Organisation have various kinds of boundaries: functional, market segments, geographical, product groups, business units. These boundaries may overlap, even over the external boundary of an organisation (trade unions, industry groups, common market channels).
How the boundary is designed and manifests itself to others is not without meaning and helps people within the boundary to belong to the entity or entities and makes interaction effective.
How does finance interact with production, how does a company act upon competitors on the shelf space in the retail outlet, how does marketing cooperates with production, how do outsiders get involved the innovation process, how do NGO’s operate with various political parties and the general public?
These kind of interactions can be shaped into meaningful forms and thus define the entity.