The Algorithm and the Org Chart: How Algorithms Can Conflict with Organizational Structures

DOI

Algorithms are introducing changes to individuals’ jobs, but do algorithms also lead to changes in the structures of organizations themselves? Organizational structures, as often formalized into organization (org) charts, are meant to facilitate coordinated decision-making. Yet our 10-month ethnographic study of a large online retail company reveals why the organizational structures that facilitate effective decision-making by humans may be in tension with the organizational structures that facilitate effective decision-making using algorithms. Our findings show that the human decision-makers needed small, divided-up sets of decisions, and they had previously accomplished this through how they structured individuals’ roles and teams in the org chart. In contrast, when data scientists developed a new algorithm and first deployed it within organizational structures meant to support human decision-making, they realized that these small divided-up decision spaces were arbitrarily constraining the algorithm’s search space. When not constrained in this manner, the algorithm could identify and recommend better solutions, but those optimal solutions did not always align with the structure of roles and teams in the org chart. This study suggests that as algorithms are integrated into the workplace, organization designs may begin to more explicitly reflect the contours of those algorithms' behaviors.