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The effect of virtuality on the functioning of centralized versus decentralized structures—an information processing perspective

Author

Listed:
  • Kent Wickstrøm Jensen

    (University of Southern Denmark)

  • Dorthe Døjbak Håkonsson

    (Aarhus University)

  • Richard M. Burton

    (Duke University)

  • Børge Obel

    (Aarhus University)

Abstract

Does virtuality in organizations require centralization or decentralization? We specify the coordination and information processing requirements for virtual organizing in order to examine how these requirements are met by centralized and decentralized structural designs, respectively. We use the agent based SimVision computational discrete event simulation model as our experimental platform to develop concise and comparable measures of the information processing needs of virtual organizing, and how these are met by the information processing capabilities of the centralized and decentralized structures. Contrary to conventional wisdom, that the centralized form is more effective in virtual settings than the decentralized form.

Suggested Citation

  • Kent Wickstrøm Jensen & Dorthe Døjbak Håkonsson & Richard M. Burton & Børge Obel, 2010. "The effect of virtuality on the functioning of centralized versus decentralized structures—an information processing perspective," Computational and Mathematical Organization Theory, Springer, vol. 16(2), pages 144-170, June.
    • Handle: RePEc:spr:comaot:v:16:y:2010:i:2:d:10.1007_s10588-010-9069-z
    DOI: 10.1007/s10588-010-9069-z
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    References listed on IDEAS

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    Cited by:

    1. Hyoung-Goo Kang & Richard M. Burton & Will Mitchell, 2021. "How firm boundaries and relatedness jointly affect diversification value: trade-offs between governance and flexibility," Computational and Mathematical Organization Theory, Springer, vol. 27(1), pages 1-34, March.

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