m the Greek paradeigma, which means model,
pattern, or example. Usually associated with changes in basic science,
the term has recently been used to describe a fundamental shift in how
we think about organizations and management. Although scientific
historians and social scientists offer many different definitions, the
popular futurist Joel Barker's definition seems most relevant to the
dramatic changes now taking place in management. He says, simply, that a
paradigm establishes the "rules," defines the "boundaries," and
describes how to behave within those boundaries to be successful.
Organization design has entered a new paradigm--an area of new rules,
new boundaries, and new ways of behaving. Our purpose here is to examine
the new paradigm organizations: total quality, learning, and
Under the old paradigm of just a few years ago, the rules and boundaries
were simple and straightforward. To drive up quality, organizations had
to accept higher costs; to minimize cost per unit, they set long
production runs. Strategy formulation at the top was the key to
effective planning; increased productivity was best achieved by cutting
the time in sequential work-flow tasks. Under the new paradigm, these
rules are rendered obsolete. Successful organizations now drive quality
up while pushing costs down; they make small production lots at the same
cost per unit as long production runs; they focus increased attention on
real-time strategy implementation; and they sidestep sequential work
flow in favor of parallel work flow. Flexible, multiple-skilled work
forces break across the barriers formerly defined by rigid job
descriptions and functional departments.
Those organizations operating under the old rules are seeing their very
survival threatened. Exhibit 1 documents this point, dramatically, by
plotting changes in ranking among the 100 largest U.S. industrials over
...