Year: 2019
Type: article
Abstract: In this paper I analyze the circumstances that limit replacement of large companies by network organizations. It is noted that the network organizations themselves often have hierarchical qualities that is shown in subordination of partners in network. In particular, I investigate how the variability of the economic environment influences the rational balance of centralization and decentralization in coordination of economic activity. Dynamic qualities of the environment when comparing organizational structures at first are hold fixed, then — vary. It is shown that the decentralization is not the universal answer to the variability of the economic environment. However, the combination of elements of the hierarchical and network relations within large firms promotes their adaptation to the changing dynamic qualities of the environment. Such combination helps business diversification, transition to formation of new markets instead of adaptation to market conditions. As a result, I present organizational measures of the companies implementing the strategy of “the blue ocean”.
Source: Russian Management Journal
Author: Victor E. Dementiev
Institution: Central Economics and Mathematics Institute
Language: English
Subfield: Management of Technology and Innovation
Domain: Social Sciences
Open Access status: diamond
OpenAlex ID: W2995028128