Preface for the Third Edition - Read

6. Organization 159
requiring the design of extensive communication and coordination processes in
order to guarantee the free flow of information and knowledge between organizational
units, especially in a dynamic, unstable competitive environment 287 . Multidimensional
organizational structures were proposed as a solution to this problem.
This form of the organizational design is also called the matrix organization and
structures the organization with respect to two or more dimensions at the same
time. Examples are functions and projects or functions and regions 288 . Recently,
there have been numerous approaches for alternatives to the traditional organizational
design that pay attention to the management of knowledge. Examples are 289 :
Infinitely flat organization. Ideally, an infinite number of equally ranking organizational
units is grouped around a center which coordinates the activities, serves as
a knowledge source, develops specific competencies and transfers best practices.
Examples are franchising companies.
Inverted organization. The inverted organization turns the traditional organizational
pyramid upside down. Core competencies as well as knowledge about customers
resides in the leaves of the tree, not at the center of the organization (management).
Knowledge is exchanged primarily informally, horizontally between the
experts who are in contact with customers as well as formally, vertically with the
“lower levels of the hierarchy”, i.e., with management in order to develop an organizational
knowledge base. Management primarily provides a logistic and administrative
infrastructure for the experts. Examples are hospitals or professional services
companies.
Hypertext organization 290 . In this perspective, the well-known metaphor of a
hypertext document 291 is used to denote the synthesis of the traditional hierarchical
organizational structure with non-hierarchical, self-organizing structures in order
to combine efficiency and stability of the hierarchy with dynamism and flexibility
of cross-functional task forces. The design of these two systems of activities should
enable the organization to shift efficiently and effectively between these two forms
of knowledge creation. While the hierarchical organization primarily performs
combination and internalization of knowledge, the self-organizing teams perform
287. For a brief summary see e.g., Frese 1992, 1681, also Rehäuser/Krcmar 1996, 26.
288. There is a lot of literature on the matrix organization. The approach was developed in
the 70s and was a popular approach receiving a lot of attention in the organization science
literature in the 80s and early 90s, see e.g., Galbraith 1971, Reber/Strehl 1988,
Scholz 1992, Schreyögg 1999, 176ff.
289. See e.g., Quinn 1992, 113ff, Nonaka 1994, 32f, Rehäuser/Krcmar 1996, 26ff, North
1998, 79ff, Schreyögg 1999, 194ff and 254ff.
290. The idea of the hypertext organization was developed by Nonaka, Konno, Tokuoka, and
Kawamura and presented in the journal Diamond Harvard Business in 1992 in Japanese
(Nonaka 1994, 32ff).
291. A hypertext document is a text document that contains hyperlinks. Hyperlinks are connectors
to other documents with the help of cross-references to their URL that can be
activated by a mouse-click (Horn 1999, 380, also Mertens et al. 1997, 191f).