The Impact of Organizational Structural Design on Internal and External Integration: An Empirical Assessment and a Cross-Regional Examination

Abstract

We examine the effect of organizational structure on internal integration, supplier integration, and customer integration and assess whether such effects vary by region. Specifically, we draw from organization theory to propose that centralization (at the macro and micro levels), formalization, and complexity (vertical. and horizontal - employee cross-training and managerial job rotation) influence internal, supplier, and customer integration. Relationships are studied across Western and Asian environments using data collected from multiple respondents at 238 manufacturing plants in eight countries. We found that organizational structure dimensions have differing impacts on internal, customer, and supplier integration and these effects appear to vary across regions. Data analyses revealed that beyond detecting differences in patterns across regions, there are also differences in mean levels. These differences in level are identified both at the region and country level.

Keywords: Supply Chain Integration; Organizational Structure; Cross-Cultural Research; Empirical