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Biographical Note ‘Asoc rotesirof Managemen Cleef ‘Donne and Econo, Univer of ‘Whitewater, Wisconsin 53190, USA Management Research News Mintzberg’s ‘Pentagon’ and Organisation Positioning by William A. Drago Mintzberg’s (1979) Pentagon Model of Ideal Structures has become a popular ‘means of teaching, analysing and describing organisation structural designs. Yet, organisation theorists know relatively little about the actual positioning of organi- sations within this model. Do organisations tend to have structures that mirror one ideal form or are hybrid structures common where organisations combine two or more different forms? Are there firms that have structures that do not conform well to any of these forms? This study is designed to answer these basic questions conceming this popular model. The purpose of this analysis is to provide the reader with greater insight concerning the applicability of this model to existing organisa- tions and to stimulate further research directed at validating and/or improving this, popular conceptual OT tool Re Mintzberg introduced his Pentagon of Ideal Structures with the publication of The Structuring of Organizations in 1979. Over the past eighteen years this model has become very popular as a means of introducing students to the complexities of organisation design and for describing and analysing organisations and their situ- ational contexts. According to Mintzberg (1993, 1979) the structure of firms can be viewed in terms of a five-comered model with each comer representing an ‘ideal’ structure. These structures are considered ideal because they represent appropriate “fits’ between design parameters of organisation structure and because the mix of design parameters associated with the structure match certain situational or contex- tual factors (e.g. size and age of organisation, environmental volatility, complexity and hostility, technology and external power). Design parameters discussed by Mintzberg (1979) fell into four general categories including the design of positions, superstructure, lateral linkages, and decision-making systems. In addition, each ideal structure was described as having a primary coordinating mechanism and a “part” of the organisation whose importance and influence was described as greater than would be seen in other ideal structures. Table I identifies these ideal structures and includes a description of the design parameters, the primary coordinating mechanism, influential part of the organisation, and important contextual factors associated with that structure Mintzberg’s (1979) model has become popular as a teaching tool in Organisa- tion Theory courses and is increasingly used in the OT literature to aid conceptual understanding. As an example, Miller (1986), in an article awarded the *1995 Best Paper Prize” by the Strategic Management Journal, used these ideal structures as a basis for developing a configuration of strategy and structures. Relatively little empirical research has been performed directed at validating assertions made in this model or attempting to further clarify use and understanding of the model. As noted by Doty, Glick and Huber (1993), "few theories have received so much attention in ‘management textbooks and organisational science journals with such meagre em- pirical support." (p.1197). Doty, etal., provide one of the few attempts at determin- ing the strength of Mintzberg’s (1979) ‘pentagon model’ (1993). Their study attempted to show that each of the ideal structures would be associated with a unique 30 Volume 21 Number 4/5 1998 context, that organisations with appropriate ‘fit’ between structure and context would be more effective and that the closer an organisation’s structure was to an al type the more effective it would be. The results of their analysis provided little support for these hypotheses. Empirical support for the existence of these ideal forms as structural factors was provided by Drago (1997). Through a factor analysis of structural characteristics, four factors resembling Mintzberg’s machine, division- alised, professional and adhocratic structures were found. This study provides two useful insights to Mintzbere’s pentagon. First, the emergence of factors resembling ideal structures suggests that ‘fits’ across design parameters and coordinating mechanisms associated with certain ideal structures do exist. Second, the study suggests the strong possibility of ‘hybrid’ forms. That some ideal structures were generated through a factor analysis indicates some independence across factors or the ideal forms they represent. This finding highlights the potential for firms to build structures using multiple ideal forms at once. Table Description of Mintsberys Idea Structures . deal Severe ]Coordinating [Key Pan Design [Conessal Mccann Parameters [Paco Simple Dirt siategic Apex |Centralisaon, Young. smal Supervision organe [namic ev hostile sopisicatea | |tesnical system Machine system |Sid of Work [Technoxiucure [Formalsation, ~ |Lare, ol Process fork |reglating’non- specialisation, factomat fictional” fechncal simple, srounng, vericat|sabe env 7 fentalisiion external control Professional [Sid of Skis _[Operaing Coe [Trining, Complex, table Rorzontajob [enw non: | specaton, pulang, non |secenvatsed” —|sophisuesieg |_ echnical sytem Divisinaised [Sid of Ouput | Middle Line | Market grouping, [Diversified Performance: markets old onset system, flare, power Timed verte [needs middle ascension _|tanage Ahocracy | aust Suppor Staff (or [Liaison devices [Complex, ftensysiem [Adjustment [Operating Cars) logan taining, [Osean nw, lkzonal job" |soung peciaation — Sopnticaed, automated echnical Methodology Information for this study was obtained from the CEOs of ninety-one organisations. These firms responded to a questionnaire sent to 156 firms that had participated in an earlier study directed at identifying relationships between strategy, structure, environment and performance. For the original study, firms were randomly selected from Standard and Poor's Industrial Compustat. The questionnaires were mailed directly to the CEOs of the selected companies. Financial and other information on these companies was also collected from Industrial Compustat and Disclosure. Table II provides a comparison of participating firms with all firms listed in 3 Management Research News Industrial Compustat. As can be seen, participating firms were generally larger and more profitable than the population of firms included in Industrial Compustat le I: Statistical Comparison of Sample with Compustat Population Data Item ‘Compust ‘Sample (7341 firms) Ol firms) Total Sales: Minimum 482,000 88,000 ‘Maximum 126,131;000;000] 120,387,700,000) Mean '871,919,000] 3,128'090,000] Std. Dev. 4,369,633,000| 14,074:850, 000] Total Assets: Minimum o| 21,000 ‘Maximo, 349,574,000,000| 164,063,100,000 Mean 1604,513,000] 5.128,350,000] ‘Sid. Dev. 81929°244,000 20,031,240,000| Return on Sales: ‘Minimum =111.000} 0.5762 ‘Maximum 304.500) 0.8623 Mean 0091 0.0193 Sid, Dev. 4.106 0.1544 Respondents were asked to identify structural characteristics of their organisa- tion concemed with describing the position of the organisation within Mintzberg’s (1979, 1993) ‘Pentagon’. A seven-point Likert scale was used to guide responses with a ‘7° indicating strong agreement with the item and ‘1’ indicating weak agreement, Indices were developed for each of the five ideal structures. These indices and items associated with each are provided below: 1) Simple structure: Direct supervision is a primary coordinating mechanism in operations, A B. Decision-making is guided by a strong sense of mission/vision, C. Communication is vertical, following the hierarchy of management, D, E Communication is regulated along formal lines (-), and Decision-making is guided by standard operating procedures (-). 2) Machine structure: ‘A. Standardisation of tasks is a primary coordinating mechanism in operations, B. Decision-making is guided by standard operating procedures, C. Communication is regulated along formal lines, D. Decision-making is guided by action-planning (planned programmes of activities) E, Communication is vertical, following the hierarchy of management, and F. Major units are departmentalised by function performed. 3) Divisional structure: Standardisation of output is a primary coordinating mechanism in operations, ion is vertical, following the hierarchy of management, ion is regulated along formal lines, 32