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7/29/2019 DECREASING ORGANIZATIONAL SIZE: TOUNTANGLE OR NOT TO UNTANGLE?
1/19
KIRLOSKAR INSTITUTE OF ADVANCED MANAGEMENT
STUDIES, PUNE
Organizational Structure
Process And Design
ARTICLE PRESENTATION
Presented To:
Dr. Janaki Naik
Presented by:
Apoorva Kulshreshtha
Neeraj Bhandari
7/29/2019 DECREASING ORGANIZATIONAL SIZE: TOUNTANGLE OR NOT TO UNTANGLE?
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DECREASING
ORGANIZATIONAL SIZE: TOUNTANGLE OR NOT TO
UNTANGLE?
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Background
This article contradicts an article published inthe previous issue whose author wereSutton and DAunno.
They outlined the result that decliningfinancial resources and a decreasingworkforce has same effect on organizationstructure.
The author focuses on the main point ofcontention i.e. falsity of two mainassumptions made in the previous article.
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First Model
Decrease In financial resources
Increase in the mechanistic nature of
organization ( standard operating procedures,
greater job standardization, centralization ofauthority and decreased job autonomy)
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Second Model
Decrease in workforce size
Increase in mechanistic
nature of organization
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Contention
The last model is valid only in short run
not in long run.
Financial resources decline andpersonnel decline have different effects
on organizational structure and thus
these effects can be untangled.
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Assumptions
Structural change is symmetricalduring organizational growth and
decline Work force decline reduces
coordination and control needs.
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Assumption1: Symmetry between
growth and decline in structure
If growth increases needs for coordination andcontrol and leads to more formalized structures
than decline must have the opposite effect.
Because work force decline entails size changes
that are the opposite of those occurring during
growth, the assumption is that structural change
will also follow a reverse path, and the long-term
outcome of work force reduction will be a lessmechanistic structure.
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Reversing the direction of an independentvariable, such as organizational growth, may
or may not produce a reversal in a
dependent variable connected with it. Downs pointed out that a decline in a
bureaucracy's volume of work is rarely
accompanied by a proportional decrease inthe control structure or the number of
administrators.
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Assumption 2
According to Sutton and D'Aunno's
This was the assumption that work force
decline reduces needs for coordination
and control.
Sutton and D'Aunno view the level of
work force size as critical.
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Contradiction
According to past research reasons why
work force decline may not reduce
coordination and control but may,
infact,increase them .
Author give three reasons for that on the
basis of experience.
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First Reason
According to author first reasonmost decreases in work force size, or
"downsizings, take place through
layoffs.
To justify their view he gave some
examples from past research and
case studies.
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Third Reason
Third reason why work force reductionmay explain coordination needs has to
do with inter organizational linkages.
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To Untangle Or Not To Untangle ?
Many changes arising from long-termwork force reduction may be in the
direction of more mechanistic, rather
than less mechanistic, organizationalstructures.
Effects of work force reduction and
reduction in financial resources are
different and can be untangled.
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Discussion and Conclusion
The points made in this comment have
several implications for future theory and
research on the process of organizationaldecline which are enumerated below:
First decline of current model
Second complexity of the organizationaldecline process.
Third theories of decline22-Feb-13
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