Galbraith (1973, 1977) uses information processing capacity as an artifact
and determinant of structural features. Information requirements increase
as a function of increasing diversity, uncertainty, and interdependence
of work processes (Scott p. 231). He then explores various modifications
organizations use to adapt to increased demands for information processing.
In increasing order of handling info complexity (and execution cost), he
1. Rules and programs -- agreements to how to do work process prior
to actual performance. Often are embedded in formal documents.
2. Schedules -- Needed with different activities or sequential interdependence
present. Increasing uncertainty is handled by shortening the plan - replan
3. Departmentalization -- Organizations
group tasks according to their homogeniety (early theorists) or interdependence
(Thompson, 1967) . Thompson sees pooled interdependence in more separate
units, sequential interdependence in more close units, and reciprocal interdependence
in the same or close units. Organizations group tasks to minimize coordination
costs (Thompson, 1967) -- which is a special case of Williamson's transaction
4. Hierarchy -- Fayol noted that officials can help deal with special
exceptions to standard work processes, but hierarcy also is another task
grouping mechanism. As information flows become more complex and interdependent
between units, often organizations then place hierchy over both units to
improve information flow and control.
5. Delegation -- Rather than have formal quidelines, organizations
can set targets or goals and give units more autonomy to meet them. This
occurs most often with professional occupations.
6. Micro-coordination -- Recognition that the task object often has
some ability to monitor and control the actions placed upon it (whether
it be students, clients, etc.).
Reducing Information Vs Increasing Capacity
When uncertainty, diversity, and interdependence get too high Galbraith
argues that organizations have two basic options -- reduce the amount of
information processed, or increase the info handling capacity.
Reducing Information Processing
7. Product-based vs Process-Based Departmentalization -- gathering
all production tasks of one product into one department can reduce the amount
of information needed to coordinate and control. The gains by increased
homogeniety of task (and goals) are offset by reduction in economies of
scale and variety.
8. Slack Resources
Reducing the required level of performance can create slack -- unused resources
-- that can help ease the strain in the system. For instance, delivery deadlines
could be extended, inventory controls relaxed, etc. Building redundancy
or alternative paths in the work flows can also help reduce information
processing needs. Slack reduces the need for info processing through reducing
the interdependence between units.
Some slack is necessary for smooth function, as systems cannot be specified
exactly and have some inefficiencies. The difficulty is deciding how much
slack to permit, as it is costly.
It appears that the introduction of computer technology and networks is
allowing increased interdependence between units (e.g., designers and manufacturers
through networked CAD systems).
Increasing Information Processing Capacity
9. Augmented Hierarchies
Hierarchical systems can become overloaded if the info processing requirements
become too great. Increasing hierarchical capacity can occur in two ways.
One is to create specialist roles that gather and synthesize information
used in higher level decision making (e.g, inspectors, accountants, secretaries).
Recently these tasks have been increasinly resident in computer systems.
Another way is to use the staff-line principle what can help increase problem-solving
ability without sacrificing the "unity of command" principle (though
sometime power shifts from line to staff in this arrangement).
10. Lateral Connections
Developing more laterial connections across divisions is often much more
efficient than relying on the "up-across-down" interdivisional
flow of information in hierachical communications. These augment the more
information relations across divisional boundaries that develop and make
it a more formal part of the structure. The tradeoff is in the transfer
of some control from hierarchical schemes to more lateral, inter-divisional
schemes. Some mechanisms of this (in increasing levels of lateral control)
A. Liasion Roles -- roles that bridge two groups and have responbilities
in troubleshooting, integrating, conflict resolution, etc. Lawrence and
Lorsch (1967) describe the responsibilities and characteristics of these
B. Task Forces -- a temporary group made up of part-time or full-time
people from several departments set up to address a specific task. It facilitates
inter-departmental interaction but is hindered by ignored status distinctions
between members and existing goal differences between departments. Often
task forces serve as safety valves to reduce tension caused by hierchiacal
C. Project Teams -- these are more permanent than task forces, and
members are more often full time. Usually there is a project leader assigned
to coordinate group activities and department officers would delegate some
authority to the project leader while making sure their own participating
members are treated fairly.
D. Matrix Structures -- This unique form
has both hierarchical and lateral authority chains -- "competing bases
of authority are allowed to jointly govern the work flow" (Scott p.
239). While the functional departments remain the 'home base" for the
participants, additional control structures are set up across departments,
usually around a specific project (see Davis and Lawrence, 1977). Often
consulting organizations operate on a loose matrix system.
The matrix system elevates the conflict between product and functional interests.