The networked organization is one that is connected together by informal networks and the demands of the task, rather than a formal organizational structure. The network organization prioritizes its “soft structure” of relationships, networks, teams, groups and communities rather than reporting lines.
In reality, even the most flexible organizations do have some reporting relationships, so a pure networked organization rarely exists. It is more a statement of intent to get things done flexibly rather than to rely on structure.
In this respect, the networked organization is very similar to a matrix . The key challenges of multiple stakeholders, influence without authority, competing goals and accountability without control mean that the skills required to be successful in a network organization or a matrix are very similar.
(Note: disambiguation – although technology is an enabler, ‘networked’ in this context does not refer to computer networks)