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Describe Mintzberg’s five types of organization structure.

In what way does Mintzberg’s ideas constitute an advance over earlier theories of organizational structure?

Answer two questions. Give some examples to support.

Be careful of plagiarism, please reference it properly.

Answer

Mintzberg’s Five Types of Organization Structure

Contents

Introduction. 2

Overview of Mintzberg’s Five Types of Organization Structure. 3

Ways in Which Mintzberg’s Ideas Constitute an Advance over Earlier Theories of Organizational Structure. 7

Conclusion. 11

References. 12

 

Introduction

Henry Mintzberg is a renowned scholar who has theorized widely in the areas of business and management. One of Mintzberg’s (1980) most important contributions to the fields of business and management is the idea of five distinct types of organization structure, which include simple structure (entrepreneurial organization), machine bureaucracy, professional bureaucracy, divisionalized (diversified) form, and adhocracy (innovative organization). This categorization provides insights into how different organizations come up with different operational structures in order to increase productivity. For instance, the simple structure is ideal for managers who want to embrace the environment of flexibility that is a crucial requirement for entrepreneurial thinking while the machine bureaucracy is suited to organizations that seek to promote the traditional approach to management.

The simple structure is characterized by a large unit where operations are overseen by a few top executives and standardized systems are lacking, thereby creating room for flexibility. In contrast, the machine bureaucracy is characterized by standardization, whereby work is highly formalized through procedures and routines within a centralized structure. On the other hand, the professional bureaucracy is like a machine bureaucracy only that it depends on trained professionals who insist on taking control of their own work, leading to the decentralization of decision-making. The divisionalized form occurs in organizations with many different business units and product lines. The last type of organization structure is the adhocracy, which Mintzberg (1980) associates with new industries that must innovate in an “ad hoc” basis in order to survive. Such industries endeavour to avoid complexity, bureaucracy, and centralization.

Mintzberg’s ideas can best be understood in the context of the ongoing debate regarding the nature of organizational structure. In modern times, this debate started in the early twentieth century with the development of Frederick Taylor’s scientific management theory (Taylor, 2004). Taylor’s (2004ideas on the nature of organizational structure, which are explained in the scientific management theory, differ in several ways from Mintzberg’s. For this reason, it is important for scholars to explore the issue of how Mintzberg’s ideas have contributed to the theoretical debate on how organizations should be structured. Against this backdrop, this paper describes Mintzberg’s five types of organization structure with a view to explore the ways in which these ideas constitute an advance over earlier theories of organizational structure.

Overview of Mintzberg’s Five Types of Organization Structure

Mintzberg’s (1980) theory of organization structure is based on five organizational categories. In explaining these categories, Mintzberg (1980) uses terms that are of utmost relevance in the contemporary understanding of the modern organization. For instance, the idea of different parts of an organization helps to establish a conceptual context for theoretical development in organization studies. According to Mintzberg (1980), a typical organization comprises of five parts: operating core, middle line, strategic apex, support staff, and technostructure. In the process of coordinating these parts, managers use mechanisms such as direct supervision, mutual adjustment, and standardization. These mechanisms inform decisions to employment design parameters such as behavior formalization, job specialization, training, and delegation (Mintzberg, 1980).

The first type of organization structure is the simple structure. It is characterized by simple and dynamic environments, a high level of centralization, and strong leaders. This description fits small, young organizations that are keen to achieve entrepreneurial success. Organizations that are going through a serious crisis may also choose to adopt the simple structure. By adopting a flat structure, such organizations are able to operate in a flexible environment. This also allows the owner of the company to maintain control over all activities. However, a strong leader is required to steer the company on the path of continuous growth even in hostile conditions.

Today, many companies aspire to adopt a simple structure because it is flexible and lean (Greenwood & Miller, 2010). However, these companies must learn to overcome its inadequacies, one of which is the tendency for decision makers to become overwhelmed to the point of starting to make bad decisions (Noordegraaf, 2011). Similarly, companies whose growth depends on the skills, power, and knowledge of a few individuals may fail to survive once those individuals retire, move to new organizations, or sell up (Noordegraaf, 2011).

A viable alternative to the simple structure is the machine bureaucracy (Mintzberg, 1980). In this structure, the technostructure is relied on by managers to impose work standards (Mintzber, 1980). Using these work standards, managers can control all the activities and strategies of the organization. According to Robbins & Judge (2012), the level of job specialization and formalization is very high whereas units are strictly functional and in most cases very large in this organizational structure. Moreover, the level of vertical centralization of power is high whereas horizontal decentralization is limited. This model is mostly common in stable environments where the element of simplicity is highly valued. This description fits well into large, old organizations, some of which are externally controlled. It is also common in mass production systems involving technical operations.

The main attributes of professional bureaucracy include the standardization of all skills, job specialization, extensive training, extensive decentralization both vertically and horizontally, and minimal formalization. Grouping is done on market and functional basis while operating units tends to be large-sized. Evidently, this type of structure is ideal for large, complex organizations operating in stable environments where technical systems are simple, straightforward, and non-regulating (Brivot, 2011). However, a major disadvantage with this type of structure is that the amount of control that senior managers can exercise over employees is limited because of the spread of power and authority along the hierarchy (Brivot, 2011).

According to Iedema, Rhodes & Sheeres (2006), serious problems relating to the exercise of power by senior executives may arise due to the volatility of everyday interactions particularly in environments characterized by participative-communicative forms of work. In such situations, it can be hard to bring about change within the organization. In the meantime, this issue may easily pave way for a debate on how senior executives operating in professional bureaucracies can employ different types of power (legitimate, expert, referent, reward, and coercive) to win the hearts and minds of their followers (Lunenburg, 2012).

In divisionalized form, some power is delegated to the middle line through market-based units, meaning that decentralization is limited to the vertical dimension. The efforts of the market-based units are coordinated through the standardization of all outputs as well as performance control systems. Companies operating under this structure normally set up their headquarters in a central location, in most cases the country where they were founded, to offer support various divisions operating in different geographical locations. These business divisions operate autonomously and are responsible for making their own decisions as well as establishing unique structures. This structure is suitable for large, mature companies that operate within diversified markets. One may expect that such companies have done a lot to diversify their operations, leading to the multiplicity of target markets and specialized business units to feed those markets.

The divisional structure is advantageous in the sense that line managers are able to maintain greater control than in the machine structure (Daft, 2010). Moreover, since day-to-day decision-making is decentralized, the central team acquires some requisite space to enable them to focus on broader strategic plans. However, the structure tends to be weak in the sense that resources and activities may be duplicated across divisions, leading to wastage. Moreover, divisions may be in conflict as they compete to get allocation for limited resources available at the headquarters. Organizations operating under this structure can at times be inflexible, meaning that the structure is most suited to stable organizations that are seeking to avoid functional complexity.

The adhocracy is the type of structure where adjustment in all parts of the organization is done primarily by mutual consent. This means that there is a need for collaboration among support staff and only a small degree of formalization should be allowed (Pourezzat, & Attar, 2009). Moreover, jobs tend to be specialized and extensive training is a crucial requirement. An adhocracy fits well in companies with small units characterized by a combination of market and functional bases within matrix structures, there is extensive use of liaison devices, and decentralization is inherent on both vertical and horizontal dimensions (Mintzberg, 1980). This description is typical of complex organizations operating in dynamic environments where automated, highly sophisticated systems are an integral part of organizational operations.

All the structures described in this paper, except for adhocracy, are characteristic of traditional organizations. Adhocracy is the ideal structure for new industries, which must innovate and function with an “ad hoc” framework in their struggle for survival (Lam, 2010). Such organizations adopt adhocracy in efforts to avoid complexity, bureaucracy, and centralization, all of which potentially limit growth (Bolman & Deal, 2013). This structure is common in innovative, project-based industries such as pharmaceuticals and filmmaking. In these industries, experts from diverse areas must be brought in to form an innovative, functional team. For creativity and innovation to be nurtured, decisions must be decentralized and power must always be delegated to those who need it. The main downside of this arrangement is that top executives may find it extremely difficult to control the organization.

Mintzberg (1989), points out that the adhocracy is advantageous because it enables organizations to maintain a talent pool from which experts can be drawn to solve problems whenever they arise. Once one project is completed, the experts can flexibly move on to a new project. This means that adhocracies are good at responding quickly to change and meeting emerging challenges. Nevertheless, these structures must also contend with the numerous avenues of conflict that come with delegation of power and authority. Employees may also find it extremely stressful to deal with rapid change, leading to high turnover (Lam, 2000; Vaccaro et al., 2012). In today’s digital era, this structure is quickly emerging as a favourite choice for young organizations that seek to operate in a flexible environment.

Ways in Which Mintzberg’s Ideas Constitute an Advance over Earlier Theories of Organizational Structure

Before Mintzberg came up with the theory of five types of organization structure, management theories had already proposed other theories. One of them is Frederick Taylor’s scientific management theory. Scientific management provided a firm foundation for the onset of the modern era for management in general and organizational structure in particular. Taylor (2004) proposed that companies should use scientific methods to determine the best way of doing a job. He also recommended clear division of labour as well as specific tasks and responsibilities. Other principles of Taylorism, as the theory is popularly known, included scientific selection, surveillance, and precise training (Taylor, 2004).

Henry Ford also made important contributions to scientific management. To begin with, he was a staunch supporter of the implementation of Taylor’s principles. Additionally, he conceived ideas relating to deskilling, efficient mass production, the assembly line, top vertical integration, and increased production speed. Ford held the view that the assembly line should operate based on the principles of planned and continuous progression of commodities through the production line. In Fordism, managers were required to deliver work instead of waiting for the worker to find it through his own initiative (Beynon & Nichols, 2006). Moreover, operations needed to be analysed into all their constituent parts.

In Taylor’s view, factory management was responsible for determining the best way in which a worker could do a specific task and job, providing the right tools and training, and offering incentives for better performance (Taylor, 2004). To achieve these objectives, Taylor sought to break down every job into its constituent time and motion requirements, analysed all these motions to identify the ones that were essential, and timed workers using a stopwatch. The result was that superfluous motion was eliminated, and the worker performed his task based on a machine-like routine. Consequently, productivity increased considerably. Taylor also recommended the practice of delegating some of the tasks to specialists, for example, sharpening of tools. Taylor’s work resulted in the elevation of two managerial functions to a primary level within the process of production; the two functions are planning and coordination.

The influence of scientific management on Mintzberg’s ideas is best demonstrated in the idea of machine bureaucracy. Mintzberg seems to borrow the ideas of Frederick Taylor when he defines the machine bureaucracy in terms of the standardization of highly formalized procedures and routines. Taylor was a stanch proponent of the idea of establishing standard procedures for performing specific tasks with a view to achieve optimal productivity levels. Taylor also alluded on the importance of delegating some of the tasks to specialists. Mintzberg expounds on this idea by explaining a type of organization structure he calls professional bureaucracy. In this regard, Mintzberg’s explanation constitutes an important advance over earlier theories of organizational structure.

In his scientific management theory, Frederick Taylor did not envision a situation where employees would be given too much freedom to make decisions for the organization. Yet this is precisely what Mintzberg alludes to in the adhocracy. Taylor’s ideas fitted in well with the context in which they were being expressed, which in this case was the height of the industrial revolution in the Western world. At this time, numerous factories were being established in efforts to facilitate mass production of consumer and industrial goods through the assembly. The world has since changed, and this is evident in the rise of the information age. Mintzberg (1980) elaborates on the adhocracy in a manner that facilities a better understanding of the need for organizations to go with the changing circumstances by adopting new organizational structures.

At the height of industrial revolution, it was unheard of to talk about adhocracy since it did not fit in well with the circumstances under which workers performed tasks. In today’s information age, the idea of adhocracy is appropriate because it provides a framework through which young entrepreneurs can start companies in a dynamic way that facilitates creativity and innovation. The online space within the World Wide Web is full of opportunities that may not be exploited optimally through the traditional organizational conception that places premium on bureaucracy and centralization. Konieczny (2010), explains the importance of this organizational structure by highlighting the case of Wikipedia, an online company that uses adhocracy to offer open content online. Thus, Mintzberg’s idea of adhocracy constitutes a crucial advance over earlier theories of organizational structure.

The question of Mintzberg’s contribution to existing ideas on organizational structure may be answered by comparing it to the contingency theory. The contingency theory, which emerged during the 1950s, deviated from scientific management by through the view that there was no such thing as “one best way” (Donaldson, 2001; West, M, Tjosvold & Smith, 2003). It is based on the view that effectiveness in an organization is contingent on several factors, including technology, size, degree of change or uncertainty, diversification, and internationalization (Donaldson, 2001; Morton & Hu, 2008).

Contingency theories have dominated studies on organization behavior, performance, and management strategy for a long time (Morton & Hu, 2008). The most common proposition is that every organizational outcome is contingent on a fit between several factors. A major problem in the contingency theory is that the concept of fit has not been clearly explained. Mintzberg’s ideas on the five types of organizational structures have greatly contributed to the disambiguation of this concept. This has been made possible through Mintzberg’s (1980) reference to standard terms such as operating core, middle line, strategic apex, support staff, and technostructure in explaining how organizations choose the structures under which are currently operating.

Conversely, Mintzberg’s categorization of organizational structures was greatly influenced by factors that may be said to have an impact on organizational effectiveness as per the contingency theory, such as size, degree of change, technology, and diversification. For instance, adhocracy is typical of small organizations while the machine bureaucracy is typical of large, stable organizations. In contrast, the adhocracy is normally employed by small, young companies seeking to grow in a dynamic environment by harnessing the power of technology, creativity, and innovation. This explanation demonstrates that Mintzberg’s constitute a bid to advance on the contingency theory.

Conclusion

This paper has examined five types of organization structure as outlined by Mintzberg (1980): simple structure (entrepreneurial organization), machine bureaucracy, professional bureaucracy, divisionalized (diversified) form, and adhocracy (innovative organization). The paper sought to determine the ways in which these ideas constitute an advance over earlier theories of organizational structure. In many ways, Mintzberg’s ideas build on earlier theories, particularly, scientific management theory and contingency theory. For example, the concept of the machine organization is closely related to Frederick Taylor’s proposals on standardizing and routinizing tasks in a factory in order to optimize productivity. Similarly, Mintzberg contributes to the contingency theory by explaining how factors such as level of stability, size, diversification, technology, and internalization influence the organizational structures that companies choose to adopt. In contribution, Mintzberg’s ideas as espoused in the five types of organizational structure constitute a major advance over earlier theories of organizational structure.

 

References

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Daft, R 2010, Organization theory and design, Cengage Learning, Mason.

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Pourezzat, A & Attar, G 2009, ‘Professional Adhocracy, an Appropriate Design for Knowledge Economy in the Light of Mintzberg’s Perspective’, Journal of Electronic Commerce in Organizations, vol. 7, no. 4, pp. 12-32.

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