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Human-Centred Organization Design

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 The Design Journal
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Human-Centred Organization Design

Rodrigo Magalhães

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Human-Centred
Organization Design
Rodrigo Magalhães 
Kuwait College of Science and Technology, Kuwait

ABSTRACT  The key aim of this article is to give a

contribution to a design-oriented definition of organ-

The Design Journal  DOI: 10.1080/14606925.2018.1426940

ization design, with the human-centred approach to
design (HCD) serving as the epistemological tool.
Highlighting organizational identity as a facilitator or
inhibitor of organization design change, the paper
shares HCD’s focus on meaning with Verganti’s theory
of design-driven innovation. An explanatory model is
put forward detailing the steps in the process of link-
ing the top-down changes from strategy or product
innovation initiatives, as well as bottom-up changes
emerging from organizational practices and relation-
ships, with organizational design change. Organiza-
tional identity is defined as a superordinate conveyer
and transformer of meaning and purpose, assuming
different roles in the creation and dissemination of
meaning, internally, as well as to and from the organ-
ization and the external environment. The paper ends
with a number of recommendations about the need to
focus on the management of identity.
1
 Rodrigo Magalhães

KEYWORDS: organization design, organizational identity, design man-

agement, design change, human-centred design

Introduction
Organization design as a field of study has had many varia-
tions and interpretation. The early research, dominated by a
(social) scientific approach, was characterized by a search
for the variables that might bring about the best fit between environ-
mental contingencies and organizational configurations (Donaldson
1987). This line of research considers organization design as the result
of external forces, with little concern for the internal workings of the
organization and the roles of agency and interaction. Typically, this type
of approach manifested a concern with the testing of hypothesis lead-
ing to causal relationships and generalizable rules, often with the word
‘design’ used as a metaphor equivalent in meaning to ‘structure’ or
‘configuration’, as the dependent variables.
Although still followed by some researchers, contingency repre-
sents the past of organization design, typically an era dominated by
functional thinking, planning methodologies and managerial analytics
(Barry 2016). Standing on the opposite side of the planning mode of
management and organizing, we find the situated mode, which holds
that organizations are not designed but are in a continuous process
of being designed (Johnston and Brennan 1996). Situated organiza-
tion design is epitomized by the image of organizations as systems
of meaning (Daft and Weick 1984) in a state of perpetual flux (Morgan
1997). A group of authors have lent their support to this perspective by
highlighting that organization design (i) is not a static configuration but
a never-ending process of designing (Boland et al. 2008; Ciborra 1996;
Dunbar, Romme, and Starbuck 2008; Garud, Jain, and Tuertscher
2008); (ii) must be viewed as a holistic phenomenon or a ‘gestalt’ (Yoo,
Boland, and Lyytinen 2006), driven by not only technical-structural rules
but also by heuristics or generative rules (Garud, Kumaraswamy, and
Sambamurthy 2006; Parrish 2010; Romme and Endenburg 2006); (iii)
rather than being determined by the environment, organization designs
have the ability to shape and even create new environments (Saras-
vathy et al. 2008).
This literature stream is rich in analysis and filled with insights; how-
ever, it stops short of prescribing solutions for organization design.
More recently, the field of design management has attempted to fill this
gap, by showing an active interest in the relationship between organiza-
The Design Journal

tion design and organizational change (Brown 2008, 2009; Buchanan

2008; De Mozota 2003; Martin 2009). In the Introduction to the Hand-
book of Design Management, Cooper and Junginger (2011) trace the
origins of the field to the Industrial Revolution in England, and explain
why the activities of managing and designing cannot be disentangled.
As time passes, this relationship is becoming better comprehended, as
might be inferred from the following quotation by Buchanan (2016, 19)
2
 Human-Centred Organization Design

Indeed, it is arguable that the most important design products

of the 20th Century are neither products of graphic design nor
of industrial design but products of management, i.e. the design
of organizations, without which no other design discipline could
have any impact on society and the lives of human beings.

In this paper, we aim at building on this tradition and establishing closer

and more practical ties between the design discipline and organization
design. Our starting point is the assertion by Junginger (2015, 210) that
‘designing, like changing, is a core organizational activity’, a statement
that echoes Simon’s (1996, 111) claims that the overarching remit of
design is one of devising ‘courses of action aimed at changing existing
situations into preferred ones’. Indeed, the issue of change is at the
core of the design discipline itself, a discipline that has developed dif-
ferent approaches and schools of thought. One of such schools, which
marks an important departure from the science of design as origi-
nally conceived by Simon (1996), is known as human-centred design
(Krippendorff 2006). Its founder argues that

as soon as we move beyond the engineering of functional prod-

ucts, we need to be concerned with what the artefacts of design
could possibly mean to users and interested parties, with the
multiple rationalities that people can bring to bear on them.
(Krippendorff 2011, 413)

Compared with Simon’s stance on design science, human-centred

design (HCD) reverses the relation between the design object and its
intention. For Simon the artefact is at the core, while for Krippendorff
meaning is the core of the design process and the artefact becomes
a medium for communicating the meanings intended by the designer
(Johansson-Sköldberg, Woodilla, and Çetinkaya 2013)
Although HCD has not been adopted as a foundation for organiza-
tion design, we believe that it holds significant promise. From a different
corner of the spectrum of the organization and management litera-
tures, HCD is making significant progress, through the work of Ver-
ganti (2008, 2009, 2016) on business strategy. This author proposes a
new approach to innovation, named as design-driven innovation, and
founded upon the notion of the meaning of products or services. For
Verganti, innovation does not depend necessarily on the functionality
afforded by new technology, but is strongly dependent upon the mean-
ings attributed by customers to products or services. In his publica-
The Design Journal

tions, Verganti creates a new theory of innovation, and presents many

examples of meaning-driven innovations. Such examples presuppose
important changes in the respective enterprises’ business strategies,
including internal changes in organization design; however, this litera-
ture is generally silent about the new identities, processes and prac-
tices that were assuredly required to support the new meaning-driven
competitive strategies.
3
 Rodrigo Magalhães

In this paper it is suggested that the missing link is the concept of

organizational identity, interpreted in the light of HCD and defined as a
key conveyer of meaning and purpose throughout the organization. By
going to the roots of HCD (Krippendorff 2006), we posit that to design,
including to design organizations, is to create meaning, and that under
this epistemological assumption, organizational identity can play an
important role as a bridging construct between the external and the
internal aspects of design-driven innovation strategies. Our contention
is based on the observation that any messages about an enterprise’s
products or services sent to the external environment and resulting
from the adoption of a strategy based on innovation-as-meaning
must originate from the organization’s internal processes. This, in turn,
implies that before a certain product image is released to the outside
world, a supporting identity orientation must either already exist or be
in formation, inside the enterprise.
After a brief discussion about the interconnections between organi-
zation, design and identity in the next section, Verganti’s key proposals
will be expounded upon in the third section. The fourth section contains
the main contribution of the paper in the form of a model, where the
role of organizational identity is explained as a key cognitive compo-
nent with organization-wide reach, facilitating or inhibiting changes in
organization design. The paper ends with a set of concluding remarks.

The Nexus between Organization, Design and Identity

Our conceptual research starts with the search for common denomi-
nators between traditional notions of organization theory and the con-
fines of design as a discipline. In this endeavour we were struck by the
proximity of the definitions of design and of organizational identity. In
the most frequently cited paper on the topic, organizational identity has
been defined as the shared perceptions of stakeholders about what is
‘central, distinctive, and continuous’ in their organization (Albert and
Whetten 1985). This definition does not stray far from Krippendorff’s
(1989) etymological explanation of the noun ‘design’ as ‘de+signare’,
and his definition of the verb ‘design’ as ‘making something, distin-
guishing it by a sign, giving it significance, designating its relation to
other things’ (Krippendorff 1989, 9, italics added). Looking closely at
the two definitions, it is apparent that they are both underpinned by an
intention to designate or create meaning.
In one of the best synopses of the human-centred approach, Krip-
pendorff (2011) provides a summary of the trajectory of design in the
The Design Journal

last 40 years, from industrial design to the design of discourses. From

such a trajectory of artificiality, the evolution of the design discipline can
be traced, from the design of products to the design of communicative
and social artefacts, the type of artefacts that organizations are mostly
made of. In the same article Krippendorff proposes a set of nine design
principles, put forward as the basis of the governance of contempo-
rary design. The present paper approaches the first and fundamental
principle – Meaning is the Only Reality that Matters – and extends it to
4
 Human-Centred Organization Design

organization design, through the proposition that, in a fashion similar

to meaning in the context of design in general, identity plays a central
role in the shaping and maintenance of organization design, acting as
a superordinate conveyer and transformer of meaning and purpose.
Buchanan’s (1992, 1998) framework of four design orders shows
a similar trajectory, but is somewhat closer to the design of organi-
zations. The first order is about using communication, i.e. symbols,
words and images, to attract people’s attention and to connect them
to each other. The second order focusses on problems of constructing
tangible products that serve human beings in their various activities,
i.e. the engineering, architecture and mass production of artefacts. The
third order of design, emerging in the middle of the twentieth century,
is about how to design human action and interactions that form activ-
ities, processes and services. Finally, Buchanan talks of a fourth order
of design, comprising the design of the environments and systems
within which all the other orders of design exist. This order deals with
the core ideas and values that hold such environments and systems
together, and focusses particularly on the transformation and change
of the systemic whole. Buchannan (1998, 16, italics added) states: ‘the
problems of transition are not problems of action but of reaching a new
understanding of purpose and ends’.
Giacomin (2014, 607) defines human-centred design as a ‘language
which is absorbed and exchanged between people, providing the
basic units of meaning’, and suggests a useful model based on a hier-
archy of human-centred design factors (see Figure 1). At the bottom of
the pyramid, the factors highlight the physical nature of the interaction
of people with products, systems or services, while the factor at the
top – Meaning – highlights the ambitions, desires or wishes of the peo-
ple using the products, systems or services. The suggestion behind
the model is that meaning ‘whether pre-existing or still to be created
through contact, is considered to be the key to social acceptance,
commercial success, brand identity and business identity’ (Giacomin
2014, 612). The model contains a series of questions which focus the

Figure 1.
The human-centred design
(HCD) hierarchy applied to
organization design.
The Design Journal
5
 Rodrigo Magalhães

attention on the different levels of the involvement of people with arte-

facts. As one moves further up the hierarchy, the answers to the ques-
tions not only provide a deeper understanding of the artefact, but also
offer a wider range of affordances that people may expect to get from
the artefact.
Considering that organization design is an overall property that
sums up the characteristics of the organization, it is apparent how
meaning should also be at the apex. In Figure 1, it is shown how mean-
ing (i.e. identity) occupies this position, and how the entirety of the
organization’s design shapes and is shaped by the messages com-
municated by the organization’s identity. In the second layer, the model
features the range of communicative artefacts that the organization
requires to exist and to prosper, such as its mission and vision state-
ments, its brand identity, its policies and procedures, and crucially its
managerial discourse. The third layer answers the question of ‘when’
and represents the organization in action, with its stakeholders inter-
acting through its horizontal processes. The next layer stands for the
traditional understanding of organization design, i.e. the organizational
structure, detailing the roles, functions, activities and reporting lines for
the execution of individual tasks. The bottom layer, arguably the most
important, contains the stakeholders or the agents who turn the organ-
ization’s design from intentions to performance. In such a transition,
the meanings contained within the organization’s identity are instilled
into the practices of stakeholders, whether the interactions take place
within the organization or between internal and external stakeholders.
The arrow going from the top to the bottom layer signifies that stake-
holders are affected directly by the collective perception of identity and
that when performing their tasks or interacting with other stakeholders,
identity is being enacted, and work practices are being shaped and
re-shaped. The small arrows running up and down signify the effect of
identity from one layer to the next. For example, the meaning contained
within the organization’s brand is likely to affect interactions with cus-
tomers through the call centre. Likewise, the meaning contained within
an individual’s job description will most likely have an impact on the
way the customer complaints process is operated.

A Meaning-Driven Approach to Radical Product

Innovation
Verganti (2008) proposes a new approach to product innovation, which
has been labelled design-driven innovation. This approach considers
The Design Journal

the competitive market not as a given to be discovered, but the result

of a fluid process of co-creation, involving the firm and its various
stakeholders. It emphasizes not only the functional needs of consum-
ers, but also the symbolic and emotional meanings of products, and it
gives particular attention to the evolution of socio-cultural trends, in a
networked process of research also involving ‘interpreters’, i.e. experts
in a given segment of the market, who help the company understand
6
 Human-Centred Organization Design

the unfolding socio-cultural trends. Thus, the design-driven approach

to innovation might be characterized in the following way:

• A networked process of research, spanning widely outside the

boundaries of the firm, to include users, but also several interpreters
• A knowledge-sharing process, emphasizing socio-cultural models,
meanings and product languages
• An environment-building process, through the influencing and
seductive power of the interpreters themselves

For Verganti, design deals with the meanings that people give to prod-
ucts, and with the messages or product languages that designers can
devise to convey such meaning. In other words, in addition to the func-
tionality of a product, the customer’s affective and socio-cultural needs
are also ‘tickled’ by the product’s emotional and symbolic value (i.e. its
meaning). One notable example of meaning-driven innovation is Star-
bucks, where the breakthrough is the result of a radical change in the
social meaning of drinking coffee, with no role being played by tech-
nology. This approach is unique in the sense that it contains a novel
definition of radical innovation, where radical changes in meaning play
a role as important as radical technological innovation.
Situations of radical innovation are labelled ‘technology epiphanies’,
explained as ‘a radical change in meaning, enabled by the emergence
of new technologies or the use of existing technologies in totally new
contexts’ (Norman and Verganti 2014, 90). Such epiphanies or supe-
rior applications of a technology happen when a technology which has
been dormant because it does not satisfy existing needs is awakened
by a new product design that challenges the dominant interpretation
of what that product is and creates a brand new, unsolicited product.
One example of a technology epiphany is Wii, the games console that
wiped out the games market after it was launched in 2006.
Figure 2 shows the process model of innovation, originally put
forward by Verganti (2008) and elaborated upon by Norman and
Verganti (2014). It shows the competitive trajectory of Wii, plotted

Figure 2.
Verganti’s model of
meaning-driven innovation
and summary of the Wii
case.
The Design Journal
7
 Rodrigo Magalhães

as the outcome of the two strategic choices in product innovation:

change in technology versus change in product meaning. In the early
days, games were played by small numbers of usually young people
gathered around a console. Sony and Microsoft followed a strategy of
improvement of the primitive graphics technology, and gained market
dominance of the game market with ever more sophisticated graphics.
As internet speeds increased, games become multi-player, with thou-
sands of people playing the same game in different locations across
the world. Nintendo, however, adopted the strategic choice of com-
peting not on technology, but on using known technology, such as
micro-electro-mechanical sensors (MEMS), also known as acceler-
ometers. These relatively inexpensive motion sensors, as well as the
infrared imaging sensors also used by Nintendo, had been around for
a while; however, a smart use of this technology allowed the company
to develop a game controlled by whole body movements, which was
not only innovative but was also within everybody’s reach.
The new combination of technology and market approach radically
changed the meaning of games, i.e. rather than a small niche seg-
ment of skilled experts, the Wii games were something for the entire
family to play, exercise and interact with. It took some time until Sony
and Microsoft were able to catch up, but Microsoft’s Kinect eventually
became the market leader, again by using a new wave of technol-
ogy not requiring the hand-held wands. Thus, the design approach
to product innovation is driven by either advances in technology or
a deliberate change in the meaning of the product; however, it does
not necessarily come from the user, as is suggested by the so-called
human-centred design methodology widely used in product design.
The design approach concerns the development of products that peo-
ple would find meaningful, and therefore love and purchase. It is also
a strategic approach, in the sense that it aims at identifying and build-
ing capabilities which are difficult to replicate by the competition and
give the company a competitive edge. Such capabilities are very much
focussed on the sharing and recombining of resources, aimed at build-
ing new and unique value propositions.
However, for this approach to be sustainable it needs to be sup-
ported by the appropriate design of both the internal and the external
aspects of the organization. In a separate article, Verganti (Verganti and
Öberg 2013) started to address this problem, by introducing a frame-
work for looking at innovation as a process of interpreting and envision-
ing, based on hermeneutics. Hermeneutics is founded upon the notion
that the acquisition of knowledge happens through interpretation and
The Design Journal

reflection, where interpretation takes place in the process of trying to

understand parts of a situation, placed in a larger contextual whole
or, conversely, trying to understand the context as being made up of
many component parts. Reflection implies the iterations between the
two. The meanings of a product such as Wii are the result of these pro-
cesses, occurring through continuous interactions among Nintendo,
designers, users, and several other stakeholders, both inside and out-
side the company.
8
 Human-Centred Organization Design

The centre of attention, these authors assert, should not be on cre-

ativity, but on strategy:

The leaders, together with a team of both internal and exter-

nal interpreters, need to co-create proposals of new meanings
in parallel to the strategic work of vision creation. Innovation of
meaning does not come from users, but from interpretation.
­(Verganti and Öberg 2013, 94)

This view on organization design is clearly focussed on the cognitive

dimension of organization design; however, it ought to be noted that
there are other dimensions, namely structural, relational, service and
normative (Magalhães forthcoming). In this paper, we stay with the
cognitive dimension, but augment it by adopting the well-researched
concept of organizational identity. As a design dimension, identity has
a superordinate quality, in the sense that it stands over and above all
the other dimensions, shaping the way the entire organizational edifice
is understood by the stakeholders.

Organizational Identity as Facilitator or Inhibitor of

Organization Design Change
In this section, we expound on an explanatory model, where the role
of organizational identity as a mediator between the mostly external
aspects of organization design change associated with Verganti’s
meaning-driven approach to strategic innovation and the required cor-
responding internal changes in the company’s organization design is
highlighted. Argote and Kane (2009) explain that organizational identity
plays a ‘superordinate’ role in acting as a governance and coordinating
mechanism influencing knowledge creation and transfer in the organi-
zation. This gives organizational identity extraordinary powers in acting
as a facilitator or inhibitor of organization design change. The model,

Figure 3.
The role of organization
identity in an HCD
conception of organization
design change.
The Design Journal
9
10 The Design Journal

Rodrigo Magalhães

Table 1. Summary of organization identity topics and authors referred to in the paper.

Social and organizational Identity and behavioural Management of organizational

Authors identity Image/reputation Corporate identity change identity
Ashforth, Harrison, and x x
Corley (2008)
Brickson (2005, 2007) x x
Brown et al. (2006) x x
Cornelissen, Haslam, and x x
Balmer (2007)
Dukerich, Golden, and x x
Shortell (2002)
Dutton and Dukerich x
(1991)
Hatch and Schultz (2002) x
Scott and Lane (2000) x
Seidl (2005) x
 Human-Centred Organization Design

shown in Figure 3, borrows mainly from the writings on organizational

identity and identification. A summary of the key authors and concepts
used is contained in Table 1.

Enterprise’s Identity Orientation

Brickson (2007) suggests that in determining how the organization
relates to its stakeholders, identity processes rest at the heart of the role
of the firm. That author puts forward the notion of identity orientation, to
refer to ‘the nature of assumed relations between an organization and
its stakeholders’ (Brickson 2005, 577). Thus, identity orientation cap-
tures how relations with stakeholders are reflected in the organization’s
identity, and also how identity guides the organization’s relationships
with stakeholders.
This is a useful starting point because it provides a map of the path
of the organization’s identity, from the time managerial choices are
made, to the time that organizational relationships and inter-relation-
ships are changed, in practice. The organization’s identity orientation
plays two types of roles: integrative and operative (Seidl 2005, 80).
Under the integrative role, identity orientation provides the organization
with a sense of unity and prevents it from ‘losing itself’, while under the
operative role it provides orientation and guidance, even in the absence
of a hierarchy. An example of the harmful effects of identity orientation
is the case of Nokia, where the organization lost its way, in the compet-
itive environment (Alcacer, Khanna, and Snively 2014).
Identity orientation is a process that starts when new policy guide-
lines, such as a new vision or an innovative product, are adopted and
disseminated throughout the organization, and changes are instilled
into the organization’s existing design. Subsequent actions on the
part of individual stakeholders are guided by such orientation (Scott
and Lane 2000), leading to further identity self-descriptions about the
organization’s work and its outcomes. It may also lead to claims or nar-
ratives about the organization (Seidl 2005), which sometimes originate
from within, but other times originate from the external environment. In
other words, identity orientation is the result of the intentions and the
implementation of managerial choices, as reflected in all the ensuing
identity self-descriptions, as well as the claims and narratives from the
outside world. Its final outcome is behavioural.

Internal and External Components of Organizational

Identity
The Design Journal

The notion of identity orientation should not be understood as a mon-

olithic entity, but as the result of multiple manifestations of identity.
Thus, it is suggested that this notion is the combined outcome of three
types of interacting components: (1) substantive identity, i.e. the tacit
understandings, the shared rules, the values, and the world views of
stakeholders, as well as the respective behavioural outcomes (i.e. the
enactment of identity understandings) – these exert a direct influence
11
 Rodrigo Magalhães

on daily routines; (2) reflective identities, i.e. the claims or narratives

about the organization, including the organization’s internal image, its
external image, and its reputation, which have only an indirect effect on
daily routines; (3) overt forms of identity, constituted by the presenta-
tions about the organization made to external stakeholders, to include
physical premises, corporate and brand identity, and the company’s
products and services (Ashforth, Harrison, and Corley 2008; Hatch and
Schultz 2000; Seidl 2005).
Substantive identity, the major part of organizational identity, is
made up of myriad self-descriptions of the organization, which grow
out of recursive interactions between the processes of sensemaking
and identity enactment (Ashforth, Harrison, and Corley 2008). Sen-
semaking refers to the interpretation and understanding by individual
members of the existing collective perception of identity, while identity
enactment refers to the actions taken by individuals in performing their
daily tasks, in harmony with such sensemaking inputs. The concept
of sensemaking is split into sensebreaking and sensegiving, which are
explained as follows: sensebreaking is about questioning new organ-
izational reality that does not fit prior knowledge, while sensegiving is
about guiding the sensemaking of others according to the organiza-
tion’s prevailing identity orientation.
In other words, while sensemaking serves to reduce knowledge
gaps, sensebreaking serves to accentuate them. Moreover, these two
steps are complemented by processes of condensation and confirma-
tion. Condensation is the process of aggregation of several self-obser-
vations into one, while confirmation explains the process of perceptual
checking and adding new meaning to existing self-descriptions (Seidl
2005). Indeed, the notion of identity orientation can be described as an
ongoing process of perceptual condensation and confirmation.
The second group of components, known as reflective identities,
concerns the organization’s internal and external image, as well as its
reputation. Internal image refers to internal description of the ‘official’
description of the organization, while external image refers to internal
descriptions of the external descriptions of the organization (Brown
et al. 2006; Gioia et al. 2010). The distinction between the two types of
image is important because they elicit different kinds of responses from
organizational members. Internal image is strongly influenced by mana-
gerial pronouncements inside the organization, not generally known on
the outside, while external image is shaped by everything the organiza-
tion does with an external impact. Both have important repercussions
in identity orientation; however, internal image has a more direct and
The Design Journal

dramatic impact on the daily execution of work. Reputation refers to

descriptions of the organization made by external stakeholders. It can
be based on observation of explicit identity manifestations from the
organization or it can be inferred from attitudes or stances taken by the
organization (Dukerich, Golden, and Shortell 2002; Dutton and Duker-
ich 1991).
Finally, the overt forms of identity exert a strong influence on iden-
12

tity orientation given that they provide the most visible face of the
 Human-Centred Organization Design

organization’s identity to the outside world. Marketing communication

tactics affect every stakeholder, even those that are not primarily tar-
geted. For example, when companies advertise, campaigns target not
only consumers, but also employees, community members, suppliers,
the media, as well as stockholders and investors. In a similar fashion,
campaigns to build brand identity or brand equity are often designed
to develop the company’s corporate identity, either by building up the
company’s image or by advocating support for the company’s policies
and programmes (Hatch and Schultz 2000).

Identification with the Organization

Identification with the organization is defined as an individual’s willing-
ness to commit to the organization and to contribute to its goals in a
positive and truthful manner. Identification grows with the number of
self-observations that confirm a certain type of phenomenon or expec-
tation; however, there is also the possibility of rejection, in which case
the new information will not be integrated into existing knowledge.
Situations of no confirmation of self-observations lead to diminished
identification, which may hinder change or cause undesirable changes
to occur.
An approach that helps to understand the process of identification
(or lack of it) is the well-known theory of organizational learning put
forward by Argyris and Schon (1996). The theory is based on the pos-
tulate that organizations create constraints that prevent their individual
members from learning, and lead them to create defence mechanisms.
People in organizations are very often pressured into saying and doing
not what they think is right, but what is right for the organization. With
time, this process becomes internalized, and organizational members
are often unaware that they do not use the theories that they explic-
itly espouse and few are aware of the theories they actually use. An
espoused theory of action, in non-technical terms, means preaching
one doctrine and acting in accordance with a very different set of val-
ues or practices.
Applying to the process of identification, what this means is that
in many organizational settings the espoused mode is prevalent,
and expectations are created that are not matched by events on the
ground. Using Seidl’s (2005) terminology, this means that there is no
confirmation of the self-observation. This creates an environment of
scepticism and negativity, where members identify less and less with
their organization, and eventually stop identifying altogether. Hence,
The Design Journal

it may be concluded that in the process of changing the organiza-

tion’s identity orientation, it must be carefully considered whether the
change expectations are espoused or in-practice. For real change in
identity orientation to happen and change in organization design to be
effected, the construction of identity, image, reputation, and corporate
and brand identity are required, but not sufficient. Consistency and
truthfulness in organizational relationships are also indispensable.
13
 Rodrigo Magalhães

Organizational Practices and Relationships Initiating,

Corroborating, or Undermining Changes in Organization
Design
Changes in organization design often cause changes in organizational
practices and relationships, but sometimes it works the other way
around, i.e. organizational practices and relationships elicit changes in
organization design. Our contention in this paper is that whether organ-
ization design happens in a top-down or a bottom-up fashion, identity
is a key mediating factor. In the top-down mode, identity orientation
drives perceptual mechanisms in stakeholders about the intentions of
management, but in the bottom-up direction changed work practices
at the local level bring about perceived changes in organization design.
These perceptions are the result of changes in relationships among
internal stakeholders, as well as between internal and external stake-
holders. For example, friendly and cooperative relationships between
customers and staff in the customer complaints department are inter-
preted as a company that is ethical regarding customers’ rights. In
other words, the design of the company (i.e. an ethical company) is
inferred from practices and relationships in the customer complaints
department.
These observations are supported by Dukerich, Golden, and
Shortell’s (2002) empirical study, where a positive correlation was found
between the external image of a set of clinics and the physicians’
identification with the system, which in turn was positively related to
cooperative behaviour within the clinics. They also find echo in the
research findings by Nag, Corley, and Gioia (2007) about an empirical
link between the organization’s identity and the organization’s prac-
tices. Finally, the above remarks are reinforced by the assertion made
by Junginger (2015) that organization practices embed past organiza-
tion design decisions and are part of the organization’s design legacy.
Thus, it would be reasonable to assert that changes arising from the
components of organization identity or their inter-relationships are likely
to give rise to changes in meaning of daily practices and in relationships
between and among stakeholders, which in turn will elicit changes in
the perception of organization design.

Concluding Remarks
Verganti (2016, 28) argues that the world we live in has entered a
phase of too much choice and an overcrowding of ideas, leading to a
chronic struggle to reach ‘a stable idea of what is meaningful’. In this
The Design Journal

scenario, the notion of innovation is changing, and the new evidence

points towards a form of competition based on meaning, with or with-
out the use of technology. However, how does one manage the internal
organization around the new competitive strategies or, in other words,
how does this new strategic mind-set translate in terms of organization
design? Taking this as one of our leads, we have persevered on a badly
needed exploration of new ways of theorizing organization design, with
14

Krippendorff’s (2006) human-centred design –the same as Verganti’s –

 Human-Centred Organization Design

as the conceptual lens. Thus, we propose organizational identity as a

bridging device between Verganti’s (2008) vision of design-driven inno-
vation and the goal of organizational design change.
In developing our proposition, we have put forward a framework
for the process of organization design change (see Figure 3). The
framework explains the role of identity in this process, starting from the
construct of identity orientation, which is the outcome of a recursion
between the perceptions of the outside world about the organization
and the organization’s internal perceptions of identity. It is not a frame-
work that is exclusively cognitive in nature, but it also has a behavioural
component, crucial in bringing about change to organization design. It
describes how the various components of organizational identity affect
the willingness and motivation of individuals to identify with the organ-
ization, and how identification plays a crucial role in shaping everyday
practices and relationships. Practices and relationships exert two types
of influence on the organization’s design, i.e. they can be the outcome
of top-down managerially led change or they can be the cause of bot-
tom-up pressures shaping new designs.
As regards practical conclusions, it should be noted, before all else,
that change in organizational design is multi-dimensional, and that
actual change is the result of the combined effect of various forces. This
paper focusses only on the cognitive dimension – identity – a dimension
that is considered to be above all others, and therefore vital for the suc-
cess or failure of any attempts to change the design of organizations.
Having made this caveat, three implications for practice derived from
the arguments presented thus far will be put forward. These are clus-
tered around the theme of the need for identity management. Firstly,
identity needs to be understood as a powerful tool for change, in so
far as it enables new meanings to be established, and old meanings to
be modified. The role of identity sitting at the top of a hierarchical view
of organization design mechanisms must be internalized by manage-
ment (see Figure 1), the implication being that the myriad artefacts that
make up the organization’s design (including identity itself) are primarily
shaped by the meanings created and communicated by management.
The second implication is that consistency in meanings is crucial. The
tacit and explicit values contained in the organization’s identity orienta-
tion will permeate all the other components of the organization’s iden-
tity – internal and external image, reputation, and brand and corporate
identity – and without consistency change will not be achieved. A major
challenge for most companies is to maintain consistency between the
internal and the external manifestations of identity. A relevant ques-
The Design Journal

tion to be asked in the case of the companies practising design-driven

product innovation is: how do these companies match the meanings
collected by the external network of interpreters researching socio-
cultural trends and product languages with the meanings emerging
from their own internal identity affiliations?
The third implication for practice concerns the management of mean-
ing, as a defining feature of leadership (Smircich and Morgan 1982).
15

Indeed, the actions and utterances of managers and entrepreneurs

 Rodrigo Magalhães

frame the context in such a way that the people who work in that con-
text are able to use the created meanings as points of reference. Man-
aging meaning can mean, for example, articulating and making explicit
what previously had remained implicit, creating images and metaphors
or challenging prevailing wisdom. However, meanings are not fixed in the
mind of one individual alone, but are generated in relational processes of
coordinated action (Hersted and Gergen 2013). Likewise, the manage-
ment of meaning should not be seen as anchored on a fixed notion of
identity, but as something dependent upon the type of cooperation and
relationships that management is able to engender, through leadership.

Disclosure Statement
No potential conflict of interest was reported by the author.

Funding
This research did not receive any specific grant from funding agencies
in the public, commercial, or not-for-profit sectors.

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Biography
Rodrigo Magalhães is Professor of Information Systems and Organiza-
tion, currently serving as Dean of Student Affairs at the Kuwait College
of Science and Technology. He is an active researcher at the Centre for
Organization Design and Engineering, INOV, Lisbon, and at the Centre
for Spatial and Organizational Dynamics, University do Algarve, both
The Design Journal

in Portugal. He was formerly a faculty member at the School of Man-

agement and Economics at the Catholic University of Portugal, and he
held a visiting position at the Department of Computer Science and
Engineering, Instituto Superior Técnico, University of Lisbon, Portugal.
Prof. Magalhães is Co-Editor-in-Chief of the journal newly established
by Springer Organization Design and Enterprise Engineering, and has
an extensive publishing record in the areas of organization design,
19
 Rodrigo Magalhães

organizational change, information systems, knowledge management,

organization learning, e-HRM, and e-learning. He holds a PhD from
The London School of Economics, University of London.

ORCID
Rodrigo Magalhães   http://orcid.org/0000-0002-0041-0291

Address for Correspondence

Rodrigo Magalhães, CODE/INOV, Rua Alves Redol, 9, 1000-029
Lisboa, Portugal.
Tel: +351912328575
Email: rodrigo.magalhaes@inov.pt
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