Construction of digital 3D magic-cube organization structure for innovation-driven manufacturing

Abstract

Owing to the heterogeneity between functional units and resource scarcity, manufacturing firms have been struggling with intra-organizational coordination for productivity and innovation. Traditional organizational structures, such as linear-functional and matrix, may cause responsibility division and independent goals (Shahani, 2020), and are more difficult to be adopted by large-sized innovative manufacturing firms for quantity production. This is based on a review of several new forms of organization (i.e., network organization, multiteam system, and platform organization) compared with the traditional forms of organization (i.e., linear, matrix, and business unit organization, among others). This study proposes a three-dimensional (3D) magic-cube organizational structure, considering the product dimensions, business, and administration. Moreover, the characteristics, propositions of system operation, system dynamic model, and working model of the 3D magic-cube organization are described. Finally, the 3D model is applied in a Chinese manufacturing firm to test its effectiveness. By redesigning the post and pay system, the pilot organization establishes a project-driven and cross-functional coordination mechanism, positively affecting the firm’s financial profit, output value, labor productivity, and income of per capita. The proposed 3D model can be adopted by large- or medium-sized manufacturing firms for product development and innovation. The implications of both practice and theory are also discussed in this study.

Graphical abstract

Keywords

innovation / manufacturing / 3D magic-cube organization structure / coordination

References

[1] Adler, R Hiromoto, T (2012). Amoeba management: Lessons from Japan’s Kyocera. MIT Sloan Management Review, 54( 1): 83–89

[2] Adler, R Hiromoto, T Suzuki, H (2020). Amoeba management and organizational ambidexterity: Similarities, differences, and implications for organizational fit and success. International Journal of Productivity and Performance Management, 69( 2): 405–427

[3] AnnosiM CBrunettaF (2017). New Organizational Forms, Controls, and Institutions: Understanding the Tensions in “Post-Bureaucratic” Organizations. Cham: Palgrave Macmillan

[4] Cennamo, C Santalo, J (2013). Platform competition: Strategic trade-offs in platform markets. Strategic Management Journal, 34( 11): 1331–1350

[5] Ciborra, C U (1996). The platform organization: Recombining strategies, structures, and surprises. Organization Science, 7( 2): 103–118

[6] Clement, J Puranam, P (2018). Searching for structure: Formal organization design as a guide to network evolution. Management Science, 64( 8): 3879–3895

[7] Cross, R L Yan, A Louis, M R (2000). Boundary activities in “Boundaryless” organizations: A case study of a transformation to a team-based structure. Human Relations, 53( 6): 841–868

[8] Cusumano, M A Yoffie, D B Gawer, A (2020). The future of platforms. MIT Sloan Management Review, 61( 3): 46–54

[9] Damanpour, F (1991). Organizational innovation: A meta-analysis of effects of determinants and moderators. Academy of Management Journal, 34( 3): 555–590

[10] Daugherty, P J Chen, H Ferrin, B G (2011). Organizational structure and logistics service innovation. International Journal of Logistics Management, 22( 1): 26–51

[11] Davison, R B Hollenbeck, J R Barnes, C M Sleesman, D J Ilgen, D R (2012). Coordinated action in multiteam systems. Journal of Applied Psychology, 97( 4): 808–824

[12] de Vries, T A Walter, F van der Vegt, G S Essens, P J M D (2014). Antecedents of individuals’ interteam coordination: Broad functional experiences as a mixed blessing. Academy of Management Journal, 57( 5): 1334–1359

[13] Duncan, R (1979). What is the right organization structure? Decision tree analysis provides the answer. Organizational Dynamics, 7( 3): 59–80

[14] Gawer, A (2014). Bridging differing perspectives on technological platforms: Toward an integrative framework. Research Policy, 43( 7): 1239–1249

[15] Ghislanzoni, G Penttinen, R Turnbull, D (2008). The multilocal challenge: Managing cross-border functions. McKinsey Quarterly, 2: 70–81

[16] Iranmanesh, M Kumar, K M Foroughi, B Mavi, R K Min, N H (2021). The impacts of organizational structure on operational performance through innovation capability: Innovative culture as moderator. Review of Managerial Science, 15( 7): 1885–1911

[17] Kellogg, K C Valentine, M A Christin, A (2020). Algorithms at work: The new contested terrain of control. Academy of Management Annals, 14( 1): 366–410

[18] Kogut, B Zander, U (1992). Knowledge of the firm, combinative capabilities, and the replication of technology. Organization Science, 3( 3): 383–397

[19] Lawler, E E Worley, C G (2006). Designing organizations that are built to change. MIT Sloan Management Review, 48( 1): 19–23

[20] Lewin, A Y Volberda, H W (1999). Prolegomena on co-evolution: A framework for research on strategy and new organizational forms. Organization Science, 10( 5): 519–534

[21] Li, C Tao, Y (2016). How to obtain line manager’s identification with HR issues? The influence of HR manager’s on business department manager’s commitment. Human Resources Development of China, 360( 18): 42–50

[22] Li, D H (2000). History, present and future for the change of enterprise organization structure. Journal of Tsinghua University (Philosophy and Social Sciences), 15( 3): 27–33

[23] Li, P Yang, Z Y (2018). “Three platforms”: A future-oriented ecological organization paradigm. Business Review, ( 11): 92–105

[24] Lin, R H Li, W A (2000). Network organization: An organization model well adapting to the environment. Nankai Business Review, ( 3): 4–7

[25] Lu, Y Ramamurthy, K (2011). Understanding the link between information technology capability and organizational agility: An empirical examination. Management Information Systems Quarterly, 35( 4): 931–954

[26] Mathieu, J E Marks, M A Zaccaro, S J (2001). Multi-team systems. In: Anderson N, Ones D S, Sinangil H K, Viswesvaran C, eds. Handbook of Industrial, Work and Organizational Psychology. London: Sage, 289–313

[27] Mei, S E Xie, G (2013). Client-internal business/IT alignment, governance of IT outsourcing relationships and service quality. Management Review, 25( 7): 132–142

[28] MintzbergH (2007). Tracking Strategies: Toward a General Theory. New York: Oxford University Press

[29] Podolny, J M Page, K L (1998). Network forms of organization. Annual Review of Sociology, 24( 1): 57–76

[30] Porck, J P Matta, F K Hollenbeck, J R Oh, J K Lanaj, K Lee, S M (2019). Social identification in multiteam systems: The role of depletion and task complexity. Academy of Management Journal, 62( 4): 1137–1162

[31] Porter, M E Heppelmann, J E (2015). How smart, connected products are transforming companies. Harvard Business Review, 93( 10): 96–114

[32] RenH (2005). Modern Enterprise Organization Design. Beijing: Tsinghua University Press (in Chinese)

[33] Samimi, E Sydow, J (2021). Human resource management in project-based organizations: Revisiting the permanency assumption. International Journal of Human Resource Management, 32( 1): 49–83

[34] Sandhu, S Kulik, C T (2019). Shaping and being shaped: How organizational structure and managerial discretion co-evolve in new managerial roles. Administrative Science Quarterly, 64( 3): 619–658

[35] ShahaniJ (2020). Limits and Opportunities of a Matrix Organization: A Study of Coordination Mechanisms within a Multiple Brand Organization. Wiesbaden: Springer

[36] Steigenberger, N (2016). Organizing for the big one: A review of case studies and a research agenda for multi-agency disaster response. Journal of Contingencies and Crisis Management, 24( 2): 60–72

[37] Sun, G Q (2001). The definition, characteristics and forming factors of network organization. Nankai Business Review, ( 4): 38–40

[38] Thoben, K D Wiesner, S Wuest, T (2017). Industrie 4.0 and smart manufacturing: A review of research issues and application examples. International Journal of Automotive Technology, 11( 1): 4–16

[39] Turner, S G Utley, D R Westbrook, J D (1998). Project managers and functional managers: A case study of job satisfaction in a matrix organization. Project Management Journal, 29( 3): 11–19

[40] van Bunderen, L Greer, L L van Knippenberg, D (2018). When interteam conflict spirals into intrateam power struggles: The pivotal role of team power structures. Academy of Management Journal, 61( 3): 1100–1130

[41] van Laar, E van Deursen, A J A M van Dijk, J A G M de Haan, J (2019). Determinants of 21st-century digital skills: A large-scale survey among working professionals. Computers in Human Behavior, 100: 93–104

[42] Victor, B Blackburn, R S (1987). Interdependence: An alternative conceptualization. Academy of Management Review, 12( 3): 486–498

[43] Wei, Y Samiee, S Lee, R P (2014). The influence of organic organizational cultures, market responsiveness, and product strategy on firm performance in an emerging market. Journal of the Academy of Marketing Science, 42( 1): 49–70

[44] XiangQ (2013a). Aero-engine Maintenance Engineering Management. Beijing: China Machine Press (in Chinese)

[45] Xiang, Q (2013b). Recognition and practice on remanufacturing engineering management of military aero-engines. Strategic Study of CAE, 15( 11): 67–73

[46] Xiang, Q (2014). Building a new normal, upgraded China’s aviation MRO under the guidance of creative economy theory. Military Industry Culture, ( 12): 37–39

[47] Xiang, Q (2015). Discussion on problem-based engineering management system. Frontiers of Engineering Management, 2( 3): 249–260

[48] Zanzi, A (1987). How organic is your organization? Determinants of organic/mechanistic tendencies in a public accounting firm. Journal of Management Studies, 24( 2): 125–140

[49] Zhang, C Hu, Z Gu, F F (2008). Intra- and inter-firm coordination of export manufacturers: A cluster analysis of indigenous Chinese exporters. Journal of International Marketing, 16( 3): 108–135

RIGHTS & PERMISSIONS

Higher Education Press