How does the horizontal organization influence the agility of the business model? Think about, for example, how innovation is influenced in both the vertical and horizontal organization and how the latter can drive not only production but the capacity to react quickly to changes in, for instance, the supply chain, inventory changes in light of major catastrophes (e.g., Hurricane Katrina), and competition. Comment on any hidden costs in your answer.
Horizontal organization influence the agility of the business model in both positive and negative manner. Its influence is positive in a sense that there is more room to input from most of the staff about the ongoing activities. The staff members work as a team in making decisions and it implementation is hence quick an efficient. The negative influence is because there is not a chain of command and specified duties so it could become a time consuming process to identify the specific functions of all the staff members.
In case of innovation, I would argue that a horizontal organization has more room for it than a vertical organization. In horizontal organization, there is more involvement from the majority of staff and they can directly communicate their thought to the top management. Thus the overall structure of the organization is active and alive and the decisions reflect a collective wisdom of the members of the organization. These organizations thus have the capacity to react quickly to unforeseen circumstances and be more productive. In the case of a vertical organization, there are layers of organizational management and the decisions are made by a few top management members.
In case of a major catastrophes, the top management of the horizontal organization are directly communicating with the staff actively participating on ground. This makes the supply chain management easy as the top management does not have to involve staff members who does not have firsthand information to make decisions about the requirements on ground because these decisions may or may not be accurate about the actual needs.
A horizontal organization may require a skillful on ground staff to provide accurate and meaningful information. This calls for an allocation of more financial resources as the number of staff to be trained is much higher than vertical organizations. The cost may increase if the information supplied by the staff on ground is not accurate due to lake of training or experience.