is sustained by the quantitative methods of network analysis as applied to relations among firm's resources and activities. Theoretically, the approach revisits organization design, integrating classic organization theory tenets with the new inputs provided by organizational economics. Substantively, it is argued that a mix of much differentiated coordination mechanisms is usually superior to the codified, “packaged”, allegedly “coherent”, forms of organization. The procedure presented in the paper is applied to a field experiment in a medium size firm.1

Suggested Citation

  • Anna Grandori & Giuseppe Soda, 2006. "A Relational Approach to Organization Design," Industry and Innovation, Taylor & Francis Journals, vol. 13(2), pages 151-172.
    • Handle: RePEc:taf:indinn:v:13:y:2006:i:2:p:151-172
    DOI: 10.1080/13662710600684316
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    References listed on IDEAS

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    1. Casson, Mark, 1991. "The Economics of Business Culture: Game Theory, Transaction Costs, and Economic Performance," OUP Catalogue, Oxford University Press, number 9780198283751.
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    1. Dietrichson, Jens & Gudmundsson, Jens & Jochem, Torsten, 2022. "Why don’t we talk about it? Communication and coordination in teams," Journal of Economic Behavior & Organization, Elsevier, vol. 197(C), pages 257-278.
    2. Eresia-Eke CE & Makore S, 2016. "Responsiveness to Knowledge and Organisational Performance of Listed-Companies in the Construction Sector," Journal of Economics and Behavioral Studies, AMH International, vol. 8(5), pages 82-90.
    3. Dietrichson, Jens & Jochem, Torsten, 2014. "Organizational coordination and costly communication with boundedly rational agents," Comparative Institutional Analysis Working Paper Series 2014:1, Lund University, Comparative Institutional Analysis, School of Economics and Management.
    4. Phanish Puranam & Marlo Raveendran, 2013. "Interdependence and organization design," Chapters, in: Anna Grandori (ed.), Handbook of Economic Organization, chapter 11, Edward Elgar Publishing.
    5. Dietrichson, Jens & Gudmundsson, Jens & Jochem, Torsten, 2014. "Let's Talk It Over: Communication and Coordination in Teams," Working Papers 2014:2, Lund University, Department of Economics, revised 18 Apr 2018.
    6. Rosa Grimaldi & Elisa Mattarelli & Andrea Prencipe & Maximilian von Zedtwitz, 2010. "Offshoring of Intangibles: Organizational and Strategic Issues," Industry and Innovation, Taylor & Francis Journals, vol. 17(4), pages 331-336.
    7. Jetta Frost & Rick Vogel & Khaled Bagban, 2016. "Managing Interdependence in Multi-business Organizations," Schmalenbach Business Review, Springer;Schmalenbach-Gesellschaft, vol. 17(2), pages 225-260, August.
    8. Emil Inauen & Margit Osterloh & Bruno Frey & Fabian Homberg, 2015. "How a multiple orientation of control reduces governance failures: a focus on monastic auditing," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 19(4), pages 763-796, November.
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