A Clustering Approach to the Organization Design of Knowledge-Intensive Service Providers

Knowledge intensive service providers are highly dependent on human workers who possess specialized knowledge and skills. A client project typically requires a number of different specialists and a project manager coordinating all activities. For many purposes such as supervision, execution of chosen business strategies, and employee well-being, the knowledge workers have to be organized in a structure that is more permanent than project teams. The optimal design of such an organization is not entirely clear as the requirements of the project-based work and other organizational needs such as skill development are not necessarily aligned. In addition, many knowledge intensive services do not need specialized physical facilities and their organizations therefore have few physical constraints. All of these make the organization design problem harder, but at the same time provide a better opportunity for a more effective organization design. To help design an organization that is conducive to achieving the business objectives of the enterprise, we propose a systematic procedure based on the clustering of attributes of the knowledge workers and their relationships with other entities in the organization. This approach provides reasonable starting points for a human expert to modify into a final design, gives better insight into the impact of strategic objectives on the organization design, and serves as a catalyst for hybrid designs that do not follow common structures.