mintzberg: situation and configuration pål sørgaard, telenor r&d and ifi inf 5250 september...

Mintzberg: situation and configuration

Pål Sørgaard, Telenor R&D and IfI

INF 5250

September 19, 2005

19 September, 2005 Pål Sørgaard, R&D 2

Situational factors of organisations (ch 6) Age and size The technical system used in the operating core Environment (stability, complexity, diversity, hostility) Power relationships

In the group task: determine these factors for your case organisation!

Test the hypotheses in your case organisation!


Relations between design parameters and with the situation We have worked through 9 design parameters These cannot be combined arbitrarily There are some combinations that are really

consistent: these are called configurations

Effective structuring requires a fit between situation and design parameters (congruence)

Today: cover situational factors, hypotheses about congruence and configuration, and two “basic” configurations


Age and size hypotheses

1. Older organisations tend to rely more on formalisation of behaviour– They’ve seen it all before

2. The structure of the organisation tends to reflect the age of its industry

3. Larger organisations are more elaborate: more specialised tasks, more differentiated units, more developed administrative components

4. Larger organisations have larger units

5. Larger organisations have more formalised behaviour


Technical system in the operating core Woodward’s research on

– unit production– mass production– process production (high degree of automation)

Mass production, boring jobs, conflict, hostility, suspicion, focus on control

Automation (IT!) leads to dramatic reduction on the number of unskilled operators in production

– Machines do their jobs without control– Hordes of specialists needed– Change in mix of people and jobs, new culture– Different challenges for management


Technical system hypotheses

6. A more regulating technical systems leads to more formalisation and more bureaucratic structure of the operating core– Remember: this is from the 80ies. Still a lot of manual work

being controlled by elaborate technical systems

7. A more sophisticated technical systems requires a more elaborate nonoperating structure (IT/Telenor)

8. Automation of the operating core transforms a bureaucratic administrative structure into an organic one– Less traditional industry, more knowledge industry,

especially in high-cost economies


Environment

Stability: stable vs dynamic (unpredictable) Complexity: simple vs complex, p 136 Market diversity: integrated vs diversified Hostility: munificent (friendly) vs hostile

Telenor example– From stable to dynamic – From quite simple to increasing complexity– From two integrated services in one market to increased

diversification and many markets– From monopoly to competition and regulation


Environment hypotheses

9. A more dynamic environment requires more dynamic structure

10. A more complex environment requires more decentralised structure

11. Diversified markets generally lead to split into market-based units

12. Extreme hostility in the environment leads to (temporary) centralisation

13. A mixed environment encourages selective decentralisation


Type of organisation and environment (p 144)

stable dynamic

Complex Decentralised

Bureaucratic

(standardisation of skills)

Decentralised

Organic

(mutual adjustment)

Simple Centralised

Bureaucratic

(standardisation of work processes)

Centralised

Organic

(direct supervision)


Power issues

External control– owners– politicians – regulation

Personal ambitions– at different positions in the organisation

Internal power struggles


Power hypotheses

14. External control drives centralisation and formalisation

15. Power needs of groups favour centralisation, to themselves …

16. There is fashion and fad in the way organisations are structured, sometimes resulting in inappropriate structures


Overview of configurations (p 153)

Structural configuration

Prime coordinating mechanism

Key part of organisation

Type of decentralisation

Simple structure

Direct supervision Strategic apex

Vertical and horizontal centralisation

Machine bureaucracy

Standardisation of work processes

Techno-structure

Limited horizontal decentralisation

Professional bureaucracy

Standardisation of skills

Operating core

Vertical and horizontal decentralisation

Divisionalised form

Standardisation of outputs

Middle line Limited vertical decentralisation

Adhocracy Mutual adjustment Support staff Selective decentralisation


An “evolutionary” interpretation

To a large extent organisations compete (companies) As the economy develops, new environmental

challenges emerge (e.g. use of IT) Some organisation try new structures to cope better

with the challenges Those that succeed, tend to win in the competition Some solutions settle as types/configurations Thus, in an evolving economy, it is no surprise that we

over time have an increasing set of typical configurations


The simple structure (ch 8)

Characteristics– prime coordinating mechanism: direct supervision– key part: strategic apex (the boss)– main design parameters: centralisation, organic structure– situational factors: young, small, nonsophisticated technical

system, simple, dynamic environment, possible extreme hostility or strong power needs of top manager, not fashionable

Typical example: the entrepreneurial firm– normally a boss and some employees (operating core)

Under extreme conditions other organisations revert to the simple structure


Variants and hybrids

The simplest structure (more mutual adjustment) The crisis organisation (temporary) The autocratic organisation (dictatorship) The charismatic organisation


Important features

Flexible and dynamic, no bureaucracy Risky (depends on one person) Has a sense of mission, many people like them! Often a stage in a more mature organisation’s life

– It’s very hard to grow large with a simple structure

The transition from simple structure to other configurations can be difficult


The machine bureaucracy (ch 9)

Characteristics– prime coordinating mechanism: standardisation of work

processes– key part: technostructure – main design parameters: behaviour formalisation, vertical and

horizontal job specialisation, usually functional grouping, large operating-unit size, vertical centralisation and limited horizontal decentralisation, action planning

– situational factors: old, large, regulating, nonautomated technical system, simple and stable environment, external control, not fashionable


The organisation as a programmed machine The operating core is the processor The technostructure does the programming Low-level programming where assumptions are hard-

coded into the design– equipment

– job descriptions

The focus is efficiency and control Weber’s ideal Some remaining cases

– The Norway Post, Oslo sporveier, SAS, traditional mass production, classical bureaucracies such as the Tax Administration, National Insurance Scheme


Max Weber 1864–1920

The decisive reason for the advance of bureaucratic organisation has always been its purely technical superiority over any other form of organization. The fully developed bureaucratic mechanism compares with other organizations exactly as does the machine with the non-mechanical modes of production.

Precision, speed, unambiguity, knowledge of the files, continuity, discretion, unity, strict subordination, reduction of friction and of material and personal costs — these are raised to the optimum point in the strictly bureaucratic organization (p 176 in Structure in Fives)


The control issue

Rules, regulations, formal communication, formal chain of authority: predictability

Attempts are made to eliminate all uncertainties, so that the organisation can run smoothly, uninterruptedly

By virtue of its design, the structure is ridden with conflict; the control system is required to contain it

– separation of planning and doing– jobs with little satisfaction– difficult to get heard– vulnerable to disobedience

Conflicts are not resolved, but bottled up


Challenges for the machine bureaucracy Work of complex environments cannot be rationalised

into simple tasks The work of dynamic environments cannot be predicted

and made repetitive Does not cope well with full automation of the operating

core Behaviour and lack of mutual adjustment (govt) Human problems Split strategy formulation and strategy implementation

– Assumes full information– Assumes enough stability so that strategies remain relevant

during implementation


Future of the configuration

Will become less common, especially in rich, developed countries

Will remain superior in mass production involving manual work

Loses (has lost?) its role as the main type of organisation, as the source for general principles about organising

May still thrive in contexts were external control and predictability is given top priority

– this ought to be a dilemma for politicians

mintzberg: situation and configuration pål sørgaard, telenor r&d and ifi inf 5250 september...

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