From a Traditional to a Networking Organization: The Role of Information and Communication Technologies

Abstract

The development of Information and Communication Technologies (ICT) resulted in transforming the traditional hierarchical organizations into networking flexible ones. In the circumstances of identifying a new type of organizations, the notions as ‘organization’ and ‘synergy’ should be revised. The organizations with individual elements that build up a network have altered their attitude towards the problem of a global optimum. Individual elements that can be called ‘junctions,’ strive to optimize local optima instead of the traditionally approached global optimum. The article offers a hypothesis that a networking organization is formed when all its elements gain profits. What is needed to form it is the consensus of all the constituent elements. The management of networking organization is supported by the contemporary ICT tools that help to manage the network. Intellectual capital is the most important element of a networking organization. A new organizational form is becoming fully competitive against traditional organizations with the fixed position in the market. A comparison of the model of business functioning of a traditional and a networking organization has been made. The model shows what economic conditions should be met to form networking organizations. It presents as well practical examples of relations between traditional and networking organizations. The suggested further research into the issue has been outlined in the text.