Building Of Flexible Organization Based On Information Technology

In the Internet economy, information technology (IT) has been a prerequisite and basic collocation for organizations to involve in the competition, or they will be marginalized or excluded by the time. The ability to response to environmental changes quickly and effectively, that is flexibility, has been another focus for competition after quality and cost. Flexibility has become one of the sources for competitive advantage. Both IT and flexibility have great impact on organizational changes. In order to adapt to the changing environment, new organizational forms, such as team organization, network organization and virtual enterprise emerge quickly, which improve enterprise's ability of adaptation, decision-making and innovation quickly and effectively. Organizations are becoming more and more flexible.The purpose of this paper is to build a flexible organization based on IT. Theoretical bedrock has been established in the first part of the paper, and the building process of a virtual enterprise is given as an example in the second part of the paper. The process is analyzed in detail from three aspects, they are IT infrastructure, information system and business process respectively. The main themes discussed in the paper are listed below.Firstly, definitions, classifications and measurements of flexibility are reviewed among much of accumulative literature about flexibility at home and aboard. Then, the positive and negative impacts of IT on organizational flexibility are examined. Grounded on the work of many researchers, an understanding of flexibility and the concept and meaning of flexible organization are developed. Furthermore, the practical and theoretical backgrounds, the research object, research problems and methods are stated. All of that lay a foundation for the consequent chapters.The development of IT and its application in the organization are analyzed in this paper. Comparing the architectures of computer with the structures of organization, they are surprisingly analogical. Both of them have evolved from centralized forms to more decentralized forms. It also examines how IT can be used to help managers to design more flexible organizational forms while processing more information simultaneously. In order to further illustrate the impact of IT onorganization design, an organization model with two hierarchies is established. There are two ways to collocate information and decision rights, which are the MIS solution and the organization redesign solution. The findings of the models show that there are global and local underinvestment in all the three organization designs, the hierarchy, the market and the mixed mode. And there is no clear winner between the different organization designs.According to the foregoing statements, the relationship model between IT, organizational structure and flexibility is set up. From the model, we can see that the building of flexibility is hierarchical, from the component flexibility to system flexibility and then to integrated flexibility. The flexibility is obtained under the support of IT and organizational structure. Flexibility without integration and integration without flexibility cannot create competitive advantage. If they can combine together properly, the resulting "integrated flexibility" can build a necessary platform for the creating of competitive advantage. The decisions about flexible organization based on IT are explored from strategic, tactical and operational aspects respectively, which is helpful for understanding the benefits of flexibility investment. For the three aspects, there are corresponding IT support systems. For evaluating the investment of the IT systems, a multi-objective mathematical model is developed to integrate four critical performance measures, which are cost, flexibility, quality and time. Finally, the basis for building flexible organization is pointed out. Flexible organization and IT cannot departure because IT is the basis for the building of flexible organization.After laying the theoretical foundation, virtual enterprise, as a typical flexible organization, is illustrated for the building of flexible organization. Virtual enterprise is based on effective usage of distributed resources, which can obtain the competitive advantages and dynamic operations required for the fast changing market. There are many changing factors in the business processes of virtual enterprise, which increase complexity for the building of virtual enterprise. The general business processes of virtual enterprise are put forward in this paper, which provides references for the building of virtual enterprise. The business processes are supported by certain information systems. Therefore, information system implementation for virtualenterprise is explored based on the integration of several enterprise management systems. An integrated database for virtual enterprise is illustrated for the requirements of its information system, which settles a base for further research and implementation. In the network environment, virtual enterprise is distributed and goal oriented, while agents are self-adaptive and goal-driven, which is proper for the architecture of virtual enterprise. Consequently, according to the definition and characteristics of mobile agent, multi-agent, etc., a model based on AGORA architecture for virtual enterprise is established in this paper. Two key phases, requirement and implementation, in virtual enterprise' lifecycle are illustrated in detail.