Abstract
This chapter addresses the issue of structural change within for-profit organizations, both as adaptation to changing markets and as purposeful experimentation to search for new opportunities, and builds upon the “reconfiguration” construct. In the areas of strategy, evolutionary economics, and organization theory, there are conflicting theories that either predict structural change or discuss obstacles to change. Our aim is to highlight relevant theoretical rationales for why and when organizations would, or would not, be expected to undertake structural reconfiguration. We conclude with remarks on how these literatures, together, inform our understanding of reconfiguration and organization design and provide insights for practitioners.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Notes
- 1.
Eisenhardt and Brown (1999) broadly refer to “reorganization” in their comparison to patching, however, we refer more specifically to their “reorganization” construct as that of “organizational restructuring.”
References
Abernathy W, Utterback J (1978) Patterns of Industrial Innovation. Technology Review 80: 40–47.
Amburgey TL, Kelly D, Barnett WP (1993) Resetting the Clock: The Dynamics of Organizational Failure. Administrative Science Quarterly 38(1): 51–73.
Baldwin CY, Clark KB (2000) Design Rules: The Power of Modularity. Boston: MIT Press.
Bergh DD (1998) Product-Market Uncertainty, Portfolio Restructuring, and Performance: An Information-Processing and Resource-Based View. Journal of Management 24 (2): 135–155.
Blau PM (1970) A Formal Theory of Differentiation in Organizations. American Sociological Review 35(2): 201–218.
Bowman EH, Singh H (1993) Corporate Restructuring: Reconfiguring the Firm. Strategic Management Journal 14 (Special Issue: Corporate Restructuring): 5–14.
Burns T, Stalker GM (1961) The Management of Innovation. London: Tavistock.
Burton RM, Lauridsen J, Obel B (2002) Return on Assets Loss from Situational and Contingency Misfits. Management Science 48 (11): 1461–1485.
Burton RM, Obel B (2004) Strategic Organization Diagnosis and Design: The Dynamics of Fit, 3rd edn. Dordrecht: Kluwer Academic Publishers.
Cafferata GL (1982) The Building of Democratic Organizations: An Embryonic Metaphor. Administrative Science Quarterly 27: 280–303.
Chandler A (1962) Strategy and Structure: Chapters in the History of the American Industrial Enterprise. Cambridge, MA: MIT Press.
Chattopadhyay P, Glick WH, Huber GP (2001) Organizational Actions in Response to Threats and Opportunities. Academy of Management Journal, 44 (5): 937–955.
Chesbrough H, Teece D (1996) When is Virtual Virtuous: Organizing for Innovation. Harvard Business Review, 74(1): 65–74.
Child J (1972) Organizational Structure, Environment and Performance: The Role of Strategic Choice. Sociology 6 (1): 1–22.
Child J, Kieser A (1981) Development of Organizations over Time. In: Starbuck W, Nystrom P (eds), Handbook of Organization Design. New York: Oxford, pp 28–64.
Ciborra CU (1996) The Platform Organization: Recombining Strategies, Structures, and Surprises. Organization Science 7 (2): 103–118.
Crozier M (1964) The Bureaucratic Phenomenon. Chicago: University of Chicago Press.
Cyert RM, March JG (1963) A Behavioral Theory of the Firm. Cambridge: Blackwell Publishing.
Dalton DR, Daily CM, Ellstrand AE, Johnson JL (1998) Meta-Analytic Reviews of Board Composition, Leadership Structure, and Financial Performance. Strategic Management Journal 19: 269–290.
Donaldson L (1985) Organization Design and the Life Cycles of Products. Journal of Management Studies 22 (1): 25–37.
Donaldson L (1987) Strategy and Structural Adjustment to Regain Fit and Performance: In Defense of Contingency Theory. Journal of Management Studies, 24 (1): 1–24.
Donaldson L (1990) The Normal Science of Structural Contingency Theory. In: Clegg H, Nord W(eds), The Handbook of Organization Studies. London: Sage.
Donaldson L (1995) American Anti-Management Theories of Organization: A Critique of Paradigm Proliferation. New York: Cambridge University Press.
Donaldson L (2001) The Contingency Theory of Organizations. Thousand Oaks, CA: Sage.
Eisenhardt KM, Brown SL (1999) Patching: Re-Stitching Business Portfolios in Dynamic Markets. Harvard Business Review 77(3): 71–82.
Eisenhardt KM, Martin JA (2000) Dynamic Capabilities: What are They? Strategic Management Journal, Special Issue 21(10–11): 1105–1121.
Feldman MS, Pentland BT (2003) Organizational Routines as a Source of Flexibility and Change. Administrative Science Quarterly 48(1): 94–118.
Galunic DC, Eisenhardt KM (1996) The Evolution of Intracorporate Domains: Divisional Charter Losses in High-Technology, Multidivisional Corporations. Organization Science 7(3): 255–282.
Galunic DC, Eisenhardt KM (2001) Architectural Innovation and Modular Corporate Forms. Academy of Management Journal 44 (6): 1229–1249.
Garud R, Kumaraswamy A (1995) Technological and Organizational Designs for Realizing Economies of Substitution. Strategic Management Journal 16 (Special Issue: Technological Transformation and the New Competitive Landscape): 93–109.
Greiner L (1972) Evolution and Revolution as Organizations Grow. Harvard Business Review 50(4): 37–46.
Gresov C (1989) Exploring Fit and Misfit with Multiple Contingencies. Administrative Science Quarterly 34(3): 431–454.
Greve HR (2003) Organizational Learning from Performance Feedback: A Behavioral Perspective on Innovation and Change. Cambridge: Cambridge University Press.
Hage J, Aiken M (1969) Routine Technology, Social Structure and Organizational Goals. Administrative Science Quarterly 14(3): 366–376.
Hambrick DC, Mason PA (1984) Upper Echelons: The Organization as a Reflection of its Top Managers. Academy of Management Review 9: 193–206.
Hannan MT, Freeman J (1984) Structural Inertia and Organizational Change. American Sociological Review 49: 149–164.
Haveman H (1992) Between a Rock and a Hard Place: Organizational Change and Performance under Conditions of Fundamental Environmental Transformation. Administrative Science Quarterly 37: 48–75.
Helfat CE, Eisenhardt KM (2004) Inter-Temporal Economies of Scope, Organizational Modularity, and the Dynamics of Diversification. Strategic Management Journal 25(13): 1217–1232.
Henderson RM, Clark KB (1990) Architectural Innovation: The Reconfiguration of Existing Product Technologies and the Failure of Established Firms. Administrative Science Quarterly 35(1): 9–30.
Hill CWL, Hitt MA, Hoskisson RE (1992) Cooperative versus Competitive Structures in Related and Unrelated Diversified Firms. Organization Science 3(4): 501–521.
Hirsch PM, De Soucey M (2006) Organizational Restructuring and its Consequences: Rhetorical and Structural. Annual Review of Sociology 32: 171–89.
Hoskisson RE, Johnson RA (1992) Corporate Restructuring and Strategic Change: The Effect on Diversification Strategy and R&D Intensity. Strategic Management Journal 13 (8): 625–634.
Hoskisson RE, Johnson RA, Moesel DD (1994) Corrporate Divestiture Intensity in Restructuring Firms: Effects of Governance, Strategy, and Performance. Academy of Management Journal 37(5): 1207–1251.
Hoskisson RE, Turk TA (1990) Corporate Restructuring: Governance and Control Limits of the Internal Capital Market. Academy of Management Review 15 (3): 459–477.
Huber GP (2004) The Necessary Nature of Future Firms: Attributes of Survivors in a Changing World. Boston, MA: Sage.
Jensen MC (1986) Agency Costs of Free Cash Flow. American Economic Review 76: 323–329
Jensen MC (1988) Takeovers: Their Causes and Consequences. Journal of Economic Perspectives 2 (1): 21–48.
Johnson R (1996) Antecedents and Outcomes of Corporate Refocusing. Journal of Management 22 (3): 439–483.
Karim S (2006) Modularity in Organizational Structure: The Reconfiguration of Internally Developed and Acquired Business Units. Strategic Management Journal 27: 799–823.
Karim S, Mitchell W (2004) Innovating Through Acquisition and Internal Development. Long Range Planning 37: 525–547.
Keats BW, Hitt MA (1988) A Causal Model of Linkages Among Environmental Dimensions, Macro Organizational Characteristics, and Performance. Academy of Management Journal 31 (3): 570–598.
Khandwalla PN (1977) Organizational Design. New York: Harcourt, Brace, Jovanovich.
Kimberley J, Miles RH (1980) The Organizational Life Cycle. San Francisco: Jossey Bass.
Lant TK, Hurley AE (1999) A Contingency Model of Response to Performance Feedback: Escalation of Commitment and Incremental Adaptation in Resource Investment Decisions. Group and Organization Management 24 (4): 421–437.
Lawrence PR, Lorsch JW (1967) Organization and Environment: Managing Differentiation and Integration. Boston: Harvard Business School.
Lei D, Hitt MA, Goldhar JD (1996) Advanced Manufacturing Technology: Organizational Design and Strategic Flexibility. Organization Studies 17 (3): 501–524.
Liebeskind J, Wiersema M, Hansen G (1992) LBOs, Corporate Restructuring, and the Incentive-Intensity Hypothesis. Financial Management 21(1): 73–88.
Lopes LL (1987) Between Hope and Fear: The Psychology of Risk. Advances in Experimental Social Psychology 20: 255–295.
March JG (1981) Footnotes to Organizational Change. Administrative Science Quarterly 26: 563–577.
March JG, Shapira Z (1992) Variable Risk Preferences and the Focus of Attention. Psychological Review 99 (1): 172–183.
Merton RK (1957) Social Theory and Social Structure, Rev. ed. Glencoe, IL: Free Press.
Miller D (1988) Relating Porter’s Business Strategies to Environment and Structure: Analysis and Performance Implications. Academy of Management Journal 31 (2): 280–308.
Mintzberg H (1980) Structure in 5s: A Synthesis of the Research on Organization Design. Management Science 26 (3): 322–341.
Nadler D, Tushman ML (1984) A Congruence Model for Diagnosing Organizational Behavior. In: Kolb DA, Rubin JM, McIntyre JM (eds), Organizational Psychology: Readings on Human Behavior in Organizations. Englewood Cliffs, NJ: Prentice-Hall, pp 587–603.
Nadler DA, Tushman M (1997) Competing by Design: The Power of Organizational Architecture. New York: Oxford University Press.
Naman JL, Slevin DP (1993) Entrepreneurship and the Concept of Fit: A Model and Empirical Tests. Strategic Management Journal 14 (2): 137–153.
Ocasio WC (1995) The Enactment of Economic Adversity: A Reconciliation of Theories of Failure-Induced Change and Threat-Rigidity. In: Staw BM, Cummings LL (eds), Research in Organization Behavior Greenwich, CT: JAI Press, 17: 287–331.
Penrose ET (1959) The Theory of the Growth of the Firm. New York: Wiley.
Porter ME (1987) From Competitive Advantage to Corporate Strategy. Harvard Business Review 65 (3): 43–59.
Phan PH, Hill CWL (1995) Organizational Restructuring and Economic Performance in Leveraged Buyouts: An Ex Post Study. Academy of Management Journal 38 (3): 704–739.
Quinn RE, Cameron K (1983) Organization Life Cycles and Shifting Criteria of Effectiveness: Some Preliminary Evidence. Management Science 29 (1): 33–51.
Ravenscraft DJ, Scherer FM (1987) Mergers, Sell-offs, and Economic Efficiency. Washington, DC: Brookings Institution Press.
Romanelli E, Tushman ML (1994) Organization Transformation as Punctuated Equilibrium: An Empirical Test. Academy of Management Journal 34: 141–1166.
Rumelt RP (1974) Strategy, Structure and Economic Performance. Boston, MA: Harvard University Press, Cambridge.
Sanchez R, Mahoney JT (1996) Modularity, Flexibility, and Knowledge Management in Product and Organization Design. Strategic Management Journal 17: 63–76.
Schilling MA (2000) Toward a General Modular Systems Theory and Its Application to Interfirm Product Modularity. Academy of Management Review 25 (2): 312–334.
Schilling MA, Steensma HK (2001) The Use of Modular Organizational Forms: An Industry-Level Analysis. Academy of Management Journal 44 (6): 1149–1168.
Seth A, Easterwood J (1993) Strategic Redirection in Large Management Buyouts: The Evidence from Post-Buyout Restructuring. Strategic Management Journal 14 (4): 251–273.
Sirmon DG, Hitt MA, Ireland RD (2007) Managing Firm Resources in Dynamic Environments to Create Value: Looking Inside the Black Box. Academy of Management Review 32 (1): 273–292.
Starbuck W, Milliken F (1988) Executives’ Perceptual Filters: What They Notice and How They Make Sense. In: Hambrick D (eds), The Executive Effect: Concepts and Methods for Studying Top Executives. Greenwich, CT: JAI Press, pp 35–65.
Staw BM, Ross J (1987) Understanding Escalation Situations: Antecedents, Prototypes, and Solutions. Research in Organizational Behavior 9: 39–78.
Staw BM, Sandelands LE, Dutton JE (1981) Threat-Rigidity Effects in Organizational Behavior: A Multilevel Analysis. Administrative Science Quarterly 26: 501–524.
Teece DJ, Pisano G, Shuen A (1997) Dynamic Capabilities and Strategic Management. Strategic Management Journal 18 (7): 509–533.
Thomas J, Clark S, Gioia D (1993) Strategic Sensemaking and Organizational Performance: Linkages among Scanning, Interpretation, Action, and Outcomes. Academy of Management Journal 36: 239–270.
Tushman ML, Murmann JP (1998) Dominant Designs, Technology Cycles, and Organizational Outcomes. In: Staw B, Sutton R (eds), Research in Organizational Behavior. Greenwich, CT: JAI Press, Vol. 20.
Utterback JM (1994) Mastering the Dynamics of Innovation. Boston, MA: Harvard Business School Press.
Utterback JM, Suárez F (1993) Innovation, Competition, and Industry Structure. Research Policy 22: 1–21.
Van de Ven AH, Poole MS (1995) Explaining Development and Change in Organizations. Academy of Management Review 20 (3): 510–540.
Walsh JP (1988) Top Management Turnover Following Mergers and Acquisitions. Strategic Management Journal 9: 173–183.
Walsh JP (1989) Doing a Deal: Merger and Acquisition Negotiations and Their Impact upon Target Company Top Management Turnover. Strategic Management Journal 10: 307–322.
Walsh JP, Ellwood JW (1991) Mergers, Acquisitions, and the Pruning of Managerial Deadwood. Strategic Management Journal 12 (3): 201–217.
Zenger TR, Hesterly WS (1997) The Disaggregation of Corporations: Selective Intervention, High-Powered Incentives, and Molecular Units. Organization Science 8 (3): 209–222.
Acknowledgments
The authors wish to thank Anne Bøllingtoft, George Huber, and participants in the 2008 Aarhus Conference on Organization Design for their helpful comments.
Author information
Authors and Affiliations
Corresponding author
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2009 Springer Science+Business Media, LLC
About this chapter
Cite this chapter
Carroll, T.N., Karim, S. (2009). Predicting Organizational Reconfiguration. In: Bøllingtoft, A., Håkonsson, D., Nielsen, J., Snow, C., Ulhøi, J. (eds) New Approaches to Organization Design. Information and Organization Design Series, vol 8. Springer, Boston, MA. https://doi.org/10.1007/978-1-4419-0627-4_5
Download citation
DOI: https://doi.org/10.1007/978-1-4419-0627-4_5
Published:
Publisher Name: Springer, Boston, MA
Print ISBN: 978-1-4419-0626-7
Online ISBN: 978-1-4419-0627-4
eBook Packages: Business and EconomicsBusiness and Management (R0)