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Why has information technology taken the machine industry so long to adapt to the cry for smaller cars? Why does a film production group go out its conglomerate visitor to start on its own? Why do so many public hospitals and universities wither under government controls? These questions tin exist answered in many ways, with lots of reasons. But 1 reason common to them all, the author of this article would say, is that some element in the organisation'south design was ill suited to the task. Large machine bureaucracies are perfect for efficient mass production but not for adapting quickly to new situations. Film product divisions rely on flexible structures in club to innovate, which is difficult to achieve in a conglomerate that controls operations with the bottom line. Finally, public hospitals and universities require a grade of professional control incompatible with the technocratic standards governments tend to impose. The author of this article has institute that many organizations fall close to ane of 5 natural "configurations," each a combination of certain elements of structure and situation. When managers and organizational designers try to mix and lucifer the elements of dissimilar ones, they may emerge with a misfit that, similar an ill-cut piece of article of clothing, won't clothing very well. The cardinal to organizational pattern, and so, is consistency and coherence.
- A conglomerate takes over a small manufacturer and tries to impose budgets, plans, organizational charts, and untold systems on information technology. The consequence: failing sales and product innovation—and about defalcation—until the sectionalisation managers buy dorsum the visitor and promptly plough it around.
- Consultants make abiding offers to introduce the latest direction techniques. Years ago LRP and OD were in way, later, QWL and ZBB.
- A regime sends in its analysts to rationalize, standardize, and formalize citywide school systems, hospitals, and welfare agencies. The results are devastating.
These incidents suggest that a not bad many problems in organizational pattern stem from the supposition that organizations are all akin: mere collections of component parts to which elements of structure tin can exist added and deleted at will, a sort of organizational bazaar.
The opposite assumption is that constructive organizations achieve a coherence amongst their component parts, that they do not change i element without because the consequences to all of the others. Spans of control, degrees of job enlargement, forms of decentralization, planning systems, and matrix structure should non be picked and called at random. Rather, they should be selected co-ordinate to internally consistent groupings. And these groupings should be consistent with the state of affairs of the organization—its age and size, the conditions of the industry in which it operates, and its production applied science. In essence, like all phenomena from atoms to stars, the characteristics of organizations fall into natural clusters, or configurations. When these characteristics are mismatched—when the wrong ones are put together—the arrangement does not role effectively, does non achieve a natural harmony. If managers are to design constructive organizations, they need to pay attention to the fit.
If we look at the enormous amount of inquiry on organizational structuring in low-cal of this idea, a lot of the defoliation falls away and a hit convergence is revealed. Specifically, five clear configurations emerge that are singled-out in their structures, in the situations in which they are constitute, and even in the periods of history in which they first developed. They are the elementary structure, car bureaucracy, professional bureaucracy, divisionalized form, and adhocracy. In this article I describe these configurations and consider the letters they contain for managers.
Deriving the Configurations
In order to draw and distinguish the 5 configurations, I designed an adaptable picture of five component parts (see part A, Exhibit 1). An organization begins with a person who has an idea. This person forms the strategic apex, or top management. He or she hires people to exercise the basic work of the organisation, in what can be called the operating core. Every bit the organization grows, information technology acquires intermediate managers between the chief executive and the workers. These managers course the heart line. The organization may as well find that information technology needs two kinds of staff personnel. First are the analysts who pattern systems concerned with the formal planning and control of the work; they form the technostructure. 2nd is the support staff, providing indirect services to the rest of the organisation—everything from the cafeteria and the mail room to the public relations section and the legal counsel.
Exhibit one The V Bones Parts of the System
These v parts together make the whole arrangement (see function B, Showroom 1). Not all organizations need all of these parts. Some apply few and are unproblematic, others combine all in rather complex ways. The central purpose of structure is to coordinate the work divided in a variety of means; how that coordination is achieved—by whom and with what—dictates what the organization will look similar (meet Exhibit 2):
Exhibit two The Five Configurations
- In the simplest case, coordination is achieved at the strategic apex past direct supervision—the chief executive officer gives the orders. The configuration called simple structure emerges, with a minimum of staff and middle line.
- When coordination depends on the standardization of piece of work, an arrangement's entire administrative structure—especially its technostructure, which designs the standards—needs to be elaborated. This gives rise to the configuration called machine hierarchy.
- When, instead, coordination is through the standardization of skills of its employees, the organization needs highly trained professionals in its operating cadre and considerable support staff to back them upward. Neither its technostructure nor its middle line is very elaborate. The resulting configuration is chosen professional bureaucracy.
- Organizations volition sometimes exist divided into parallel operating units, assuasive autonomy to the centre-line managers of each, with coordination achieved through the standardization of outputs (including performance) of these units. The configuration called the divisionalized form emerges.
- Finally, the most circuitous organizations engage sophisticated specialists, particularly in their back up staffs, and crave them to combine their efforts in project teams coordinated past mutual aligning. This results in the adhocracy configuration, in which line and staff as well every bit a number of other distinctions tend to break downwards.
I shall describe each of these five configurations in terms of construction and situation. But kickoff let me listing the elements of structure, which are described in more than detail in the Appendix. These include the following:
- Specialization of tasks
- Formalization of procedures (job descriptions, rules, and then forth)
- Formal grooming and indoctrination required for the task
- Grouping of units (notably by function performed or marketplace served)
- Size of each of the units (that is, the bridge of control of its manager)
- Action planning and functioning command systems
- Liaison devices, such equally task forces, integrating managers, and matrix structure
- Delegation of power down the chain of authority (called vertical decentralization).
- Delegation of power out from that concatenation of authority to not-managers (called horizontal decentralization).
Likewise included in the Appendix, together with their impact on these elements of construction, are the situational factors—namely, the age and size of the organization, its technical system of product, and various characteristics of its environment (east.m., how stable or complex it is) and of its power system (e.g., how tightly information technology is controlled externally.)
Our job now is to see how all of these elements cluster into the five configurations. I describe each in the sections that follow and summarize these descriptions in Showroom 3, where all the elements are displayed in relation to the configurations. In the discussions of each configuration, information technology should become more than axiomatic how all of its elements of structure and situation class themselves into a tightly knit, highly cohesive package. No 1 element determines the others; rather, all are locked together to class an integrated organisation.
Exhibit iii Dimensions of the Five Configurations
Simple Structure
The name tells all, and Showroom two shows all. The structure is simple—not much more than i large unit consisting of i or a few peak managers and a group of operators who exercise the basic work. The virtually mutual simple structure is, of course, the classic entrepreneurial company.
What characterizes this configuration above all is what is missing. Picayune of its beliefs is standardized or formalized, and minimal employ is fabricated of planning, training, or the liaison devices. The absence of standardization means that the organization has little need for staff analysts. Few heart-line managers are hired because and then much of the coordination is achieved at the strategic apex past direct supervision. That is where the real ability in this configuration lies. Even the support staff is minimized to keep the structure lean and flexible—simple structures would rather purchase than make.
The organization must be flexible considering it operates in a dynamic environment, often by choice considering that is the one place it can outmaneuver the bureaucracies. And that environment must be simple, as must the organization's system of product, then that the chief executive can retain highly centralized control. In turn, centralized control makes the elementary structure platonic for rapid, flexible innovation, at least of the simple kind. With the right chief executive, the organisation can plough on a dime and run circles effectually the slower-moving bureaucracies. That is why so much innovation comes non from the giant mass producers simply from small entrepreneurial companies. Merely where circuitous forms of innovation are required, the uncomplicated structure falters considering of its centralization. As we shall see, that kind of innovation requires another configuration, one that engages highly trained specialists and gives them considerable power.
Simple structures are ofttimes immature and small, in office considering aging and growth encourage them to bureaucratize only also because their vulnerability causes many of them to fail. They never become a risk to grow old and big. 1 heart set on tin can wipe them out—every bit tin can a chief executive then obsessed with innovation that he or she forgets about the operations, or vice versa. The corporate landscape is littered with the wrecks of entrepreneurial companies whose leaders encouraged growth and mass product still could never take the transition to bureaucratic forms of structure that these changes required.
Yet some simple structures take managed to grow very large under the tight command of clever, autocratic leaders, the most famous instance beingness the Ford Motor Co. in the later years of its founder.
Virtually all organizations begin their lives equally uncomplicated structures, granting their founding chief executives considerable latitude to set them upward. And most revert to uncomplicated structure—no matter how large or what other configuration unremarkably fits their needs—when they confront extreme pressure level or hostility in their environment. In other words, systems and procedures are suspended as ability reverts to the chief executive to give him or her a hazard to gear up things correct.
The heyday of the unproblematic construction probably occurred during the catamenia of the nifty American trusts, tardily in the nineteenth century. Although today less in fashion and to many a relic of more autocratic times, the unproblematic structure remains a widespread and necessary configuration—for building upwards most new organizations and for operating those in simple, dynamic environments and those facing extreme, hostile pressures.
Car Hierarchy
Just equally the simple structure is prevalent in pre-Industrial Revolution industries such every bit agriculture, the car hierarchy is the offspring of industrialization, with its emphasis on the standardization of piece of work for coordination and its resulting low-skilled, highly specialized jobs. Exhibit 2 shows that, in dissimilarity to simple structure, the car bureaucracy elaborates its administration. Offset, it requires many analysts to blueprint and maintain its systems of standardization—notably those that formalize its behaviors and plan its actions. And past virtue of the organisation's dependence on these systems, these analysts gain a degree of breezy power, which results in a certain amount of horizontal decentralization.
A large bureaucracy emerges in the middle line to oversee the specialized work of the operating core and to keep the lid on conflicts that inevitably result from the rigid departmentalization, as well equally from the alienation that oft goes with routine, confining jobs. That middle-line hierarchy is unremarkably structured on a functional ground all the style upwardly to the height, where the real ability of coordination lies. In other words, machine bureaucracy tends to be centralized in the vertical sense—formal power is concentrated at the summit.
And why the large support staff shown in Exhibit 2? Because machine bureaucracies depend on stability to function (modify interrupts the smooth functioning of the organization), they tend not only to seek out stable environments in which to part but likewise to stabilize the environments they find themselves in. One way they practice this is to envelop within their structures all of the support services possible, ones that simple structures prefer to buy. For the same reason they also tend to integrate vertically—to go their own suppliers and customers. And that of course causes many auto bureaucracies to abound very big. So we run into the two-sided upshot of size here: size drives the organization to bureaucratize ("We do that every solar day; let'due south standardize it!"), but bureaucracy also encourages the organization to abound larger. Aging also encourages this configuration; the organisation standardizes its work because "we've done that before."
To enable the peak managers to maintain centralized command, both the environment and the product system of the auto hierarchy must be fairly simple. In fact, automobile bureaucracies fit most naturally with mass product, where the products, processes, and distribution systems are commonly rationalized and thus easy to comprehend. And so car bureaucracy is most common amidst large, mature mass-product companies, such as motorcar manufacturers, as well as the largest of the established providers of mass services, such as insurance companies and railroads. Thus McDonald's is a classic example of this configuration—achieving enormous success in its elementary industry through meticulous standardization.
Because external controls encourage bureaucratization and centralization, this configuration is oftentimes causeless by organizations that are tightly controlled from the exterior. That is why government agencies, which are subject to many such controls, tend to be driven toward the car bureaucracy structure regardless of their other conditions.
The problems of the car hierarchy are legendary—dull and repetitive work, alienated employees, obsession with control (of markets as well as workers), massive size, and inadaptability. These are machines suited to specific purposes, not to adapting to new ones. For all of these reasons, the car bureaucracy is no longer stylish. Bureaucracy has become a dirty word. Nevertheless this is the configuration that gets the products out cheaply and efficiently. And hither as well in that location can be a sense of harmony, every bit in the Swiss railroad arrangement whose trains depart as the 2nd hand sweeps past the twelve.
In a club consumed past its appetite for mass-produced goods, dependent on consistency in so many spheres (how else to deliver millions of pieces of mail service every day?) and unable to automate a great many of its routine jobs, machine hierarchy remains indispensable—and probably the well-nigh prevalent of the 5 configurations today.
Professional Hierarchy
This bureaucratic configuration relies on the standardization of skills rather than piece of work processes or outputs for its coordination and so emerges as dramatically dissimilar from the motorcar bureaucracy. It is the construction hospitals, universities, and bookkeeping firms tend most often to favor. Nearly important, because it relies for its operating tasks on trained professionals—skilled people who must exist given considerable control over their own work—the system surrenders a skilful bargain of its power not just to the professionals themselves but as well to the associations and institutions that select and railroad train them in the get-go place. As a result, the structure emerges as very decentralized; power over many decisions, both operating and strategic, flows all the way down the hierarchy to the professionals of the operating core. For them this is the most autonomous structure of all.
Considering the operating procedures, although complex, are rather standardized—taking out appendixes in a infirmary, teaching the American Motors case in a business organisation school, doing an audit in an accounting firm—each professional can work independently of his or her colleagues, with the balls that much of the necessary coordination will be effected automatically through standardization of skills. Thus a colleague of mine observed a five-hour open heart performance in which the surgeon and anesthesiologist never exchanged a unmarried give-and-take!
As can be seen in Exhibit two, in a higher place the operating core nosotros detect a unique structure. Since the main standardization occurs as a event of training that takes place exterior the professional bureaucracy, a technostructure is hardly needed. And because the professionals work independently, the size of operating units can be very large, and so few first-line managers are needed. (I piece of work in a business school where 55 professors report directly to i dean.) Yet fifty-fifty those few managers, and those above them, do picayune direct supervision; much of their time is spent linking their units to the broader environment, notably to ensure adequate financing. Thus to become a superlative director in a consulting house is to become a salesperson.
On the other paw, the back up staff is typically very large in order to support the high-priced professionals. But that staff does a very different kind of work—much of it the elementary and routine jobs that the professionals shed. As a result, parallel hierarchies emerge in the professional bureaucracy—one autonomous with bottom-upward power for the professionals, a 2d autocratic with top-down command for the support staff.
Professional bureaucracy is most constructive for organizations that find themselves in stable all the same complex environments. Complexity requires that decision-making ability be decentralized to highly trained individuals, and stability enables these individuals to apply standardized skills and so to work with a good deal of autonomy. To farther ensure that autonomy, the production system must be neither highly regulating, complex, nor automatic. Surgeons use their scalpels and editors their pencils; both must exist sharp only are otherwise elementary instruments that let their users considerable liberty in performing their complex work.
Standardization is the bang-up strength equally well equally the great weakness of professional hierarchy. That is what enables the professionals to perfect their skills and then reach great efficiency and effectiveness. Merely that same standardization raises problems of adaptability. This is not a construction to innovate but one to perfect what is already known. Thus, and then long equally the environment is stable, the professional bureaucracy does its job well. It identifies the needs of its clients and offers a set of standardized programs to serve them. In other words, pigeonholing is its great forte; change messes up the pigeonholes. New needs arise that autumn between or across the slots, and the standard programs no longer apply. Another configuration is required.
Professional person bureaucracy, a product of the middle years of this century, is a highly fashionable structure today for two reasons. First, it is very democratic, at least for its professional person workers. And second, it offers them considerable autonomy, freeing the professionals even from the demand to coordinate closely with each other. To release themselves from the close control of administrators and analysts, non to mention their own colleagues, many people today seek to have themselves declared "professional"—and thereby turn their organizations into professional bureaucracies.
Divisionalized Form
Similar the professional hierarchy, the divisionalized form is not then much an integrated organization as a prepare of rather independent entities joined together by a loose administrative overlay. But whereas those entities of the professional person bureaucracy are individuals—professionals in the operating core—in the divisionalized grade they are units in the middle line, called divisions.
The divisionalized form differs from the other iv configurations in ane central respect: information technology is not a complete just a partial structure, superimposed on others. Those others are in the divisions, each of which is driven toward machine hierarchy.
An organization divisionalizes for 1 reason to a higher place all—because its product lines are diversified. (And that tends to happen most often in the largest and well-nigh mature organizations, those that have run out of opportunities or become stalled in their traditional markets.) Such diversification encourages the organization to create a market-based unit, or division, for each singled-out product line (as indicated in Exhibit 2) and to grant considerable autonomy to each division to run its own business.
That autonomy notwithstanding, divisionalization does not amount to decentralization, although the terms are often equated with each other. Decentralization is an expression of the dispersal of decision-making power in an organisation. Divisionalization refers to a construction of semiautonomous marketplace-based units. A divisionalized structure in which the managers at the heads of these units retain the lion's share of the power is far more than centralized than many functional structures where large numbers of specialists get involved in the making of important decisions.
In fact, the most famous instance of divisionalization involved centralization. Alfred Sloan adopted the divisionalized form at General Motors to reduce the ability of the different units, to integrate the holding company William Durant had put together. That kind of centralization appears to have continued to the point where the automotive units in some ways seem closer to functional marketing departments than truthful divisions.one
But how does top management maintain a semblance of command over the divisions? Some direct supervision is used—headquarters managers visit the divisions periodically and authorize some of their more than important decisions. But also much of that interferes with the necessary autonomy of the divisions. So headquarters relies on performance command systems or, in other words, on the standardization of outputs. It leaves the operating details to the divisions and exercises command past measuring their performance periodically. And to design these control systems, headquarters creates a small-scale technostructure. It also establishes a small central back up staff to provide sure services common to the divisions (such as legal counsel and external relations).
This functioning control organization has an interesting effect on the internal structure of the division. Beginning, the division is treated as a single integrated entity with ane consistent, standardized, and quantifiable set of goals. Those goals tend to get translated downwardly the line into more than and more specific subgoals and, eventually, work standards. In other words, they encourage the bureaucratization of construction. And second, headquarters tends to impose its standards through the managers of the divisions, whom information technology holds responsible for divisional performance. That tends to issue in centralization within the divisions. And centralization coupled with bureaucratization gives machine bureaucracy. That is the structure that works best in the divisions.
Simple structures and adhocracies make poor divisions because they abhor standards—they operate in dynamic environments where standards of any kind are hard to constitute. (This might partly explain why Alan Ladd, Jr. felt he had to leave the picture division of Twentieth-Century Fox.two) And professional bureaucracies are not logically treated every bit integrated entities, nor can their goals be easily quantified. (How does one measure cure in a psychiatric ward or cognition generated in a university?)
This decision is, of course, consequent with the earlier statement that external command (in this example, from headquarters) pushes an system toward machine bureaucracy. The point is invariably illustrated when a conglomerate takes over an entrepreneurial company and imposes a lot of bureaucratic systems and standards on its simple structure.
The divisionalized form was created to solve the problem of adaptability in motorcar hierarchy. By overlaying some other level of administration that could add and subtract divisions, the organization institute a manner to arrange itself to new conditions and to spread its risk. But there is another side to these arguments. Some evidence suggests that the control systems of these structures discourage run a risk taking and innovation, that the division head who must justify his or her performance every month is non complimentary to experiment the mode the independent entrepreneur is.3
Moreover, to spread chance is to spread the consequences of that risk; a disaster in one division tin pull downwardly the entire organization. Indeed, the fear of this is what elicits the directly control of major new investments, which is what often discourages ambitious innovation. Finally, the divisionalized form does not solve the trouble of adaptability of car hierarchy, it merely deflects it. When a sectionalisation goes sour, all that headquarters seems able to do is modify the management (as an independent board of directors would exercise) or divest it. From society's point of view, the trouble remains.
Finally, from a social perspective, the divisionalized form raises a number of serious issues. Past enabling organizations to grow very large, it leads to the concentration of a bully deal of economic power in a few hands. And in that location is some evidence that it sometimes encourages that power to exist used irresponsibly. By emphasizing the measurement of performance as its means of control, a bias arises in favor of those divisional goals that can be operationalized, which usually ways the economic ones, not the social ones. That the division is driven by such measures to exist socially unresponsive would not seem inappropriate—for the business of the corporation is, after all, economical.
The trouble is that in big businesses (where the divisionalized course is prevalent) every strategic determination has social likewise as economic consequences. When the screws of the operation control system are turned tight, the division managers, in social club to reach the results expected of them, are driven to ignore the social consequences of their decisions. At that point, unresponsive behavior becomes irresponsible.iv
The divisionalized structure has become very fashionable in the by few decades, having spread in pure or modified form through nearly of the Fortune "500" in a series of waves and then into European companies.5 It has also become fashionable in the nonbusiness sector in the guise of "multiversities," large hospital systems, unions, and regime itself. And still it seems fundamentally ill suited to these sectors for two reasons.
Starting time, the success of the divisionalized form depends on goals that tin exist measured. Simply exterior the business organisation sector, goals are often social in nature and nonquantifiable. The result of operation control, and so, is an inappropriate displacement of social goals by economic ones.
Second, the divisions frequently require structures other than motorcar hierarchy. The professionals in the multiversities, for instance, often balk at the technocratic controls and the meridian-down decision making that tends to accompany external control of their campuses. In other words, the divisionalized form can exist a misfit just as can whatsoever of the other configurations.
Adhocracy
None of the structures discussed and then far suits the industries of our age—industries such as aerospace, petrochemicals, think-tank consulting, and filmmaking. These organizations demand above all to introduce in circuitous ways. The bureaucratic structures are too inflexible, and the simple structure is too centralized. These industries require "project structures" that fuse experts drawn from different specialties into smoothly functioning creative teams. Hence they tend to favor our fifth configuration, adhocracy, a structure of interacting project teams.
Adhocracy is the most difficult of the v configurations to describe because it is both complex and nonstandardized. Indeed, adhocracy contradicts much of what we take on organized religion in organizations—consistency in output, control by administrators, unity of command, strategy emanating from the top. It is a tremendously fluid structure, in which ability is constantly shifting and coordination and command are by mutual adjustment through the informal communication and interaction of competent experts. Moreover, adhocracy is the newest of the five configurations, the one researchers take had the least run a risk to study. Yet it is emerging every bit a central structural configuration, one that deserves a expert deal of consideration.
These comments notwithstanding, adhocracy is a no less coherent configuration than any of the others. Similar the professional hierarchy, adhocracy relies on trained and specialized experts to go the bulk of its work done. Simply in its case, the experts must work together to create new things instead of working apart to perfect established skills. Hence, for coordination adhocracy must rely extensively on mutual aligning, which information technology encourages by the apply of the liaison devices—integrating managers, task forces, and matrix structure.
In professional bureaucracy, the experts are concentrated in the operating cadre, where much of the power lies. Merely in adhocracy, they tend to be dispersed throughout the construction according to the decisions they make—in the operating core, middle line, technostructure, strategic noon, and especially back up staff. Thus, whereas in each of the other configurations ability is more or less concentrated, in adhocracy it is distributed unevenly. It flows, non according to authority or status but to wherever the experts needed for a item decision happen to exist found.
Managers abound in the adhocracy—functional managers, projection managers, integrating managers. This results in narrow "spans of control" by conventional measures. That is non a reflection of command but of the small size of the project teams. The managers of adhocracy do not control in the conventional sense of direct supervision; typically they are experts too who take their place alongside the others in the teams, concerned especially with linking the dissimilar teams together.
Every bit can be seen in Exhibit 2, many of the distinctions of conventional structure disappear in the adhocracy. With ability based on expertise instead of authorization, the line/staff stardom evaporates. And with power distributed throughout the construction, the stardom between the strategic apex and the residual of the construction also blurs. In a projection construction, strategy is not formulated from above and and then implemented lower downwardly; rather, it evolves by virtue of the multitude of decisions made for the projects themselves. In other words, the adhocracy is continually developing its strategy as information technology accepts and works out new projects, the creative results of which tin never be predicted. Then everyone who gets involved in the projection work—and in the adhocracy that can hateful virtually everyone—becomes a strategy maker.
In that location are two basic types of adhocracy, operating and administrative. The operating adhocracy carries out innovative projects direct on behalf of its clients, usually under contract, as in a creative advertising agency, a recall-tank consulting firm, a manufacturer of engineering science prototypes. Professional person bureaucracies work in some of these industries too, but with a unlike orientation. The operating adhocracy treats each client trouble as a unique one to be solved in creative fashion; the professional hierarchy pigeonholes information technology so that it can provide a standard skill.
For example, in that location are some consulting firms that tailor their solutions to the client'south order and others that sell standard packages off the rack. When the latter fits, information technology proves much cheaper. When it does not, the money is wasted. In one example, the experts must cooperate with each other in organic structures to innovate; in the other, they can utilise their standard skills autonomously in bureaucratic structures.
In the operating adhocracy, the operating and authoritative work blend into a unmarried effort. That is, the organization cannot easily split the planning and design of the operating work—in other words, the projection—from its actual execution. So another classic distinction disappears. As shown above the dotted lines in Showroom 2, the arrangement emerges as an organic mass in which line managers, staff, and operating experts all work together on project teams in ever-shifting relationships.
The administrative adhocracy undertakes projects on its own behalf, every bit in a infinite agency or a producer of electronic components. NASA, for example, equally described during the Apollo era past Margaret K. Chandler and Leonard R. Sayles, seems to be a perfect example of administrative adhocracy.six In this type of adhocracy, in contrast to the other, nosotros notice a precipitous separation of the authoritative from the operating work—the latter shown by the dotted lines in Showroom 2. This results in a two-part structure. The authoritative component carries out the innovative design work, combining line managers and staff experts in project teams. And the operating component, which puts the results into production, is separated or "truncated" then that its need for standardization will not interfere with the project work.
Sometimes the operations are contracted out altogether. Other times, they are fix up in independent structures, equally in the printing function in newspapers. And when the operations of an organization are highly automated, the same event takes place naturally. The operations essentially run themselves, while the administrative component tends to adopt a project orientation concerned with modify and innovation, with bringing new facilities on line. Note also the effects of automation—a reduction in the demand for rules, since these are congenital right into the mechanism, and a blurring of the line/staff distinction, since control becomes a question more of expertise than authority. What does it mean to supervise a machine? Thus the effect of automation is to reduce the degree of machine hierarchy in the assistants and to drive it toward administrative adhocracy.
Both kinds of adhocracy are ordinarily establish in environments that are complex as well as dynamic. These are the ii atmospheric condition that telephone call for sophisticated innovation, which requires the cooperative efforts of many different kinds of experts. In the instance of administrative adhocracy, the production system is also typically complex and, as noted, frequently automated. These product systems create the need for highly skilled support staffers, who must be given a good deal of power over technical decisions.
For its part, the operating adhocracy is frequently associated with young organizations. For 1 thing, with no standard products or services, organizations that use it tend to be highly vulnerable, and many of them disappear at an early age. For some other, age drives these organizations toward bureaucracy, as the employees themselves age and tend to seek an escape from the instability of the structure and its surround. The innovative consulting firm converges on a few of its most successful projects, packages them into standard skills, and settles downwards to life as a professional bureaucracy; the manufacturer of prototypes hits on a hot product and becomes a automobile bureaucracy to mass-produce it.
But non all adhocracies make such a transition. Some endure as they are, continuing to innovate over long periods of time. Nosotros see this, for instance, in studies of the National Film Board of Canada, famous since the 1940s for its creativity in both films and the techniques of filmmaking.
Finally, fashion is a cistron associated with adhocracy. This is clearly the structure of our historic period, prevalent in most every industry that has grown up since World State of war 2 (and none I can remember of established before that time). Every characteristic of adhocracy is very much in vogue today—expertise, organic structure, project teams and task forces, diffused power, matrix structure, sophisticated and often automated production systems, youth, and dynamic, circuitous environments. Adhocracy is the only one of the five configurations that combines some sense of democracy with an absence of bureaucracy.
Yet, like all the others, this configuration too has its limitations. Adhocracy in some sense achieves its effectiveness through inefficiency. Information technology is inundated with managers and costly liaison devices for communication; nothing ever seems to get done without everyone talking to everyone else. Ambiguity abounds, giving rise to all sorts of conflicts and political pressures. Adhocracy can do no ordinary thing well. But it is extraordinary at innovation.
Configurations equally a Diagnostic Tool
What in fact are these configurations? Are they (1) abstract ideals, (two) real-life structures, one of which an organization had better use if it is to survive, or (3) edifice blocks for more complex structures? In some sense, the reply is a qualified yes in all three cases. These are certainly abstruse ideals, simplifications of the circuitous earth of structure. Nonetheless the abstract ideal can come up to life too. Every organization experiences the v pulls that underlie these configurations: the pull to centralize past the summit management, the pull to formalize by the technostructure, the pull to professionalize by the operators, the pull to balkanize by the managers of the middle line, and the pull to collaborate past the support staff.
Where one pull dominates—where the conditions favor it above all—and then the system volition tend to organize itself close to one of the configurations. I accept cited examples of this throughout my give-and-take—the entrepreneurial visitor, the hamburger chain, the university, the conglomerate, the space agency.
But i pull does not always dominate; two may have to exist in residual. Symphony orchestras engage highly trained specialists who perfect their skills, as do the operators in professional bureaucracy. But their efforts must be tightly coordinated hence, the reliance on the direct supervision of a leader—a conductor—as in simple structure. Thus a hybrid of the two configurations emerges that is eminently sensible for the symphony orchestra (even if it does generate a practiced deal of conflict betwixt leader and operators).
Besides, we accept companies that are diversified effectually a central theme that creates linkages among their unlike product lines. As a outcome, they continually experience the pull to dissever, as in the divisionalized form, and also integrate, as in machine hierarchy or peradventure adhocracy. And what configuration should we impute to an IBM? Clearly, there is likewise much going on in many behemothic organizations to describe them as one configuration or another. But the framework of the five configurations tin can notwithstanding help u.s. to understand how their different parts are organized and fit together—or refuse to.
The point is that managers can improve their organizational designs by considering the different pulls their organizations feel and the configurations toward which they are drawn. In other words, this ready of five configurations can serve as an constructive tool in diagnosing the problems of organizational design, especially those of the fit amidst component parts. Allow us consider four bones forms of misfit to show how managers tin employ the set of configurations as a diagnostic tool.
Are the Internal Elements Consistent?
Management that grabs at every structural innovation that comes along may be doing its arrangement not bad harm. It risks going off in all directions: yesterday long-range planning to pin managers down, today Outward Spring to open up them up. Quality of working life programs likewise as all those stylish features of adhocracy—integrating managers, matrix structure, and the similar—have exemplary aims: to create more satisfying work conditions and to increase the flexibility of the organization. But are they appropriate for a machine bureaucracy? Practise enlarged jobs actually fit with the requirements of the mass production of automobiles? Can the jobs ever be made large plenty to really satisfy the workers—and the costconscious customers?
I believe that in the stylish world of organizational design, fit remains an important characteristic. The hautes structurières of New York—the consulting firms that seek to bring the latest in structural fashion to their clients—would practise well to pay a keen deal more than attending to that fit. Machine bureaucracy functions all-time when its reporting relationships are sharply divers and its operating core staffed with workers who adopt routine and stability. The nature of the work in this configuration—managerial too as operating—is rooted in the reality of mass product, in the costs of manual labor compared with those of automatic machines, and in the size and age of the system.
Until we are prepared to modify our whole way of living—for example, to pay more for handcrafted instead of mass-produced products and so to consume less—nosotros would practice better to spend our fourth dimension trying not to convert our machine bureaucracies into something else merely to ensure that they work effectively as the bureaucracies they are meant to be. Organizations, similar individuals, tin avoid identity crises by deciding what it is they wish to be and then pursuing it with a healthy obsession.
Are the External Controls Functional?
An organisation may achieve its own internal consistency and so take information technology destroyed by the imposition of external controls. The typical result of those controls is to drive the organization toward machine hierarchy. In other words, information technology is the simple structures, professional bureaucracies, and adhocracies that suffer most from such controls. Two cases of this seem rampant in our gild: one is the takeover of small, individual companies by larger divisionalized ones, making bureaucracies of entrepreneurial ventures; the other is the tendency for governments to assume increasingly straight control of what used to be more contained organizations—public school systems, hospitals, universities, and social welfare agencies.
As organizations are taken over in these ways—brought into the hierarchies of other organizations—ii things happen. They get centralized and formalized.7 In other words, they are driven toward automobile bureaucracy. Government administrators assume that just a little more formal control volition bring this callous infirmary or that weak school in line. Yet the cure—fifty-fifty when the symptoms are understood—is worse than the disease. The worst manner to right deficiencies in professional work is through control by technocratic standards. Professional bureaucracies cannot be managed like machines.
In the school organisation, such standards imposed from outside the classroom serve only to discourage the competent teachers, not to improve the weak ones. The performance of teachers—as that of all other professionals—depends primarily on their skills and training. Retraining or, more likely, replacing them is the bones means to improvement.
For nearly a century now, the management literature—from time study through operations enquiry to long-range planning—has promoted machine bureaucracy as the "one best way." That assumption is false; it is one mode among a number suited to only sure conditions.
Is There a Part That Does Non Fit?
Sometimes an organization's direction, recognizing the need for internal consistency, hives off a part in need of special treatment—establishes it in a pocket off in a corner to be left alone. But the problem all besides often is that information technology is not left lonely. The research laboratory may be built out in the state, far from the managers and analysts who run the machine bureaucracy dorsum home. But the distance is but physical.
Standards have a long authoritative achieve: it is difficult to corner off a small component and pretend that it will not be influenced by the rest. Each system, not to mention each configuration, develops its own norms, traditions, beliefs—in other words, its own ideology. And that permeates every office of information technology. Unless there is a crude rest among opposing forces—every bit in the symphony orchestra—the prevailing ideology will tend to boss. That is why adhocracies demand peculiarly tolerant controllers, but as automobile bureaucracies must usually scale downwardly their expectations for their research laboratories.
Is the Correct Structure in the Wrong State of affairs?
Some organizations do indeed achieve and maintain an internal consistency. But then they find that information technology is designed for an environment the arrangement is no longer in. To accept a nice, neat machine bureaucracy in a dynamic industry calling for constant innovation or, alternately, a flexible adhocracy in a stable industry calling for minimum cost makes no sense. Remember that these are configurations of situation as well every bit structure. Indeed, the very notion of configuration is that all the elements interact in a organization. One element does non cause another; instead, all influence each other interactively. Structure is no more designed to fit the situation than state of affairs is selected to fit the construction.
The way to bargain with the right structure in the wrong environment may be to change the surroundings, non the structure. Oftentimes, in fact, it is far easier to shift industries or retreat to a suitable niche in an industry than to undo a cohesive structure. Thus the entrepreneur goes afterwards a new, dynamic environment when the old 1 stabilizes and the bureaucracies begin to movement in. When a situation changes all of a sudden—as information technology did for oil companies some years agone—a rapid change in situation or structure would seem to be mandatory. But what of a gradual alter in situation? How should the organization adapt, for example, when its long-stable markets slowly become dynamic?
Essentially, the organization has ii choices. It can arrange continuously to the environs at the expense of internal consistency—that is steadily redesign its structure to maintain external fit. Or it can maintain internal consistency at the expense of a gradually worsening fit with its environment, at to the lowest degree until the fit becomes so bad that it must undergo sudden structural redesign to accomplish a new internally consistent configuration. In other words, the choice is between evolution and revolution, between perpetual mild adaptation, which favors external fit over time, and exceptional major realignment, which favors internal consistency over time.
In his research on configuration, Danny Miller constitute that effective companies commonly opt for revolution. Forced to make up one's mind whether to spend most of their time with a good external fit or with an established internal consistency, they choose consistency and put up with brief periods of severe disruption to realign the fit occasionally. It is better, apparently, to maintain at least fractional configuration than none at all. Miller called this process, appropriately enough, a "breakthrough" theory of structural change.viii
Fit Over Fashion
To conclude, consistency, coherence, and fit—harmony—are critical factors in organization design, but they come up at a price. An arrangement cannot exist all things to all people. It should do what it does well and suffer the consequences. Be an efficient auto hierarchy where that is appropriate and do not pretend to be highly adaptive. Or exist an adaptive adhocracy and do not pretend to be highly efficient. Or create some new configuration to accommodate internal needs. The point is not actually which configuration you have; information technology is that you achieve configuration.
1. See Leonard Wrigley, "Diversification and Divisional Autonomy," DBA thesis, Harvard Business Schoolhouse, 1970.
2. See "When Friends Run the Business concern," HBR July–August 1980, p. 87.
three. See Wrigley, "Diversification and Divisional Autonomy."
4. For a full discussion of the bug of implementing social goals in the divisionalized form, meet Robert West. Ackerman, The Social Challenge to Business organization (Cambridge: Harvard Academy Press, 1975).
5. For a review of this trend, see Bruce R. Scott, "The Industrial Country: Sometime Myths and New Realities," HBR March–April 1973, p. 133.
6. Margaret K. Chandler and Leonard Sayles, Managing Big Systems (New York: Harper & Row, 1971).
seven. There is a good deal of evidence for this conclusion. Come across, for example, Yitzhak Samuel and Bilha F. Mannheim, "A Multidimensional Approach Toward a Typology of Hierarchy," Administrative Science Quarterly, June 1970, p. 216; Edward A. Holdaway, John F. Newberry, David J. Hickson, and Peter Heron, "Dimensions of Organizations in Circuitous Societies: The Educational Sector," Administrative Scientific discipline Quarterly, March 1975, p. 37; D. Southward. Pugh, D. J. Hickson, C. R. Hinnings, and C. Turner, "The Context of Organization Structures," Administrative Science Quarterly, March 1969, P. 91; Bernard C. Reimann, "On Dimensions of Bureaucratic Structure: An Empirical Reappraisal," Authoritative Science Quarterly, December 1973, p. 462.
8. Danny Miller, Revolution and Evolution: A Quantum View of Organizational Adaptation, working newspaper, McGill University, 1980.
A version of this article appeared in the January 1981 issue of Harvard Business Review.
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