Page 154 - Managing Change in Organizations

CarnCh08v3.qxd 3/30/07 4:24 PM Page 137

Contingency, choice and organizational environments
■ The design of communication and coordinating systems, to provide informa-
tion and participation in decision making.
■ The provision of reward systems to motivate individuals.
■ The establishment of decision-support systems such as regular management
meetings, project teams and specialist posts or departments.

Where the structure of an organization is inappropriate or deficient we would
expect to see a number of possible problems emerging, including the following:
1 Low motivation and low morale of employees.
2 Delayed or poor decisions.
3 Conflict between departments.
4 Rising costs.
5 A tendency to stick to the rules and regulations, whether or not appropriate
action will follow.
6 Lack of the capacity to adapt to changing circumstances.
If we observe problems such as those listed here (and this is not meant to be an
inclusive list) then we have reason to conclude that the structure of the organi-
zation is deficient in some way. It is important to recognize that the dimensions
of an organizational structure can be designed in different ways and that they
vary considerably in practice.
The organizational form with which we are all most familiar is bureaucracy.
Bureaucratic structures are characterized by a high degree of job specialization, by
reliance on formal procedures and paperwork, by hierarchy, by clear and signifi-
cant status differentials and by an emphasis on control. Bureaucratic structures
are intended to provide for equal treatment for all employees; a reliance on the
expertise, skills and experience relevant to the job; specific standards of work and
output; the maintenance of records and files dealing with work and output; the
setting up and enforcement of rules and regulations that serve the interests of the
organization; and a recognition that rules and regulations are binding on man-
agers as well as on other employees.

In environments which are changing rapidly, however, rules, regulations
and working procedures can quickly become out of date and irrelevant.
Moreover, rules and regulations can become barriers behind which individual
managers hide or which they use to justify incorrect decisions. Inflexible systems
or procedures can create demotivating conditions for employees and can
reduce the ability of managers or employees to innovate. From this we could
conclude that a bureaucratic structure might be suitable for an organization
dealing with a stable and simple environment. Conversely, an altogether more
flexible and innovative structure would be suitable for a changing, complex
environment.
Contingency theory is a label applied to a body of research based on the
assumption that there is ‘no one best way’ to design an organizational structure
but, rather, that the effectiveness of the design of a particular organization is con-
tingent on various factors. These factors are normally stated to include the tech-
nology, the environment, the history of the organization, norms and expectations

137