Centralization vs. Decentralization in a Multi-Unit Organization: A Computational Model of a Retail Chain as a Multi-Agent Adaptive System
AbstractA computational model of a retail chain is developed in which store managers continually search for better practices. Search takes place over a rugged landscape defined over the space of store practices. The main objective of this research is to determine how the amount of discretion given to store managers, as to how they run their stores, influences the rate of innovation at the store level. We find that greater decentralization enhances firm performance when stores' markets are sufficiently different, the horizon is sufficiently long, and market are sufficiently stable.
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Bibliographic InfoPaper provided by Santa Fe Institute in its series Working Papers with number 00-02-010.
Date of creation: Feb 2000
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Decentralization; organization; innovation.;
Other versions of this item:
- Myong-Hun Chang & Joseph E. Harrington, 2000. "Centralization vs. Decentralization in a Multi-Unit Organization: A Computational Model of a Retail Chain as a Multi-Agent Adaptive System," Management Science, INFORMS, vol. 46(11), pages 1427-1440, November.
- Myong-Hun Chang & Joseph Harrington, 2000. "Centralization vs. Decentralization in a Multi-Unit Organization: A Computational Model of a Retail Chain as a Multi-Agent Adaptive System," Econometric Society World Congress 2000 Contributed Papers 0860, Econometric Society.
- NEP-ALL-2000-02-28 (All new papers)
- NEP-CMP-2000-03-12 (Computational Economics)
- NEP-IND-2000-02-28 (Industrial Organization)
- NEP-MIC-2000-02-28 (Microeconomics)
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