Information, Organization, and Leadership: On the Way to the Boundaryless Enterprise

We are used to thinking of companies as self-contained, integrated entities. They are physically located in office buildings and factories where their members operate and where the necessary materials, machines, and other resources are located. The physical location structures and the labor or corporate contractual relationships between the members of the enterprise generally define the boundaries of an enterprise. Of course, a venture crosses these boundaries all the time by operating in markets, e.g., procuring materials, selling products or services, or raising or investing capital. But these boundary crossings correspond to a clear notion of inside and outside, of belonging and not belonging, of interfaces between enterprise and markets. Large parts of the economy no longer correspond to this corporate model, which is also the basis of many textbooks. Modular, agile organizations, networks and cooperations, electronic markets, platforms, telecooperations, and virtual organizational structures have become reality. The classic boundaries of the enterprise are beginning to blur, to change both internally and externally, and in some cases to dissolve. Deeply tiered corporate hierarchies that function primarily according to command and control are increasingly being replaced by decentralized, modular structures characterized by autonomy, cooperation, and indirect leadership. This development is closely linked to changes in competition, technology, and values.