Learning from the Past- Structural Changes over Time

The final chapter of Organizations and Organizing, Changing Contours of Organizations and Organization Theory draws in many of the concepts that have been used throughout the rest of the book.  Although it poses challenges to some of the theories set forth in earlier chapter, one major agreement can be found between the chapter and previous concepts.  One aspect of Chapter 14 emphasizes the ways in which organizations have changed their structures over time.  These developments occur due to mobilization on an international level.  On page 382 it is stated that, “over time the boundaries delimiting organizational form shift as a consequence of both segregating and blending processes, as new forms arise, undergo random drift, recombination, and deinstitutionalization.” The chapter addresses the idea that organizations do not begin each day with a “blank slate” but rather that they are able to inherit many ideas from predecessors.

Often, organizations are able to look to history in order to see what succeeded and what failed.  In this way, firms can adapt their business processes and corporate structure in order to fit with the current requirements. “It continues to be the case that up to the present, the great bulk of scholarship on organizations rests on research conducting on existing organizations examined cross-sectionally or over a brief period of time” (pg. 376).   Organizations do not just treat history as a study of the past but rather use history as a tool to help make positive changes for the future.

To make changes that will help with globalization, organizations will look to the past in order to create new goals.  Structure of organizations is bound to be different over time but often it is only adapted instead of completely redesigned.

This is relevant to Chapter 13 about the rise of corporate form.  Businesses have grown over time to meet growing demands of society.  One of the most crucial transformation of organizations was from the U-form to the M-form or multidivisional structure (pg. 352), The U-form was historically used for railroads, industrial firms and retailers.  These firms were concerned with expanding and filling out existing product lines but not with existing across a variety of markets.  As these industries began to expand the firms needed to diversify by expanding departments and creating a corporate form in order to keep goals between these departments in line.

The M-form or multidivisional structure is best suited for firms that operate in a variety of diverse markets.  It is much more hierarchical than the U-form with a corporate office as well as several regional divisions.  In the U-form, structure was composed of a central management unit and several other departments organized by function.   In the past, the U-form worked well because as scale and complexity increased, departments were specialized so as to focus on one area of expertise.  However, as technology increases and spreads throughout the nation, a more hierarchical form was needed to keep these departments focused on the same goal and coordinate activities among them.  In this way, the upper level management is separated from the divisional labor which coordinates that production of goods and services.  The corporate office is responsible for the overall strategy of the company.

It is clear from this transformation that when companies adopted the M-form structure they did not create this based on nothing.  The historical structure, the U-form contributed greatly to the ways in which the M-form would be utilized and was ultimately adapted for growing markets and industries.  As organizations grew from monocultural to multicultural these changes in structure were needed to keep up with the changes.  “Understanding the turns taken at particular points help us explain where we are today, and why organizations look the way they do”(pg. 377).  In looking at structural forms such as the rise of the multidivisional form, patterns can be developed and industries can thrive by looking at history in order to update structure.

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