Investigating modular organizations

This paper explores a new organizational form—modular organization—through a case-study approach. The aim is to isolate the specific properties that set this form apart from other known organizational forms. The case studies examined focus on the manufacturing process of small, medium and large companies in different industries, and provide a clear picture of modular organization. The analysis shows that modular organizations are an innovation per se and not the mere outcome of modular products. Modular organizations leverage decomposition by employing small units within a larger organization. Each unit is responsible for a specific domain, it is quasi-independent and makes autonomous decisions on various business issues. Modular organizations deal with suppliers directly, and are characterized by a flat structure. Companies based on modular organization can improve their efficiency in the high-tech and mature markets, and fully exploit their resources.

Mario BenassiEmail:

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Mario Benassi   is Tenured Professor in Management and Business Administration at the Department of Economics, Business and Statistics, University of Milan, Italy. He received his Ph.D. at the University of Venice, was Research Associate at New York and Columbia University, Visiting Scholar at Haas Business School (UC Berkeley) and Visiting Professor at Stanford University. He is Director of NewBusinessLab, a research centre supporting start-ups and new business ideas in high tech industries. He is current doing research on IP brokers and on the impact of social capital in knowledge-intensive companies.