Modeling the Effect of Organizational Structure on Organizational Self-Renewal and Knowledge Diffusion: A Theoretical Framework

30 Pages Posted: 9 Dec 2004

See all articles by Avimanyu Datta

Avimanyu Datta

College of Business, Illinois State University

Sukumar RayChaudhuri

Director, Anand Engineering College, Agra, India.

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Date Written: July 2005

Abstract

Combining the concepts of fluid viscosity, system dynamics and Cobb-Douglas production function, an attempt was made to propose a theoretical framework that models the effect of organizational structure on organizational self-renewal and knowledge diffusion. It was showed that rigidity in organizational structure creates an organizational viscosity (due to vertical layers of management) and conflict of interest (between functional divisions), that affects both the self-renewal exercise and Knowledge Diffusion, which are the two most integral aspects of staying competitive in volatile business environment. It was illustrated that with the increase in the rigidity of the organizational structure causes decrease in its self-renewal exercise and diffusion of knowledge. Ironically, the model also shows that absence of any structure also has a negative impact on organizational self-renewal and knowledge diffusion. Based on its self-renewal capability organizations are categorized here, as innovators, adapters (both early and late), laggards and virtual innovators. The model explained, graphically, how knowledge diffusion decreases the time to innovate.

Keywords: Knowledge Carriers (KC), Organizational Viscosity, Damping Ratio, Organization Self-Renewal, Steady State, Knowledge Diffusion

Suggested Citation

Datta, Avimanyu and RayChaudhuri, Sukumar, Modeling the Effect of Organizational Structure on Organizational Self-Renewal and Knowledge Diffusion: A Theoretical Framework (July 2005). Available at SSRN: https://ssrn.com/abstract=628301 or http://dx.doi.org/10.2139/ssrn.628301

Avimanyu Datta (Contact Author)

College of Business, Illinois State University ( email )

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Sukumar RayChaudhuri

Director, Anand Engineering College, Agra, India. ( email )

Nh 2, Agra Mathura Highway
Keetham.
Agra, 282007
India

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