The impact of digital transformation on formal and informal organizational structures of large architecture and engineering firms

Abstract

PurposeThe purpose of this paper is to understand the impact of digital technologies adoption on the forms of organization of large architecture and engineering (A/E) firms. Network theory has attracted scholarly and managerial attention, particularly from the perspective of the changes of project organization. However, little research focuses on network theory as a lens for understanding and managing the new forms of firms’ organization. Additionally, conventional organizational analyses are hampered by the lack of methods for understanding the changes in roles and relationships due to the adoption of digital technologies and examining their impact on organizational structures.Design/methodology/approachTo address this gap, this research adopted a mixed-method case-study approach. This approach combined interviews, regular check-ins, and document analysis with data mining and social network analysis (SNA) to capture the changes of intra-organizational roles and relationships and for understanding their impact on the firm’s organizational structure. Using the data gathered, the authors created a dendrogram that shows the formal organizational structure, a sociogram that displays the informal organizational structure and a network map that visualizes the interplay between the two structures.FindingsFrom this analysis, the authors identified four main findings: informal roles – as go-to people for advice and information about digital technologies – play within A/E firms facing digital transformation; such go-to people operate through informal networked relationships and beyond their formal roles; most of these relationships do not overlap with the formal reporting relationships; the combination of both these roles and relationships create an informal social network. The authors also show how managers can use SNA to understand the changes in roles and relationships due to the adoption of digital technologies and to diagnose their impact on organizational structures.Originality/valueThis research contributes to the literature of organizational design and change management from a network perspective in the context of the digital transformation of large A/E firms. It provides a systematic data-driven approach to understanding the changes of intra-organizational roles and relationships within A/E firms facing digital transformation and to diagnosing the impact of these changes on firms’ organizational structures.