Design, innovation and corporate integration

Functional integration is a new trend in corporate organization. By changing the balance between functional differentiation and integration, functional integration gives up some supposed economies of scale and benefits from division of labour in order to increase the degree of interaction and task-sharing between diverse functions. The aim is to achieve faster response to threats and opportunities in the persistent turbulent business environment of today. The exact location of the new functional boundaries and inter dependencies differs from industry to industry; in some cases external integration, say with customers or suppliers, may be justifiable. Advantage can be taken from new forms of organization such as flatter hierarchies, the building of interfunctional teams, and the adoption of new design and manufacturing control technologies.
The paper gives examples of functional integration and discusses implications and problems generated by its adoption. Some of the implications may eventually induce radical rethinks on a whole range of presuppositions about corporate structure, relationships between the firm and its suppliers and customers, the role of management, industrial relations and the socio-cultural impact of increasing reliance on automated information systems.