Organisation Theory
Introduction to organisation theory
Perrow’s article emphasizes:
- Post WWII expansion of organisations
- Shift from mechanical to human relations-based organisations theory
- Need for new approaches to understand organisations
Mechanical school Human relation school
Organisations as a machine People rather than machines
Centralized authority Delegation of authority
Specialization and expertise Employee autonomy
Strict division of labour Trust and openness
High bureaucracy Concerns with the “whole person”
Strict management Interpersonal dynamics
Which changes forced new approaches to emerge?
- Response to complex, large-scale organisations
- Labour became more critical for organisations
- New emerged technologies increased the demand for trained/skilled labour
- Increased complexity of markets, increased variety of products and
services
- Human factor became more important (proper way to treat people)
- Shift from authoritarian management to “good” leadership
Human Relations School (Great depression and Hawthorne studies // WWII)
- Critique of classical theory
- Focus on employee satisfaction and group dynamics
o Employee morale, social relations, social interacts and informal
organizational structures.
- Social aspect of work environment
Hawthorne research
Conducted just after the great depression (1929-1939) // (workforce was reduced)
The research highlighted the following:
- The role of informal groups
- Work restriction norms
- The value of good leadership
- The role of psychological manipulation
, Post WII era
- Good leadership
- Focus on innovative and rapidly changing organisations
- Temporary labour, temporary authority systems, temporary leadership
- Decentralized hierarchy
Perrow: more emphasis on autonomy, change, humanity, creativity and
democracy.
Return of Weberian approach (bureaucracy)
- Bureaucracy can be productive and efficient (especially in routine
operations)
- Clear specification of authority and responsibility
- Clear knowledge of division of labour
- Studies show bureaucratic organisations could change faster than non-
bureaucratic ones (Perrow)
Political sciences to the field in the 1950s
- Both schools were challenged (human and mechanical) by the sociologist
and political scientist interested in the field.
- Conflict and power (influence) became focus concepts
Conflict could be healthy for organisations.
Main argument: Man is limited (in intelligence, reasoning, information and
time) therefore usually picks the first “acceptable” alternative when deciding
rather than the best. And this behaviour is repeated (rather than changed)
until it gets bad. (cognitive limits on rationality // decision making school)
Enter of the sociologist to the field
- Focus on goals and the environment
- NO ‘one best way’ to organize (one size fits all models are not efficient)
- Goals should be dynamic as the firm
- Importance of situational factors
- Aligning structure with environment and technology
Introduction to organisation theory
Perrow’s article emphasizes:
- Post WWII expansion of organisations
- Shift from mechanical to human relations-based organisations theory
- Need for new approaches to understand organisations
Mechanical school Human relation school
Organisations as a machine People rather than machines
Centralized authority Delegation of authority
Specialization and expertise Employee autonomy
Strict division of labour Trust and openness
High bureaucracy Concerns with the “whole person”
Strict management Interpersonal dynamics
Which changes forced new approaches to emerge?
- Response to complex, large-scale organisations
- Labour became more critical for organisations
- New emerged technologies increased the demand for trained/skilled labour
- Increased complexity of markets, increased variety of products and
services
- Human factor became more important (proper way to treat people)
- Shift from authoritarian management to “good” leadership
Human Relations School (Great depression and Hawthorne studies // WWII)
- Critique of classical theory
- Focus on employee satisfaction and group dynamics
o Employee morale, social relations, social interacts and informal
organizational structures.
- Social aspect of work environment
Hawthorne research
Conducted just after the great depression (1929-1939) // (workforce was reduced)
The research highlighted the following:
- The role of informal groups
- Work restriction norms
- The value of good leadership
- The role of psychological manipulation
, Post WII era
- Good leadership
- Focus on innovative and rapidly changing organisations
- Temporary labour, temporary authority systems, temporary leadership
- Decentralized hierarchy
Perrow: more emphasis on autonomy, change, humanity, creativity and
democracy.
Return of Weberian approach (bureaucracy)
- Bureaucracy can be productive and efficient (especially in routine
operations)
- Clear specification of authority and responsibility
- Clear knowledge of division of labour
- Studies show bureaucratic organisations could change faster than non-
bureaucratic ones (Perrow)
Political sciences to the field in the 1950s
- Both schools were challenged (human and mechanical) by the sociologist
and political scientist interested in the field.
- Conflict and power (influence) became focus concepts
Conflict could be healthy for organisations.
Main argument: Man is limited (in intelligence, reasoning, information and
time) therefore usually picks the first “acceptable” alternative when deciding
rather than the best. And this behaviour is repeated (rather than changed)
until it gets bad. (cognitive limits on rationality // decision making school)
Enter of the sociologist to the field
- Focus on goals and the environment
- NO ‘one best way’ to organize (one size fits all models are not efficient)
- Goals should be dynamic as the firm
- Importance of situational factors
- Aligning structure with environment and technology
