The Nature and Design of Post-Industrial Organizations

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George P. Huber

Management Science, Vol. 30, No.8 (Aug., 1984), 928-951.

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MANAGEMENT SCIENCE
Vol. 30, No. 8, August 1984
Printed in U.S.A.

THE NATURE AND DESIGN OF POST-INDUSTRIAL

ORGANIZATIONS*
GEORGE P. HUBER
College of Business Administration, University of Texas, Austin, Texas 78712
This paper describes the nature and design of post-industrial organizations. It begins with
an assessment of the popular literature on post-industrial society, and finds that this literature
is an inappropriate basis for inferring the nature of post-industrial organizations. Partly as a
consequence of this finding, the paper turns to systems theory as a basis for determining both
the nature of post-industrial society and the nature of the increased demands that this
environment would impose on post-industrial organizations. The middle three sections of the
paper describe design features that post-industrial organizations will employ to deal with these
demands. In particular they examine designs for making more effective three processes that
will exhibit increased importance in post-industrial organizations: (I) decision-making, (2)
innovation, and (3) information acquisition and distribution.
In addition to its conclusions concerning the design features that post-industrial organiza-
tions will possess, the paper sets forth three general conclusions. One of these is that, even
though the aggregate of the demands on post-industrial organizations will be qualitatively
greater than that experienced by previous organizations, there are design features that
organizations can adopt that will enable them to cope with even worst-case loadings of these
demands. A second conclusion is that the nature of the post-industrial environment will cause
decision-making, innovation, and information acquisition and distribution to take on added
importance in post-industrial organizations, and that one result of this will be that organiza-
tions will attempt to ensure routine effectiveness of these processes through increased formal-
ization. In some cases this formalization will have as its purpose ensuring the existence of
informal (or at least unstructured) activities, such as experimentation by "self-designing"
organizations or acquisition of "soft" information by top managers.
The third conclusion set forth is that during the current transition period between the
industrial and post-industrial societies we can expect many organizations to fail, or to flee to
less than wholly desirable niches, because they are ignorant of the post-industrial technologies,
structures, and processes that would enable them to successfully engage the post-industrial
environment and to become viable post-industrial organizations. It appears that an important
task of organizational and management scientists during this period will be to aid in the
development, transfer, and implementation of post-industrial design features and in this way
help reduce the possibility of unnecessary failure or flight.
(DECISION MAKING; INNOVATION; ORGANIZATION DESIGN; FUTURE; POST-
INDUSTRIAL)

1. Introduction
This paper describes the nature and design of post-industrial organizations.' The
effort that led to the paper was undertaken after a search of the literature revealed

*Accepted by Arie Y. Lewin; received October 5, 1983.

1We will use the term "post-industrial organizations" to refer to organizations whose structure and

processes are well-suited to the environment known as "post-industrial society." We will shortly define
"post-industrial society" in some detail. At this point we note that is one of many terms used to describe the
human-made environment whose particular aspects have been variously referred to as the Post-Industrial
State (Bell 1973), the Technetronic Era (Brzezinski 1970), the Information Society (Masuda 1980), the
Telematic Society (Martin 1981), and the Third Wave (Toffler 1980). It is important to note that some
organizations of the future will still face environments much like those of industrial society, and thus may
retain the structures and processes that characterize industrial organizations. Other organizations will face
post-industrial environments but will be able to temporarily retain old structures and processes by relying on
slack, loose couplings, or other buffers. Neither of these two groups of organizations are post-industrial
organizations even though they may exist in the post-industrial age.
928
0025-1909/84/3008/0928$01.25
Copyright© 1984, The Institute of Management Sciences
 NATURE AND DESIGN OF POST-INDUSTRIAL ORGANIZATIONS 929

that, while many organizational scientists had contributed findings and concepts that
might be useful, and while some had made important headway on certain key aspects
of the problem (cf., Simon 1973; Hedberg, Nystrom, and Starbuck 1977), apparently
no one had undertaken the task as a whole. Since it seemed that post-industrial
organizations might be quite different from their predecessors, and since we are
presently in a transition between the industrial and post-industrial societies, the task
appeared to be both important and timely. It further seemed that the task was one
whose successful completion would contribute to our understanding of organizations,
and also to our ability to counsel more wisely the administrators of organizations
beginning to experience the post-industrial environment. With these thoughts in mind,
the task of determining the nature and design of post-industrial organizations was
chosen from among other projects that were less risky but more mundane.
Two important concepts serve as an introduction to the paper. One is that post-
industrial society will be a radically different environment for organizations than was
industrial society. This statement summarizes the thinking of some eminent social
scientists (cf. Bell 1973; Simon 1973) and of some highly regarded professionals in
other fields as well (cf. Brzezinski 1970; Ferguson 1980; Masuda 1980; Toffler 1980;
Martin 1981; Naisbitt 1982). Nevertheless, we shall see that we must make our own
determination of the nature of this environment. On the basis of this independent
determination we will conclude that in several important respects the above statement
is factual.
The second concept is that, in general, organizations have survival as a goal and, in
general, organizations whose structures, processes and technologies are well suited to their
environment have a greater likelihood of survival than do those whose structures and
processes are poorly suited to their environment. Both clauses of this statement follow
from the extensive literature associated with the contingency theory of organizational
scientists (cf., Burns and Stalker 1961; Lawrence and Lorsch 1967; Duncan 1973),
from the somewhat smaller literature associated with strategic management theory (cf.
Hofer and Schendel 1978; Miles and Snow 1978), and from the mammoth and varied
literature associated with the systems theory of systems scientists (cf. Miller 1972; Land
1973; Boulding 1978). Consequently we will treat the statement as factual except where
we ourselves point out exceptions to it.
The confluence of these two statements strongly suggests the possibility that the
designs of organizations in post-industrial society will be qualitatively different from those
of previous organizations. This possibility of qualitative differences in organizational
structures, processes, and technologies is a matter of some importance. It is important
both to those who will participate in future organizations and to those who will be
affected by changes in the nature or design of current organizations. It is especially
important to organizational scientists whose societal role it may be to predict and
interpret such differences.
The structure of the remainder of the paper is as follows. §2 examines the nature of
post-industrial society and the nature of the demands that the post-industrial societal
environment will impose on organizations. §§3, 4, and1 5 then describe the structures,
processes, and technologies (i.e., the designs) that organizations will likely adopt in
order to meet these demands. 2 The final section summarizes the preceding sections and
attempts to provide some additional perspective on the subject.

2 The definitions of organization design provided by Kilman (1976, p. 251) and Mackenzie, Martel, and
Price (1982, p. 214) highlight the fact that an organization's technology is a component of its design. The
definition provided by Kilman, Pondy, and Slevin (1976, p.l) highlights the structure and process compo-
nents.
930 GEORGE P. HUBER

2. The Nature of Post-Industrial Society

Since in this paper we define post-industrial organizations as "organizations whose
structure and processes are well-suited to the environment known as post-industrial
society," we must ascertain the nature of this environment. In §2.1 we examine what
others have written on the subject and in §2.2 we make our own determination of the
post-industrial environment. §2.3 contains a description of the demands that this
environment will impose on post-industrial organizations.
2.1. An Assessment of the Literature
It would be convenient to use the popular descriptions of post-industrial society that
we cited earlier as our description, and to proceed straightaway to §3. Unfortunately,
there are two reasons why we cannot rely on these descriptions, and why we must
therefore make an independent determination of the nature of post-industrial society.
The first of these reasons is that the bulk of the literature that we might expect to
describe post-industrial society actually describes, instead, the period of transition to
this society. Many of the descriptive statements contained in these writings are the
consequence of extrapolating recent trends. This is a weak form of analysis in the case
at hand, as the empirical literature on living systems makes clear. When living systems
such as humans, organizations or societies are in a transition stage, they engage in
exploratory behavior (such as do humans during their adolescent transition). Many of
the alternatives examined are rejected; often the ratio of tested alternatives to adopted
alternatives is large (cf. Parsons 1977, Chapter 11; Boulding 1978, Chapter 13). Our
current transition (from industrial society to post-industrial society) is characterized by
the exploring of many goals, values; technologies, and processes. Which alternatives
will survive to characterize post-industrial society is difficult to say. Indeed, alterna-
tives temporarily rejected may later be accepted, as changed conditions enhance their
suitability. Assuming transition-based trends to be indicators of the future conditions
is certain to result in accepting a large number of false hypotheses.3.4
The second reason why we cannot rely greatly on popular descriptions of post-
industrial society is that their authors have often assumed that societal changes
reflecting the author's value system will occur pervasively and with certainty. A few
examples will make the point. (The following quotes are not misrepresentative of the
context from which they were taken.) "The information civilization being fundamen-
tally a humanistic civilization, it will bring about the unification of the present spiritual
and materialistic civilizations" (Masuda 1980, p. 71). "We are shifting from institu-
tional help to more self-reliance in all aspects of our lives" (Naisbitt 1982, p. 2).The
data from which these and similar conclusions are drawn, when carefully examined,
seem incomplete; one suspects that there are other data that could lead to different or
more cautiously worded conclusions. Certainly there is evidence that researchers are
prone, as are other people, to drawing conclusions primarily from those data that
support their prior beliefs (cf. Nisbett and Ross 1980,~especially Chapter 8). In any

3 Some writers are more aware of this danger than are others. Drucker, for example, makes explicit in the
Preface to his The Age of Discontinuity (1969) and the Introduction to Managing in Turbulent Times (1980)
that he is purposefully dealing with the transitory phenomena themselves, and is not attempting to predict
their outcomes. Kahn and his associates in their study of The Next 200 Years (1976) adopt the opposite
strategy, but are also clearly aware of the distinction: "While we do not ignore the short and medium terms,
our focus in this book is on the long run-and we consider most of th.e.interm.edi.ate and medium term issues
that do arise as transitional phenomena". In contrast with these authors, many of those writing on
post-industrial society seem to equate recent trends with eventual conditions.
4 We note here the irony that one of the more acceptable (from a social science perspective) of the
methodologies described in these works, Naisbitt's (1982) content analysis of newspaper articles over the
past twelve years, will necessarily identify many trends that will not continue.
 NATURE AND DESIGN OF POST-INDUSTRIAL ORGANIZATIONS 931

case, it appears reasonable to maintain a degree of skepticism toward such seemingly

value-laden prognostications.
2.2. The Nature of Post-Industrial Society
Post-industrial society will be characterized by more and increasing knowledge, more
and increasing complexity, and more and increasing turbulence. These, in combination,
will pose an organizational environment qualitatively more demanding than those in
our experience.
2.2.1. Available Knowledge-More and Increasing. We earlier warned against
inferring the continuation of "recent trends." The Knowledge Explosion is not a
"recent trend." As reported by de Solla Price (1963), the first two scientific journals
appeared in the mid-seventeenth century. By the middle of the eighteenth century
there were ten scientific journals, by 1800 about 100, by 1850 perhaps 1,000. Today?
Estimates range between 30,000 and 100,000 (Bell 1979). Nor is this explosion likely to
diminish in the intermediate future. 5 Further, since knowledge feeds on itself, we can
expect the absolute amount of knowledge to continue to rise. That is, even when (or if)
the rate of increase declines, the existing knowledge base will be so large that absolute
increases in units of knowledge per unit of time will remain large throughout at least
the first half of the next century and very likely far beyond that.
Of equal importance, for our purpose, is the fact that communications and comput-
ing technologies, about which more will be said, will greatly increase the availability of
whatever knowledge is produced. Since these technologies are in their early stages, in
terms of both their effectiveness and their adoption, we must also anticipate a sudden
increase in the availability of existing knowledge as these distribution technologies
mature and serve. The increased adoption of knowledge-distribution technology,
superimposed on the geometrically increasing knowledge base, will necessarily result in
a knowledge environment that is dramatically more munificent (or burdening) than is
that of today. It is the generally unconsidered combination of these two phenomena
that will cause the knowledge environment of post-industrial society to be qualitatively
different from what society has experienced in the past; in post-industrial society both
the amount of available knowledge and its absolute growth will be significantly greater
than in the past.
2.2.2. Complexity-More and Increasing. For the purpose of analysis it is useful
to view organizational complexity as having three characteristics: numerosity, diver-
sity, and interdependence. Systems theory reminds us that these tend to be related to
each other, e.g., "As a system's components become more numerous, they become
specialized, with resulting increased interdependence ..• " (Miller 1972, p. 5). An
examination of these characteristics and their relationships indicates that post-
industrial society will necessarily be much more complex than was industrial society.
Consider, for example, numerosity. Whether or not societal components in general will
become more numerous is unclear, in spite of current short-term tendencies for some
types to increase. If some do, such as humans or corporations, our conclusion that
society will be more complex will to some extent be confirmed. Aside from whether or
not the actual number of components will be greater, however, it does seem clear that
communications and transportation technologies will cause the "effective" number of
societal components to be greater.

5 As Anderla noted in his study (1973) for the OECD, "Today it is absolutely certain that these forecasts,
repeated without number and echoed almost universally, have failed to materialize, at any rate so far" (p.
19). As evidence, Anderla identified the number of abstracts published between 1957 and 1971 for 19
scientific disciplines and demonstrated that between 1957 and 1967 the output increased by nearly two and a
half times, for an annual growth rate of 9.5 percent. Over the 14 years from 1957 to 1971, the volume
increased more than fourfold, for a growth ra~e of 10.6 percent.
932 GEORGE P. HUBER

The major increases in post-industrial society's complexity will not, however, arise
from or depend on increases in numerosity. Instead they will follow from increases in
diversity and interdependency. New knowledge leads to increases in specialization and
diversity. In strictly biological systems this new knowledge or information is generated
through mutation, hybridization, evolution, and biological innovation, and is conveyed
in the form of genetic code. In human-made systems it is generated through experience
and research and is conveyed in the form of extra-genetic records. The large increase
in available knowledge discussed earlier will lead to a large increase in societal
diversity, as it will enable individual societal units to identify and exploit technological,
economic, and social niches, much as genetic changes enable biological organisms to
identify and exploit ecological niches. Thus we can anticipate more and increasing
societal specialization and diversity as a result of more and increasing societal
knowledge, whether or not there is an increase in numerosity.
Finally, let us turn now to the matter of interdependence. Specialization results in
interdependence because as living systems specialize, they give up certain capabilities
(or do not achieve commensurate growth in certain capabilities) and must rely on
other system components for the resources that they themselves can no longer provide.
Thus the anticipatable increases in specialization noted above will necessarily lead to
increased interdependencies. In addition, potential increases in physical interdepen-
dence may lead to increases in societal interdependence (Mesarovic and Pestel 1974;
Kahn, Brown, and Martel 1976). For example, possible increases in the ratio of the
demand to the supply of certain limited resources (such as metals or croplands) may
create interdependencies for post-industrial society beyond those experienced by
industrial society.
In summary, the following seem clear: (1) the anticipatable large increases in
knowledge will lead to large increases in technological, economic, and social specializa-
tion and diversity; these increases may be facilitated by increases in the effective
numerosity of societal components, and (2) these large increases in specialization and
diversity will lead to large increases in societal interdependence; these latter increases
may be aggravated by increases in the demand-supply ratio of certain physical
resources. As a consequence of these arguments we can conclude that in post-industrial
society both the level of complexity and its absolute growth rate will be significantly
greater than in the past.
2.2.3. Turbulence-More and Increasing. Increased turbulence will follow from
increases in the rapidity of individual events. We recall that post-industrial society will
be characterized by more and increasing knowledge. This will cause many technologies
to be more effective. An important consequence of these heightened levels of effective-
ness will be that individual events will be shorter in duration. They will transpire more
quickly. For example, improvements in R & D technology, in advertising technology,
and in distribution technology will enable competitors to steal markets even more
quickly than they can today, and high-technology military engagements will be subject
to completion in a matter of moments. The role of geographical distance and even
cultural differences as "time buffers" will be greatly diminished as improved communi-
cation and transportation technologies are implemented on a near-universal scale.
Since shorter events permit more events per unit of time, the eventual effect of
increasing knowledge is increased turbulence. In combination, then, our earlier reviews
of forthcoming increases in the number and diversity of societal components and in
the growth of knowledge cause us to conclude that in post-industrial society both the
level of turbulence and its absolute growth rate will be significantly greater than in the
past.
It is in order to take stock of where we are. We have determined, quite independently
of the current literature and quite independently of the nature of recent trends, that
 NATURE AND DESIGN OF POST-INDUSTRIAL ORGANIZATIONS 933

post-industrial society will be characterized by qualitatively greater levels of knowl-

edge, complexity, and turbulence, and that in each case these levels will be increasing
at a considerable rate. The literature on post-industrial organizations reaches essen-
tially the same conclusions. Does our own derivation validate the literature's projec-
tions? Or, looking at the other side of the issue, do the recent increases in societal
complexity and turbulence described in the literature confirm our independently-
derived hypotheses? It is greatly tempting to so regard them. The answer to both
questions is, however, a resounding "No!" This becomes apparent when we consider
the fact that even if post-industrial society were destined to be characterized by less
complexity and turbulence, we would still obseJ:Ve during the transition period in-
creased levels of frantic search and exploration for new coping mechanisms. In other
words, at least early in the transition period we would observe increased complexity
and turbulence as society moved toward decreased complexity and turbulence. It is
clear that our independent derivation of post-industrial conditions was required.
2.3. Environmental Demands in the Post-Industrial Era
What are the organizational implications of the fact that post-industrial society will
be characterized by more and increasing knowledge, complexity, and turbulence?
Although this question is of considerable importance, much of the previous discussion
relates to it, and so we can proceed rapidly. Contingency theory and systems theory
both tell us that for an organization to survive, it must be compatible with its
environment. When the environment changes to a state that is incompatible with the
organization, the organization has available a variety of strategies including: (1)
adapting to the changed demands, (2) moving to a different environment, (3) changing
the environment to a more compatible state, or (4) relying on slack, loose couplings, or
other buffers. 6 These and other coping strategies require that decisions be made. The
greater turbulence of the post-industrial environment will demand that organizational
decision making be more frequent and Jaster. The greater complexity of this environ-
ment will also cause decision making to be more complex (e.g., to require consideration
of more variables and more complex relationships among these variables).
Many of these decisions will concern changes in what the organization markets as its
goods or services (i.e., will concern the creation of innovations for external consump-
tion). Some decisions will concern fairly radical changes in the technologies, processes,
and structures that the organization employs (i.e., will concern innovations for internal
consumption). The heightened turbulence of post-industrial environment will require
that these organizational innovations be more frequent and Jaster.
Organizations require information to decide when decisions and innovations are
needed, and decision makers require information to reach conclusions. The increased
turbulence of post-industrial society will cause organizational information acquisition to
be more continuous, and the increased complexity will cause it to be more wide-ranging.
At the same time, however, the information richness of the environment may create
problems of overload, both on the organization's sensors and on the receivers of
messages from these sensors. This fact will result in organizational information acquisi-
tion and distribution being more directed.
2.4. Summary and Overview
In this section we first made an independent determination of the nature of the
post-industrial environment and then proceeded to a determination of the demands

6 The period of environmental change will exceed the life of many organizations. Their successors,
however, will tend to start with most of the coping-facilitating knowledge available to the predecessors, and
perhaps more, and we therefore include this "pass-the-knowledge-baton" form of evolution in our use of the
term "adapting."
934 GEORGE P. HUBER

that this environment will impose on post-industrial organizations. How will those
organizations that choose to become compatible with post-industrial society (i.e., that
choose to become post-industrial organizations) design themselves to deal with these
demands? The next three sections of the paper attempt to answer this question. 7
We note, before proceeding, two realities: (I) the "organizational choice" of some
design features may well be the consequence of nonrational (or nonrationalized)
processes (March 1981), e.g., it may be the consequence of political or bureaucratic
processes such as those described by Allison ( 1969) and Pfeffer ( 1981 ), or of the
"garbage can" process described by Cohen, March, and Olsen (1972), and (2) some
design features may evolve simply as responses to the need for technology, structure,
and process to be compatible with each other (cf. Pfeffer 1978; Gerwin 1981), rather
than as responses to some environmental demand.
We turn now to a discussion of designs for decision making. Simon highlights the
importance of the topic:
Organizational decision making in the organizations of the post-industrial world shows every
sign of becoming a great deal more complex than the decision making of the past. As a
consequence of this fact, the decision making process, rather than the processes contributing
immediately and directly to the production of the organization's final output, will bulk larger
and larger as the central activity in which the organization is engaged. In the post-industrial
society, the central problem is not how to organize to produce efficiently (although this will
always remain an important consideration), but how to organize to make decisions-that is, to
process information (Simon 1973, pp. 269-270).

3. Designs for Decision Making

The requirement that decision making in post-industrial organizations be simulta-
neously more frequent, faster, and more complex will create decision-task loadings
qualitatively greater than those of the past. Awareness of this fact will provoke and
promote need-driven developments both within organizations themselves and within
the organizational science community. We expect these efforts to be successful and
that, in order to enhance their decision-making processes, post-industrial organizations
will adopt on a widespread basis three design features: (I) advanced communication and
computing ( C 2) technologies, (2) improved decision- group technologies and structures, and
(3) "decision-process management." We describe the C 2 and decision-group technolo-
gies, and their effects on other organizational design features, in §§3.1 and 3.2
respectively. The relatively new concept of "decision-process management" is de-
scribed in §3.3. §3.4 contains a summary and review.
3.1. C 2 Technologies
There are three reasons to discuss C 2 technologies in a paper on organizational
design. One is that the technologies themselves are organizational design features. The
second reason is that advanced C 2 technologies will increase the range of the
behaviorally-based decision-aiding technologies that behavioral scientists will be able
to propose and that administrators will find it feasible to adopt. The third reason is
that adoption of C 2 technologies often contributes to changes in other organizational
design features.
7 We note here the desirability of treating organization design variables at a somewhat lower level of

abstraction than we generally find in the organizational theory literature. To know that post-industrial
organizations must possess relatively abstract characteristics, such as "flexibility" or "increased decision-
making efficiency," is only marginally useful. To be of real service to managers attempting to more properly
design their organizations, we must show how such a characteristic can be achieved, i.e., we must identify
operational design features that when implemented yield the desired characteristic (cf. Baligh and Burton
1981). With this admonition in mind, we have attempted to describe the organizational design features in
operational terms and to explain how their implementation would help satisfy particular environmental
demands.
 NATURE AND DESIGN OF POST-INDUSTRIAL ORGANIZATIONS 935

3.1.1. The Nature of the Technologies. With regard to communications technologies,

we must remind ourselves of two important facts: (1) today's systems are not nearly as
friendly or as effective as they will be, and (2) the low level of adoption of some
currently-available systems is a consequence of their temporary unfamiliarity and high
cost (much as was the case for word processors a half-dozen years ago or computers a
decade ago). Electronic mail systems, voice mail systems, radio-phones and yet-to-be-
discovered communication systems will be improved with new technological
"generations." Portable phone-like devices will have voice-mail features, combining
the real-time, access-enhancing capability of the portable phone with the message-
recording capability of voice mail (thus nearly eliminating "telephone tag," where
parties reciprocally and repeatedly call back and forth, only to find the other to be
unavailable). The consequent increased accessibility to people, increased efficiency of
communication, and increased timelines of communication (all much more important
in the faster-paced environment of post-industrial organizations) will cause post-
industrial communications systems to be adopted on a scale not greatly different from
that of hard-wired audio-telephone systems today.
Computing technologies are currently aiding decision makers. They are used for
storing and retrieving information, as in Management Information Systems, and for
processing information to derive new information, as in Monte Carlo simulation
systems. In recent years, often under headings such as Decision Support Systems
(DSS) (cf. Sprague and Carlson 1982; Bennett 1983) and artificial intelligence-based
Knowledge Systems (KS) (cf., Winston, 1977; Weinstock 1982), these two computing
capabilities have been combined. 8 In the post-industrial era DSS and KS capabilities
will often appear in the same system and, in any case, will be far beyond what we find
in their current, transitory, embryonic forms. A number of points must be noted. One
is that post-industrial DSS and KS will be extremely friendly. For example, they will
be voice operable and will coach their users. The second point is that they will contain
a great deal of information that was originally external to the organization. The third is
that their information will be much more up-to-date than is that of current systems.
(These last two points will be explained in some depth in §5.) Fourth, the systems will
be much smarter, incredibly smarter, and in view of this and their friendliness, will
serve more as counselors than as file drawers (cf. Miller, Pople, and Myers 1982). The
last point is that they will serve in political, bureaucratic, and "garbage can" decision
environments in addition to serving in more rationalized decision environments (cf.
Huber 1981; Shrivastava 1982).
Although there will be false-starts and failures, as early MIS were false-starts
towards today's more successful MIS and DSS, it is clear that in the post-industrial era
C 2 technologies will be much more helpful than those now available (and "computer-
anxiety" among users will be as rare as telephone or TV anxiety is today). These facts,
combined with the need of post-industrial organizations to deal more quickly with
more numerous and more complex decision situations, lead to the conclusion that we
can expect to see widespread adoption of advanced C 2 technologies. Let us turn now
to the effects of these technologies on other aspects of organizational design.
3.1.2. The Effects of the Technologies on Other Design Features. Changes in C 2
technologies often lead to changes in other aspects of an organization's nature or
design (cf. ONR 1976; Ginzberg 1978; Huber, Ullman and Leifer 1979). Here we note
four changes that we expect to follow from the adoption of the advanced C 2
technologies just described.

8 Today's DSS are primarily applied to the solving of financial problems, draw on "hard" data such as

previous sales figures, and contain heuristic models developed by their users. Today's KS are primarily
applied to the solving of medical or scientific problems, draw on "soft" data such as the judgments of
experts, and contain heuristic models either learned by the system or borrowed from experts.
936 GEORGE P. HUBER

As one change, we expect that the number of persons contributing to a decision

from outside the formal decision-making unit will be greater, as communications
technologies will cause remoteness in time or distance to be less a factor controlling
involvement. Since "uncertainty absorption" (March and Simon 1958, p. 67) will be
more widespread, the locus of decision making will be less well defined. Thus, in
post-industrial organizations the diffuseness of influence on decisions will be greater. In
effect, the boundaries of decision-making units will be fuzzier and more permeable.
A second change will follow from the fact that, in post-industrial organizations,
decision-making units will obtain some of their information and analyses from very
"friendly and smart" DSS and KS. While to some extent DSS and KS will update their
knowledge by "reading" inventories and newspapers, and will be self-teaching, the
turbulence and changing complexity of the post-industrial environment will require
that experts frequently be called in to update and upgrade the information and
intelligence of these systems. Having thus contributed their knowledge, experts who
otherwise would be contacted directly by decision-making units will be "accessed"
through the DSS or KS system. Thus, in post-industrial organizations the processes
through which experts influence decisions will often be less direct.
The increased complexity of post-industrial decision situations will contribute to a
third change. While on the one hand decision-making units will be motivated to
increase their heterogeneity and size (so as to include people having various types of
expertise and representing various constituencies), on the other hand efficiency consid-
erations will cause this pressure to be resisted to whatever extent is possible. One
approach that will be used to help resolve this dilemma will be the accessing of
individual "outsiders" when needed, either directly via video-phones, or indirectly
through DSS and KS, rather than keeping these "outsiders" "on-hand" as members of
the formal decision group. Thus we expect that in post-industrial organizations the
heterogeneity and size of "formaf' decision-making units will be less in terms of
personnel but greater in terms of resources (less, that is, than would be the case if the
decision-making units did not employ the C 2 technologies).
The fourth change will be that post-industrial C 2 technologies will cause decision-
processes to be more formalized. This conclusion follows from two lines of reasoning.
One is that advanced communication devices will increase the accessibility of any
source of information, formal or informal. Since the attractiveness of informal infor-
mation sources is largely a function of their ready accessibility (Rosenberg 1967;
O'Reilly 1982), the proportion of information that is formally acquired and processed
will increase. For example, Delphi studies become much less costly in terms of their
logistics and much speedier in their execution when supported with high-tech commu-
nications (Hiltz and Turoff 1978; Johansen, Vallee, and Spangler 1979) and, when
used in place of informal contacts with a set of readily available advisors, would tend
to result in a net formalization of the decision process. The second line of reasoning
focuses on routinization. Today's computers have aided in the routinization of many
decisions, such as inventory reordering. It would seem reasonable to believe that, in
view of their increased capabilities, computers in post-industrial society will aid in the
routinization of still more decisions. For both these reasons, then, we expect that in
post-industrial organizations decision processes will be more formalized.
3.2. Technologies for Decision Groups
For a variety of reasons, increased environmental complexity generally leads to the
need for more information exchange. Often this exchange takes place at meetings.
Given higher levels of environmental complexity, there will be pressure for the number
of meetings in post-industrial organizations to be greater. This pressure will be resisted
strongly, however, since the managerial time available for meetings may be approach-
 NATURE AND DESIGN OF POST-INDUSTRIAL ORGANIZATIONS 937

ing its limits and because meetings are widely regarded as less than optimal uses of
time. What is to be the resolution of this situation?
As one approach, we expect behavioral scientists and individual organizations to
develop and implement additional technologies for increasing the efficiency and effective-
ness of decision-oriented meetings (particularly technologies for designing solutions
rather than thinking of or choosing solutions). Even though a good deal of .development
work has already been done, and some adoption of the resulting "decision-group"
technologies is occurring, we expect that in post-industrial organizations the increased
need to exchange information will lead to a much higher density of application of such
technologies. 9
As a second approach, we expect that a significant increase in decision-group
efficiency and effectiveness will be achieved by creatively integrating C 2 technologies into
decision-group technologies. This has already occurred in a rudimentary way in the
form of teleconferencing, video-conferencing, and electronic-mail-enhanced Delphi
studies (Johansen, Vallee, and Spangler 1979; Martin 1981; Hiltz and Turoff 1978) for
aiding distributed decision groups. Face-to-face groups also are made more effective
with marriages of C 2 and behaviorally-based technologies as when, for example, in the
Nominal Group Technique (Delbecq, Van de Ven, and Gustafson 1975) each partici-
pant writes his or her ideas on an electronic pad and then transfers them individually
or all together to the "public screen" with the touch of a "send" button, or when
ratings are forwarded and compiled electronically and displayed as histograms so that
discussion can be directed in more fruitful channels (cf. Huber 1982c; Kull 1982). As
another example, consider that the effectiveness of many decision-related meetings is
considerably reduced when a difference of opinion develops about certain facts. With
DSS and KS at hand, some proportion of these differences of opinion can be resolved
during the meeting and nearly instantaneously, thus facilitating progress and decreas-
ing participant concerns about the validity of the data or reasoning that led to choice.
In summary, given the apparent need for more decision-group meetings and at the
same time a considerable resistance to them, we expect post-industrial organizations to
seek and adapt on a widespread basis more sophisticated group technologies, and that
as a result the effectiveness of decision groups will increase. We also expect these
developments to reduce some of the dissatisfaction with meetings and also to facilitate
whatever increases in the frequency of meetings that other considerations demand or
permit. This, in tum, will lead to a small increase in the diffusion of influence on
decisions and to some increase in the formalization of decision processes.
We further expect that post-industrial organizations will be especially motivated to
provide C 2 and behaviorally-based technologies to decision groups under high stress,
e.g., crisis decision groups (cf. Herman 1963; Smart and Vertinsky 1977; Bronner 1982).
In particular, we expect for the crisis decision groups of large post-industrial organiza-
tions to frequently include in their designs two structural components not found in
today's organizations. 10 One will be the addition of "scenario-analysis units," units

9 Techniques of Structured Problem Solving (Van Gundy 1981) describes 70 techniques, almost all of them
designed for use by groups and most developed in the past two decades. While the practical domain of most
is small, some are more widely applicable and a few (e.g., Synectics and the Nominal Group Technique)
have seen relatively rapid and widespread adoption in U.S. organizations.
10 In contrast to Smart and Vertinsky, we do not expect that this will include "creation of dual structures,

one for routine decision making and one for crisis decision making" (Smart and Vertinsky 1977, p. 655). We
interpret the work of Duncan (1973) to support the use of variable structures, decision-unit memberships
that are custom-designed to fit the decision and the phase of the decision process, rather than "in-place"
dual structures. While in-place dual structures are useful for formal innovation (Ansoff and Brandenberg
1971; Duncan 1976), the empirical literature supporting this application does not relate to decision making
under time pressure. Instead we expect that decision-group membership and structure will be determined on
a decision-situation basis.
938 GEORGE P. HUBER

composed of (I) experts in the use of DSS for quickly building and testing scenarios
with which to evaluate proposed solutions, and (2) prepackaged software for preparing
such scenarios. Addition of this component will help reduce the tendencies of units
under time pressure to examine too few alternatives (Wright 1974) or to coalesce too
quickly (Janis and Mann 1977). The second structural change that we can expect will
be the addition of one or two members who are trained in helping crisis units avoid the
behavioral dysfunctions described by Smart and Vertinsky and in implementing
prescriptive crisis-decision-group processes such as those provided by these same
authors (Smart and Vertinsky 1977, p. 648).

3.3. Decision-Process Management

The demand for faster decisions will cause logistically-related delays in decision
processes (cf. Cyert, Dill, and March 1958; Mintzberg, Raisinghani and Theoret 1976)
to be considerably less tolerable in post-industrial organizations. In addition, the need
to make more complex decisions will require organizations to ensure participation from
a wider variety of technical experts and political partisans. Together these needs will
motivate post-industrial organizations to adopt more formal approaches to "decision-
process management."
Although the idea of formally managing the organization's decision-making process
is novel, except for its use in legislative bodies (cf. Robinson 1958), it is so similar to
the concepts of project management (with its proven technologies of PERT and CPM)
and community-program planning (with its proven technology, PPM) that we expect it
to be readily operationalized. It is likely, in fact, that as decision-making receives more
explicit recognition, decisions will increasingly be viewed as "projects." This will lead
to the adoption, with only minor modification, of project-management technologies for
managing the production of tactical and operations-level decisions. For example, at
the planning stage the decision-making unit's use of PERT networks would facilitate
identification of (1) needed activities such as obtaining some particular information,
(2) needed resources such as experts, new computer programs, authorizations from top
managers, etc., (3) precedence and temporal relationships among these activities,
thereby cont_ributing to the scheduling of meetings, people, analyses, etc., and (4) the
times required to make decisions of various qualities, i.e., decisions that do or do not
contain various quality-enhancing activities in the PERT network. Similarly, the
"technology transfer" of the more behaviorally-based Program Planning Model (PPM)
(Delbecq and Van de Ven 1971; Van de Ven and Koenig 1976) from its primary arena
of application, community-program planning, seems readily applicable to managing
the production of strategic decisions.
The efficacy of PERT and CPM is well known, and what empirical research we
have on the matter indicates that PPM is also an effective management technology
(Van de Ven 1980). It appears that process-management technologies such as these
could be readily transferred to the organizational-decision context, and it is likely that
future demands will lead to the development and use of technologies specifically
designed for decision-process management. Thus the availability and adoption of
decision-process management technologies at the decision-unit or decision-project level
seems assured. The question now becomes, in what manner will the overall flow of
organizational decisions also be explicitly managed? In particular, will there be
centralized control?
Although the case is not clear, it seems likely that the relatively centralized
management of decision processes observed in legislative bodies will not occur in most
post-industrial organizations. The continuous stream of partially-uncontrollable de-
mands for decisions of quite varying natures will cause agreed-upon priorities to shift,
 NATURE AND DESIGN OF POST-INDUSTRIAL ORGANIZATIONS 939

resources to be reallocated, and schedules to be altered. In addition, the novelty of

many decisions will force the organizations to create (rather than select) solutions, thus
leading to the cycling and looping documented by Mintzberg, Raisinghani and
Theoret (1976). Thus, while in the post-industrial era there will be an even greater need
for the careful allocation of the organization's decision-related resources, the increased
turbulence of the environment will cause centralized, mechanistic management of the
overall flow of the organization's decisions to be impractical. What we envision as
more likely is that the allocation of decision-related resources, from resource providers
to "decision-project managers", will take place through negotiation in a manner very
similar to that now occurring in "matrix organizations." In more egalitarian organiza-
tions, allocations may be negotiated among project managers in a manner analogous
to the "partisan mutual adjustment" process described by Lindblom (1959). 11

3.4. Summary and Overview

In this section we suggested that post-industrial organizations should and will
include, among other design features, advanced C 2 technologies, improved decision-
group techniques, and decision-process management as responses to the post-industrial
environment's demand for more frequent, faster, and more complex decisions. We
must make clear, however, that we do not expect any one particular feature, any one
particular technology, structure, or process, to be lasting. Opportunities and problems,
and means for dealing with them, will change. The appropriateness of any particular
organization design feature will change, often quickly. Innovation will be called for.

4. Designs for Innovation

In §2 we concluded that post-industrial organizations will be required to innovate
more frequently and more rapidly. In this section we describe organizational designs
that post-industrial organizations will employ in response to this requirement. Our
discussion will primarily concern maintaining experimenting organizations and employ-
ing organizational experiments, two design features that facilitate intra-organizational
innovation. First, however, we briefly discuss designs that facilitate the production of
innovations for extra-organizational consumption.

4.1. Innovations for External Consumption

The defense industry in the 1940's and 1950's and the electronics industry in the
1960's (and since then) operated in a post-industrial environment. Not surprisingly,
they developed organizational designs that facilitated the production of innovations.
Basically these designs involve organizational separation of the innovation-initiation
function from the innovation production function, and also the formal transfer, at
some point in time, of responsibility for any particular innovation from the initiating
unit to the production and marketing unit (Ansoff and Brandenberg 1971; Radosevich
1976). This approach is an operationalization of the concept that the initiation of
innovations is facilitated through the use of organic structures while the production
and marketing of innovations (for external consumption) is facilitated with the use of

11 In matrix management, in project management, and in use of the Program Planning Model there is a

concern for the proper allocation of resources (e.g., people) to tasks (e.g., phases in PPM). It may be that
sophisticated staffing technologies such as MAPS (cf. Kilman 1976) will find a high density of application as
decision-process management becomes a common organizational design feature.
940 GEORGE P. HUBER

mechanistic structures (cf. Sapolsky 1967; Duncan 1976). 12 (The tie between process
and structure is apparent here, as the process is to transfer the intended innovation
from one specialized structure to another.) Given the need for frequent and fast
initiation and production of innovative products and services, we can expect that in
post-industrial organizations, the initiation and production of innovations for external
consumption will be by specialized units and the transfer of the intended innovation from
one unit to another will be a formal process. Of course, as we noted earlier, this practice
is not new. What we expect, though, is that its formalization will become a more
pervasive design feature as a larger proportion of organizations move into the post-
industrial environment.
4.2. Innovation for Internal Use
In this context innovation involves the selection or design, and subsequent adoption,
of an organizational feature that is relatively unfamiliar to most of those affected. In
the post-industrial environment organizations will have to innovate rapidly. In order to
ensure the ready identification and rapid adoption of appropriate features, we expect
to see post-industrial organizations incorporate into their design, to a much greater
extent than has been the case in the past, two processes: (1) maintaining experimenting
organizations and (2) employing organizational experiments.
4.2.1. Maintaining Experimenting Organizations. Living-systems scientists make
the distinction between two survival-enhancing characteristics, adaptation and adapt-
ability. The former represents achievement of a good environment. The importance of
this is that "Adaption to a particular niche ... while it leads to short-run survival, is
never adequate for survival in the long run . . . Adaptability is the capacity to expand
niches or to find new niches" (and is necessary for survival in the long run) (Boulding
1978, p. Ill). The post-industrial environment will require that post-industrial organi-
zations possess adaptability. How can organizational adaptability be obtained and
maintained? One answer may be to maintain "experimenting" or "self-designing"
organizations, i.e., organizations characterized by frequent, nearly-continuous change
in structures, processes, domains, goals, etc., even in the face of apparently optimal
adaptation (Nystrom, Hedberg, and Starbuck 1976; Hedberg, Nystrom, and Starbuck
1976).
Hedberg, Nystrom, and Starbuck (1977) argue convincingly that maintaining ex-
perimenting organizations will be efficacious, perhaps even a requirement for survival,
in the post-industrial environment. What would be the consequences of keeping an
organization in a state of experimentation? One probable consequence would be that
the organization would become more knowledgeable about a variety of design features
and "enacted" (Weick 1979, p. 130) environments. Another consequence would be
that the organization would remain flexible, and thus would be less resistant to
adopting unfamiliar features or engaging unfamiliar environments. These are, of
course, characteristics of adaptable organizations, characteristics that we desire in

12 Recent works suggest that there are exceptions to this generally-valid concept (cf. Aiken, Bacharach,

and French 1980; Daft 1982; Zmud 1982). My own interpretation of these works is that the apparent
exception, that initiation of administrative innovations is facilitated with mechanistic structures, is not really an
exception. To the contrary, administrative innovation is generally initiated by upper levels of management,
and these levels are in effect very organically structured. Further, it may be that the predictability of lower
unit behavior in mechanistic organizations frees top management to engage in more environmental
scanning, thus leading to more frequent initiation of administrative innovations. The consequence: a positive
relationship between mechanistic structure of lower and middle level units (where most conventional
measures are applied) and initiation of administrative innovations, i.e. an apparent but not real contradic-
tion of the concept set forth by Sapolsky (1967) and Duncan (1976).
 NATURE AND DESIGN OF POST-INDUSTRIAL ORGANIZATIONS 941

organizations facing the need to innovate rapidly. Thus it seems clear that experiment-
ing organizations would be effective discoverers of innovations.
How would they exploit discovered opportunities or implement discovered solu-
tions?
Duncan articulates the dilemma:
During the initiation (discovery) stage, the organization needs to be as flexible and as open as
possible to new sources of information and alternative courses of action . . . During the
implementation stage, however, ... a singleness of purpose is required ... in order to bring the
innovation into practice (Duncan 1976, p.l75).

Duncan's principal suggestion is that the initiating units should transform their
structure and becbme less diverse, more formalized, and more centralized. But, of
course, if the units do this, they will not be able to reap the advantages of being
experimenting organizations, at least not during the implementation period. What
alternative is there? The idea of experimenting organizations is so novel that we
hesitate to speculate on what the eventual answer to the question might be. Still, our
task requires that we address such issues and employ, where possible, creative
syntheses of organizational science knowledge. In this instance we suggest that, in
some situations, organizations that adopt the experimenting-organization form should
also adopt as a part of their design the "collateral organization" structure (Zand 1974).
(A "collateral organization" is a supplemental organization coexisting with the usual
organization. The two organizations have the same members.) Zand (1974) gives an
example where the members of a bureaucratic organization were also members of a
collateral organization, a task force designing a major innovation for the bureaucratic
organization. In the present context, we suggest reversing the situation, and viewing
the experimenting organization as the usual organization. The collateral organization
would then comprise the set of more mechanistic roles and procedures that the
organization's members would use to capitalize on an opportunity or a solution that
they had discovered in their experimenting organization.
Organizational members generally participate simultaneously in several "organ-
izational structures" (Mackenzie 1978). Simultaneous participation in an experiment-
ing organizational structure and in a collateral organizational structure would seem to
be an idea worth considering in an environment that demands the rapid and effective
implementation of internal innovations. 13 •14 How well members would cope with such
divergent roles is, of course, uncertain and a matter for empirical research. The
original dilemma is not easily resolved. Each solution has its faults. Whether the
adopted design should be for the experimenting organization to encompass the parent
organization, or to be a separate "learning" component, or whether experimenting
organizations should turn to a more mechanistic form to implement discovered·
innovations, or should coexist with a collateral organization as suggested here, will be a
function of research, experience, and the organization's particular circumstances.
Regardless of the particular design chosen, we can conclude that as a consequence of

13 Use of the collateral organization would seem to have an important side benefit as well. Nystrom,
Hedberg, and Starbuck (1976) point out that the turbulence of the experimenting organization would create
extremely high stress levels. Participation in the relatively stable collateral organization could be a respite;
the collateral organization could serve as the "haven" called for by Toffler (1970) and others concerned with
the stress of change.
14 1f we regard the concept of experimenting organizations as a meta-process, it may be that Duncan's

(1976) proposed structural transformation and also the collateral organization structure proposed here are
subsumable within it. It is possible to argue either way, that these approaches are subsumable or that they
are antithetical. The matter is partly one of the time frames that the debater choosed to adopt.
942 GEORGE P. HUBER

the considerable turbulence of their environment, many post-industrial organizations

will maintain experimenting organizations in order to maintain "adaptability." 15

4.2.2. Employing Organizational Experiments

Learning is hastened by the availability of unambiguous and rapid feedback. It
follows that learning by organizations (or their members) must in general be slow, as in
general ( 1) uncontrolled or unmeasured variables make the relationship between action
and outcome ambiguous, and (2) apparently useful feedback often goes unnoted-the
principals have either departed or the resource or political commitment was such that
the decision cannot be undone, and therefore feedback is of little use. In the
post-industrial environment, however, the increased velocity of events will motivate
organizations to learn more rapidly.
One approach for accomplishing more rapid learning in organizations is to reduce
the ambiguity of feedback about the relationship between organizational actions and
outcomes. Another is to ensure the collection and interpretation of such feedback.
Both approaches would follow from the employment of formal experiments, a strategy
increasingly advocated by organizational scientists (cf. Lawler 1977; Staw 1977), but
not widely authorized by organizational administrators. The reluctance on the part of
the latter is understandable, as the need to project an image of decisiveness causes
them not to admit to the uncertainty that would motivate an experiment, and
proprietary and political concerns tend to inhibit dissemination of any but positive
findings. These motivations will inhibit the use of organizational experiments in
post-industrial organizations as they do in today's. Nevertheless, the increased need for
information with which to confidently initiate innovation will expand the use of
organizational experiments significantly beyond what we now observe.

4.3. Summary and Overview

It appears that organizational designs for facilitating initiation and production of
innovations for external consumption, even in the post-industrial environment, are well
understood and already in use. In contrast, experimenting organizations, collateral
organizations, and even organizational experiments are, with minor exceptions, outside
the realm of our experience. Skepticism is therefore to be expected. Nevertheless, the
post-industrial environment's demand for frequent and rapid innovation suggests that
design features closely akin to these will necessarily characterize many if not all
post-industrial organizations. Much of the information about the need to innovate will
come from outside the organization. Let us turn, then, to examining designs for
acquiring and disseminating information.

5. Designs for Information Acquisition and Distribution

In §§3 and 4 we discussed a number of topics related to information acquisition and
distribution (e.g., communication technologies, decision-group technologies for aiding
in the sharing of information, and organizational learning through experimentation).
As a consequence of these earlier treatments of the topic, and because of space
constraints, our discussion in this section will be limited to information acquisition and
distribution at the organization boundary. Two topics will be examined, the design of
boundary-spanning sensor units and the design of top management teams.

15 The strategic management literature classifies organizations as prospectors, analyzers, and defenders

(Miles and Snow 1978). We expect that experimenting organizations will be a nearly universal design feature
among "prospector" organizations, widespread as a design feature of some components of "analyzer"
organizations, and less widespread in components of "defender" organizations.
 NATURE AND DESIGN OF POST-INDUSTRIAL ORGANIZATIONS 943

5.1. Design of Sensor Units

Examination of literature on the design of boundary spanning units as sensors of the
organization's environment identifies an interesting bifurcation; one part of the litera-
ture focuses on the need for organizations to seek out information (cf. Aguilar 1967;
Hedberg 1980), while another quite distinct part focuses on the need for organizations
to guard against information overload (cf. Ackoff 1967; Simon 1973). Surprisingly, this
problem of dual and apparently conflicting needs seems hardly to have been recog-
nized, at least not in the sense that practical guidelines have been developed for
designing organizations so as to fulfill both needs simultaneously.
This situation will not be tolerable in the post-industrial environment. Given their
great need for information on the one hand and the overabundance of environmental
information on the other, post-industrial organizations will seek, develop, and imple-
ment design features that allow both needs to be fulfilled. One of these will be an
increase in the number of sensor units, as suggested by Aldrich and Herker (1977).
Efficiency considerations will limit the use of this feature, however, and will cause
other design features to be adopted as well. In particular, we expect to see (I) increased
specialization and integration, (2) formalization of the handling of nonroutine mes-
sages, and (3) formalization of the buffering function. The next three subsections
describe these features in some detail.
5.1.1. Specialization and Integration. Information acquisition can be viewed as
occurring in two modes. One is the scanning of the organization's environment for
information about the existence of problems or opportunities, or for information to be
used in the future (such as for data to be stored in the DSS or KS). Scanning is often
routinized, as when sales personnel are required to report competitors' sales, or in
corporate-environment scanning units (cf. Aguilar 1967; Stub bart 1982). 16 The other
mode of information acquisition is the probing of the organization's environment for
information not routinely gathered, often in response to a specific problem or opportu-
nity. The post-industrial environment will impose greatly increased workloads in both
modes. We expect one coping strategy to be specialization. It will occur in two forms.
The functional specialization that we already observe (market scanning vs. technology
scanning vs. governmental activities scanning, etc.) will of course be in place, both to
take advantage of expertise and to satisfy the proprietary concerns of powerful
stakeholders in the functional units.
The second form of specialization will be between scanning units and probing units.
By their natures, scanning tends to be continuous while probing tends to be ad hoc. In
order to conserve their own human resources, managers desiring probes often request
that these be conducted by scanning units. If this is permitted, the political necessity of
responding to these requests will drive out scanning (just as operational requirements
drive out planning and engineering changes siphon off R & D resources). We expect
that in post-industrial organizations the recognized importance of environmental
scanning will cause higher-level administrators to impose policies that will protect
scanning units from the de facto demands of line managers and others desiring probes.
The result will be specialization by acquisition mode, a form of specialization that is not
yet more commonplace but that will become formally recognized as the demand for
both types of information acquisition increases.
Increased functional specialization and increased specialization by acquisition mode
will result in an increased need for integration. While ad hoc communications for

16 Although there is a growing recognition that environmental scanning is becoming a critical organiza-

tional task, the current low level of knowledge about how this should be done is evidently causing the
performance of these units to be somewhat less than impressive (Fahey, King, and Narayanan 1981;
Stubbart 1982).
944 GEORGE P. HUBER

integration purposes will continue to be informal (although perhaps more efficient as a

result of the advanced communication devices described earlier), the expanded volume
of information and the need for its integration will cause more formal integration to
take place on both a routine and nonroutine basis (perhaps drawing on C 2 technology
in the form of video-conferences).
5.1.2. Formalization of the Handling of Nonroutine Information. Organizational
sensors (or those units acting in this capacity) obtain both anticipated information and
unanticipated information. Mechanistic organizations are superior to organic organiza-
tions for dealing with relatively high volumes of routine information. On the other
hand, organic organizations are superior for dealing with nonroutine information. It
appears that hardly any effort has been directed toward the particular problem of
designing organizations to deal with the high volumes of both types of information
that we expect to see in post-industrial environments.
What will post-industrial organizations do to enable their boundary-spanning units
to deal with high volumes of both routine and nonroutine information? We envision
two approaches. One is to ensure that boundary spanners of all types are (I) attuned to
the nature of events and information that are important to the organizations, and (2)
provided with easily-used guidelines and devices for distributing information that (for
them) is nonroutine. Thus we expect post-industrial organizations to take aggressive
measures to educate all boundary-spanning personnel about the organization's current
and anticipated goals, domains, structures and processes. The purpose of these efforts
will be not only to enhance employee motivation and esprit-de-corps, but also to
enhance understanding and judgment about how to recognize and what to do with
nonroutine information.
Organizations will further augment this learning with guidelines and devices that
facilitate the making of routing decisions and the transmission of messages. In
post-industrial organizations C 2 technologies will support this effort; DSS-like direc-
tories will accept verbal descriptions of the event or information that their users see has
possible importance, will use artificial intelligence to generate recommendations con-
cerning where the information should be sent, and will activate the appropriate
communication devices for conveying whatever messages the user authorizes. It is
important to note that effective use of these devices depends on the ability of the
human sensor to recognize significant events; the educational measures noted above
are critical. 17
5.1.3. Formalization of the Buffering Function. An important function of sensor
units and other types of boundary spanning units is to buffer the organization's core
from excessive loadings from the environment. Before proceeding on to our discussion
of this topic, we note that such units must occasionally cope with their own work
overload. Although this is an important topic, it has been dealt with at length by others
(cf. Meier 1963; Driver and Streufert 1969; and Farace, Monge, and Russell 1977).
Because of this, we will limit our discussion to design features that sensor units may
use to protect the organization's internal information processing and decision-making
system.
The need for the sensor units to buffer core units takes on increased meaning when
organizations adopt advanced communication devices, many of which can "rifle-
shoot" messages to receivers (i.e. can by-pass the layers of nodes that characterize the
communication networks of today's organizations). While organizational scientists

17 An examination of the organizational information and communications processing literature suggests

strongly that this combination of education and technology would have a favorable effect on the acquisition
and distribution of nonroutine information without significantly impairing the handling of routine informa-
tion (cf. Huber 1982a).
 NATURE AND DESIGN OF POST-INDUSTRIAL ORGANIZATIONS 945

have generally viewed direct communications as being more desirable, in that they
minimize distortions and delays, the direct-access feature of several communication
systems will pose the danger of information overload on message receivers. The fact that
layers of organization may not have the opportunity to summarize messages, or to
iteratively restrict the routing of messages to only those with a need to know, must be
dealt with.
Two approaches we have already noted: post-industrial organizations (1) will more
formally educate their personnel about what is important and to whom; and (2) will in
some cases provide C 2 technology for augmenting routing judgments. A third ap-
proach to controlling the load on message receivers will be the formal monitoring of
message content, form, and distribution and the occasional purposeful alteration of the
operating mode of load-passing or buffering units. (The burden of the monitoring effort
will be considerably eased by the fact that a very large proportion of messages will go
through C 2 devices that can read, categorize, store and report on the content, form,
and distribution.) Knight and McDaniel provide a vivid example of the purposeful
alteration of operating mode, albeit in a somewhat different context:
Systems that serve dual roles ... must change the role of the scanner/sorter devices when
(there is) ... an environmental change . . . An example is the condition under which a
personnel office, operating in a tight labor market condition, scans and sorts, using active
recruitment and intensive training of new employees. In a loose labor market, the same
personnel office might scan and sort mainly to keep people out of the system because there is
an overabundance of qualified, trained personnel. (Knight and McDaniel 1979, p. 98).

These formal efforts to direct and control the operations of sensor units will be
necessary to protect internal information processors and decision makers from fluctua-
tions in environmentally-imposed loads since, without instructions or interventions,
sensor units will tend to routinize their information-distribution behavior over time.
The organization's managers are among the most important sensors of its environ-
ment. We can expect post-industrial organizations to take explicit account of this fact.
It is to this matter that we now proceed.

5.2. Design of Top Management Units

In his article, "The Manager's Job: Folklore and Fact," Mintzberg concludes from
his own studies (Mintzberg 1973) and his examination of the literature that:
As monitor, the manager perpetually scans his environment for information, interrogates his
liaison contacts and his subordinates, and receives unsolicited information, much of it as a
result of the network of personal contacts he has developed ... a good part of the information
the manager collects in his monitor role arrives in verbal form, often as gossip, hearsay, and
speculation. By virtue of his contacts, the manager has a natural advantage in collecting this
soft information for his organization. He must share and distribute much of this information.
Information he gleans from outside personal contacts may be needed within his organization.
In his disseminator role, the manager passes some of his privileged information directly to his
subordinates, who would otherwise have no access to it (Mintzberg 1975, p. 56).

This quote, and the writings of more recent examiners of the top management function
(cf. Hambrick 1981, and Kotter 1982), highlight the role of CEO's as key sensors for
their organizations. Since their environment will demand that post-industrial organiza-
tions acquire and disseminate information more rapidly and from a more diverse
environment, we can expect their CEO's to be under a considerably expanded
information acquisition workload. This problem will be compounded by the need for
post-industrial organizations to produce more decisions and by the fact that CEO's
currently have decision making, or at least decision authorization, as another central
role. Our everyday observations of top managers and the literature on managerial
workloads make clear that CEO's will not be able to cope with greatly increased
workloads unless their capabilities are enhanced through some means or other. In the
946 GEORGE P. HUBER

next three sections we describe approaches that we expect to see adopted in post-
industrial organizations.
5.2.1. Achieving Specialization through Selective Delegation. One approach to deal-
ing with increased workload is to delegate. In industrial society we observe, at the
top-management level, delegation principally of the operations-related decision-
making and decision-implementation functions. The retaining of the information-
acquisition responsibility can be explained on two counts: (1) certain information
sources (especially other CEO's) are effectively available only to CEO's, and (2)
acquisition of external information is critical to building the mental model of the
environment that CEO's use to guide them in their entrepreneurial tasks of setting
goals, choosing domains, and identifying the need for changes in organizational
strategy. In effect this retention of the environmental scanning and entrepreneurial
decision-making functions, and the delegation of the operations-related decision-
making and decision-implementation functions, is a form of specialization by task.
Unfortunately, delegation of some decision-making and decision-implementation tasks
will not suffice in the post-industrial environment; information acquisition tasks alone
will in many instances exceed the abilities of one person. As a consequence, we can
expect post-industrial organizations to adopt other approaches as well. One will be the
creation of the top management team.
5.2.2. Use of a Top-Management Team. Team management is not new, although
when found in the public sector its occurrence is often more for purposes of political
representation rather than for sharing the information acquisition and distribution
workload. Further, in the private sector the team's division of functions is generally as
described above, with an "outside man" concerned with the environmental interface
and entrepreneurship, and with one or more "inside" men concerned with operations.
In post-industrial organizations, in contrast, we will often observe teams of peers
whose overall function is to acquire and distribute information about the environment
and to engage in entrepreneurial decision making. Although there is relatively little
precedent in today's organizations for this structural feature, it will be the inevitable
consequence of the demands imposed by the post-industrial environment. If this
reasoning is sound, we would expect it to first appear in complex but young organiza-
tions that are already post-industrial in other respects (cf., Chase's description of
Intel's management team in the February 4, 1983 Wall Street Journal).
Efficiency considerations will lead these top management teams to specialize in the
environments they monitor, at least to some degree. This will result in the need for a
rather thorough sharing among themselves of their "findings". This is especially
important in view of the need for each team member to make as encompassing as
possible the mental models that we mentioned above and that have been noted as
critical to top management performance (Wilensky 1967, p. 190; Kiesler and Sproull
1982).
5.2.3. Use of C 2 Technology. Will advanced C 2 technology be used to facilitate
scanning by top management? The business literature abounds with enthusiastic
descriptions of the executive work-stations of the present and future (cf. Rockart and
Treacy 1982; Lasden 1982). The thrust of Mintzberg's (1973, 1975), and Lyles and
Mitroff's (1980), and Hambrick's (1981) studies, however, do not reinforce the view of
the CEO as a hands-on user of computer technology, with their identification of the
value placed on "soft" information, verbally transmitted. 18 In addition, Mackenzie

18 Hambrick notes that top management's "scanning tends to be fragmented, informal, and ad hoc"

(Hambrick 1981, p. 261), and Neustadt observed from his study of three U.S. presidents that "it is the odds
and ends of tangible detail that pieced together in his mind illuminate the underside of issues put before him.
To help himself he must reach out as widely as he can for every scrap of fact, opinion, and gossip ... "
(Neustadt 1960, p. 154).
 NATURE AND DESIGN OF POST-INDUSTRIAL ORGANIZATIONS 947

(1982) and Huber (1982b) have noted that, at the present time, computer-aided
information systems are but a small component of the organization's overall informa-
tion system, "especially at the senior management level" (Mackenzie 1982, p. 21).
Before choosing to support one view or the other, we must look more carefully at the
reasoning and the facts, as these apply both to the present and to the post-industrial
environment. Mintzberg (1975) suggests that a major attraction of verbal information
is that it is up-to-date, in contrast to information from MIS (of the early 1970's). This
particular argument of the "outdatedness" of computer-supplied data applies less well,
even just a decade later, and will be minimally applicable in post-industrial organiza-
tions where a manager's information terminal will be able to display information about
far-distant sales as the data are recorded at the point of sale or about far-distant world
events as the text is being entered into the writer's word processor.
An additional and important advantage of using advanced C 2 technology as a
design feature of the top management unit is that information from C 2 technologies can
be obtained at a~ry level of aggregation desired and can be instantaneously compared with
other pertinent information. Either detailed breakdowns or global summaries can be
obtained, ratios and differences can be calculated, and trend lines and projections can
be graphically portrayed.
We recognize, of course, that a good deal of the information relevant to top
management will not be available through computers. Certainly a good deal of
politically or socially sensitive information will not. What C 2 technology will do,
however, is to reduce the amount of time needed to scan less sensitive environments
and thus produce more time for the chats and gossip sessions that provide the soft and
sensitive information that the manager needs to complete his or her mental model.
5.3. Summary and Overview
This section of the paper focused on designs for information acquisition and
distribution. We identified a number of issues that had received relatively little
attention in the literature but that seemed critical to designing for information
acquisition and distribution. Among these were: (I) the need to carry out both
scanning and probing, (2) the need to deal efficiently with routine information and at
the same time deal effectively with nonroutine information, and (3) the need for
organizations to seek out information and also to guard against information overload.
We reasoned that in order to deal with these issues and to respond to the overall need
to acquire and distribute more information faster, post-industrial organizations will
adopt the following design features: (I) more sensor units, (2) increased specialization
and integration, (3) formalization of the handling of routine messages, and (4)
formalization of the buffering function. The section concluded with our observation
that an organization's top managers are among the most important sensors of its
environment and with our description of three design features that post-industrial
organizations will adopt in order to increase the effectiveness of these managers as
environmental sensors.

6. Summary and Conclusions

This paper described the nature and design of post-industrial organizations. It began
in §2 with an assessment of the popular literature on post-industrial society and found
that this literature was an inappropriate basis for inferring the nature of post-industrial
organizations. It then turned to determining the nature of post-industrial society and
finally to determining the nature of the increased demands that this environment
would impose on post-industrial organizations. The middle three sections of the paper
described design features that post-industrial organizations will employ to deal with
these demands. In particular it examined designs for making more effective three
948 GEORGE P. HUBER

processes that will exhibit increased importance in post-industrial organizations:

decision making, innovation, and information acquisition and distribution.
A number of conclusions seem to follow from the work reported here. One of these
is that, even though the aggregate of the demands on post-industrial organizations will
be qualitatively greater than that experienced by previous organizations, there are
design features that organizations can adopt that will enable them to cope with even
worst-case loadings of these demands. The effect of this will be to reduce the number
of organizations that fail under load, and thus to reduce the personal and societal
stress that such failures engender.
A second conclusion is that the nature of the post-industrial environment will cause
decision-making, innovation, and information acquisition and distribution to take on
added importance in post-industrial organizations. One effect of this will be that
organizations will attempt to ensure routine effectiveness of these processes through
increased formalization (e.g., through the use of decision process management). This
formalization will not be "formalization for the sake of formalization," however; in
some cases it will have as its purpose ensuring the existence of informal (or at least
unstructured) activities, such as experimentation by "self-designing" organizations or
acquisition of "soft" information by top managers.
As a last conclusion we observe that during the current transition period we can
expect many organizations to fail, or flee to less than wholly desirable niches, because
they are ignorant of the post-industrial technologies, structures, and processes that
would enable them to successfully engage the post-industrial environment and to
become viable post-industrial organizations. It appears that an important task of
organizational and management scientists during this period will be to aid in the
development, transfer, and implementation of post-industrial design features and in
this way help reduce the possibility of unnecessary failure or flight. 19

19 An earlier version of this paper shared First Prize in the TIMS College on Organizations Second

International Prize Competition for the Most Original New Contribution to the Field of Organization
Analysis and Design.
The research reported in this paper was sponsored in part by the U.S. Army Research Institute for the
Behavioral and Social Sciences and in part by the National Science Foundation. The preparation of the
paper itself was supported by EXECUCOM Systems Corporation while I was on a leave of absence from the
University of Wisconsin-Madison.
I would like to thank George Ainsworth-Land, Edgar Johnson, Peter Keen, John Slocum, and Robert
Zmud, each of whom read an early and longer draft and made useful suggestions for reducing its size while
retaining its ideas, and also David King, Kirk Jones, and Nelda Taylor, my associates at EXECUCOM, who
read a later draft and pointed out numerous places where my thoughts were not clearly and crisply
expressed.

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