Impact of Technology on Management Structure

Glushkov, L. & Razvigorova, E. (1988). Impact of Technology on Management Structure. IIASA Working Paper. IIASA, Laxenburg, Austria: WP-88-072

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Abstract

The problem of type, characteristics, and factors which influence organizational structure has always been a basic problem in management, both for researchers and for managers. Organizational structure, in addition to being a management tool, is also an expression of power and social status, and this obviously makes it an attractive problem for everyone. In management literature, particularly in the literature on the management of innovation processes, there are few studies more numerous than those on the relation between technology and organizational structure. The results from these different studies are very contradictory.

Woodward and her supporters established a direct relation between the type of technology and organizational structure. About ten years later, however, Hickson and his associates discovered than structure is influenced considerably by many factors, and its relation with technology is indirect. In spite of the contradictory nature of the results from a large number of empirical studies, their importance in this field is constantly increasing. This has been especially true in the past few years because of major technological changes and the introduction of technologies essentially different from those with which researchers and managers had been familiar in the past.

A special place in contemporary studies is occupied by the problems relating to the influence of information technologies on organizational and management structure. Here again the conclusions and hypotheses are rather diverse. Therefore, each step forward, even the smallest one, in this direction is important and valuable for practical activities.

The project "Management of Technological Change" (MTC) investigates some of the possible links between the phases of the life cycles of technologies and the elements of management, including its organizational structure. Recognizing the importance of information technologies during the present technological revolution, we can say that there is no change greater than that caused in all fields by the introduction of information technologies. Even the simplest innovations in this field essentially change the content of many management functions, change the place of hierarchical levels and decision-making centers, and create new links and relations.

This paper is based on results from studies of Bulgarian organizations as well as results from past studies and information about organizational structure collected from the MTC pilot study. The results direct attention to the impact of information technologies and to the special role of the level of technology in changing organizational structures. On this basis, the introduction of so-called high technologies is a special factor which provokes such changes. In this sense, the conclusion is that the dynamics of structural changes are much greater in the case of high technology. To this influence is added the influence of information technologies whose invariant phase structure allows them to be defined and considered as analogous production technologies.

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