I agree with what you write about integration difficulties... and You
ask..
"How can an organization identify those areas of integration that it most
needs to concentrate on, while not building barriers between those that
have "natural" connections? Maybe another way to phrase this is: How can
an organization be set up to promote both vertical and horizontal
integration?.... whether there are models of organizations that might help
determine an approach to working through this on a practical level."
I won't address the issue of matrix management which attempts to do just
this, as I my experience is limited in that area, although our consultancy
promotes this approach. However, our work with performance measurement
certainly has something to say about both the barriers/damage which
vertically functional organizations do, and about the basis of a more
horizontal component to organization. I'll briefly touch on these now.
We find that organizations which are dominated by functional structure and
cost allocation accounting, provide performance measures and career
rewards on the basis of localized measurements which largely do not
promote the overall success of the organization, but rather the movers and
shakers who are good at manipulating the numbers. This can be made much
worse when each functional unit is treated as an independent profit
centre. The reason for this is that the performance measures in such
organizations do not address the flow of causality which results in
profitable actions by the company, often the functional structure itself
introduces totally unnecessary delays in processing which lower throughput
and quality (because of poor feedback and identification of problems).
Hence, the causal flows which produce the strategic throughputs of the
organization should in our view, provide the basis of the horizontal
organizational component. When these causal flows can be easily
visualized and discussed, then the interrelatedness of the whole system
can be better recognized and appropriate actions and decisions taken. For
us, this then becomes an issue of providing smooth flows of production and
services throughout the organization, providing the next downstream
component with a smooth output at just the right rate which encourages
them to do the same for their downstream neighbour, etc. Performance
measures can be constructed to encourage this and the supportive behaviour
it generates within the organization.
It is rather like an important principle from the practice of Tai Chi,
which is to encourage a steady flow of action, "like pulling silk from a
cocoon." One avoids the use of force, and abrupt changes in rate of
movement.
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Dr. Doug Seeley: compuserve 100433,133... Fax: +41 22 756 3759
InterDynamics Pty. Ltd. (Australia) in Geneva, Switzerland
"Integrity is not merely an ideal; it is the only reality."