Organizational performance in hierarchies and communities of practice

In a preceding article we have studied the Communities of Practice and their conditions of emergence using an Agent based model of a set of agents facing a continuous flow of problems. We center now our analysis on the performance of this organizational structure in comparison with a two-level hierarchical delegation structure. Our results show the crucial role played by the communication and the specialisation of the agents. Our main result shows that community structures are efficient for competence building, and particularly, if one considers learning in the long term. This paper backs the claim made by Bowles and Gintis [2000] that hierarchy and communities are complementary rather than substitute modes of governance.