Mason School of Business, College of William and Mary
Structure has been a central focus of organization theory from its beginnings in the 1890s when Max Weber defined managers' choice as "bureaucracy or dilettantism". Bureaucracy centered on structural means—assignment of responsibility, reporting relationships, and decision authority, for instance—to control variance in behavior and information, assuring appropriate assignment of attention and responsibility for clearly identified tasks. Yet Another view suggests that, while rules and routines help for some tasks, they offer little to address unpredictable circumstances or to facilitate innovation. Both have become increasingly central to business, as indicated in IBM's surveys of global executives, who repeatedly point to internally generated innovation as their key concern. Meanwhile, new products, services, and technologies, new global competitors and methods roil markets and demand fresh responses. Moreover, products and more recently services have become increasingly complex, intertwined with customers' (or customers' customers') needs and organizations. So, how can firms organize for innovation? Many do so by emphasizing networks of relationships beyond traditional organizational boundaries, as we shall show.
This chapter will begin with an account of how organizing for innovation has moved from classic emphasis on structures to systems to teams (increasingly, to virtual ...