on India Strategy Think Tank I had this to say about Organizational Structure and It's role in Innovation:

The question to ask is :

1.What is the purpose of the structure and processes?

2.Are they serving that purpose?

3. If they are not, what (pardon the word) innovative processes and
structures will facilitate faster communication and better alignment?

I specifically liked the idea of forming a team around a process. A
lot of organizations have such 'cross-functional teams' in place for
specific projects. And a 'extra-constitutional team' often is formed
to help tide over organizational crises.

Why not have a team for each process flow looking after it end-to-
end? Indeed, why not? Why have so many information hand-overs
between otherwise vertical silos?

A cross-functional team around each work process in an
organization??? Amazing thought!

The challenge here would not be to say "my turf-your turf" but "my
outcome...our purpose!"