Turn Your Company Outside-In! How to Build the Empowered Network Organization, Guided by Beyond Budgeting Principles: A Practical Paper on Cell Structure Design, Part II

Abstract

In the first part of this paper, we explained the rationale for a different, non-tayloristic, way to structuring organizations – leading to the question of how to build organizations capable of (1) accommodating human beings, and (2) competing in today's dynamic and non-linear market-places. We described why previous ideas such as systems theory failed in creating significant momentum for change in organizational practice, and outlined the design principles that decentralized, networked cell structure organizations must adhere to. We detailed the ingredients of such structures, which include (1) a sphere of activity, (2) network cells, (3) strings and (4) market pull. Finally, we described some of the consequences of applying such a design, highlighting key advantages as well.In the 2nd part of this paper, we describe two cases from the author's consulting practice, in which tayloristic command and control organizations were redesigned as decentralized networks. Finally, we derive conclusions for network design within an organizational transformation process.