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Strategic Design In New Organizations

             The change from an old form organization to a new one, through the strategic design perspective.
             I chose the strategic design perspective because it seemed like the most obvious and transparent one, and because the changes being made in new organizations are changes in the system (design) and in the means of achieving the goal (strategy).
             One of the key features of the new organization is the emphasis placed on team work and especially their cross-functionality. This is best explained with the first element of organizational design: strategic grouping. "Old" firms were grouped mostly by activity, "new" ones are grouped by output, customer and geography. Grouping by output means bringing individuals with different tasks but who contribute to one final product. This goes along with the idea of networking. The wider the product line the more there is a need for output grouping. Activity grouping, on the other side, would be more advantageous in companies with a less diverse product line. I can't see a great need for output grouping for companies like Coca-cola. With one or few major products, and with little change in markets and customers it doesn't need the responsiveness of the networked organization. Its being global, however, commands grouping by geography.
             The new "flat" organization eliminates levels of middle management and gives more power to the lower level groups. The internal strategic linking changed with a need for a more flat design. The strict hierarchy and order giving of the "old" gave way to a system of sharing information, which became the key ingredient in the modern company. The old hierarchy and reporting structures were simple and easily controlled, but had some major limitations. Managers on top of the pyramid can become overloaded and therefore delay the decision making. Information travelling through many layers may be distorted by the time it gets to the recipient.

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