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Exploring the Duality between Product and Organizational Architectures: A Test of the Mirroring Hypothesis

Author

Listed:
  • Alan D. MacCormack

    (Harvard Business School, Technology and Operations Management Unit)

  • John Rusnak

    (Harvard Business School)

  • Carliss Y. Baldwin

    (Harvard Business School, Finance Unit)

Abstract

A variety of academic studies argue that a relationship exists between the structure of an organization and the design of the products that this organization produces. Specifically, products tend to "mirror" the architectures of the organizations in which they are developed. This dynamic occurs because the organization's governance structures, problem solving routines and communication patterns constrain the space in which it searches for new solutions. Such a relationship is important, given that product architecture has been shown to be an important predictor of product performance, product variety, process flexibility and even the path of industry evolution. We explore this relationship in the software industry. Our research takes advantage of a natural experiment, in that we observe products that fulfill the same function being developed by very different organizational forms. At one extreme are commercial software firms, in which the organizational participants are tightly-coupled, with respect to their goals, structure and behavior. At the other, are open source software communities, in which the participants are much more loosely-coupled by comparison. The mirroring hypothesis predicts that these different organizational forms will produce products with distinctly different architectures. Specifically, loosely-coupled organizations will develop more modular designs than tightly-coupled organizations. We test this hypothesis, using a sample of matched-pair products. We find strong evidence to support the mirroring hypothesis. In all of the pairs we examine, the product developed by the loosely-coupled organization is significantly more modular than the product from the tightly-coupled organization. We measure modularity by capturing the level of coupling between a product's components. The magnitude of the differences is substantial - up to a factor of eight, in terms of the potential for a design change in one component to propagate to others. Our results have significant managerial implications, in highlighting the impact of organizational design decisions on the technical structure of the artifacts that these organizations subsequently develop.

Suggested Citation

  • Alan D. MacCormack & John Rusnak & Carliss Y. Baldwin, 2008. "Exploring the Duality between Product and Organizational Architectures: A Test of the Mirroring Hypothesis," Harvard Business School Working Papers 08-039, Harvard Business School, revised Jan 2011.
    • Handle: RePEc:hbs:wpaper:08-039
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    References listed on IDEAS

    as
    1. von Hippel, Eric, 1990. "Task partitioning: An innovation process variable," Research Policy, Elsevier, vol. 19(5), pages 407-418, October.
    2. Chrysanthos Nicholas Dellarocas, 1996. "A Coordination Perspective on Software Architecture: Towards a Design Handbook for Integrating Software Components," Working Paper Series 193, MIT Center for Coordination Science.
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    Cited by:

    1. Simy Joy, 2021. "Client-centric modular architecture: Empirical investigation into the organizational design of a large Indian IT service vendor," Working papers 471, Indian Institute of Management Kozhikode.

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