Maximization Principle

Katz and Kahn (1978 p. 97) note that organizations are likely to grow and maximize their organizational structure. Some dynamics that produce this are:

1. Proficiency dynamic leads to an increase in organizational capabilities (through technical improvements that expand capacity for instance)

2. Expansion as a simple solution to system strain. The organization can't meet all the demands placed on it which causes internal strain. Compromise tends to add things in subsystems instead of reducing them. Sometimes a larger superstructure is created to oversee the subsystems having the conflict.

3. Environmental Demands. Often increasing output volume and profits can improve one's survivability. Controlling more of the environment through expansion is also advantageous. Top management often becomes more specialized and numerous.

4. Nature of Bureaucratic Structure. The budgeting process is one example of internal processes that favor maximization of budgets (and resources and hence power). What was a special case in one budget becomes mandatory in the next one.

5. Organizational Ideology. Growth is provided as a basis for an organization's existence and mission. Profit-making institutions have an ideology of profit maximization.