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Adaptive Organizations

  • Wouter Dessein
  • Tano Santos

We consider organizations that optimally choose the level of adaptation to a changing environment when coordination among specialized tasks is a concern. Adaptive organizations provide employees with flexibility to tailor their tasks to local information. Coordination is maintained by limiting specialization and improving communication. Alternatively, by letting employees stick to some preagreed action plan, organizations can ensure coordination without communication, regardless of the extent of specialization. Among other things, our theory shows how extensive specialization results in organizations that ignore local knowledge, and it explains why improvements in communication technology may reduce specialization by pushing organizations to become more adaptive.

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File URL: http://dx.doi.org/10.1086/508031
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Article provided by University of Chicago Press in its journal Journal of Political Economy.

Volume (Year): 114 (2006)
Issue (Month): 5 (October)
Pages: 956-985

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Handle: RePEc:ucp:jpolec:v:114:y:2006:i:5:p:956-985
Contact details of provider: Web page: http://www.journals.uchicago.edu/JPE/

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  1. Smith, Adam, 1776. "An Inquiry into the Nature and Causes of the Wealth of Nations," History of Economic Thought Books, McMaster University Archive for the History of Economic Thought, number smith1776.
  2. Gary S. Becker & Kevin M. Murphy, 1994. "The Division of Labor, Coordination Costs, and Knowledge," NBER Chapters, in: Human Capital: A Theoretical and Empirical Analysis with Special Reference to Education (3rd Edition), pages 299-322 National Bureau of Economic Research, Inc.
  3. Kevin Crowston, 1997. "A Coordination Theory Approach to Organizational Process Design," Organization Science, INFORMS, vol. 8(2), pages 157-175, April.
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