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Henry Mintzberg (1979)

The structuring of
Organisations

The focus of Mintzbergs work is on


organizational structure
He defined structure as the sum total of the
ways in which it divides its labor into
distinct tasks and then achieves
coordination among them
Every organized human activity gives rise
to two fundamental and opposing
requirements:

Division of labour into various tasks


Coordination of these tasks to accomplish the activity

5 Coordinating
Mechanisms

He called them the glue of


structure, the basic elements that
hold organizations together

5 Coordinating
Mechanisms
Seem to explain the fundamental ways in which
organisations coordinate their work :

Mutual Adjustment
Direct supervision
Standardisation of work processes
Standardisation of work outputs
Standardisation of worker skills

These should be considered the most basic elements of


structure, the glue that holds organizations together.

Mutual adjustment

It achieves the coordination of work by


the simple process of informal
communication
The control of work rests in the hands of
those who are doing the work
It is the only one that works under
extremely difficult circumstances.
The ability of the specialists to adapt to
each other.

Direct supervision

Direct supervision achieves


coordination by having one
individual taking responsibility for
the work of others, issuing
instructions to them and
monitoring their actions
One brain coordinates several hand

Standardization of work

Work processes are standardised


when the contents of the work are
specified or programmed

Standardization of outputs

Outputs are standardized when the


results of the work, for example,
the dimensions of the product or
the performance are specified.

Standardisation of skills

Skills (and knowledge) are standardized


when the kind of training required to
perform the work is specified.
Standardisation of skills achieves
indirectly what standardization of work
processed or work outputs does
directly it controls and coordinates
the work

A continuum among the


coordinating mechanisms

As organization work becomes more


complicated, the favored means of
coordination seems to shift from
mutual adjustment to direct
supervision to standardization,
preferable work processes, otherwise
of outputs or else of skills, finally
reverting back to mutual adjustment

Formalization - the degree


to which the organization
has official rules,
regulations and procedures
Hierarchy of
Authority the degree of
vertical
differentiation
across
levels of
management

Centralization - the degree


to which decisions are
made at the top of the
organization

Basic
Design
Dimensions

Complexity - the degree to


which many different types
of activities occur in the
organization

Specialization the degree to


which jobs are
narrowly
defined and
depend on
unique
expertise

Standardization - the
degree to which work
activities are accomplished
in a routine fashion

Mintzbergs Framework
Mintzberg claims that
organizations are composed
of five basic elements, or
groups of individuals, any of
which may predominate in
an organization.
The element that
predominates will determine
the most effective design in
that situation.

Mintzberg: Five Basic


Elements
Operating Core:
Core Employees who perform the basic
work related to an organizations product or service.
Strategic Apex:
Apex Top-level executives responsible for
running an entire organization.
Middle Line:
Line Managers who transfer information
between higher and lower levels of the organizational
hierarchy. They join the strategic apex to the operating
core through the chain of commange
Technostructure:
Technostructure Organizational specialists (analysts)
responsible for standardizing various aspects of an
organizations activities and applying their analytical
techniques to help the organisation adapt to its
environment.
Support Staf:
Staf Individuals who provide indirect support
services to an organization. (ex research &
development, cafeteria, mailroom)

Mintzbergs Five
Basic Parts
of an
Organization

Strategic
Strategic
Apex
Apex

TTec
rtrt
hhno
e
o
c
p
pppo
stsru no- u
S
u aff f
trucctu
S
t t af
r
tuere
S
S
Middle
Line

Operating Core
Core
Operating

From H. Mintzberg, The Structuring of Organizations (Upper Saddle


River, N.J.: Prentice-Hall, 1979): 20. Reprinted with permission.

5 structural configurations

Simple Structure - a
centralized form of
organization that
emphasizes the strategic
apex & direct
supervision

Adhocracy - a
selectively
decentralized
form of
organization that
emphasizes the
support staff &
mutual adjustment
among people

Structural
Configurations
of
Organizations

Machine Bureaucracy a moderately


decentralized form of
organization that
emphasizes the
technical staff &
standardization of
work processes

Divisional Form - a
moderately decentralized
form of organization
that emphasizes the
middle level &
standardization of outputs

Professional
Bureaucracy a decentralized
form of
organization that
emphasizes the
operating level
& standardization
of skills

Five Structural Configurations of Organization


Prime
Structural
Type of
Key Part of
Configuration Coordinating Organization Decentralization
Mechanism
Simple
Structure

Direct
Supervision

Strategic
Apex

Standardization
Technostructure
of Work
Processes

Vertical & horizontal


Centralization

Professional Standardization
Bureaucracy
of Skills

Operating
Core

Divisionalized Standardization
Form
of Outputs

Middle
Line

Limited
Horizontal
Decentralization
Vertical &
Horizontal
Decentralization
Limited Vertical
Decentralization

Support
Staff

Selective
Decentralization

Machine
Bureaucracy

Adhocracy

Mutual
Adjustment

Five Organizational Forms


(1)
The Simple Structure: young, small;
nonsophisticated technical system;
simple, dynamic environment. Key:
strategic apex

Machine Bureaucracy: old, larger;


regulating, nonautomated technical
system; simple, stable envir. Key:
technostructure
The Divisionalized Form:
diversified markets (esp. products &
services); old, large. Key: Market
grouping, performance control, limited
vertical decentralization

Five Organizational Forms


(2)
The Professional Bureaucracy:
complex, stable envir. Nonregulating,
nonsophisticated technical system: Key:
Operating Core.
The Adhocracy: complex, dynamic envir.;
sophisticated and often automated
technical system
The Idea Organization: Value-based
organizations, public/religious
organizationsJehovas Witnesses,
Greenpeace, Al Quada, IRA

Mintzberg: A Summary

Mintzberg: Organizational
Designs I
Simple Structure:
Structure An organization characterized
as being small and informal, with a single
powerful individual, often the founding
entrepreneur, who is in charge of everything.
Machine Bureaucracy:
Bureaucracy An organizational form in
which work is highly specialized, decision
making is concentrated at the top, and the work
environment is not prone to change (e.g., a
government office).
Professional Bureaucracy:
Bureaucracy Organizations (e.g.,
hospitals and universities) in which there are lots
of rules to follow, but employees are highly
skilled and free to make decisions on their own.

Mintzberg: Organizational
Designs II
Divisional Structure:
Structure The form used by many
large organizations, in which separate
autonomous units are created to deal with
entire product lines, freeing top management
to focus on large-scale, strategic decisions.
Adhocracy:
Adhocracy A highly informal, organic
organization in which specialists work in
teams, coordinating with each other on various
projects (e.g., many software development
companies).

Simple structure

little or no technostructure
few support staff
loose division of labour
minimal differentiation among its units
a small managerial hierarchy
minimal use of planning, training & liaison services
Prime coordinating mechanism : direct supervision
It is organic structure (this is the opposite of Webers bureaucracy. It
is characterised by loose, informal working relations, absence of
standardisation in the organisation
centralized decision-making power, that is, in the CEOs hands
strategic apex is the key part of the structure
one-person strategic apex and an organic operating core
uses entrepreneurial mode of strategy formulation
little R&D
subsists in a simple and dynamic environment
can be autocratic or charismatic in leadership style
can be the riskiest of the 5 structures
typified by owner-management

Simple structure

It is nonstructure. It avoids using


all the formal devices of structure,
and it minimises its dependence on
staff specialists.
Coordination is effected largely by
direct supervision
One great advantage is its sense of
mission.

Machine Bureaucracy

Prime coordinating mechanism : standardization


of work processes
Key part of Organization : Technostructure
Main design parameters : Behaviour
formalization, vertical and horizontal job
specialization, usually functional grouping, large
operating unit size, vertical centralization and
limited horizontal decentralization,
Contingency factors : Old, large, regulating,
non-automated technical system, simple, stable
environment, external control, not fashionable.

Machine Bureaucracy

Highly specialized
Routine operating tasks
Very formalized procedures in the operating core
large number of rules, regulations
Formalized communication throughout the
organisation
Large-sized units at the operating level
Relatively centralized power for decision making
An elaborate administrative structure with a
sharp distinction between line and staff

Machine Bureaucracy

found in simple and stable environments


typically found in mature organizations used to repetition and
standardisation
usually identified with regulating technical systems and routinised
work mass production
It is the most efficient structure when simple, repetitive tasks are
required to be performed precisely and consistently
But it can destroy the meaning of work by treating people
instrumentally
Human problems in the operating core can become co-ordination
problems in the administrative centre
Centralization of structure in a machine bureaucracy can lead to
abstract and useless information being passed on to top managers for
strategy formulation
Top managers can only succeed in changing the machine bureaucracy
by reverting to a more flexible, simple structure (example of a
machine bureaucracy in the hotel industry)
Democratisation does not eliminate the basic conflict in the machine
bureaucracy between engineering efficiency and individual satisfaction

Machine Bureaucracy

Operating core : highly rationalized work flow,


simple tasks, requiring a minimum of skills and
little training, sharp division of labour, little
discretion in work, little possibility for mutual
adjustment, direct supervision is limted by the fact
that standardization handles most of the
coordination
The Middle line : fully developed, sharply
differentiated into functional units
Technostructure : as Machine bureaucracy depends
primarily on the standardization of work processes,
technostructure is the key part of the structure.
The strategic apex : concerned with the fine tuning
of the bureaucratic machine

Machine Bureaucracy

It most strongly emphasizes


division of labor and unit
differentiation.
It is a structure with an obsession,
namely control

Professional Bureaucracy

Prime coordinating mechanism :


standardization of skills
Key part of Organization : Operating core
Main design parameters : Training,
horizontal job specialization, vertical and
horizontal decentralization
Contingency factors : Complex, stable
environment, nonregulating,
nonsophisticated technical system,
fashionable

Professional Bureaucracy

Environment is the chief contingency


factor
Technology PBs are mainly found in
service sectors thus technology base
provides vital functions
Where PB is widely dispersed for
example, police loyalty to the
organization is maintained through
training and indoctrination
PB satisfies the needs of modern man:
democratic and autonomous

Professional Bureaucracy

The Operating Core coordination based on standardisation of


skills, hiring of appropriately trained and indoctrinated
professionals and gives them considerable control over their
work each professional knows roughly what his fellowprofessional is doing.
Focus on operating core is essential in a professional
bureaucracy because professionals are highly paid and need a
lot of support
Decentralisation in the professional bureaucracy is both
vertical and horizontal and a lot of power rests at the bottom
of the operating core where the professional works with
his/her clients students, patients
The Bureaucratic Structure internalised standards and
coordination of structure is achieved by design and standards
which predetermine what is done standards come from
outside its own structure from self-governing associations and
training establishments.

Professional Bureaucracy

Strategy formulation is for the most part in the hands of


individual professionals and their professional
association outside the organization. This has been
emphasized in current government policy through public
sector reforms in which strategy is concentrated in the
hands of individual local organizations hospitals
schools and colleges.
The administrative structure is very democratic with
collective control of the administrative decisions held, at
least in part, by the professionals. The roles of the
professional administrator include:

disturbance handler inter-departmental disputes


intermediary between professionals inside and government
officials, clien associations and parental groups

Problems include:
Professional discretion professionals find it
difficult to deal with colleagues who are
incompetent or unconscientious
Inflexible good at producing standard outputs
but problems with innovation and adaptability to
change
Dysfunctional responses occur when those outside
the profession try to control the work of the
professionals through coordinating mechanisms
such as direct supervision note the resistance to
change that newly appointed hospital managers
faced from the medical profession

Divisionalised form

Prime coordinating mechanism :


standardization of outputs
Key part of Organization : Middle line
Main design parameters : Market
grouping, performance control system,
limited vertical decentralization
Contingency factors : diversified
markets, old, large, power needs of
middle managers, fashionable

Divisionalised form

The prime coordinating mechanism is the standardization of


outputs and a key design parameter, the performance control
system
Market Diversity drives the organization to the divisionalized
form to cope with diverse markets
Technical System : divisionalization is possible only when the
organizations technical system can be efficiently separated into
segments, one for each division
Environment narrows its range as compared with the other
configurations it must operate in environments which are neither
very complex nor very dynamic
Age & Size also determine the divisionalised form in that as the
organization grows larger they tend to diversify and then to
divisionalise thus can often follow from the machine bureaucracy
Power plays a role towards the divisionalised structure in that
CEOs seek to expand their empires by taking over smaller
companies and divisionalising them.

Adhocracy

Prime coordinating mechanism : mutual


adjustment
Key part of Organization : support staff
Main design parameters : Liaison
devices, organic structure, selective
decetralization, horizontal job
specialization, training, functional and
market grouping simultaneously
Contingency factors : complex, dynamic
environment, sophisticated and often
automated technical system,fashionable

Adhocracy

A highly organic structure, a high


horizontal job specialisation, a tendency
to group the specialists in functional
units for housekeeping purposes and a
heavy reliance on mutual adjustment
Shows the least respect for the classical
principles of management
It hires and gives power to experts whose
skills and knowledge have been highly
developed in training programmes

Adhocracy
There at least 2 types of adhocracy:
Operating adhocracy the administrative and operating
work tend to mix together in a single effort
Adminstrative adhocracy operating core is cut off from
the rest of the organization so that the administrative
component can be structured as an adhocracy
Administrative component of adhocracies is different
from all other configurations it emerges as an organic
mass of line managers and staff experts working
together in ever-shifting relationships on ad hoc projects
Strategy formation not so much formulated by
individuals but formed implicitly by decisions they make
one at a time

Conditions of Adhocracy

The Basic Environment of the adhocracy is both dynamic and


complex which in turn demands a structure which is both
organic and decentralised
Frequent Product Change draws organizations towards an
adhocratic structure
Technical System Many organizations use the adhocracy
because their technical systems are sophisticated and perhaps
automated as well.
Youth is a Condition of Adhocracy early stages in the
development of an organization if successful will inevitably
move towards a more bureaucratic structure
Fashion as a Condition of the Adhocracy

Emphasis on expertise
Organic structure
Project teams
Task forces
Decentralisation without a single concentration of power
Matrix structure
Automated technical systems
Youth
Complex and dynamic environments

Size

Technology
Contextual Variables a set of characteristics that
influences the organizations
design processes

Strategy
& Goals

Environment

Mintzbergs 16 Hypotheses on Fitting


Design to Situation (1)
Age & Size
1.The older the organization, the more formalized its behavior
2. Structure reflects the age of founding of the industry
3. The larger the organization, the more elaborate its structure (the
more specialized its tasks, the more differentiated its units, and the
more developed is administrative component)
4. The larger the organization, the larger the average size of its units
5.
The larger the organization, the more formalized its behavior

Technical System:
6. The more regulating the technical system, the more formalized
the operating work and the more bureaucratic the structure of the
operating core.
7. The more sophisticated (difficult to understand) the technical
system, the more elaborate the non-operating structure
specifically, the larger and more professional the support staff, the
greater the selective decentralization (to the staff), and the greater
the use of liaison devises (to coordinate the work of that staff).
8.The automation of the operating core transforms a bureaucratic
administrative structure into an organic one.

Mintzbergs 16 Hypotheses
on Fitting Design to Situation
Environment:
9. (2)
The more dynamic the environment, the more organic the structure

10.The more complex the environment, the more decentralized the


structure
11. The more diversified the organizatons markets, the greater the
propensity for it to split into market-based units (given favorable
economies of scale)
12.Extreme hostility in its environment drives any organization to
centralize its structure temporarily
13.Disparities in the environment encourage the organization to
decentralize selectively to differentiated work constellation
Power:
14.The greater the external control of the organization, the more
centralized and formalized its structure
15.The power needs of the members tend to generate structures that
are excessively centralized
16.Fashion favors the structure of the day (and of the culture),
sometimes even when inappropriate

Size

Basic Design
Dimensions
Formalization
Centralization
Specialization
Standardization
Complexity
Hierarchy of authority

Small
Organizations
Less
High
Low
Low
Low
Flat

Large
Organizations
More
Low
High
High
High
Tall

Technology

Technological
Interdependence the degree of interrelatedness
of the organizations various
technological elements

Environment - anything outside the boundaries


of an organization
Task Environment - the elements of an
organizations environment that are related to
its goal attainment
Environmental Uncertainty - the
amount and rate of change
in the organizations
environment

Environment

Extremes of
Environmental Uncertainty
Mechanistic Structure an
organizational design that emphasizes
structured activities, specialized tasks,
and centralized decision making
Organic Structure an organizational
design that emphasizes teamwork, open
communication, and decentralized
decision making

Strategic Dimension

Predicted Structural
Characteristics
Innovation--to understand
Low formalization
and manage new processes
Decentralization
and technologies
Flat hierarchy
Market differentiation--to
Moderate to high complexity
specialize in customer
Moderate to high
preferences
formalization
Moderate centralization
Cost control--to produce
High formalization
standardized products
High centralization
efficiently
High standardization
Low complexity

Strategy
& Goals

Millers Integrative Framework of


Structural & Strategic Dimensions
D. Miller, The Structural and Environmental Correlates of Business Strategy, Strategic Management Journal 8 (1987): 55-76. Copyright
@ John Wiley & Sons Limited. Reproduced with permission.

The Relationship
among Key
Organizational
Design
Elements

Context of the organization


Correct size
Current technology
Perceived environment
Current strategy & goals

Influences how manager perceive structural needs


Structural dimensions
Level of formalization
Level of centralization
Level of specialization
Level of standardization
Level of complexity
Hierarchy of authority

Which characterize the organizational processes


Differentiation & Integration
Which influence how well the structure meets its
Purposes
Designate formal
lines of authority
Designate formal
informationprocessing patterns
Which influence how well the structure fits the
Context of the organization

Forces Reshaping
Organizations

Organization in Life Cycle - the


differing stages of an organizations
life from birth to death
Globalization
Changes in Information-Processing
Technologies
Demands on Organizational Processes
Emerging Organizational Structures

Structural Roles of Managers Today


versus Managers of the Future
Roles of Managers Today
1. Strictly adhering to boss
-employee relationships
2. Getting things done by
giving orders
3. Carrying messages up
and down the hierarchy
4. Performing a set of tasks
according to a job description
5. Having a narrow functional
focus
6. Going through channels,
one by one by one
7. Controlling subordinates

Roles of Future Managers


1. Having hierarchical
relationships subordinated
2. Getting things done by
negotiating
3. Solving problems and
making decisions
4. Creating the job through
entrepreneurial projects
5. Having a broad crossfunctional collaboration
6. Emphasizing speed &
flexibility
7. Coaching ones workers
Management Review, January 1991, Thomas R. Horton.

Class Exercise

How would you classify your project company


according to Mintzbergs model (e.g. simple,
machine bureaucracy, professional bureaucracy,
divisionalized, adhocracy).
Where would you place key persons/departments in
the organization in the 5 Basic Parts of the
Organization model?
Which principles are used in the company to
departmentalization (dividing people into groups or
departments)
How does the organizational structure influence
other processes and/or systems in the organization?