Hollow organisation
A hollow organisation concentrates on selected core activities and outsources many other activities to external providers. Its boundaries reflect decisions about what capabilities to retain, not the absence of substantive work or accountability. Supplier dependence, coordination, quality and protection of knowledge require active management.
Worked example
A design business retains product design and customer relationships while external providers handle manufacturing, payroll and distribution under monitored agreements.
Common mistake
Assuming outsourcing removes responsibility for outcomes or that a hollow organisation must have no employees.
Where it appears in your exams
| Qualification | Exam | Relationship | Period |
|---|---|---|---|
| ACCA | BT | Direct | September 2026–June 2027 |
| ACCA | SBL | Supporting | September 2026–June 2027 |
| FIA | FBT | Direct | September 2026–June 2027 |