The effect of virtuality on the functioning of centralized versus decentralized structures—an information processing perspective

  • Kent Wickstrøm Jensen
  • Dorthe Døjbak Håkonsson
  • Richard M. Burton
  • Børge Obel


Does virtuality in organizations require centralization or decentralization? We specify the coordination and information processing requirements for virtual organizing in order to examine how these requirements are met by centralized and decentralized structural designs, respectively. We use the agent based SimVision computational discrete event simulation model as our experimental platform to develop concise and comparable measures of the information processing needs of virtual organizing, and how these are met by the information processing capabilities of the centralized and decentralized structures. Contrary to conventional wisdom, that the centralized form is more effective in virtual settings than the decentralized form.


Virtual organization Centralization Information processing Organizational design Virtuality 


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Copyright information

© Springer Science+Business Media, LLC 2010

Authors and Affiliations

  • Kent Wickstrøm Jensen
    • 1
  • Dorthe Døjbak Håkonsson
    • 2
  • Richard M. Burton
    • 3
  • Børge Obel
    • 4
  1. 1.Department of Entrepreneurship and Relationship ManagementUniversity of Southern DenmarkKoldingDenmark
  2. 2.Department of Management, Aarhus School of BusinessAarhus UniversityAarhus VDenmark
  3. 3.The Fuqua School of BusinessDuke UniversityDurhamUSA
  4. 4.Aarhus School of BusinessAarhus UniversityAarhus VDenmark

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