Mintzberg: situation and configuration

1
Mintzberg situation and configuration

• Pål Sørgaard, Telenor RD and IfI
• INF 5250
• September 19, 2005

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!

3
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

4
Age and size hypotheses

• Older organisations tend to rely more on
  formalisation of behaviour
• Theyve seen it all before
• The structure of the organisation tends to
  reflect the age of its industry
• Larger organisations are more elaborate more
  specialised tasks, more differentiated units,
  more developed administrative components
• Larger organisations have larger units
• Larger organisations have more formalised
  behaviour

5
Technical system in the operating core

• Woodwards 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

6
Technical system hypotheses

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

7
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

8
Environment hypotheses

1. A more dynamic environment requires more dynamic
   structure
2. A more complex environment requires more
   decentralised structure
3. Diversified markets generally lead to split into
   market-based units
4. Extreme hostility in the environment leads to
   (temporary) centralisation
5. A mixed environment encourages selective
   decentralisation

9
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)
10
Power issues

• External control
• owners
• politicians
• regulation
• Personal ambitions
• at different positions in the organisation
• Internal power struggles

11
Power hypotheses

1. External control drives centralisation and
   formalisation
2. Power needs of groups favour centralisation, to
   themselves
3. There is fashion and fad in the way organisations
   are structured, sometimes resulting in
   inappropriate structures

12
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
13
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

14
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

15
Variants and hybrids

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

16
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 organisations
  life
• Its very hard to grow large with a simple
  structure
• The transition from simple structure to other
  configurations can be difficult

17
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

18
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
• Webers ideal
• Some remaining cases
• The Norway Post, Oslo sporveier, SAS, traditional
  mass production, classical bureaucracies such as
  the Tax Administration, National Insurance Scheme

19
Max Weber 18641920

• 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)

20
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

21
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

22
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