Are Two Heads Better than One: The Multi-Authority Form and Organizational Adaptation

36 Pages Posted: 14 Jul 2015

See all articles by Daniel Levinthal

Daniel Levinthal

University of Pennsylvania - Management Department

Maciej Workiewicz

INSEAD

Date Written: July 12, 2015

Abstract

The multi-authority form is a type of organization where subordinates report to multiple superiors and superiors share authority over their subordinates. While those forms are quite common among modern organizations, research on such forms offers conflicting findings. These conflicting findings, in turn, suggest the need for greater understanding of the mechanisms through which these complex hierarchies operate. We create an explicit agent-based model where organizational adaptation is guided by a coupled search, with superiors integrating efforts of interdependent organizational units and their subordinates pursuing specialization within those units. We identify the specific mechanisms which make the multi-authority form the preferred option when specialization and integration are both important. The traditional hierarchy is, in turn, shown to be superior at integrating interdependent units, but at a cost of local specialization.

Keywords: organization design, organizational adaptation, multi-authority

JEL Classification: D21, L20, M10

Suggested Citation

Levinthal, Daniel A. and Workiewicz, Maciej, Are Two Heads Better than One: The Multi-Authority Form and Organizational Adaptation (July 12, 2015). Available at SSRN: https://ssrn.com/abstract=2630088 or http://dx.doi.org/10.2139/ssrn.2630088

Daniel A. Levinthal

University of Pennsylvania - Management Department ( email )

The Wharton School
Philadelphia, PA 19104-6370
United States
215-898-6826 (Phone)
215-898-0401 (Fax)

Maciej Workiewicz (Contact Author)

INSEAD ( email )

Boulevard de Constance
77305 Fontainebleau Cedex
France

Register to save articles to
your library

Register

Paper statistics

Downloads
172
Abstract Views
752
rank
172,953
PlumX Metrics