Effective Intra-Organizational Collaboration: A Performance Management Perspective

Understanding factors that influence intrafirm coordination and collaboration is crucial for today’s complex organizations to succeed. This thesis explores the factors influencing intra-organizational collaboration as a mean to achieve coordination and its relationship with performance management, within a large multidivisional company. Building on the literature on coordination, collaboration, information sharing, trust and performance management, as well as on the specific literature on supply chains, the thesis provides a grounded theory model to understand the factors influencing intra-organizational collaboration in organizations and their relation to coordination. Further, the thesis examines the performance management measures that have an influence on intra-organizational collaboration. To study these phenomena empirically, a qualitative single-case study was conveyed using grounded theory principles. The case study aimed to understand the collaboration between two core functions of the case company’s supply chain, the sales companies and the supply operations. The collection of primary and secondary data included 20 interviews with 20 informants in identified roles, at different management levels. The Gioia methodology was applied in analyzing the data. The findings of the study indicate that the following factors influence intra-organizational collaboration: accurate expectations associated with roles, familiarity, having visibility of updated project information, achieving consensus and synchronization, goals and incentives alignment, transparency within a project, and trust development. The relationship between performance management and collaboration resides in goals and incentives alignment. The thesis provides four main practical recommendations for the case company: a) create a better understanding of the interdependences in the project as a key to bridging organizational boundaries, b) ensure that the optimization of full-chain costs is incentivized to contribute to collaboration between sales companies and supply units, c) enable the development of trust through the development of internal networks and interpersonal relationships, and d) design common performance measurements that are shared between different units or functions as a mean to align incentives and goals. This thesis brings two main theoretical contributions: a) the formalization of the relationship between performance management and intra-organizational collaboration through goals and incentives alignment, and b) the generalization of frameworks about inter-organizational collaboration to intra-organizational collaboration in the context the supply chain of a multidivisional company