Innovation Perspectives – Mechanistic or Organic?
Innovation Perspectives – Mechanistic or Organic?
This is the seventh of several ‘Innovation Perspectives‘ articles we will publish this week from multiple authors to get different perspectives on ‘How should firms develop the organizational structure, culture, and incentives (e.g., for teams) to encourage successful innovation?’. Here is the next perspective in the series: by Willings Botha and Andreas Constantinides
Innovation is one of the most important pillars on which successful companies rely on. Employees are the vital component in the innovation equation. Therefore, it is of utmost importance for a firm to have the right organizational structure, culture and incentives in place in order to allow its employees to be innovative and perform to their maximum ability.
Organisational structures can be classified as either mechanistic or organic. Mechanistic structures have high degrees of formalization and standardization and information flow tends to be unidirectional top-down. Furthermore, employees in mechanistic structures are constrained to conform to their job descriptions and there is tight control through sophisticated control systems. On the other hand, organic structures tend to be more free-flowing and have low degrees of formalization and standardization. Employees with expertise and knowledge are influential, irrespective of their hierarchical position. The communication channels in organic structures are open and allow free information flow and exchange of ideas. Practice has shown that organic structures are more conducive in promoting and recognizing the potential for innovations.
Organisational culture is also a very important characteristic of innovative firms. The general firm culture should be inspiring to employees, encourage risk-taking and experimentation and tolerate failure. Employees should learn from failures in order to improve chances of success in the future. The firm should also put great emphasis in training and education of
This is the seventh of several ‘Innovation Perspectives‘ articles we will publish this week from multiple authors to get different perspectives on ‘How should firms develop the organizational structure, culture, and incentives (e.g., for teams) to encourage successful innovation?’. Here is the next perspective in the series: by Willings Botha and Andreas Constantinides
Innovation is one of the most important pillars on which successful companies rely on. Employees are the vital component in the innovation equation. Therefore, it is of utmost importance for a firm to have the right organizational structure, culture and incentives in place in order to allow its employees to be innovative and perform to their maximum ability.
Organisational structures can be classified as either mechanistic or organic. Mechanistic structures have high degrees of formalization and standardization and information flow tends to be unidirectional top-down. Furthermore, employees in mechanistic structures are constrained to conform to their job descriptions and there is tight control through sophisticated control systems. On the other hand, organic structures tend to be more free-flowing and have low degrees of formalization and standardization. Employees with expertise and knowledge are influential, irrespective of their hierarchical position. The communication channels in organic structures are open and allow free information flow and exchange of ideas. Practice has shown that organic structures are more conducive in promoting and recognizing the potential for innovations.
Organisational culture is also a very important characteristic of innovative firms. The general firm culture should be inspiring to employees, encourage risk-taking and experimentation and tolerate failure. Employees should learn from failures in order to improve chances of success in the future. The firm should also put great emphasis in training and education of