Innovation, Organisational Structure, and Culture: Its Impact and Linkage on Organization - A Review

Innovation, Organisational Structure, and Culture: Its Impact and Linkage on Organization - A Review

Sayan Banerjee (Chandragupt Institute of Management, Patna, India) and Dinesh Srivastava (National Institute of Industrial Engineering, Mumbai, India)
Copyright: © 2017 |Pages: 22
DOI: 10.4018/IJCESC.2017010101
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Abstract

Organizations are fundamentally different from the hierarchical, bureaucratic structures that underlie more traditional organizational theory and research. The paper deals with the fact that culture is omnipotent in shaping the structure of the organisation and structure along with culture is intricately related with the way innovation is managed or implemented in any organisation. This paper is basically a extensive review of papers relating to organisational structure, culture and innovation right from the aspect of how culture shapes structure to how innovation is linked and shaped by both organisational structure and culture. Models by different researchers depicting the relationship between the various aspects of structure culture and innovation are discussed for better understanding.
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Introduction

The environment facing organisations today is characterised by unprecedented levels of technological change, product and service innovation, coupled with intense global competition. (Nanni et al.,1992). To survive in this environment organisations must possess specific capabilities including the ability to learn (Levinthal & March,1993) and to respond flexibly and rapidly to technological and market changes through continuous innovation. Among the operational attributes needed to sustain organisational learning, adaptive flexibility and innovation, the literature identifies the development of flexible organisational structures and interaction patterns, particularly the use of fluid work groups and teams with changing membership and the leadership (Abernathy & Lillis, 1995, Levinthal & March, 1993).

Post-industrial organisations today are knowledge based organisations and their success and survival depends on creativity, innovation discovery and inventiveness. It appears that the rate of change is accelerating rapidly as new knowledge, idea generation and global diffusion is increasing (Senge et al 1999). Creativity and innovation have a role to play in this change process for survival. An effective reaction to these demands leads not only to changes in individuals and their behaviours, but also to innovative changes in organisations to ensure their existence.

Thus, the dynamics leading to all the above changes are making the organisations and leaders try to create an institutional frame work in which creativity and innovation will be accepted as a basic cultural norm in the midst of technological and other changes. Authors like Ahmed (1998)Martell (1998) Phessey (1993), Robbins (1996) have also emphasised the importance of organisational culture in this context. Organisational culture appears to have an influence on the degree to which creativity and innovation are stimulated in the organisation.

Criteria for Selection of Studies

Only those papers were reviewed which were thought to be relevant in any way or from which some important idea can be taken concerning the three aspects Organisational structure, culture and innovation.

Organisational Structure

Similar to the cultural wars, organisational structure and how it creates and sustains itself has been an important ongoing and debatable question in organisational research. While some people suggest that the notion of structure is usually understood to imply a configuration of activities that is characteristically enduring and persistent: the dominant feature of it being its patterned regularity while some others like Barley (1986) suggests that structure can be simultaneously viewed as a flow of ongoing action and as a set of institutionalised traditions or forms that reflect and constrain that action .Again according to Gidden's(1979) theory of structuring structure is a socially constructed phenomenon that is both the medium and outcome of interaction.

A social constructionist perspective argues that structure is created by and is often reflective of member’s behaviour and interpretations (Barley, 1986). Cultural anthropologists would again suggest that these behaviours and interpretations represent member’s cultural perspectives. The notion that structures are socially constructed is similar to arguments that culture reflects shared interpretation systems. The questions these arguments bring forth are, how does organisational culture create structure? And what role do change processes play in linking culture to structure?

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