Technology Structures and Social Boundaries
The following post is adapted from my personal academic coursework.
Technology Structures and Social Boundaries
Scott and Davis asserted that “most analysts have conceived of organizations as social structures.” While organizations may themselves be structures and structure may be one of the most common features of organizations, the nature of these structures varies greatly from one organization to another, and most structures are quite important to the organization. Mahmood and Mubarik identified structural capital as a vital component of intellectual capital within their Industry 4.0 framework. There are many different formal and informal structures and organizations develop their unique structural arrangements for differing reasons. Among these reasons are technology and labor, each of which holds tremendous influence over the creation and modification of organizational structures.
Technology and Organizational Structure
Scott and Davis stated that technology links the organization to its environment because the organization draws technology from the environment. Technology, in this case, refers to the machinery, methods, and skills used to process the organization’s inbound material to output products.
Not only does the material come from the environment, but the environment also provides the technology used to transform the material into the final product. Merida provided a good example of this when he explained Solomon’s request for materials and skill for constructing the temple: “Hiram… …[supplied] wood, carpenters, and stonemasons. The Sidonians were experts in building techniques. Solomon asks Hiram for skilled men and materials.”
Scott and Davis stated that the term “environment… …incorporates technological, political, and institutional aspects of the organizational context.” Theorists differ on the exact nature of the relationship between the environment, technology, and organizational structure. Scott and Davis stated that “technology informs and constrains, but does not dictate the precise configuration of machines and methods that make up a specific technical system.”
Scott and Davis, in their discussion of the rational approach, stated that “the structural features of organizations that are of primary interest are those designed to reduce uncertainty, to deal with complexity, and to coordinate interdependent tasks.” Attempts to mitigate these organizational concerns are nothing new; leaders have used them since ancient times. According to Genesis 41:8, 40-41 (NKJV), Pharaoh had magicians and wise men in his court to reduce uncertainty and appointed Joseph to deal with complexity and coordinate interdependent tasks. According to the rational perspective, modern organizations respond to these challenges by either protecting the core of the organization, restructuring the core of the organization, or coordinating interdependent factors.
Scott and Davis identified seven primary forms of organizational structures. The differences between these forms include the organization’s size, the concentration of authority, the assignment of departments, and the connectedness of the organization. Simple structures minimize the division of labor and direct supervision while bureaucracies have centralized authority and routinized tasks. Functional organizations divide work into operations and support departments while multidivisional organizations divide it among autonomous departments working on a common product or in a common market. Matrices draw from the functional and multidivisional structures to assign workers to teams or task forces based on both the nature of the work and specific projects. Adhocracies have low formality and require independent workers who can fluidly move between teams. Finally, networks integrate activities vertically within the organization and horizontally across the organization.
Other Rational Considerations
Scott and Davis discussed organizational slack and the effects of emergent information and communication technologies on organizational structures.
Slack refers to unused resources in the system. Scott and Davis described this seemingly wasteful and inefficient phenomenon as “not only inevitable, but also essential to smooth operations,” noting that “all operations require a margin of error” and omitting this slack has led to “some of the failures in complex military and space systems.” Zhang and Mendonça researched organizational improvisation in the context of disaster recovery operations following Hurricane Sandy and found significantly more idea generation and less decision making when operations began than at the end. This indicates slack in the form of wasted ideas in the early phase of operations. However, this slack was beneficial to the organization’s overall efficiency because had each of these ideas materialized into a decision it would have slowed the recovery process and diverted valuable resources away from their ultimate uses.
Information and Communication Technologies
Scott and Davis explained that recent innovations in information and communication technologies “affect not only the gathering and transmission of information, but also its use in decision making…, …[which ultimately] improve[s] both the speed and quality of decision making.” These technologies have made an immense difference in the daily operations of many organizations. The speed and consistency with which the modern world exchanges information, while often problematic at a personal level, allows greater organizational flexibility and response than previously thought possible. Abeele et al. explained how “mobile communications technologies have made it logical for people to organize their activities in a ‘networked’ manner. Indeed, in contemporary Western societies, people are accustomed to directly access persons, services and information irrespective of time and place. For example, we check our work email during a restroom break.”
While this somewhat crude example may trivialize the phenomenon, the reality is that these technologies have impacted all of us. Consider briefly the COVID-19 vaccination. Regardless of one’s thoughts on its efficacy or safety, these technologies have enabled its record-shattering development, authorization, distribution, and usage. They will similarly allow organizations of all types continue to accelerate their efforts for the intermediate future.
Scott and Davis identified three themes central to the natural perspective’s treatment of the relationship between technology and structure — social and cultural factors, informal structure, and tacit knowledge.
Social and Cultural Factors
Several studies have shown the relationships between culture and structure, demonstrating significant differences in organizational structures between societies that otherwise seem quite similar. Hofstede in particular noted patterns of differentiation between values and practices at the national and organizational levels: “Whereas national cultures tend to vary considerably in values but engage in rather similar practices…, …people in different organizations showed considerable differences in practices but much smaller differences in values.” In other words, while behavior tends to be homogenous and beliefs tend to be heterogenous at the national level, behavior tends to be heterogenous and beliefs tend to be homogenous across organizations within a nation. This seems to suggest that national identity is a stronger predictor of behavior while organizational identity is a stronger predictor of beliefs.
Ntale et al. (2020) discussed the impact of culture on structure as follows: “It would seem that in the more developed countries, [structuring to allow interagency cooperation] has been achieved, leading to high levels of interorganization collaboration. In low-income countries, however, observable practice shows limited collaboration among organizations. Whereas these countries have stepped up their efforts to address challenges such as graduate unemployment, their efforts remain largely individualistic and highly fragmented.”
Thomas also addressed the importance of culture to organizations’ decisions regarding technology and structure. He identified three phases of introducing new technologies – identification of the issue, selection of the preferred technology, and implementation of the technology. Within this process, he recommended that organizations consider whether the technology can accomplish the task, does so in an acceptable way, and is aligned to the individual’s or organization’s stated or political interests. Wu and Zhu, in their consideration of blockchain as a solution to managing Chinese charity donations, concluded that “blockchain… [is beneficial] …in sharing donation data, in managing information among donors and beneficiaries, in contract management among charitable organizations and enterprises, and [in] its application in dealing with the Covid-19-centered donations.” In this example, blockchain can accomplish the task of dealing with donations, does so in an acceptable way by managing donor information and contracts, and is aligned to Chinese cultural interests by balancing concerns of information security and charitable accountability.
Scott and Davis explained that strategic choice hinges on the understanding that individuals have agency – the ability to make choices – and bring their own diverse perspectives and interests into the organization. Because of this agency and individual differentiation, strategic choice theorists view organizations as ever-shifting coalitions whose interests and power relationships are in constant states of flux and which impact the uncertainty, complexity, and interdependence of the task.
Information and Communication Technologies
Natural perspective theorists also differ with their rational perspective colleagues over the role of information and communication technologies in organizations. They believe that the impact of these technologies is not limited to automation, but that it also includes the technologies’ ability to “informate work processes” by absorbing excess information and creating new information.
Informating exists in a variety of organizational settings. Libraries are a common example of how these technologies has informated work processes. Thirty years ago, librarians had to maintain a physical card catalog, reshelve books, arrange for inter-library loans, and perform a wide range of other tasks that information technology has mostly absorbed over the past three decades. However, while those tasks are increasingly becoming obsolete, librarians are far from extinct. In fact, they have a whole new job description because of all the new information which these technologies have created.
Thaichon et al. identified the same phenomenon in hybrid sales structures, which they stated “constitute dynamic capabilities, enabling firms to innovate by engaging in constant and rapid recombinations of resources, including attaining extra resources and removing redundant ones.” Like libraries and countless other organizations, hybrid sales structures are capitalizing on information and communication technologies’ absorption of excess information (redundant resources) and creation of new information (recombinations of resources and extra resources).
Other Natural Perspective Considerations
Scott and Davis identified other considerations relevant to the natural perspective, including the duality of technology, the importance of informal structure, the sociotechnical approach, and the role of tacit knowledge.
Scott and Davis argued that professional organizations combine “aspects of rational and natural system approaches to dealing with complex tasks.” These organizations exist for reasons which both the rational and natural perspectives can explain. They typically arrange themselves either as a group of professionals under an administrative hierarchy with limited autonomy or as a semi-autonomous group of professionals who establish goals, set standards, and enforce expectations.
Labor and Organizational Structure
Scott and Davis began their discussion on labor by explaining the nature of, and problems with, determining organizational boundaries. They stated that there are two perspectives to examining these boundaries –that of the realist or that of the nominalist – and that each may examine “the characteristics of the actors, their relations, and their activities.” They differentiated between the rational and natural perspectives with their discussion of whom and how organizations recruit.
Division of Labor
Scott and Davis further explored the divide between rational and natural theorists through their examination of how organizations divide labor. Rational theorists see the division and specialization of labor in terms of efficiency and productivity while natural theorists take a more Marxist approach and see it as deskilling, subordinating, and dehumanizing workers.
One way that organizations reinforce their boundaries is through the implementation of internal labor markets which exist in both the private and public sectors. Internal labor markets tend to be more prevalent in “organizations that [are] larger, more bureaucratic, unionized, faced with asset specificity problems, and whose personnel decisions [are] made by a centralized personnel office.”
Market-mediated employment offers an alternative to internal labor markets and focuses on externalizing the workforce by reducing the attachment between employers and employees.
Solutions and Problems
Scott and Davis highlighted the success of high-performance work organizations which are more flexible, empowering, team-based, and well-governed than their competitors. Finally, Scott and Davis identified alienation, inequity, and insecurity as issues facing workers.
Scott and Davis provided a wealth of information on the relationships between technology, labor, and structure. Their discussions included perspectives from the rational, natural, and open systems approaches. While the sheer quantity of information is overwhelming, it leads to a well-rounded understanding of how environments impact organizations’ development of structures.
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Mahmood, T. & Mubarik, M. S. (2020). Balancing innovation and exploitation in the fourth industrial revolution: Role of intellectual capital and technology absorptive capacity. Technological Forecasting & Social Change, 160, 1-9. https://doi.org/10.1016/j.techfore.2020.120248
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Scott, W. R. & Davis, G. F. (2016). Organizations and organizing: Rational, natural, and open system perspectives (6th ed.). Routledge.
Thaichon, P., Surachartkumtonkun, S. Q., Weaven, S., & Palmatier, R. W. (2018). Hybrid sales structures in the age of e-commerce. Journal of Personal Selling & Sales Management, 38(3), 277-302. https://doi.org/10.1080/08853134.2018.1441718
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Wu, H. & Zhu, X. (2020). Developing a reliable service system of charity donation during the covid-19 outbreak. IEEE Access, 8, 154848-154860. https://doi.org/10.1109/ACCESS.2020.3017654
Zhang, X. & Mendonça, D. (2020). Co-evolution of work structure and process in organizations: Improvisation in post-disaster debris removal operations. Cognition, Technology & Work, https://doi.org/10.1007/s10111-020-00631-2