The flow of communication through the network of an organization can be visualized by an "organizational chart." Such charts are composed of "nodes" and "lines." Nodes are both "senders" and "receivers." Since senders also receive messages, and receivers also send messages, we can think of a node as a "sender/receiver." A node may be a single person, but it is more often a group of people, or a "department." Lines are the channels of communication open between nodes.
Let's take the example of the FP Corporation, a Japanese company that manufactures polystyrene packaging for the foodservice industry. Take a look at FP's organizational chart here. Can you spot the nodes and the lines? Pretty simple huh?
Traditional organizations, especially those involved in heavy manufacturing, tend to have a hierarchical structure, with many different tiers in the hierarchy. In traditional organizations, the lines of communication are mostly vertical, linking nodes higher up to nodes further down. Traditional organizations don't have many horizontal lines of communication (that is, nodes on the same hierarchical level don't have channels of communication). One of the advantages of this vertical line structure is that it creates a high degree of accountability. If something goes wrong with one of the nodes (let's say a node that represents a manufacturing facility) it is easy to trace responsibility—you just follow the line up to the node above it in the hierarchy, and assign blame there. In traditional organizations, higher nodes are responsible for lower nodes, and lower nodes only communicate with nodes directly above them in the hierarchy.
One of the problems with traditional organizations is that they can't respond to change quickly. Since the lines of communication are so rigid (the lines are often unidirectional: messages flow from top to bottom easier than from bottom to top) and since there are only vertical lines (messages cannot flow horizontally from node to node) it is difficult for such organizations to communicate changes or implement innovations. An innovation developed in one lower-level manufacturing node, for example, must must be transmitted up a vertical chain of command, through middle management nodes, to a central management node, and then back down another vertical chain of command to reach another manufacturing node. The more nodes a message passes through, the greater the amount of time the message takes to arrive, and the greater the chance that noise will be introduced into the message (think of the old "telephone" game).
Modern organizations, especially those in fast-moving industries like high tech, tend to use less rigid and hierarchical organizational structures. They open up horizontal lines of communication and they allow flexibility in developing new lines between nodes at all levels. They may even deconstruct the node itself, by forming ad hoc teams composed of people from different nodes to lead a particular project.
Most traditional organizations practice vertical integration, which means basically that they own all of their nodes. At the old Ford Motor Company plant in Dearborn, Michigan, steel and rubber would be brought in at one end of a single manufacturing complex and Model-T's would roll out of the other end. Most companies today, however, use outsourcing, which means that part of their manufacturing process or even customer service or information technology functions, may be handled by a different company, maybe one thousands of miles away (how many of you have called your New York bank only to end up talking to a customer service rep in New Delhi?!).
When it comes to manufacturing in particular, from the personal computer industry to the automotive industry, most companies are adopting a global supply chain. In fact, many "New Economy" companies (Dell is nonpareil in this regard) own very little besides the logistics of managing the supply chain. This type of organizational structure, which frees the company of the costly capital expenses associated with owning, maintaining, and periodically retooling manufacturing facilities has been called the "Command and Control" model. Such a model has advantages and disadvantages.
- Assignment Details
- The essay "Unmade in America: The True Cost of the Global Assembly Line," discusses problems with the "Command and Control" model. Read the essay here, then post a discussion of some of the problems the author details. [Update: I mean the problems with the "Command and Control" model, which relies on outsourcing, not problems with "globalization" in general.]
Length: at least 250 words.
Links: 4 (2 to classmates' posts; 2 to outside web sources).