Building Flexible Organizations for Fast-moving Markets

By considering flexibility as a valuable strategic option in turbulent environments, this article distinguishes four types of effective response to strategic change. From this typology different trajectories of revitalization are derived. On the basis of this typology, the article describes a method for diagnosing organizational flexibility and guiding the transition process, the Flexibility Audit & Redesign (FAR) method. This method was applied successfully within the Dutch Postbank NV, Philips Semiconductors and the Dutch National Gas Corporation. The findings suggest that a viable corporation has to oscillate between ‘planned’ and ‘flexible’ forms. In this process of change, the corporation has to prevent itself from overshooting and becoming extremely rigid or chaotic

Change for change’s sake?

__Abstract__ In today’s increasingly volatile business environment, senior managers have to stay one step ahead by making the necessary internal organisational and strategic decisions, before it is too late to react to external changes

Beyond Adaptation-Selection Research: Organizing Self-Renewal in Co-Evolving Environments

Special Research Symposium BEYOND ADAPTATION VS. SELECTION RESEARCH: ORGANIZING SELF-RENEWAL IN CO-EVOLVING ENVIRONMENTS Guest Editors Arie Y. Lewin and Henk W. Volberd

On the Concept of Flexibility: A Dual Control Perspective

Organizational flexibility has recently received much attention from researchers, management consultants and practitioners. In general, the term 'flexibility' has a positive connotation: flexible organizations are the better ones. However, the meaning of flexibility as well as its relation to the functioning of an organization is still ambiguous. This article develops a systematic and multidimensional picture of flexibility on the basis of views taken from the systems theory of control. The general idea is that flexibility can be analysed as a characteristic of some dual and relative control relation between the organization and its environment, which fosters organizational independence. It is argued that flexibility is a function of the control capability of the management as well as the controllability of the organization. Flexibility is thus concerned with the promotion of the management's control capability or competence. The management's ability to allocate and use this capacity with success, however, is dependent upon organizational conditions that determine the controllability. The organization design task, therefore, involves the creation of appropriate organizational conditions to foster flexibility. This article clarifies the paradoxical nature of flexibility and the existence of different types of flexibility. Copyrigh

Rethinking the Dutch Innovation Agenda: Management and Organization Matter Most

In this essay, we challenge the present dominant emphasis in the Dutch Innovation Debate on the creation of technological innovations, the focus on a few core technologies, and the allocation of more financial resources. We argue that managerial capabilities and organizing principles for innovation should have a higher priority on the Dutch Innovation Agenda. Managerial capabilities for innovation deal with cognitive elements such as the capacity to absorb knowledge, create entrepreneurial mindsets, and facilitate managerial experimentation and higher-order learning abilities. These capacities can only be developed by distinctive managerial roles that enhance hierarchy, teaming and shared norms. Utilizing these unique managerial capabilities requires novel organizing principles, such as managing internal rates of change, nurturing self-organization and balancing high levels of exploration and exploitation. These managerial capabilities and organizing principles of innovation create new sources of productivity growth and competitive advantage. The dramatic fall back of the Netherlands in the league of innovative and high productivity countries of the World Economic Forum-Report can be mainly attributed to the present lack in the Netherlands of these key managerial and organizational enablers of innovation and productivity growth. We provide various levers for building unique managerial capabilities and novel organizing principles of innovation. Moreover, we describe the necessary roles that different actors have to play in this innovation arena. In particular, we focus on the often neglected but important role of strategic regulations that speed up innovation and productivity growth. They are the least expensive way to boost innovation in organizations in both the Dutch private and public sector. Finally, we discuss the implications for the Dutch Innovation Agenda. It should start with setting a challenging ambition, namely the return of The Netherlands within the WEF- league of the top-ten most innovative and productive countries of the world. Considering the under-utilization of available knowledge stemming from technological innovations, managerial and organizational determinants of innovation should receive first priority. These determinants have a high strategic relevance and should receive more public recognition. We suggest to organize an annual innovation ranking of the most outstanding Dutch firms, to develop an innovation audit that measures firms’ non-technological innovation capacity, and to create an overall innovation policy for fast diffusion of new managerial capabilities and adequate organizing principles throughout the Dutch private and public sector. In conclusion, we add five new items to the Dutch Innovation Agenda: 1. Prioritize administrative innovations Investments in management and organization determinants of absorption of knowledge and its successful application (administrative innovation) should have a higher priority than investments in technological innovations. 2. Build new managerial capabilities and develop novel organizing principles For these administrative innovations to succeed, firms have to build managerial capabilities (broad knowledge-base, absorptive capacity, managerial experimentation, higher-order learning) and various management roles (hierarchy, teaming, shared norms) to increase the assimilation of external knowledge and the utilization for innovation. Moreover, they have to develop novel organizing principles that increase internal rates of change, nurture self-organization and synchronize high levels of exploration and exploitation. 3. Set levers of innovation by creating selection environments that favor innovation and by redefining the roles of key actors Management has to create a proper organizational context to foster entrepreneurship and innovation (internal selection environment). Governmental agencies have to focus on innovation and productivity enabling strategic regulations (external selection environment). Moreover, research institutes, business schools, and consulting firms should not only focus on technological knowledge, but also on managerial and organizational knowledge for innovation. In the end, private small and large firms and public institutions have to recognize that they all must contribute to the national goal of increasing innovation and productivity growth. 4. Create a new challenging national ambition: return of the Netherlands within the top-10 The Netherlands has to return to the top-ten most innovative and productive countries in the world as reflected in international rankings such as the World Economic Forum’s Global Competitiveness Index. 5. Proliferate an awareness and passion for innovation: Create public awareness and recognition of the societal relevance of outstanding managerial capabilities and organizing principles to innovation and productivity growth: o Initiate a Dutch innovation ranking in terms of management and organization; o Develop proper assessment tools for innovations in management and organization; o Enhance reporting on the progress on managerial and organizational innovation as part of modern corporate governance and as part of outstanding annual reports. These issues may contribute to rethinking the fundamental sources of innovation, productivity growth and sustainable competitive advantage of the Dutch economy