Exploring the Duality between Product and Organizational Architectures: A Test of the Mirroring Hypothesis

A variety of academic studies argue that a relationship exists between the structure of an organization and the design of the products that this organization produces. Specifically, products tend to "mirror" the architectures of the organizations in which they are developed. This dynamic occurs because the organization's governance structures, problem solving routines and communication patterns constrain the space in which it searches for new solutions. Such a relationship is important, given that product architecture has been shown to be an important predictor of product performance, product variety, process flexibility and even the path of industry evolution. We explore this relationship in the software industry. Our research takes advantage of a natural experiment, in that we observe products that fulfill the same function being developed by very different organizational forms. At one extreme are commercial software firms, in which the organizational participants are tightly-coupled, with respect to their goals, structure and behavior. At the other, are open source software communities, in which the participants are much more loosely-coupled by comparison. The mirroring hypothesis predicts that these different organizational forms will produce products with distinctly different architectures. Specifically, loosely-coupled organizations will develop more modular designs than tightly-coupled organizations. We test this hypothesis, using a sample of matched-pair products. We find strong evidence to support the mirroring hypothesis. In all of the pairs we examine, the product developed by the loosely-coupled organization is significantly more modular than the product from the tightly-coupled organization. We measure modularity by capturing the level of coupling between a product's components. The magnitude of the differences is substantial - up to a factor of eight, in terms of the potential for a design change in one component to propagate to others. Our results have significant managerial implications, in highlighting the impact of organizational design decisions on the technical structure of the artifacts that these organizations subsequently develop.Organizational Design, Product Design, Architecture, Modularity, Open-Source Software.

TESNA: A Tool for Detecting Coordination Problems

Detecting problems in coordination can prove to be very difficult. This is especially true in large globally distributed environments where the Software Development can quickly go out of the Project Manager’s control. In this paper we outline a methodology to analyse the socio-technical coordination structures. We also show how this can be made easier with the help of a tool called TESNA that we have developed

Coordination Implications of Software Coupling in Open Source Projects

The effect of software coupling on the quality of software has been studied quite widely since the seminal paper on software modularity by Parnas [1]. However, the effect of the increase in software coupling on the coordination of the developers has not been researched as much. In commercial software development environments there normally are coordination mechanisms in place to manage the coordination requirements due to software dependencies. But, in the case of Open Source software such coordination mechanisms are harder to implement, as the developers tend to rely solely on electronic means of communication. Hence, an understanding of the changing coordination requirements is essential to the management of an Open Source project. In this paper we study the effect of changes in software coupling on the coordination requirements in a case study of a popular Open Source project called JBoss

Hierarchy and Misalignments in Complex New Product Development Projects

Developing complex new products requires firms to break down the product into subsystems and create an organizational structure which ideally mirrors the product architecture. However, empirical evidence on the mirroring hypothesis is mixed and misalignments occur in the product and the corresponding organizational architectures. Misalignments take two general forms: (1) a missing link between two teams responsible for two interacting subsystems results in an unmatched interface and (2) two teams interacting without a link between their respective subsystems cause an unmatched interaction. In a model of product design as a search on a rugged landscape, we model misalignments as design teams searching on a “perceived” rather than “real” landscape. As a consequence, type-I or type-II errors are likely whereby the former causes the teams to reject superior designs and the latter to accept inferior designs. We study the performance deterioration by two measures: the magnitude and frequency of errors. We show that unmatched interactions cause a higher type-I error both in magnitude and frequency. Unmatched interactions and interfaces cause the same magnitude of type-II error but unmatched interfaces cause a higher frequency of type-II error. We further study how misalignments affect the convergence behavior of the search process, i.e., the time to converge and the quality of the final design. We find that misalignments affect, though not necessarily increase, the convergence time significantly but they are not a critical factor in the final design quality. We discuss the managerial implications of our results for the new product development projects

Governance-technology co-evolution and misalignment in the electricity industry

This paper explores some reasons why the alignment between governance and technology in infrastructures may be unstable or not easy to achieve. Focusing on the electricity industry, we claim that the decentralization of governance – an essential step towards a decentralized technical coordination - may be hampered by if deregulation magnifies behavioural uncertainties and asset specificities; and that in a technically decentralized system, political demand for centralized coordination may arise if the players are able to collude and lobby, and if such practices lead to higher electricity rates and lower efficiency. Our claims are supported by insights coming from approaches as diverse as transaction cost economics, the competence-based view of the firm, and political economy.Governance; Technology; Coherence; Competence; Transaction costs; Regulation.

Exploring the Misalignment between Business and Information Technology on the Implementation of Balanced Scorecard: Case Study of State-Owned Telecommunication Companies in Indonesia

Many organisations around the world have faced misalignment in attaining the alignment between business and IT. The positive effect of alignment on overall company success has been focused on previous research. On the other hand, the misalignment in the implementation of a balanced scorecard was primarily unexplored. This study aimed at identifying and evaluating the factors that contribute to a misalignment of businesses and IT. The case study methodology is conducted in two state-owned telecommunication companies in Indonesia. The telecommunication industry’s selection as the case study is because of their nature closely related to technology development and implementation. Five semi-structured interviews, field notes and business records are used to produce the data, which have been thematically analysed and further follow by cross-case analysis to compare the thematic analysis result from each company. This study has resulted in 12 factors of misalignment between business and IT that can inhibit achieving alignment in implementing a balanced scorecard. The main findings showed that human factors, enterprise architecture, and IT project implementation factors could be three main source themes that can potentially contribute to misalignment. The findings may allow researchers to devise frameworks for how misalignments can be minimised to align business and IT better. This finding also useful in practice for companies that are seeking to achieve business-IT alignment by focusing on human factors, enterprise architecture factors, and IT project implementation factors

Characterizing Design Process Interfaces as Organization Networks: Insights for Engineering Systems Management

The engineering design literature has provided guidance on how to identify and analyze design activities and their information dependencies. However, a systematic characterization of process interfaces between engineering design activities is missing, and the impact of structural and compositional aspects of interfaces on process performance is unclear. To fill these gaps, we propose a new approach that characterizes process interfaces as organization networks consisting of people and their interactions when performing interfacing activities. Furthermore, we provide guidance on how to test and interpret the effect of those characteristics on interface problems. As a result, we show how structural and compositional aspects of the organization networks between information-dependent activities provide valuable insights to better manage complex engineering design processes. The proposed approach is applied to the development of a power plant, analyzing 79 process interfaces. The study reveals a relationship between the structure and composition of the process interfaces and reported interface problems. Implications of this approach include the integration of information about process and organization architectures, the systematic identification of key performance metrics associated with interface problems, and improved support for engineering managers by means of a better overview of information flows between activities