n of both approaches followed by an example will further illustrate the purpose of this article.

Traditionally, the most common organizational structure is controlled through the vertical hierarchy. Decision making comes from top management and works its way down through the organization. According to Daft, "This structure can be quite effective. It promotes efficient production and in-depth skill development, and the hierarchy of authority provides a sensible mechanism for supervision and control in large organizations, (29-30). Although this structure may promote efficiency, in a rapidly changing environment, this type of structure may become overloaded. Because decisions r

Put together one very centralized company, a deserving workforce, several opinionated executives, a little bit of time and what do you get? No, it's not Extreme Makeover: Home Edition, but Extreme Makeover: Organization Edition.

Although this sounds like the hit reality TV show on ABC where a family whose home is in ruins has the opportunity to have their entire house redesigned, this article argues that the same idea holds true for organizations today where design, in many ways, is also in ruins and needs an organizational makeover.

In a fast-paced business environment, many organizations recognize the need for a strategy that allows their firms to prosper. However, failure will eventually result when late nineteenth and early twentieth century structures prevail in these organizations. In his book, Organization Theory and Design, Richard Daft says, "This structure was quite effective and became entrenched in the business world for most of the twentieth century. However, this type of vertical structure is not always effective, particularly in rapidly changing environments, (87). The solution for an organization stuck in the past, in terms of strategy, structure, and leadership, which desires to succeed in the future, is to adopt the approach of the learning organization.

What sets learning organizations apart from traditional organizations is that the former's essential value is problem solving, where the latter's is designed for efficient performance. In his book, The Age of Unreason, Charles Handy writes, "The learning organization can mean two things, it can mean an organization which learns and/or an organization which encourages learning in its people, (225). These firms thrive on asking questions, testing theories, and changing paradigms. Likewise, Richard Daft says, "The learning organization promotes communication and collaboration so that everyone is engaged in identifying and solving problems. The learning organization is based on equality, open information, little hierarchy, and a culture that encourages adaptability and participation, (28).

The environment for companies today is anything but stable. Managers can no longer forecast with certainty the outcome of their organizations. This has drawn attention to chaos theory, which suggests relationships between complex systems, including organizations, are nonlinear and are composed of many choices that create varying effects and render the environment unpredictable.

In the new environment managers are seeking solutions for today and the future of their organizations. The learning organization offers hope for the future as they seek to change key dimensions of their firms in a chaotic environment. A comparison of both approaches followed by an example will further illustrate the purpose of this article.

Traditionally, the most common organizational structure is controlled through the vertical hierarchy. Decision making comes from top management and works its way down through the organization. According to Daft, "This structure can be quite effective. It promotes efficient production and in-depth skill development, and the hierarchy of authority provides a sensible mechanism for supervision and control in large organizations, (29-30). Although this structure may promote efficiency, in a rapidly changing environment, this type of structure may become overloaded. Because decisions r

er, failure will eventually result when late nineteenth and early twentieth century structures prevail in these organizations. In his book, Organization Theory and Design, Richard Daft says, "This structure was quite effective and became entrenched in the business world for most of the twentieth century. However, this type of vertical structure is not always effective, particularly in rapidly changing environments, (87). The solution for an organization stuck in the past, in terms of strategy, structure, and leadership, which desires to succeed in the future, is to adopt the approach of the learning organization.

What sets learning organizations apart from traditional organizations is that the former's essential value is problem solving, where the latter's is designed for efficient performance. In his book, The Age of Unreason, Charles Handy writes, "The learning organization can mean two things, it can mean an organization which learns and/or an organization which encourages learning in its people, (225). These firms thrive on asking questions, testing theories, and changing paradigms. Likewise, Richard Daft says, "The learning organization promotes communication and collaboration so that everyone is engaged in identifying and solving problems. The learning organization is based on equality, open information, little hierarchy, and a culture that encourages adaptability and participation, (28).

The environment for companies today is anything but stable. Managers can no longer forecast with certainty the outcome of their organizations. This has drawn attention to chaos theory, which suggests relationships between complex systems, including organizations, are nonlinear and are composed of many choices that create varying effects and render the environment unpredictable.

In the new environment managers are seeking solutions for today and the future of their organizations. The learning organization offers hope for the future as they seek to change key dimensions of their firms in a chaotic environment. A comparison of both approaches followed by an example will further illustrate the purpose of this article.

Traditionally, the most common organizational structure is controlled through the vertical hierarchy. Decision making comes from top management and works its way down through the organization. According to Daft, "This structure can be quite effective. It promotes efficient production and in-depth skill development, and the hierarchy of authority provides a sensible mechanism for supervision and control in large organizations, (29-30). Although this structure may promote efficiency, in a rapidly changing environment, this type of structure may become overloaded. Because decisions r

nizations is that the former's essential value is problem solving, where the latter's is designed for efficient performance. In his book, The Age of Unreason, Charles Handy writes, "The learning organization can mean two things, it can mean an organization which learns and/or an organization which encourages learning in its people, (225). These firms thrive on asking questions, testing theories, and changing paradigms. Likewise, Richard Daft says, "The learning organization promotes communication and collaboration so that everyone is engaged in identifying and solving problems. The learning organization is based on equality, open information, little hierarchy, and a culture that encourages adaptability and participation, (28).

The environment for companies today is anything but stable. Managers can no longer forecast with certainty the outcome of their organizations. This has drawn attention to chaos theory, which suggests relationships between complex systems, including organizations, are nonlinear and are composed of many choices that create varying effects and render the environment unpredictable.

In the new environment managers are seeking solutions for today and the future of their organizations. The learning organization offers hope for the future as they seek to change key dimensions of their firms in a chaotic environment. A comparison of both approaches followed by an example will further illustrate the purpose of this article.

Traditionally, the most common organizational structure is controlled through the vertical hierarchy. Decision making comes from top management and works its way down through the organization. According to Daft, "This structure can be quite effective. It promotes efficient production and in-depth skill development, and the hierarchy of authority provides a sensible mechanism for supervision and control in large organizations, (29-30). Although this structure may promote efficiency, in a rapidly changing environment, this type of structure may become overloaded. Because decisions r

encourages adaptability and participation, (28).

The environment for companies today is anything but stable. Managers can no longer forecast with certainty the outcome of their organizations. This has drawn attention to chaos theory, which suggests relationships between complex systems, including organizations, are nonlinear and are composed of many choices that create varying effects and render the environment unpredictable.

In the new environment managers are seeking solutions for today and the future of their organizations. The learning organization offers hope for the future as they seek to change key dimensions of their firms in a chaotic environment. A comparison of both approaches followed by an example will further illustrate the purpose of this article.

Traditionally, the most common organizational structure is controlled through the vertical hierarchy. Decision making comes from top management and works its way down through the organization. According to Daft, "This structure can be quite effective. It promotes efficient production and in-depth skill development, and the hierarchy of authority provides a sensible mechanism for supervision and control in large organizations, (29-30). Although this structure may promote efficiency, in a rapidly changing environment, this type of structure may become overloaded. Because decisions r

n of both approaches followed by an example will further illustrate the purpose of this article.

Traditionally, the most common organizational structure is controlled through the vertical hierarchy. Decision making comes from top management and works its way down through the organization. According to Daft, "This structure can be quite effective. It promotes efficient production and in-depth skill development, and the hierarchy of authority provides a sensible mechanism for supervision and control in large organizations, (29-30). Although this structure may promote efficiency, in a rapidly changing environment, this type of structure may become overloaded. Because decisions rest solely with management, they are not able to respond to changes in the market quickly enough to succeed.

In the learning organization, structure is more horizontal, and tasks are created around processes rather than departmental functions. Furthermore, the hierarchy is considerably flattened, with only a few top managers in finance and HR functions. Daft says, "Self-directed teams are the fundamental work unit in the learning organization. Boundaries between functions are practically eliminated because teams include members from several functional areas, (30). In a rapidly changing environment, the structure of a learning organization allows firms to quickly change and adapt to new market demands. In traditional organizations, strategy is formulated by top managers of the firm, which every worker is expected to abide by. Executives use strategy to guide their organizations through efficiency and performance. Workers have little or no say in the direction and strategy of the firm.

In learning organizations, however, both management and informed workers who are in contact with suppliers, customers, and new technology, contribute ideas and help develop the strategy. The strategy of a learning organization is positioned for success because strategies are more informal and allow for quick changes. According to Mintzberg et al, "Their strategies are sufficiently open-ended to allow for the unexpected, so that their capabilities of organizational learning can deal with rapidly changing situations, (215).

The leadership in traditional organizations will directly influence the strategy, structure, and environment, or indirectly through the culture of the organization. In his article, The Genesis of Configuration, Danny Miller adds, "The personalities of the very top cadre of managers are expected to have dominated influence on the goals, strategies, structures…there will be strong associations of …needs for achievement and power, and neurotic style, with the strategies and structures of the firm, (694).

Conversely, the leadership in learning organizations does not have binding control. Instead, Mintzberg et al, say, "Managers have to learn the art of asking questions, best done at close proximity to operations. In a learning organization, managers become accustomed to walking around and interacting with their subordinates in their work settings, (214-215). Whereas information, knowledge and control of tasks were directed by top management, with learning organizations, information is shared and control of tasks is with employees.

As an example, we will consider Founders Bookstore Services and then give it an organizational makeover to transform it into a learning organization.