Organization Design: “All the elements interact in a system”

Organizations, like individuals, can avoid identity crises by deciding what it is they wish to be and then pursuing it with a healthy obsession.

Some organizations do indeed achieve and maintain an internal consistency. But then they find that it is designed for an environment the organization is no longer in. To have a nice, neat machine bureaucracy in a dynamic industry calling for constant innovation or, alternately, a flexible adhocracy in a stable industry calling for minimum cost makes no sense. Remember that these are configurations of situation as well as structure. Indeed, the very notion of configuration is that all the elements interact in a system. One element does not cause another; instead, all influence each other interactively. Structure is no more designed to fit the situation than situation is selected to fit the structure.

The way to deal with the right structure in the wrong environment may be to change the environment, not the structure. Often, in fact, it is far easier to shift industries or retreat to a suitable niche in an industry than to undo a cohesive structure.

Essentially, the organization has two choices. It can adapt continuously to the environment at the expense of internal consistency—that is, steadily redesign its structure to maintain external fit. Or it can maintain internal consistency at the expense of a gradually worsening fit with its environment, at least until the fit becomes so bad that it must undergo sudden structural redesign to achieve a new internally consistent configuration. In other words, the choice is between evolution and revolution, between perpetual mild adaptation, which favors external fit over time, and infrequent major realignment, which favors internal consistency over time.

–Henry Mintzberg, 1981
Organization Design: Fashion or Fit?

Organization Design: “All the elements interact in a system”

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