We Need to Dig a New Suez Canal: How Can ICT Help Changing Compliance Costs in the Next 20 Years?

In this chapter, we explore the paper-based functional hierarchy (Mintzbergs’ machine bureaucracy) as one of the important origins of the administrative burden. In such a functional hierarchy, the knowledge of the professionals on the one hand and the information of the clients on the other are two important resources. Both resources need to be managed for the organization to be effective and efficient. In the functional hierarchy the professional knowledge and the information of clients both are organized in stovepipes. Both resources have a low level of integration, intra-organizational as well as inter-organizational. We witness two trends. First, ICTs (‘classical ICT’ and internet technology) create an inter-organizational information infrastructure that is becoming interoperable. Second, professional knowledge is becoming modularized, with organizations starting to share their professionals and their knowledge in focusing on core competencies, outsourcing all other activities (and the relevant knowledge) and creating shared service centers. This results in a radical transformation of organizations. This transformed organizational infrastructure can deliver integrated services, by pooling different modules into one service delivery value chain and reusing all relevant information that is readily available in the interoperable, inter-organizational information infrastructure. This transformation of the organization results in potentially high levels of reduction of the administrative burden, without reducing the number and the level of norms and regulations.