Newswise — In the manufacturing industry, intra-organizational coordination has long been a critical challenge for firms pursuing productivity and innovation, mainly due to heterogeneity between functional units and resource scarcity. Traditional organizational structures (e.g., linear-functional, matrix) often lead to unclear responsibility division and independent goals, making them ill-suited for large-sized innovative manufacturing firms in mass production. Although new organizational forms like network organizations, multiteam systems, and platform organizations have addressed some issues by shifting to decentralized and boundaryless models, they still struggle to meet the demands of multi-product batch production and R&D management in innovative manufacturing.
To tackle this problem, a research team including members from Aero Engine Corporation of China, Chengdu Holy Industry & Commerce Corp., Ltd. (Group), and School of Management at Huazhong University of Science and Technology has conducted a study titled “Construction of Digital 3D Magic-Cube Organization Structure for Innovation-Driven Manufacturing”.
This study proposes a three-dimensional (3D) magic-cube organizational structure, centered on three core dimensions: product (z-axis, covering research and expanded products), business (y-axis, including functional units like strategy and R&D), and administration (x-axis, consisting of empowered grassroot administrative units). The structure integrates advantages of traditional and new organizational forms, featuring project-driven operations, cross-functional coordination, and interdependent units. It establishes a coordination mechanism of “product traction, business support, and administrative guarantee” and puts forward three key propositions: compound talent development to enhance inter-departmental collaboration, digital technology (e.g., IoT, AI) to enable intelligent connection and visualized management, and adhocracy culture with boundary spanning to break coordination barriers.
To verify effectiveness, the 3D magic-cube structure was applied in a Chinese aero-engine manufacturing firm (with over 2,200 staff across 5 sub-factories and 8 functional departments) since 2014. The firm redesigned its post system (aligning with the three dimensions) and performance evaluation system (linking compensation to product, business, and administration performance), and established a project-driven coordination mechanism. Results showed significant improvements: by 2021, gross industrial output value increased by 74.79%, total profit surged by 1691.95%, labor productivity rose by 32.89%, and per capita annual income grew by 88.06 (with only 3% increase in total employees).
The paper “Construction of Digital 3D Magic-Cube Organization Structure for Innovation-Driven Manufacturing” is authored by Qiao XIANG, You ZHANG, Jie ZHONG, Guoxuan WANG, and Lirong LONG. Full text: https://doi.org/10.1007/s42524-022-0237-x.
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