ABSTRACT
This chapter gives an overview of the nine design variables that serve as the foundation for generating alternative organization designs during the concept design phase. These nine variables are grouped into five categories: architecture, processes, culture, people and technology. The architecture category covers five design variables: the primary vertical dimension, the role of the corporate parent, centralization versus decentralization, lateral coordination and governance. The four other categories correspond to one design variable each. All nine variables are covered in detail in separate subsequent chapters. During the concept design phase, the typical approach is to begin by addressing the architecture variables. However, depending on the situation, a different sequence may be chosen, or some variables may be addressed in parallel or iteratively. In some cases, some variables may remain untouched. The chapter also outlines why and how radical and incremental organizational design changes may usefully alternate. Whether the change is radical or incremental, it is key that the choices made for the various variables are not only compatible with each other but also coherent, working together toward a common goal. The combination of design choices across the variables must form a rationale that can be explained.
