Page 25 - The Handbook for Quality Management a Complete Guide to Operational Excellence

12 B u s i n e s s - I n t e g r a t e d Q u a l i t y S y s t e m s O r g a n i z a t i o n a l S t r u c t u r e s 13

Was Is
National markets International markets
National competition International competition
Control the business environment Adapt to the environment
rapidly
Homogeneous product Customized product
De-skilled jobs Complex jobs
Product-specific capital Flexible systems
Maintain status quo Continuous improvement
Management by control Management by planning
Table 1.1 The Changing Business Environment

craftsman era of the past: more complex jobs with the resulting need for
workers with a broader reper toire of skills. Other tendencies are continu-
ations of past trends: internation al markets are the next logical step after
moving from local markets to national markets. In other ways the new
world of business is simply different: modern flexible systems diverge in
fundamental ways from previous systems.
It follows that yesterday’s organizations, which evolved in response to
the realities of the past, might not be suited to the changing reality. In fact,
there is strong evidence to suggest that organizations that do not adapt
will simply disappear. Over 40 percent of the 1979 list of the Fortune 500
had disappeared by 1990 (Peters, 1990). The organizations that have man-
aged to progress have not stood still.

Forms of Organization

In addition to describing organizations in terms of their structures, Mint-
zberg (1994) also describes them in terms of forms. Mintzberg proposes a
framework of five basic forms of organization:
1. The Machine Organization. Classic bureaucracy, highly formalized,
specialized, and centralized, and dependent largely on the stan-
dardization of work processes for coordination. Common in stable
and mature industries with mostly rationalized, repetitive operat-
ing work (as in airlines, automobile companies, retail banks).
2. The Entrepreneurial Organization. Nonelaborated, flexible structure,
closely and personally controlled by the chief executive, who coor-
dinates by direct supervision. Common in start-up and turn-
around situations as well as in small business.
3. The Professional Organization. Organized to carry out the expert work
in relatively stable settings, hence emphasizing the standardization

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