Organization Design: The Epistemic Interdependence Perspective

The Two Facets of Collaboration: Cooperation and Coordination in Strategic Alliances

“…Cognitive limitations, specifically bounded rationality (Simon & March, 1993), constrain individuals' ability to fully recognize, project, and accommodate the impact of different types and levels of interdependence among tasks, roles and units. Individuals often fail to recognize interdependencies: they tend to apply heuristics that lead them to think too narrowly and crudely about task partitioning and specialization among roles and units, and to underestimate the interrelationships between tasks and resulting coordination needs (Heath & Staudenmayer, 2000;Puranam et al, 2012). And even when individuals do recognize interdependencies, attention constraints limit the effectiveness of their coordination efforts by restricting their ability to monitor, manage, and respond to a large number of activities or events (Ocasio, 1997).…”

“…10 Flawed design encompasses factors like erroneous task decomposition, misconceived task allocation (such as assigning tasks to agents ill equipped to handle them), and misspecification of coordination mechanisms such as communication interfaces (Puranam, Raveendran, & Knudsen, 2012;. Failures of implementation can include actors' mistakes while performing assigned tasks and failure to use specified coordination mechanisms properly.…”

Organizational Constraints to Adaptation: Intrafirm Asymmetry in the Locus of Coordination

“…The patterns we have described relate to the "input, processing, output, and direct support tasks" of the firm (Mintzberg 1979, p. 19), with the need to coordinate arising as a consequence. Processing information is central to the coordination effort (e.g., Thompson 1967, Galbraith 1977, Tushman and Nadler 1978, involving the need to ensure alignment in the predictive knowledge that interdependent actors have for one another (Puranam et al 2012). The resulting coordination structures involve design trade-offs aimed at minimizing coordination costs and reducing uncertainty, and macro-structural decisions such as grouping together modules and linking together differentiated units (e.g., Nadler and Tushman 1997).…”

“…The use of an environmental shock allows us to understand more precisely the effects of factors such as organizational decomposability. Our study is anchored in the classic and more recent organization design literatures, touching on the notions of information flows across organizational modules (e.g., Thompson 1967), as well as the idea of predictive knowledge (e.g., Puranam et al 2012). The link to external change reinforces the role that the formation and renewal of knowledge plays in influencing organizational adaptation to changing conditions, per Puranam et al (2012, p. 434, italics in original), who note that "the dynamism of the environment can be related to shocks to the designer's architectural knowledge and/or the agents' predictive knowledge.…”

The Firm as a Coordination System: Evidence from Software Services Offshoring

“…Coordination as an outcome is achieved when interdependent individuals are able to act as if they can predict each other's actions; coordination failures occur when interacting individuals are unable to anticipate each other's actions and adjust their own accordingly (Puranam et al 2012, Schelling 1960. Ineffective communication and knowledge transfer, delays, misunderstandings, and poor synchronization of activity are typical manifestations of coordination failure.…”