Abstract
Firms are increasingly adopting blockchains as a form of knowledge engineering to align their internal processes, share information, and improve oversight. We study intraorganizational blockchains from an agency perspective
to understand how the distributed, sequenced, and consensus-based nature of blockchains mitigates information asymmetries and affects organizational structures. First, we explain how blockchains differ from conventional relational, contractual, and system-based mechanisms to address three pertinent information challenges—concentration, continuity, and conflict. Subsequently, we address the consequences of introducing such blockchains, arguing that they create both direct and sequenced information channels among principals and
agents, which elicit an organizational reconfiguration via vertical disintermediation and lateral reintermediation. Finally, we theorize the implications of blockchain-based organizing for agency theory regarding the chain of command, the unity of direction, and the span of control. Overall, we show how blockchains for intraorganizational governance can mitigate principal-agent problems and impact organizational design in profound
ways.
to understand how the distributed, sequenced, and consensus-based nature of blockchains mitigates information asymmetries and affects organizational structures. First, we explain how blockchains differ from conventional relational, contractual, and system-based mechanisms to address three pertinent information challenges—concentration, continuity, and conflict. Subsequently, we address the consequences of introducing such blockchains, arguing that they create both direct and sequenced information channels among principals and
agents, which elicit an organizational reconfiguration via vertical disintermediation and lateral reintermediation. Finally, we theorize the implications of blockchain-based organizing for agency theory regarding the chain of command, the unity of direction, and the span of control. Overall, we show how blockchains for intraorganizational governance can mitigate principal-agent problems and impact organizational design in profound
ways.
| Original language | English |
|---|---|
| Article number | 114195 |
| Number of pages | 12 |
| Journal | Journal of Business Research |
| Volume | 168 |
| Early online date | 2023 |
| DOIs | |
| Publication status | Published - Nov 2023 |
Bibliographical note
Funding Information:The authors would like to express their sincere gratitude to the editor, Arnd Vomberg, for his valuable insights and constructive feedback throughout the review process. We would also like to thank the two anonymous reviewers for their thoughtful comments, which helped to improve the quality of the paper. We cordially thank Herman Balsters, Stefan de Ruiter, and Evert van der Wiel at NorthChain, who supported us with their expertise regarding internal blockchains and their friendly reviews. Finally, we are grateful to Lorenz Graf-Vlachy, Helge Klapper, Jana Oehmichen, Mike Pfarrer, Jan van den Ende, and Wenqian Wang for helpful comments on earlier versions of the manuscript.
Publisher Copyright:
© 2023 The Author(s)