“Transforming a caterpillar into a butterfly” (Ghoshal and Bartlett 1997: 270), this is the process many organizations have to and are undergoing these days. Organizations are converting themselves from the traditional, hierarchical organization into the contemporary organic, learning and individualized corporation (Kimberly and Bouchikhi 1995: 9). But (1) what are the attributes of these modern organizations? (2) What makes them so different from traditional organizations? (3) And how are they managed? Moreover, it comes with a painful impression to realize that the transformation from a caterpillar into butterfly is a struggling process. Therefore, (4) what are the underlying pressures and forces which simultaneously drive but also restrain the transformation into the modern organization (Ghoshal and Bartlett 1997: 270)? In this matter, Jack Welch is the best example by turning General Electric (GE) into the modern organization par excellence; resulting in GE’s extraordinary performance and an average annual growth of the stock rate of 18.1% since 1981 (industry average: 12.2%) (Lakshman 2005: 435, Kimberly and Bouchikhi 1995: 9, 16-17). There is no unique recipe to successfully guide this process. Simply reading and trying to copy 1:1 what Jack Welch did at GE will not function in any other organization - each organization is as unique as its people. For these reasons, it is important to understand the underlying principles of the modern organization in order to identify the answers to the questions stated above in order to determine organizational effectiveness (Besanko et al. 2004: 3). Moreover, this knowledge offers a powerful source in appropriately leading one’s organization to become and to be as agile as a start-up while still being able to rely on the potential resources of a large-scale caterpillar organization (Ghoshal and Bartlett 1997: 264-268). Thus, the goal of this paper is to create an in-depth understanding of the contemporary - the modern organization.
Table of Contents
- (I) Introduction
- (II) The Key Constituents of the Modern Organization
- (i) the flat organization
- (ii) the flexible organization
- (iii) the networked organization
- (iv) the diverse organization
- (v) the global organization
- (III) The Traditional vs. the Modern Organization: Differences and Dynamics
- (i) the traditional organization
- (ii) changing dynamics and forces
- (iii) the modern organization
- (IV) The Role of Management: Leading - Leveraging – Learning
- (V) Conclusion
Objectives and Key Themes
The objective of this paper is to provide an in-depth understanding of the modern organization, exploring its key characteristics and contrasting it with traditional organizational structures. The paper examines how the transformation to a modern organization presents both opportunities and challenges.
- Characteristics of the modern organization (flat, flexible, networked, diverse, global)
- Differences between traditional and modern organizational structures
- The role of management in leading, leveraging, and learning within a modern organization
- Pressures and forces driving and restraining the transformation to a modern organization
- The importance of organizational effectiveness in the transition.
Chapter Summaries
(I) Introduction: This introductory chapter sets the stage by framing the transformation from traditional, hierarchical organizations to contemporary, organic, learning, and individualized corporations. It poses key questions about the attributes of modern organizations, their differences from traditional structures, their management, and the pressures driving their evolution. The chapter uses General Electric's transformation under Jack Welch as a successful example, emphasizing that there is no single recipe for success and highlighting the importance of understanding underlying principles for organizational effectiveness. The chapter establishes the paper's goal of creating a comprehensive understanding of the modern organization.
(II) The Key Constituents of the Modern Organization: This chapter defines five key constituents of the contemporary organization: flat, flexible, networked, diverse, and global. It explores each constituent in detail, focusing on how they contribute to organizational success. The "flat organization" section discusses span of control and hierarchical levels, emphasizing that flatter organizations are generally more effective but requiring consideration of factors like work routine, employee training, and managerial capabilities. The "flexible organization" section explores the ability of organizations to adapt to new demands, connecting flexibility to organic organizational structures and decentralized decision-making. Finally, the "networked organization" section distinguishes between intra- and inter-firm networks, highlighting the importance of internal communication and the role of strategic alliances in leveraging core competencies.
Keywords
Modern organization, traditional organization, organizational structure, flat organization, flexible organization, networked organization, diverse organization, global organization, organizational effectiveness, management, transformation, organizational change, span of control, hierarchy, decentralization, strategic alliances, core competence.
Frequently Asked Questions: A Comprehensive Language Preview of Modern Organizations
What is the purpose of this document?
This document provides a comprehensive overview of modern organizations, contrasting them with traditional structures. It explores key characteristics, challenges, and opportunities associated with the transition to a modern organizational model.
What are the key topics covered in this document?
The document covers the following key areas: the characteristics of modern organizations (flat, flexible, networked, diverse, and global); the differences between traditional and modern organizational structures; the role of management in a modern organization (leading, leveraging, and learning); the pressures and forces driving and hindering organizational transformation; and the importance of organizational effectiveness during this transition.
What are the five key constituents of a modern organization, as described in the document?
The document identifies five key constituents of the modern organization: flat organizations (characterized by a reduced number of hierarchical levels and wider spans of control), flexible organizations (able to adapt to changing demands), networked organizations (relying on both internal and external collaborations), diverse organizations (embracing a variety of perspectives and backgrounds), and global organizations (operating across international borders).
How does the document compare traditional and modern organizations?
The document contrasts traditional, hierarchical organizational structures with modern, more organic and adaptable structures. It highlights the differences in decision-making processes, communication flows, and overall responsiveness to change.
What is the role of management in a modern organization?
The document emphasizes the crucial role of management in leading, leveraging resources effectively, and fostering continuous learning within the modern organization. It suggests that successful management in this context requires adaptability, a focus on collaboration, and a commitment to ongoing development.
What are some of the driving forces behind the transformation to modern organizations?
While not explicitly listed as a single section, the document implies that factors such as increased globalization, technological advancements, and the need for greater flexibility and adaptability are among the key forces driving the shift from traditional to modern organizational structures.
What is the significance of organizational effectiveness in the context of organizational transformation?
The document stresses the paramount importance of organizational effectiveness throughout the transition to a modern organizational model. It suggests that a successful transformation hinges on understanding and implementing strategies that enhance efficiency, adaptability, and overall performance.
What is the structure of this document?
The document is structured with an introduction, a section detailing the key constituents of the modern organization, a comparison of traditional and modern organizations, a section on the role of management, and a conclusion. Each section is further broken down into sub-sections providing detailed explanations.
What examples are used to illustrate the concepts discussed?
The document uses General Electric's transformation under Jack Welch as a case study to illustrate the successful transition to a modern organizational structure, emphasizing that while there is no single "recipe" for success, understanding core principles is crucial.
What are the key terms used in this document?
Key terms include: modern organization, traditional organization, organizational structure, flat organization, flexible organization, networked organization, diverse organization, global organization, organizational effectiveness, management, transformation, organizational change, span of control, hierarchy, decentralization, strategic alliances, and core competence.
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- Thomas Lagner (Autor:in), 2006, The Modern Organization - Their differences, their development and their management, München, GRIN Verlag, https://www.grin.com/document/62149
