the Community
 Section C-5: Tailoring organizational structures

Non-Profit Organizations | Government AgenciesJoint Ventures  |  Virtual or Ad Hoc OrganizationsCooperativesInternal Organizational Structures

Purpose of Organizational Structures

When trying to implement a smart community, any number of different organizational structures can work. The choice of the best structure depends on the partners involved in the project, and on the personality and mission of the smart community (see Sections E and I).

Douglas Schuler in his book, “New Community Networks: Wired for Change,” notes that the common purposes of overall organizational structure are to:

  • Develop and communicate a shared vision, plan and voice.
  • Establish and manage how work will be organized, assigned, evaluated and sanctioned.
  • Coordinate work of paid staff and volunteers (especially in the case of non-profit organizations, which tend to be heavily supported by volunteers).

Common Organizational Structures

The types of smart community organizations which turned up in our research included:

  • Non-Profit Organizations
  • Government Agencies
  • Joint Venture Organizations
  • Cooperatives
  • Virtual Organizations

Non-Profit Organizations

Many of the smart community projects we researched were based upon non-profit organizations. This may be because a non-profit organization can serve as a risk absorber, both for private sector partners (who have to keep their eye on short-term profit/loss issues), and for the public sector (by acting as a semi-governmental agency, but without the constraints of rigid policies and procedures or the prohibition against risking scarce government resources on new and untried technologies).

Advantages of Non-Profits

The advantages of non-profit organizations are:

  • They can serve as risk-absorbers for both public and private sector partners, and try out experiments that neither otherwise could.
  • They can act as “neutral ground” for competitors to cooperate.
  • They can provide consistency, stability, and, if well-managed as entrepreneurial organizations, combing the best characteristics of both the public and private sectors.
  • Non-profits provide opportunities for extensive community involvement, and attract volunteers.

Disadvantages of Non-Profits

  • As an additional separate organization, a non-profit requires additional overhead to set up and operate.
  • Non-profits may be constrained in their operation and funding.
  • They may not move quickly enough to respond to the changing environment.
  • Non-profits are often under-staffed and may depend too much on volunteers.
  • This particular form of organization has a mixed reputation in the private sector.

Government Agencies

Another common organizational type was associated with government entities, such as local government, or semi-governmental associations (transportation management associations, Joint Powers of Authority, etc.)

Advantages of Governmental Structures

  • Governmental agencies are already well-established, with formal operating environments and fully-developed institutional infrastructures.
  • Governmental organizations are mandated to serve the entire community, and are thus positioned to address issues of universal service or access.
  • Because of their long history, governmental agencies often have a shared culture and more unified vision about their role and operation than do other forms.

Disadvantages of Governmental Structures

  • When government is in charge, that community sector tends to dominate the development of the smart community.
  • Because of this, questions of “ownership” of the smart community arise from members of other sectors.
  • Private/public partnerships become more difficult to develop, because of barriers in the institutional infrastructure (and the need not to show preference, or seem to show preference for one business over another).
  • Because of its highly bureaucratic nature, government has many challenges to efficiency and effectiveness
  • The political environment increases the tendency to be risk-averse, and financing can be hindered. City-Managed Community Network

Government Agency-Sponsored Joint Venture

Joint Ventures

The third most common type of smart community organizational structure is the joint venture.

Advantages of Joint Venture Organizations

  • A joint venture is the ideal structure for projects with high capital needs (i.e., with an emphasis on developing technical infrastructure).
  • Joint ventures are good for strong private-sector involvement, since this is a common form used in that arena already.

Disadvantages of Joint Venture Organizations

  • Joint venture organizations may not be as interactive with the entire community as others.
  • There may be a higher tendency to de-emphasize or neglect social and public policy issues and concerns.
  • These structures may be more unstable, as alliances shift and technology dynamically develops.
  • Joint ventures dominated by the private sector may be viewed with suspicion, and an eye out for hidden agendas.
  • Joint ventures are not always able to address institutional arrangements.  A Joint Venture Project - Full Service Network


Cooperatives are another type of organizational structure that was much less commonly found, but that is being explored by several current smart community projects.  This is a formal, legally-recognized structure, that can be used as either a for-profit and non-profit organization in nature.

Advantages of Cooperatives

  • All members are owners, and have equal control.
  • Certain functions, such as buying power, can be leveraged with cooperative purchasing.
  • Resources can also be extended and shared among members.

Disadvantages of Cooperatives

  • Because of equal member power and the membership nature of cooperatives, decision-making can be slower.
  • Because of legal definitions and constraints, the purview of cooperatives may be narrower than is workable for a smart community project.
  • Since cooperatives are membership organizations, unless the membership is fully representative of the community, some sectors of the community may be left out. Telecommunications Cooperative Network

Virtual or Ad Hoc Organizations

A new approach being explored by some smart community projects is “virtual teams,” which are organized around specific projects and use a combination of electronic communication (especially e-mail) and traditional communication techniques. Once the project is finished, the team is disbanded. In the private sector, the common example is a team of consulting sub-contractors, pulled together for a specific project.

Advantages of Virtual Organizations

  • They are appropriate for “affinity groups” which may not be geographically contiguous.
  • They are appropriate and tailored for short-term initiatives with clearly-defined products or outcomes.
  • Virtual organizations can be responsive to a rapidly-changing environment.
  • Virtual organizations have lower or non-existent organizational overhead.
  • They can help train key individuals who can the form the nucleus of a smart community.

Disadvantages of Virtual Organizations

  • Virtual organizations have a higher dependency on technology for communication and coordination, and are subject to the same limitations and problems inherent in these technologies.
  • Virtual organizations may be unstable or difficult to manage.
  • Because they are outside the normal institutional infrastructure, they may not necessarily have transformative effects on existing institutions.
  • They are highly dependent on specific individuals and their interests.  Virtual Organization

Internal Organizational Structures

There is great variability in the organizational structures even within each type. For example, the organizational structure of some non-profits is limited to a few board members; some have a very large advisory body and a smaller executive group; and others have large boards, a formal committee structure and paid staff. The roles of the boards often evolve over time. At the beginning of the project, the board’s role is to formulate and clearly articulate a vision to the community; as the project grows, the role of board members becomes that of resource providers and finders; and once the project is in implementation phase, the board members become managers of execution, delivery and quality-maintenance processes.

Regardless of the organizational structure you choose, all smart community projects must address the following authority/responsibility areas by assigning responsibility for development and supervision to a person or group. Most often, the board role with regard to these responsibility areas is to set the general direction, while volunteers or staff then carry out day-to-day operations. In organizations structured around volunteer committees, one technique used to preserve the spirit of the board’s direction in its translation to day-to-day activities, and to promote two-way communication between the board and its committees, is to require that each committee have at least one board member as a committee member, and for staff who have responsibilities in associated areas to serve as ad hoc committee members.

  • Strategic planningdeveloping the mission, vision and goals of the organization
  • Public educationcommunicating with and educating the community about the vision and activities of the organization through the techniques described in Section C1
  • Resource developmentdeveloping annual budgets; pursuing grants or contracts; or recruiting institutional partners with potential cash and in-kind contributions, and raising funds
  • Financebudgeting, accounting and reporting
  • Technicalhardware, software, networking technologies and their application in the project, and system administration activities
  • Volunteer and staff managementrecruiting and managing volunteers and staff
  • Content/application development and supportif the project goals include the development and support of tools, this responsibility area includes design, development, implementation and support of applications and services. If the project goals include the development and maintenance of content and information, this responsibility area also includes coordination with information providers
  • Research and evaluationrecruiting and coordinating research-based components of the project

Organizational Structure & Transformation

Here’s a last work on organizational structure. The best organizational structure will be one that is a good fit given the nature and character of the community, the project leadership, and the goals of the project. The underlying question is: what organizational structure will best support community transformation? Sometimes, the organizational structure that is ideal for the initiation of transformation will not suit the implementation phase as well. Sometimes, the fact that an organization is new, regardless of its structure, is an advantage over trying to transform an existing organization.

Another complication is that blanket characterizations of organizations do not reflect the reality of specific organizations.  For example, there are non-profit organizations which are more entrepreneurial than very large corporations.

The following matrix may help in understanding organizations from the perspective of the nature of organizations, and their natural roles during the different phases of smart community development (Cynthia Mulit, one of the co-directors for the Net at Two Rivers project, developed the original concept).

The Relational/Non-relational vs. Bureaucratic/Expedient Matrix

Quadrant 1: Bureaucratic/Relational

Quadrant 2 Expedient/Relational

Quadrant 3: Bureaucratic/Non-relational 

Quadrant 4:Expedient/Non-Relational

Quadrant 1 Organizations: tend to be large, and operate according to formal policies and procedures.  However, they have a culture that is dependent on relationships more than procedures, and individuals are able to operate more independently and take more risks than in typical bureaucracies. An example of a Quadrant 1 organization is a university. Characteristics of a Quadrant 1 organization in the context of smart community transformation are:

  • The most important factor in successful involvement of a Quadrant 1 organization is the development of mutual trust.
  • They can be a good partner or agent for start-up efforts, if the right relationships have been formed.
  • They can also successfully manage on-going implementation, if by culture or process its decision-making can be representative of the community.

Quadrant 2 Organizations are typically small to medium-sized, and are based in the private sector. As such, they tend to operate according to expediency rather than policy or procedure. An example of a Quadrant 2 organization is a medium-sized commercial telecommunications provider with strong community roots. A new, entrepreneurial non-profit can also be of this type. Characteristics of a Quadrant 2 organization in the context of smart community transformation are:

  • The building of trust is essential for successful involvement of a Quadrant 2 organization. In addition, there must be clear identification of mutual goals (the “coincidence of interests”).
  • They can be good-start-up organizations.
  • One weakness of expediency is that the time-consuming consensus-building process is not valued, which puts at risk the involvement and representation of the broad community.
  • They may not make good implementation leads, if they have competing priorities or lack sufficient resources for the long-term commitment to community transformation.

Quadrant 3 organizations are large, formal organizations. Often, they are managed by elected or appointed officials who come and go. For that reason, middle management in these organizations tends to emphasize policy, procedure, and formal agreements such as contracts much more than they do relationships. Because of an environment where priorities change as elected leadership changes, middle-management also tends to be risk-averse. An example of a Quadrant 3 organization is a large school district, or local government staff. Characteristics of a Quadrant 3 organization in the context of smart community transformation are:

  • The most important emphasis here for success must be on correct navigation through a hierarchy, and formal negotiation and written documentation of all processes and agreements.
  • They don’t make good start-up organizations, because of their risk-averse tendencies and the overhead involved in documentation, protocol, and emphasis on process over outcome.
  • Once momentum for smart community transformation has been created, they can make good implementation agencies, if their role is formally documented and is defined according to outcomes and deliverables (rather than processes).

Quadrant 4 organizations also tend to be large, but they are mostly based in the private sector. While they have bureaucratic tendencies because of their size, they are driven by the bottom line, so they are expedient. Their expediency also increases the cultural willingness to take risks. However, because of their size and emphasis on the bottom line, it is difficult to build long-term relationships, and they might not have strong community ties (in the geographic sense)for these reasons, they are classified as non-relational. An example of a Quadrant 4 organization is a large telephone company. Characteristics of a Quadrant 4 organization in the context of smart community transformation are:

  • The best tactic in involving a Quadrant 4 organization is to discover the right process to “plug in” to the organization’s most flexible and relational aspects. For example, a smart community could market itself as a testbed, and develop a mutually beneficial relationship.
  • They usually don’t make good lead start-up organizations, because of the difficulty they may encounter in representing the broader community; but they do make good partners for the initiating organization, if mutual interests are cultivated.
  • They play one of the most essential roles in the implementation and ongoing maintenance phase of smart communities, because of the importance of the private sector in building and maintaining tools and technical infrastructure. Best of All Worlds