How IT will Challenge Existing Organizational Forms and Create Ambient Organizations

IT is likely to be as important to the way companies will organize in the future as electricity was to the industrial revolution. IT will revolutionize entire industries and markets. IT will create new types of organizations that will surpass and outsmart traditional organizations. This has been predicted for more than a decade. But now it is happening especially in the music, newspaper and publishing industries, and shall see it even more pronounced in these sectors in the future. But it will not be limited to these industries; it will influence all types of industry and government organizations. Already today, we see many examples of innovative organizational designs, enhancing organizational effectiveness and competitiveness. The paper will briefly discuss the potential of future IT developments, and will proceed to give a short theoretical background for why we see a growth in IT-facilitated new organizational forms. A couple of interesting organizational design will be mentioned, before we proceed to making the argument that any business process in principle may be reengineered, centralized or outsourced in one way or other. Interesting examples will be presented. We suggest that future IT will have such a profound impact on organizational structure going far beyond the traditional ‘virtual organization’ that it calls for a new organizational concept, which we have chosen to label the “Ambient Organization’.