Microfoundations of Organizational Agility: A Socio-Technical Perspective

Abstract

To be agile, organization need to be able to quickly reconfigure their internal resources in order to respond to changes occurring in their environment. In this paper, we draw on the theories of organizational routines and technology affordances to explicate the internal socio-technical “machinery”—the people, processes, and technology—that, in response to an external change, an organization must reconfigure and redirect to achieve new organizational imperatives. The paper contributes a novel multi-level theory that recognizes behavior at the human individual (micro-) level as a causal factor in the macro-level phenomenon of agility. We illustrate and validate the theoretical model with case studies that represent three large organizations that exist in dynamic business environments that demand agility. The research suggests that business processes in the organization evolve both via top-down design and bottom-up practice routinization and further that the need for flexibility drives the tension between them. By elucidating microfoundational mechanisms, the theory defines a stronger causality model for explaining organizational agility phenomena.