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Chapter 3 Information Systems, Organizations, and Strategy 121

FIGURE 3.6 FLATTENING ORGANIZATIONS

Information systems can reduce the number of levels in an organization by providing managers
with information to supervise larger numbers of workers and by giving lower-level employees more
decision-making authority.

These changes mean that the management span of control has also been
broadened, enabling high-level managers to manage and control more workers
spread over greater distances. Many companies have eliminated thousands of
middle managers as a result of these changes.

Postindustrial Organizations
Postindustrial theories based more on history and sociology than economics
also support the notion that IT should flatten hierarchies. In postindustrial
societies, authority increasingly relies on knowledge and competence, and not
merely on formal positions. Hence, the shape of organizations flattens because
professional workers tend to be self-managing, and decision making should
become more decentralized as knowledge and information become more
widespread throughout the firm (Drucker, 1988).
Information technology may encourage task force-networked organizations
in which groups of professionals come together—face to face or electronically—
for short periods of time to accomplish a specific task (e.g., designing a new
automobile); once the task is accomplished, the individuals join other task
forces. The global consulting service Accenture is an example. Many of its
246,000 employees move from location to location to work on projects at client
locations in more than 120 different countries.
Who makes sure that self-managed teams do not head off in the wrong
direction? Who decides which person works on which team and for how
long? How can managers evaluate the performance of someone who is
constantly rotating from team to team? How do people know where their
careers are headed? New approaches for evaluating, organizing, and

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