The world we all live in has fundamentally changed from the old organized model into a new unorganized one. In the orderly organized world, there was certainty and convention. In the unorganized world there is freedom, diversity and instability.
This unorganized world can be navigated and negotiated by individuals armed with today’s flexible technologies such as electronic agents. This facilitates collapsible corporations "structured" around electronic signals rather than physical buildings, with electronic networks replacing geographical communities.
Basically, production can be carried out using either markets or firms. Today’s firms exist because the transaction costs incurred when using free markets were higher than those incurred to organize the same quantity and quality of production within a firm. These costs include those for bidding, finding out information and negotiating. However, sophisticated enabling technologies have reduced these transaction costs and thereby made it a lot easier to co-ordinate economic activity using markets rather than firms.
Downstructuring is not about reducing the number of employees, it is the art of eliminating systems and procedures such as job titles and paper-based administrative processes. This then frees each individual employee to realize their full potential and thereby add the most value for themselves and their current employer. Downstructuring is necessary because it is harder in the complicated unorganized world for managers to understand and control events and people. Managers must recognize their limited understanding and respond by letting strategies emerge, making reversible commitments and keeping decision making vague. If they don’t, they are sowing the seeds for their own downfall. The inability of managers to maximize organizational potential and exploit the transient opportunities in the unorganized world will cause discontent amongst employees, customers and shareholders.
Business success for collapsible corporations is all about combining the complementary capabilities of business partners for mutual gain. Once you have generated content or an idea you can leverage your idea by outsourcing the actual production and distribution of your ideas. Technology tools facilitate this partnering and licensing