Horizontal or Vertical: two views of the organization—which is right?

An image that we have used over and over again in recent years to explain the managerial implications of  the knowledge era is depicted in this graphic. It is an abstraction of the organization chart. Like an organization chart, the triangular figure is wider at the bottom where there are more people at the bottom working in units or on projects. There is a management level that connects the “worker” to the corporate or executive level. As you will see throughout the coming chapters, the shift to the knowledge era is necessitating greater emphasis on the bottom of this triangle.  Read more

Networks Are the New Organization Charts

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Organization chart
In the tangible economy, power and knowledge flowed primarily from the top down. An organization chart was used to explain how resources and authority were distributed. To show who reports to whom. What is the extent of the control of an individual manager? How are resources allocated? Just about every organization had and needed an organization chart.
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Our understanding of organizations continues to be influenced by the organization chart (org chart for short). It is a rare company that does not have one. And they are still used as a basic tool to understand the organization and to manage personnel. Every person in every organization needs to “report” to someone to, at a minimum, facilitate communication and personal development. But the org chart is losing its value along with a company’s financial statements—neither does a very good job at explaining how value is being created in the knowledge era. The task of putting knowledge to work does not fit inside the neat models that we have used in the past. Read more