Thesis
The hierarchical structure theory explains why David Grossman, as well as other mid-level IBM managers, had difficulties obtaining senior-level management attention, thus pushing IBM towards failure and into the "sleeping giant" phase of the organizational life cycle. The "grassroots" initiative supervised by John Patrick, succeeded as it promoted an organic structure, preventing the Vicious Circles of Bureaucracy. Canavino's management style allowed Patrick to flourish by balancing psychological and sociological empowerment. In addition, treating all levels of employees as information sponges led to normative compliance. Resource dependency theory explains why IBM was able to morph from a sleeping giant, to an industry leader.
Old Big Blue
The company's large hierarchical structure made it difficult, if not impossible, to understand and manage external issues effectively. Hierarchical structure breeds unbalanced power, effectively leading to corruption within the organization. If we believe balanced power leads to effective communication within an organization, then it is evident why IBM was failing because of the "turf battles" among managers. IBM senior-level management were preserving and/or increasing their power while ignoring lower-level employees (the definition result of corruption). The result of communication lines being damaged was apparent when Grossman (an organization sensor) faced difficulties sharing his knowledge to decision makers. This inability to adapt and respond to the external issues thrust IBM into the "sleeping giant" stage of the organizational life cycle.
Avoiding the Vicious Circles of Bureaucracy
The vicious circles of bureaucracy apparent in IBM (prior to Grossman ...