We are experiencing a rapid transformation of the world of work. Just within the few last years we have seen a dramatic increase in virtual work, gig work, different forms of collaborations beyond organizational boundaries, and artificial intelligence. All these changes guide new thinking about how work could and should be done, and organizations are driven to experiment with different work designs. To facilitate the navigation amidst all these choices of alternative work arrangements, I decided to review existing work design models to propose a new typology of work design modes and their implications for Human Resource Management (see Reiche, 2023).
My review of existing models suggests that there are two principal conceptual categories that derive from critical features that organizations need to manage: work interdependence and work autonomy. I define work interdependence as the extent to which performing work depends on work interactions with externalized labor. A high share of externalized labor is common to companies like Uber, for example. Work autonomy refers to the extent of an individual’s freedom in how the work is done, including freedom to craft work roles and responsibilities. These two principal categories allow us to distinguish between two dimensions: an organization’s preference for internalized vs externalized labor (dimension of work interdependence), and an organization’s low vs high work autonomy (dimension of work autonomy). Based on these two dimensions I derive four work design modes.
Let’s starts with the organization-defined work design, which is characterized by the predominant use of internalized labor and low work autonomy, and it represents a work design we are traditionally most familiar with. Integral to this approach is a centralized, top-down method of structuring work roles and allocating employees to these roles. Naturally, interaction between employees is necessary to get things done, yet employees are mostly internal to the organization, and they are employed on a full-time basis. Some degree of autonomy is possible, for example in how the designated work role is performed, yet autonomy is limited when it comes to questions like how a certain role could be structured in the first place.
In light of all the volatility, an organization-defined work design is rather rigid and slow to respond to necessary changes. Hence, organizations might look to the best ways to move away from an organization-defined work model by either increasing the level of work autonomy, or by increasing the level of external work interdependence.
When organizations increase the work autonomy, they switch to the self-directed internal work design. In this design, work is still done primarily by internal labor, yet there is a greater emphasis on less hierarchical and more self-directed approaches to work. The main employment mode here combines high degrees of work autonomy with internal work interdependence, which resembles the work of an intrapreneur (i.e., a corporate entrepreneur who is employed full-time by the organization). Such an approach encourages project-based work and frequent internal rotations. A great example of the self-directed internal work design is Haier Group, a multinational firm headquartered in China, which develops, manufactures, and sells a variety of home appliances and consumer electronics in over 100 countries. The company is structured as numerous independent microenterprises with the power to make strategic decisions, recruit and deploy personnel, and distribute profits. Full-time employees at Haier rotate within an internal talent market, so that when one microenterprise reaches its goals, its employees need to switch to another microenterprise. This internal talent market relies on peer-feedback and publicly displayed achievements for employees, which makes personnel appraisal and coordination a highly decentralized process. Similarly, the reward structure is decentralized, as profits are based on the microenterprise’s performance and are distributed among microenterprise employees.
If organizations keep work autonomy low but increase external work interdependence, we can speak of a formalized external work design. Organizations adopting this mode typically experience fragmentation of their workforce and use externalized labor, for example short-term agency workers, freelancers, and platform-mediated contractors. Formalizing external work interdependencies benefits organizations by reducing costs, increasing organizational flexibility and skill variety, and may also improve innovation. Yet, this distant working relationship may also pose challenges in terms of potential disruptions to workflow and/or problems with work quality. These challenges are solved by restricting workers’ autonomy. Although external contractors may decide on how, where or when to perform the assigned work, the work tasks and its structure remain organizationally prescribed and clearly bounded. Performance appraisals are primarily customer led, and the reward structure is mainly based on completion of predefined tasks or projects. In my article, I illustrate this work design with the example of Spanish law firm Ambar Partners. Ambar has a small internal team dedicated to quality control and project management, yet its main group of professionals—the lawyers—are independent workers, suggesting a high level of external work interdependencies. Although the lawyers have certain autonomy over the process of performing the work, Ambar centrally predefines client scope, fixes pricing, and regularly monitors the quality of performance.
Finally, a more radical shift from the traditional model of work involves relaxing both restrictions regarding work interdependence and work autonomy. A strong focus on external work interdependence and high levels of work autonomy are inherent to the self-governing work design. In such organizations, flexible entrepreneurs join other individual and organizational actors to design and deliver specific projects. This mode of work is common to start-ups, film production projects or event organizations. An exemplary case that I describe in the article is New York-based instrumental band Snarky Puppy. Currently the band is comprised of over 40 international musicians, with most members also playing in other music groups. All band members are involved in the creative process, the composition of acting band members changes for any given concert or project, new members join based on a vetting process of existing members, and collective profit is shared among members in an egalitarian manner. As members are encouraged to think like owners and are granted equal and significant opportunities to co-create musical output, members’ commitment to the collective is high.
All in all, the work design typology I propose could serve as a navigation tool for managers to first choose the direction of change, and second, use it as a strategic tool to change their organizations according to the requirements and affordances of the new world of work.