I was reading a story from this week’s news about Facebook’s
decision to go public with its stock when I began to wonder about Facebook’s
organizational systems.
The article mentioned Facebook’s rapid growth over this past
year, which brought to mind the idea that organizations are, in a way, in
competition with themselves, and to be successful they must outdo what they’ve
already done. A successful organization cannot become stagnate (Galbraith,
2002). This means that Facebook has its own big shoes to fill in the coming
year.
In light of what it’s up against, Facebook’s leadership
would do well to heed advice from Worley & Lawler (2006) who suggest that
an organization can be successful by keeping a pulse on the trends in the
marketplace. This can be done, by encouraging all employees to connect to the
external environment so that they can look out for a possible leg up on the
competition (Worley & Lawler, 2006). I would imagine this to be essential
to Facebook’s organizational structure – and a perk for employees who get to
“friend” people at work in the interest of finding strategic advantages.
Still, some are skeptical about Facebook’s prospects for the
future (Geewax, 2012). However, if Facebook’s leadership sees the organization
as an organic system, as described by Morgan (1998), perhaps they will be
focused on survival and will evolve to meet any new challenges in the ever-changing
social networking environment.
According to Geewax (2012), Facebook’s strategy going
forward is going to center on mobile technology. Since strategy is paramount in an
organization’s decisions about its design (Galbraith, 2011), it would be
interesting to find whether this shift in focus will lead to a shift in Facebook’s
organizational structure.
One thing is certain, customers want new and they want it
now. As such, Facebook will need to ensure
that decisions can be made quickly, in line with Galbraith’s sixth immutable
force of speed (2002), if they’re going to keep up.
Resources
Geewax, M. (2012, February 1). Investors will get to friend
Facebook by late spring. NPR News. Retrieved from http://www.npr.org/2012/02/01/146201161/investors-will-get-to-friend-facebook-as-ipo-looms?live=1
Worley, C. & Lawler, E. (2006) Designing
Organizations that are Built for Change, MIT Sloan
Management Review, 48(1), pp. 18-23.
Galbraith., J.R.. (2002)Designing
Organizations, pp. 1-8. (Chapter 1)
Galbraith., J.R.. (2011) The
Star Model, pp. 1-6.
Galbraith, J.R. (2002)Designing Organizations, pp. 73-90. (Chapter 6)
Morgan, G. (1998) Images
of Organizations: Executive Edition, pp. 35-68. (Chapter 3)
Interesting post, Marissa. You mention that Facebook should encourage their employees to interact with the environment. How does Worley and Lawler's (2006) idea of "surface area" relate to this (p. 21)? What suggestions would those authors have for Facebook in terms of building structures to encourage connection to the external environment?
ReplyDeleteHi Marissa,
ReplyDeleteI've been wondering, myself, how Facebook will outdo themselves. I'm not sure Facebook has any competition, at this point. G+ tried and seemingly failed. Myspace has all but disappeared into space, and Friendster is gonester. So, will Facebook have to compete with itself as you say by "filling its own big shoes"? I believe it will. However, I believe it will do this only to show itself as an entity that can do so, and this change will really be about driving more revenue to answer to shareholder's demands of growth.
Since Facebook will no longer have to answer only to itself, it will need to show revenue growth, thereby, evolving structurally. I would assume that would mean adding more sales staff and expanding the business development department. "When the environment changes or when a new species makes an inroad on the resource niche traditionally held by another, ultimately the change is reflected in population structure." (Morgan, p.58). This tells me that the structure of Facebook will have to change, as a new species, known as the public, has been introduced. How Facebook or the shareholders adapt to the change will ultimately reflect the success of the organization and how it morphs. This increase in population and how the new and existing inhabitants adapt to each other will determine the rise or fall of Facebook (Morgan, p.58).
Morgan, G.(1998). Images of Organization the Executive Edition. San Francisco, CA:
Berrett-Koehler Publications, Inc. & Thousand Oaks, CA: Sage Publications, Inc.
Hi Marissa,
ReplyDeleteMy perspective on this might be a bit biased because I know people who work at Facebook and they are in my backyard. From what I know, they have adopted many of the organizational design suggestions outlined in Worley & Lawler’s article. They manage and attract some of the best talent in the valley, they reward the individual and have plenty of pay for performance incentives. In addition, besides having Mark Zuckerberg as their face and leader, they also have some incredibly smart leaders who help manage (as a team from what I hear) their ever changing organization. I also think they operate in more of a “network structure” described by Lorsch where they have the ability to respond to a competitive environment rather quickly and create strategic partnerships (like the one with Zynga).
In terms of how Facebook will compete with itself...maybe they'll have the same problem that Google has faced since going public and which has forced them to restructure more than once (from what my friends at Google tell me).
Thanks for sharing!
Adriana
Marissa, as a Facebook user for over six years I've come to hate change. Facebook has continued, over the years, to push change on the user. One such example is the "timeline." It began as an optional procedure for users, but soon everyone will have to convert to it. On the "timeline" anyone with access to your wall will be able to pinpoint a certain month and year in your Facebook life. I don't necessarily agree with that. I know I've agreed to all of Facebook's terms, but it also feels like an invasion of privacy. Facebook is more of a business tool than a social tool now.
ReplyDeleteAlso, I think this article would be beneficial for everyone who has a Facebook account: http://www.nytimes.com/2012/02/05/opinion/sunday/facebook-is-using-you.html.
Also, this is a MUST READ haha: http://bits.blogs.nytimes.com/2012/02/07/facebook-graffiti-artist-could-be-worth-500-million/.
Thanks for your post Marissa.
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ReplyDeleteHi Melissa! Thanks a lot for this post. A very nice read and good food for thought, especially with what is known (and often speculated) about FaceBook, Zuckerberg and their organizational structure - or lack thereof.
ReplyDeleteI disagree with your point that Facebook "would do well to heed advice from Worley & Lawler (2006) who suggest that an organization can be successful by keeping a pulse on the trends in the marketplace" . I disagree because I think Facebook IS the marketplace, and as such it should focus its efforts more on CREATING new trends (e.g. FaceBook Gaming) than on following what others are doing.
This power to create needs for social media consumers represents Facebook's competitive advantage versus G+ and the nearly extinct MySpace & Friendster (I love how Lisa narrated this part).
However, assuming that every advantage is temporary (Galbraith, 2002), we can justify Facebook's need to "impose change on the user" (Thomas dixit) through items such as the Timeline to maintain competitiveness through the creation of needs.
Finally I completely agree and support your view of Facebook's need to be nimble in it's current and future decision- making process. In the world of the internet revolution and social media it's be quick or be dead; perhaps so quick that the choices about organizational structure may be rash and loosely thought, trampled on, or even completely forsaken in the benefit of continuous advantage driven by sheer innovation.