Servicio de Información Comunitario sobre Investigación y Desarrollo - CORDIS

Information society, work, and the generation of new forms of social exclusion: The organisational dimension

As argued above, the greatest benefits from the application of modern ICTs appear when their use is combined with other organisational assets, such as new business strategies, new organisation structures or more skilled employees. The successful integration of modern ICT into the production process in general requires major structural adjustments; modern ICT can hardly function effectively and support innovation activities when integrated in the traditional, Fordist organisation framework. Modern ICTs do not determine organisation forms; instead, they must be characterised as enabling technologies. This means that they create new organisation forms; these new organisation forms in turn provide new opportunities for technical design.

Modern ICT can affect both the vertical and horizontal dimensions of organisation forms. For example, modern ICT can facilitate the sharing of information among different organisation groups and departments by enabling the introduction of flat hierarchies. On the other hand, modern ICT facilitates a technical integration of various processes or functions supporting the introduction of group work or teamwork. Our company survey reveals that companies often introduce only isolated organisational changes. But it is not enough to introduce some minor changes on the shop floor; the successful integration of modern ICT requires a fundamental restructuring approach, changing both vertical and horizontal forms of division of work information flows and co-operation.
As our firm survey indicates, the development of an ICT-based network organisation is still an exceptional case. Companies often introduce modern ICT without adapting their organisational structures; others focus on organisational restructuring without introducing modern ICT as a backbone of new and more flexible organisation forms. And still quite a few companies have undertaken neither major technological nor organisational restructuring measures; they stick to the low-tech Fordist production model.

While modern ICT has an important role to play with respect to internal organisational restructuring, the availability of a network technology, such as the Internet, results in an increasingly outward orientation of restructuring practices. Modern ICTs offer the potential to restructure the entire value chain, particularly companies’ interaction with supplier companies and with customers. But external restructuring needs to be combined with internal renewal processes, as inter-firm cooperation is most effective when it is based on decentralised decision-making.

Despite the growing evidence that ICT-enabled organisational changes have a positive impact on companies’ productivity and innovativeness, policies aiming at supporting these restructuring processes and diffusing company-level good practices are not widespread. One reason is that companies cannot simply copy a particular organisation structure; instead, restructuring needs to be understood as a continuous open-ended learning process, as argued before.

Regions or countries, however, often lack a broad policy approach to the new challenges confronting businesses. Innovation policy focuses more on the development of new technologies and the set-up of support institutions; it seldom integrates issues related to business restructuring and human resources development. Both education policy and labour market policy have also widely ignored the dynamic developments on the company and the industry level, challenging education and training institutions as well as the labour markets. But there is a potentially important role for policy makers in the transformation process towards the information economy. They can contribute to the transformation processes by supporting and enhancing companies’ techno-organisational restructuring processes.

What SMEs in particular need is more advice, because they seldom invest in intangibles. As they do not introduce social innovations such as new business strategies and new organisation forms together with the application of modern ICT, they can hardly reap all the possible benefits from the new technologies. In addition, as the greatest restructuring potential of ICT lays in the redesign of inter-organisational relationships, policy makers should direct their attention more to networks of co-operating firms than to single companies. This means that there is a need to develop network policies of restructuring. 'Competitive benchmarking' and 'demonstration activities' initiated by policy makers can be seen as an important element of such a network policy.

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University of Tampere
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