19/01/2024

BUSN9350
OB & HRM: A Global Perspective
Week 3 Organisational Structure &
Behaviour

Professor Soo Hee Lee

s.h.lee@kent.ac.uk

“One Best Way”

• The notion of a single organizational structure and way of managing

that is highly effective in a variety of organizations held sway up to
the late 1950s

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“It Depends”

• In the 1950s the view that there is no “one best way” of

managing & organizing emerged
• Contingency – emerged in the context of studies on small
group decision-making and leadership – focus was on
situational factors
• This laid the groundwork for the emergence of the
contingency approach
• Most developed stream is structural contingency approach

Structural Contingency Approach

• Contingency seeks to discourage the search for universal
principles of management
• “…the form of management is dependent on the situation the
(organization) is trying to meet…there is no single set of principles for
good organization” (Burns & Stalker, 1966)

• The “right” way to manage and organize is dependent on

specific factors such as the environment, technology or size
• “It follows that there is an overriding management task in first
interpreting correctly the market and the technological situation, in
terms of instability or of the rates at which conditions are changing,
and then designing the management system appropriate to the
conditions and making it work” (Burns & Stalker, 1966)

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Environment

• Burns & Stalker differentiated between a stable, predictable

environment and an uncertain, less predictable environment

• Organizations in different environments must have different

organizational structures
• Mechanistic – Stable environment
• Organic – Uncertain environment
• Task uncertainty driven by innovation is the contingency
variable

Organisational Structure

Mechanistic Organic

• High specialization • Loose roles

• Written Communication
• Managers control knowledge
• Commitment to means
• Bureaucracy
• Face-to-face communication
• Knowledge spread among
employees
• Commitment to goals
• Flexible

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Technology
• Woodward argued that managers should organize according
to the logic of the production technology and not according
to an abstract principle such as “division of labour”
• Primitive production technology – the organization was fairly
informal and organic (small batch, unit production)
• If production technology was specialized and involved in
mass production, the organization was more formalized and
mechanistic (large batch, mass production)
• Automated production meant work teams and organic
organization (process production, continuous flow)
• The advance of technology (predictability, smoothness) led
first to more mechanistic and then to more organic
structures

Interestingly…..

• Both Woodward and Burns & Stalker believed that the

future of management was organic organization and a
human relations style of management
• They believed that this would be forced on managers by
technological change

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The Aston Studies

• The Aston Studies argued that there is a connection

between organizational size and organization structure
• In looking at organizational structure, this work
differentiated between:
• Structuring of activities – specialization by function, rules and
documents
• Concentration of authority – centralization of decision-making

• The Aston empirical work concluded that for:

• Structuring of activities – size is the main contingency
• Centralization – size is the main contingency along with whether or
not the organization is a subsidiary of a parent company
• The bigger an organization (number of people employed) the
more likely it would be bureaucratic
• The smaller an organization the less likely it would be bureaucratic

SARFIT
• The notion of SARFIT was developed by Lex Donaldson in response to
the lack of dynamism of the Aston Studies
• Structural Adjustment to Regain Fit (Donaldson, 1987)
• There is a fit between each contingency and one (or more) aspects of
organizational structure
• Good fit positively impacts on organizational performance bad fit has
a negative impact
• Organizations can fall out of fit and must readjust
• Cycle of adaptation:
Fit-Contingency Change-Misfit-Structural Adaptation-New Fit
Donaldson argues that competitive pressures will mean that managers
cannot afford to ignore changing contingencies and so will adjust their
structure

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Structural Contingency – The New

Panacea?
• Contingency theory appears to provide a new means to
achieve organizational success

• There is a strong normative stance embedded in the

contingency approach:
• Managers must intervene in the process by which organizations
change and develop
• Managers must identify the optimum solution to the problems of a
particular organization, in a particular set of organizational
circumstances

Do managers always respond to

contingency change?
• John Child challenged the structural contingency approach and
developed the notion of STRATEGIC CHOICE
• Though contingencies have an impact, there is a substantial degree of
choice around change and that organizational structure is a
consequence of the actions taken by the dominant group within an
organization
• Managers in position of control make strategic choices about how
they will configure their organizations
• The top management team that constitutes the dominant coalition
will constantly be evaluating the organization’s competitive position
• BUT managers’ perceptions, preferences, values, interests and the
political processes of conflict and power will impact on the choices
they make
• Managers may prefer to minimize misfit rather than maximize fit

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Bartlett & Ghoshal Typology of Integration & Response

Discussion Questions for the Seminar

Organisational Culture
Organizational Culture Edgar Schein
https://youtube.com/watch?v=wd1bsxWeM6Q&si=xGeK1w_7ybOI6ohz
Amazon's Work Culture and Its Impact on Employee Turnover
https://youtube.com/watch?v=NLYauMMjcnM&si=8RbI4pD5aN8-FNKV
Inside Google's Insane Headquarters
https://youtube.com/watch?v=72zcF1sQWEY&si=VWS2FzN8LlH_ISa3
Where does organisational culture come from?
Compare and contrast the organisational culture of Amazon and
Google.
Could multinational firms maintain a uniform corporate culture
around the world?
How can you build a healthy and sustainable organisational
culture?

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Bartlett & Ghoshal Typology of Integration & Response