Organizational Theory,

Design, and Change

Fifth Edition
Gareth R. Jones

Chapter 9
Organizational Design,
Competences, and
Technology
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Learning Objectives
1. Identify what technology is and
how it relates to organizational
effectiveness
2. Differentiate between three
different kinds of technology that
create different competences
3. Understand how each type of
technology needs to be matched
to a certain kind of organizational
structure if an organization is to
be effective
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Learning Objectives
(cont.)
4. Understand how technology
affects organizational culture
5. Appreciate how advances in
technology, and new techniques
for managing technology, are
helping to increase
organizational effectiveness

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What is Technology?
Technology: the combination of
skills, knowledge, abilities,
techniques, materials, machines,
computers, tools, and other
equipment that people use to
convert or change raw materials
into valuable goods and services

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What is Technology?
(cont.)
Technology exists at three levels

Individual level: the personal

skills, knowledge and competences
that individuals possess
Functional or department level:
the procedures and techniques that
groups work out to perform their
work and create value

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What is Technology?
(cont.)

Technology exists at three levels

(cont.)

Organizational level: the way an

organization converts inputs into
outputs

Mass production: the organizational

technology based on competences in
using standardized, progressive
assembly process to manufacture goods
Craftswork: the technology that
involves groups of skilled workers who
interact closely to produce customdesigned Copyright
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Technology and
Organizational
Technology is present in all
Effectiveness
organizational activities:

Input: allows each organizational

function to handle relationships with
outside stakeholders so that the
organization can effectively manage
its specific environment
Conversion: transforms inputs into
outputs
Output: allows an organization to
effectively dispose of finished goods
and services to external stakeholders
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Figure 9-1: Input,

Conversion and Output
Processes

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Technical Complexity: The

Theory of Joan Woodward

Programmed technology: a
technology in which the
procedures for converting inputs
into outputs can be specified in
advance

Tasks can be standardized and the

work process can be made
predictable

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Technical Complexity
(cont.)

Technical complexity: the extent

to which a production process can
be programmed so that it can be
controlled and made predictable

High technical complexity: exists

when conversion processes can be
programmed in advance and fully
automated
Low technical complexity: exists when
conversion processes depend
primarily on people and their skills
and knowledge and not on machines
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Technical Complexity
(cont.)

Woodward identified 10 levels of

technical complexity that are
associated with three types of
production technology:

Small-batch and unit technology

Large-batch and mass production
technology
Continuous-process technology

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Technical Complexity
(cont.)

Small-batch and unit technology

Involves making one-of-a-kind,

customized products or small
quantities of products
The conversion process is flexible,
thereby providing the capacity to
produce a wide range of goods that
can be adapted to individual orders
Is relatively expensive
Scores lowest on the dimension of
technical complexity
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Technical Complexity
(cont.)

Large-batch and mass production

technology

Involves producing large volumes of

standardized products
The conversion process is
standardized and highly controllable
Allows an organization to save
money on production and charge a
lower price for its products
Scores higher on the technical
complexity dimension
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Technical Complexity
(cont.)
Continuous-process technology

Involves producing a steady stream

of output

Production continues with little

variation in output and rarely stops

Individuals are only used to manage

exceptions in the work process
Tends to be more technically
efficient than mass production
Scores highest on the technical
complexity dimension
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Figure 9-2: Technical

Complexity and Three Types
of Technology

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Technical Complexity and

Organization Structure

An organization that uses smallbatch technology

Impossibility of programming
conversion activities because
production depends on the skills
and experience of people working
together
An organic structure (chap. 4) is
the most appropriate structure for
this technology
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Technical Complexity and

Organization Structure
(cont.)
An organization that uses mass
production technology

Ability to program tasks in advance

allows the organization to
standardize the manufacturing
process and make it predictable
A mechanistic structure (chap. 4)
becomes the appropriate structure
for this technology
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Technical Complexity and

Organization Structure
(cont.)
An organization that uses mass
production technology

Tasks can be programmed in advance,

and the work process is predictable and
controllable in a technical sense
Still the potential for a major systems
breakdown
An organic structure is the appropriate
structure for this technology

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Figure 9-3: Technical

Complexity and
Organizational Structure

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Technical Complexity and

Organization Structure (cont.)
Technological imperative

The argument that technology

determines structure
Aston studies found that:

Technology is one determinant of

structure
Organizational size is a more important
determinant of structure

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Routine Tasks and Complex

Tasks: The Theory of Charles
Perrow

Perrows two dimensions

underlie the difference between
routine and nonroutine or
complex tasks and technologies:

Task variability
Task analyzability

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Theory of Charles Perrow

(cont.)

Task variability: the number of

exceptions new or unexpected
situations that a person
encounters while performing a task

Is low when a task is standardized or

repetitious

Task analyzability: the degree to

which search activity is needed to
solve a problem

Is high when the task is routine

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Theory of Charles Perrow

(cont.)
Four types of technology

Routine manufacturing:
characterized by low task variability
and high task analyzability
Craftswork: both task variability
and task analyzability are low
Engineering production: both task
variability and task analyzability are
high
Nonroutine research:
characterized by high task variability
and low task analyzability
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Figure 9-4: Charles Perrow

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Theory of Charles Perrow

(cont.)

When technology is routine,

employees perform clearly defined
tasks work process is
programmed and standardized

Mechanistic structure

Nonroutine technology requires the

organization to develop structure
that allows employees to respond
quickly to manage exceptions and
create new solutions

Organic structure
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Table 9-1: Routine and

Nonroutine Tasks and
Organizational Design

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Task Interdependence: The

Theory of James D.

Task interdependence: the

Thompson

manner in which different

organizational tasks are related to
one another affects an
organizations technology and
structure
Three types of technology

Mediating
Long-linked
Intensive
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Theory of James D.
Thompson (cont.)

Mediating technology: a
technology characterized by a
work process in which input,
conversion, and output activities
can be performed independently
of one another

Based on pooled task

interdependence

Each part of the organization

contributes separately to the
performance of the whole organization

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Theory of James D.
Thompson (cont.)

Long-linked technology: based

on a work process in which input,
conversion, and output activities
must be performed in series

Based on sequential task

interdependence

Actions of one person or department

directly affect the actions of another

Slack resources: surplus resources

that enable an organization to deal
with unexpected situations
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Theory of James D.
Thompson (cont.)

Intensive technology: a technology

characterized by a work process in
which input, conversion, and output
activities are inseparable

Based on reciprocal task

interdependence

The activities of all people and all

departments are fully dependent on one
another

Specialism: producing only a narrow

range of outputs
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Figure 9-5: Task

Interdependence and Three
Types of Technology

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From Mass Production to

Advanced Manufacturing
Technology

Mass production is based on:

Dedicated machines: machines

that can perform only one operation
at a time and that produce a narrow
range of products
Fixed workers: workers who
perform standardized work
procedures, thereby increasing an
organizations control over the
conversion process
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From Mass Production to

Advanced Manufacturing
Technology (cont.)
Mass production:

Attempts to reduce costs by

protecting its conversion processes
from the uncertainty of the
environment
Makes an organization inflexible

Fixed automation
Expensive and difficult to begin
manufacturing a different kind of product
when customer preferences change

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Figure 9-6: Work Flows

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Advanced Manufacturing
Technology: Innovations in
Materials
AdvancedTechnology
manufacturing technology:
technology which consists of innovations
in materials and in knowledge that
change the work process of traditional
mass-production organizations
Materials technology: comprises
machinery, other equipment, and
computers

Organization actively seeks ways to increase

its ability to integrate or coordinate the flow
of resources between input, conversion, and
output activities

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Advanced Manufacturing
Technology (cont.)
Computer-aided design (CAD): an
advanced manufacturing technique that
greatly simplifies the design process

Computers can be used to design and

physically manufacture products

Computer-aided materials
management (CAMM): an advanced
manufacturing technique that is used to
manage the flow of raw materials and
component parts into the conversion
process, to develop master production
schedules for manufacturing, and to
control inventory

Flow of inputs determined by customer demand

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Advanced Manufacturing
Technology (cont.)
Just-in-time inventory (JIT)
system: requires inputs and
components needed for production
to be delivered to the conversion
process just as they are needed

Input inventories can then be kept to a

minimum
CAMM is necessary for JIT to work
effectively
Increases task interdependence
between stages in the production
chain
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Figure 9-7: Just-in-Time

Inventory System

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Flexible Manufacturing
Technology

Technology that allows the

production of many kinds of
components at little or no extra
cost on the same machine

Each machine is able to perform a

range of different operations
Machines in sequence able to vary
operations so that a wide variety of
different components can be
produced
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Computer-Integrated
Manufacturing (CIM)

An advanced manufacturing
technique that controls the
changeover from one operation to
another by means of commands
given to the machines through
computer software

Depends on computers programmed to:

Feed the machines with components

Assemble the product from components and
move it from one machine to another
Unload the final product from the machine
to the shipping area

Use of robots integral to CIM

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