DI TOMMASO Francesco JAGUAR ADMINISTRATIVE MANAGEMENT AND ORGANIZATIONAL STRUCTURE DESIGN Edizioni Accademiche Italiane

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To my father and mother
“Find out what you don’t know by what you do; that’s I called guessing what was at the
other side of the hill”
Sir Arthur Wellesley, 1st Duke of Wellington (1769-1852)
“However beautiful the strategy, you should occasionally look at the results”
Sir Winston Churchill, British Prime Minister (1874-1965)
“Speak softly and carry a big stick: you will go far”
Theodore Roosevelt 26th President of the United Stated (1858-1919)
For All Society
“All People have placed under the governance of two sovereign masters, pain and
pleasure. It is for them alone to point out what we ought to do, as well as to determine
what we shall do. On the one hand the standard of right and wrong, on the other the
chain of causes and effects, are fastened to their throne. They govern us in all we do,
in all we say, in all we think ..”
Jeremy Bentham 1787 - The "Greatest Happiness Principle", or the Principle Of Utility
(Utilitarism).

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Summary
INTRODUCTION .................................................................................................7
Organizational Action of Thompson and Beyond....................................................7
PART ONE
1 Organizational Action......................................................................................11
1.1. The Rationality In The Organization..............................................................11
1.2. Domains Of Organizational Action................................................................17
1.3. The Organizational Design ............................................................................25
1.4. Technology And Structure ..............................................................................33
1.5. Organizational Rationality And Structure......................................................40
1.6. The Human Variable And The Concept Of Strategy ......................................48
1.7. Discretionary Power And Its Exercise ...........................................................60
1.8. The Administrative Power ..............................................................................69
1.9. The Control of Complex Organization...........................................................76
1.10. (From One Best Way To One Best Fit) The Galbraith’Model .....................84
PART TWO
Industry Analysis (Foundamentals) Of Luxury Cars In England And The
Jaguar’Case..........................................................................................................93
2 Jaguar .............................................................................................................107
2.1. History ..........................................................................................................107
2.2. Goals, Values and Performance In Jaguar ..................................................113
2.3. The Rationality In Jaguar And Its Domains Of Organizational Action.......124
2.4. Design Reputation Mechanism In Jaguar ....................................................134
2.5. Jaguar’ Organizational Design....................................................................146
2.6. Technology And Structure In Jaguar With Its Strategic Aspects .................156
2.7. Procuring Innovation In Jaguar...................................................................166
2.8. Analyzing Resources And Capabilities (Technology) In Jaguar..................174
2.9. Organizational Structure-Rationality And Management Systems In Jaguar
(Foundamentals Of Strategy Implementation) ....................................................191
2.10. Application Of The Galbraith’ Model In Jaguar........................................211
2.11. The Variable Human In Jaguar..................................................................219
2.12. Discretionary Power And Its Exercise In Jaguar.......................................235

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2.13. Administrative Power In Jaguar And Its Leadership For Strategy............245
2.14. The Control Of Jaguar Company And Its Implementation Of
Corporate Strategy ..............................................................................................262
CONCLUSIONS................................................................................................275
3 Structure And Controls With Jaguar And Its Evaluation .........................275
3.1. Further Topics In Jaguar And Its Competitive Analysis..............................289
3.2. How Developing Resources And Capabilities And The Nature And
Source Of Competitive Advantage In Jaguar......................................................299
Comments...........................................................................................................311
Competitivity Changing And Evolution With Galbraith In A Organizational
Future ..................................................................................................................311

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Riferimenti bibliografici
J.D.Thompson - “L’Azione Organizzativa” - Isedi 1999.
A.A.Haggie Chairman Manager of Materials Engineering of Jaguar Land Rover
Limited W/1/040, Whitley, Coventry U.K. – “Interview to Jaguar Coventry” -
Francesco Di Tommaso in the Engineering Center of Jaguar Land Rover Limited
W/1/040, Whitley, Coventry U.K. 15th March 2013.
R.M.Grant – “Contemporary Strategy Analysis” – Seventh Edition Wiley - 2010.
D.Torrington, L.Hall and S.Taylor – “Human Resource Management” – fifth edition
Prentice Hall - 1998.
Irelans, Hoskisson and Hitt - “The Management Of Strategy”- international edition
South-Western Cengage Learning - 2011.
F.Di Tommaso – “ Jaguar, Competitivita’ E Cambiamento Con Galbraith” – Thesis in
Organizazione Aziendale - 2010.
N.Dimitri, G.Piga and G.Spagnolo “Handbook Of Procurement” – Cambridge
university Press – 2009.

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INTRODUCTION
Organizational Action of Thompson and Beyond1
“Administrative Management and Organizational Design” is a theory founded by James
D.Thompson and denominated to be a classic as it has the capability to enlighten on the
past and it can to trace fecund lines for the future subjecting resolutive critic traditions
that are insufficient or wrong and exceed the limits or positions through innovative
conceptual constructions. With enormous pleasure that I explain the reasons of why I
chosen this topic as the main basis of my distance of study Master of Science in
Business and Administration, in this University, as it is the key engine of the
organizational process of the company that I chosen, Jaguar, that it has much fan to me
from my last thesis of my first bachelor adressed to Jaguar company too with a
interested experience.
I can thus say that my thesis gives the answers of what is the organization?, What is the
meaning of the rationality inside of the Organization?,What is the Organizational
Design and Structure?, What is the role of Human in the Administrative process?, What
is the Administrative process too? All this thanks to the analization of a example of
English company as Jaguar that I show of how it is possible apply the theory in practical
truth that is the only truth subject to negation or affirmation where the same theory of
Thompson has left. In fact my research is divided in two parts, the first the description
of the Thompson’s theory and the second tha application of the theory in the Jaguar’s
case.
Beginning that Thompson starts from the variability of organizational action as
prosecution of intentional and limited razionality’s theory facing the uncertainty with
the rationality through the “organization” that is the organizational action in a plans of
decisions and courses of action where. The innovation is seen as construction of
conceptual scheme that is proposed for the explaination of the variability of the
organizational action.
The Conceptual Outline
The “Organization” is the process of decisions and actions oriented to a scope.
Organization as instrumental character where the “technology” is the instrumental
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From introduction of the book “Organizational action” of J.D.Thompson.

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qualification of the process, is the technical acquaintance that connotes the orientation to
the scope.
From the field choises and technical choises that they join to the choise of the
delimitation of borders of organizational action and the “Organizational design” that is
the design of the process within of the prechosen field. The “structure” is the choice of
organizational action of coordination and control of the componets of the process.
Through the choice of structure the organization faces and tries to reduce the level of
uncertainty due to the technical, field and borders of action choices. Thompson shows
the variability of the sructural choises in front of the variability of uncertainty as
Galbraith.
Power and Dependency
The reduction of dependency from the external environment is determinant in the
organizational orientation where the environment and the organization are based on the
relationship of exchange that is consent need between organizational action and the
environment and the limited rationality faces the uncertainty caused from the
environment.
Others Aspects Of The Organizational Power
Organization is seen as place of insitutionalization power’s relationship. Power bordered
inside of the organization and determined by the contingencies or as instrument of
excercise of the power of who governs the organization characterized by limited
rationality and instable preference. The dominant position is seen as composed by
highly discretionary positions where the power inside of the organization is more
indicated to face the uncertainty. The layouts where Thompson works are characterized
by a coerciveness oriented to the scope, technical acquaintances that characterize the
strumentality of the process with a functional plan and in the end the institutional layout
where are unfolded the objectives. Homo economicus is the better alternative from all
possible solutions in presence of the absolute rationality.
The efficiency of the organization depends of the nature’s environment and from the
better adaptation to its. So much greater is the dynamicity of the environment much
more is request the differentiation between the organizational units and as consequence
greater is the integration inside of the organization. The obstacles for Thompson regard

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to the achievement of the scope that can be stable or variable where the variable
obstacles are very difficult to control from the organizational action.
Transaction Costs
The transaction costs born from the necessity to create un organization for reducing the
transaction costs. For Thompson the decisional strategy is based on the jugment, not
being possible the calculation of uncertainty that it hits the acquaintance of the casual
relation. The decisional strategy based on the “compromise” where uncertain are the
preference on the result and in the end the “intuition” is when there are these two types
of uncertainty.
Also there is the necessity of the rules of coordination. In a stable environment the
structuring in the borders can be glad of standard rules. Indeed in a eterogeneous
environment the organizational action try to identify omogeneous segment and gives to
different units of action reducing in this case the dynamics of uncertainty. For Chandler
indeed the organizations don’t cover obliged stages of development.
The organizational structure is a fortuitous confluence of four indipendent elements with
problems between internal subjects and external subjects from the organization and
solutions that everyone posseses with opportunity of choise and subjects partecipants.
The organization as social construction produced by the strategy of the autors in an
human artefact where the organizational action is replaced by organized action. The
Scientific Management is subject on the fact that the healt of the involved subject inside
of the organization it comes totally subordinated to the economic efficiency where the
solution is the integration between the subjects in the organized work. The two factors
of the quality of work are the satisfaction and the discrezionality.

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PART ONE
1. Organizational Action
1.1. The Rationality In The Organization2
Instrumental action is based on the desired outcomes and on the beliefs about cause-
effect relationships. Given a desire human tryes to realize it putting in to effect of the
variable ones.
“Tecnology” or “tehcnical rationality” is seen as imposed variable in order to reach the
desired outcomes. The technical rationality is estimated using “instrumental” or
“economic method”. In the strumetal method detrminated variable ones make the
desired outcomes while the economic method the results need to be relaized with the
minimum investment of resources and the judgment on the economicity of the human at
the moment of the appraisal.
Complex organizations are constructed for putting in to effect tecnologies that could be
impossible or unproductive to relaize for the simple individuals. A tecnology
instrumentally perfect would produce the desired outcomes as the continuous productive
process of the chemical products or the production of great series. A tecnology less
perfect indeed would produce the desired outcomes but only once in a while but
however it is applied as is hard the waited desire. An example is in the psychiatric
hospitals where is hard the goal to realize better results even if it is very rare.
Technological truth
Technological varieties in the present reality have the subsequent features: 1) they are
diffused in the modern society, 2) and sufficiently diversified for illustrating the
proposition that they intend to develop.
Long-linked technology
A long-linked technology implies serial interdependence in the meaning of Z act can be
executed only with the development of Y act that in its turn it depends of a X act. The
technical rationality as assembly line from serial production reveals the nature of the
long-linked.
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From chapter 2 of the book “Organizational action” of J.D.Thompson.

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The “instrumental perfection” is when it is produced a only type of product in repetitive
and costant way. The production of only good it involves the employment of a single
type of technology, where need to be selected carefully in terms of raw materials and
labor force. From the iterative and ripetitive character of the serial production it is
achieved the elimination of technological defects and modifying and improving
machines with the “programmed preventive maintenance”, but also the elimination of
those movements superfluous humans in order to diminish energy losses. Indeed the
errors are diminished through training and the practical ones of the Scientific
Management. the advantage of the costant way of the production refers that they aren’t
under uses of resources if these resources are put right befor of the beginning of the
production.
The mediating technology
The primary function of the organization is to connect employers inside of the
organization with theyir costumers that they are interdempendent between they.
The mediating technology doesn’t need technological equipment for the single employer
and costumer, but the use of standardized modality extended to a variety of elements
and employers that it is called “procedure” or “standard criterior”.
The standardization puts in to effect mediating technolgies ones in time and space
assuring at every organizational segments the compatibility of actions with other
segments inside of the organization as “bureocratic technicals” of impersonal and
informal rules’ application.
The intensive technology
For intensive technology refers to the change of an object, subject (individual), puts in to
effect technicals that they are chosen by the “feedbacks analysis” of the same subject or
object. In fact if it is had a subject of human nature, the technology application is
understanding as “therapeutic”. The public hospital is the most significative example of
of intensive technology where the technoloy used in the patient is chosen on the based
of the same patient analysis.
The intensive technology, thus is a technology not ripetitive, where its success depends
of the technology disponibility necessary for the object or subject and the same subject’
predisposition to receive this technology.

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The limits of the technical rationality
The “technical rationality”, seen as “relation system cause – effect”, that it carries to a
desired outcomes is an alteration that is worth under the instrumental plan in a “close
logic system”, where the “exsogenous varables” are excluded and the “endogenous
varables” are indeed included and they vary only under the manager or experimenter’
will. When is put in to effect the technology not it wants only the cause – effect
relatioship but also the empiric resources that permits to the same relationship to have
cause and effect achieving the desired aoutcomes where that resources are called “logic
system’ variables”. In fact the organizations that produce in serial, as the automobile
company of which I’ll speaking, is near of the “technological perfection” where there is
a high grade of control of the variables or resources that are internal intended or
acquired that are indipendent from the external environmental fluctuations.
Once started the long – linked technology, where the necessary resources are chosen for
the serial production, it put in to effect the same logic of a close system. Indeed in the
mediating or “standardized technology” the variables to control are also external and the
desired outcomes is difficult to acquire as in the intensive technology where the desired
outcomes depends of the context’ condition, where the subject and the external variables
are put at stake.
We can say that the technical perfection where through the control of the internal
variable with the a logic process of perfect acquisition to the desired outcomes stays
under a close system where the organization has the control of all inside elements.
Proposition 1.1. Under rationality the organizations try to close definitely their
technological nucleus from the environment external influences.
Organizational rationality
The organizations find limits to apply the “abstract technology”. In the same “serial
production” is difficult to estimate the inputs that are must be allotted in the production
process as they are not more necessary. The same “educational technology” is based on
the abstract criterior of belief related to relationship betwwen teachers, scolars and
didactic materials where the foundation is the “appraisal theory”.
The technological nucleus of all intentional organization, which want to achieve a goal
is a incomplete representation of what the organization must make for having the
desired outcomes. The technical rationality is necessary but not sufficient for acquiring

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that desired results or also organizational rationality understanding to achieve the
desired outcomes starting from the same technical rationality.
The organizational rationality finds thus the involvement or allocation of inputs and the
distribution of outputs outside from the technological nucleus.
With this the organizational rationality must contain at least three principal activities: 1)
input activities, 2) technological activities and 3) output activities. These activities are
interdependent and they are controlled each other. The acquired inputs and the
allocation of the technological production must be included inside of organizational
capability. This interdependence is not only refered inside of the organization but also
outside with the environment. The organizational rationality doesn’t obey to a logic of
close system but to a logic of open system, where the same close system is not able to
answer to the technological part as the technological activities (input and output) are
selected with the external environment and they interdependent with it. We have said
that the organizations subject to a rationality definitely close their relationship with the
external environment and how is possible to explain this paradox?
Proposition 1.2. Under rationality the organizations try to costitute protections for
reducing the buffer of the environment influence encircling their technical nucleus with
input and output components.
For maximazing the productivity the technical nucleus of an organization need to be
able to operate as if the market absorbed an only type of product constantly with the
relative constant input flow. In reality this condition is impossible and the organizations
they must put able to theirs input to face the unpredicted environment fluctuation
defining fixed quantity of input and output for the technological nucleus.
In the inputs’ protection from the environment fluctuations, the inputs are acquired from
the external environment in a “irregular market” as storage and procurement where their
insertion is regular in their production process. Un example is the “preventive
maintenance” for reducing the unexpected risk and the “recruitment of diversified
groups with the relative training” for facing the different possible incidents in the
production process.
From the outputs side, the “technical’ protection” from the environment factors, it takes
the name of stabilizer of inventories or voices of warehouse in the prepared officies to
the transportation and distribution. Thus to the technical nucleus is allowed to produce
at costant way while the distribution can varies following the external environment

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fluctuations. The input protection can be used from all types of organizations while the
output protection only for the great production of mass turning out not realizable on the
therapy of individual or subject where the allocation or distribution of output, in this
case the therapy, depends of the subject’ conditions. This protection from the
environment involves others to advantages also the costs as output’ obsolescence. For
this reason under the subsequent proposition we have:
Proposition 1.3. The organizations under the technical rationality try to smooth the
inputs and outputs transactions. The protection system abosrbs the environment
fluctuations while the “levelling system” reduces these environment’ fluctuations.
The public organizations offer more services, riducing of the prices, in abundance’
periods, while they offer less services in sparsity’ periods increasing of the same prices.
The complete levelling of market demand is impossible, thus the technological nucleus
distributed from these environmental changing it must accept a lower degree of
technical rationality. For safegarding the technological nucleus the subsequent
proposition is:
Proposition 1.4. Under rationality the organizations try to adapt themself to those
enviromental changes that cannot be avoided and be attenuated.
The enviromental fluctuations penetrating inside of the organization impose to the
technological nucleus an alteration of own exsogenous activities to the technological
rationality. But these fluctuations can be anticipated or seen as ties where is possible to
use a closed logic’ nucleus.
The manufacturing company can estimate precisely what it’ll be the demand of a
particular good or product in a determined period of time, and it can become simpler its
production’ rhythm for the considered period where some subsequent enviromental
variation is attuated in the fase of programming according to forecast successive period.
If the enviromental fluctuations are “regular” the forecast and the subsequent
adaptation are automatic. The forecast work become a “specialized activity” when it is
not possible to preview it with exactitude also on the basis of past experiences.
If the enviromental fluctuations cannot be anticipated, they block the operation of
technological nucleus reducing of its performance. When indeed these fluctuations are
anticipated and considered as ties that act in a determined period of time, the technical

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nucleus is able to operate as a close system. These protection sometimes is insufficient
for the organization to avoid interferences with external environment, thus in the
subsequent proposition:
Proposition 1.5. When protection, attenuation and estimation doesn’t safeguard their
technical nucleus from enviromental fluctuations, the organizations, under norms of
rationality, appeal at rationing.
The “rationing” is individual especially for the “emergency organizations” as “firemen”.
With the rationing the technology is not used to the maximum it is used but in effective
way on the instrumental plan.
The logic of organizational rationality
The technological nucleus operates on closed logic system inserted in a wider
organizational rationality composed by the “external environment”. Such atmosphere
fixs the condition of input and output necessary for the organization that operates inside
of this environment and it becoming thus of the variable ones called ties for the same
organization while other elements indeed becoming contingencies which are not subject
to the arbitrary control of the same organizations.
We can at last reassume that the organizational rationality is the result of 1) ties that the
organization must face, 2) contingencies which the organization must tackle and 3)
variables which the organization can control.

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Figure 1 - The Rationality in the organization
Francesco Di Tommaso September 2012
1.2. Domains Of Organizational Action3
The organizations are not self-sufficient and therefore they try to find their input and
allocate their output outside from the organization through other companies, creating a
dipendence condition with these companies. In order to make this the organization must
define its “domain” that it is defined by Levine and While, considering public hospital
in a comunity, a attribute that a organization recognizes in terms of 1) dealt diseases, 2)
served population and 3) returned services. Thus if not diseases but other products used
in a domain is refers to all types of organizations.
Domains and environmental dependency
The results of organizational action don’t depend of a only technology but of “matrix of
technology” that is a plus technologies, where a complex technology incorporates also
the products and results of other technologies. Even if a single technology manages
nemerous technological nucleus its domanis doesn’t ever recover all matrix or all
technologies that the organization has on hand.
3

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The organization’ domain identifies the point in which the technological matrix of
organization depends to input coming from external environment, where the
environment’ composition that is the position of competences to its inside determines
from time to time from who the organization depends.
The organization discovers that for a particular input of which it needs the task
environment there is only a possible source or also plus sources, but in this case the
capacity of the task to offer input to the organization can became “dispersive” or
“concentrated” where the demands of this support they can be dispersed or concentrated
and for a dispersed demand can be or not competition. If a organization is alone or
almost, in order to make to be worth its input’ needs, the demand is called “concetrated
demand of input”, indeed if there are other organizations that express similar needs the
demandi s called “dispersed demand”. In the case the organization allocats output to
outside the environment has one or plus potential purchaser of that output and therefore
the organization can be the only of plus organizations that they concur to offer services
to the clients. Is important also for the organization the grade in which the sources of
support of input and output coincide in the sense that the companies that offer input to
the organization are the identical to the copanies that allocate output outside from the
same organization as the assurance companies where the clients are either suppliers that
send money to the organization that clients that purchase services from the organzation.
Task environment
The Task environment in according to Dill are “these sector ones from the external
environment that are important or potentially important for the definition of the goal and
its attainment”. According to Dill in two norvegian companies their task is costituted by
four principal sectors: 1) clients that is distributors and users, 2) suppliers of raw
materials, labor force, equipments, job place, 3) competitors either for the markets and
either for the resources, and 4) groups of regulation tha they include governative
agency, trade unions and entrepreneurial associations.
Thus for the external environment considered is meaning that the clients are seen as
customers they refer to those organizations that have supply and distribution
relationship with the organization where Evan calls organization set. But the external
environment remaining it goes held however in consideration 1) for the cultural models
that they can influence organization and 2) the external environment in more detail of

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the task environment it can represent a within in which the organization could enter in a
determined period of future.
As two domains cannot be identical also two task environment cannot be identical. The
organizations that compose the task environment of a certain organization depend of the
type of technological organization, more wide external environment and from borders of
organizational’ domain.
Task environment and the domain consensus
The determination of domain is not an arbitral act but an “operative” act if it is
recognized by the companies that can make necessary support to the organization in the
task environment. Thus the relationship between the organization and its task
environment it is of exchange: “ the organization doesn’ t receive the necessay input for
its survival until the organizations, that are in contact with the organization, estimate the
organization able to estimate something of desiderable. In Levin and White in their
sanitary organizations the tipical elements of exchange are: 1) attribution of the cases,
costumers or patients, 2) performance or receiving of labor services that includes the use
of volontiers and staff to loan, instruction offer to the staff of other organization and 3)
post or receiving resources different from the labor services that includes funds,
equipments, clinical and technical informations. The categorical detailed lists of
exchange vary from the type of organization but as Levine and White assert “the
agreements of exchange depend from a consensus precendence that regards the domain”
which it regards the operational goals of the organization without to charge to the
organization the human characteristic of motivation of the resource to a collettive mind.
The consensus in the domain defines the expectations of the organization makes and
does not make either the member inside and outside from the organization that they
interact with the organization. This is called the role of the organization in the more
wide system (external environment) which it acts as guide for orienting determined
organizational actions to the goal. The consensus it doesn’ t mean a written document
for undertaking these actions but a “criterior of jugment of the organizational rationality
where the alternative choises of action are operated”. The profit is not the goals of the
organization but to choose determined actions is caused by a consensus regarding the
exsistence of the same organization.

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Management of the interdependence
The Task Environment of the complex orgaization is pluralistic and it is composed
different distinguished elements that are potential relevant for establishing the domain.
This is worth also for the companies inserted in a economic and political system where
there are alternative sources of input that fall under different jurisdictions.
For the complex organizations the pluralism of the task environment is significative as
the organization must entertain exchange relationship with other elements of the task
everyone of which stays in a network of interdependence with other organization and it
has a its domain and task environment.
The tasks environments place the organization in front of at “contingencies” and “ties”
as in the process of problems resolution an element of the task environment interrupts
the support to the organization and the absence of other alternatives of support in the
same task determines the limits withins supported of the organization in a given
moment. In the public scholastic system the popolation can ill treat a school, but the
school cannot move in an other comunity.
Carlson calls the organizations that do not control the choises of the clients “tamed
organization” as they are not forced to provide to all their needs since is the society to
guarantee the satisfaction of the needs that the organization does not succeed to satisfy.
The organizations manage the dependence towards their task environment as such
dependency introduces ties and contingecies that interfer with the organizational
rationality.
Power and dependency
In according to Richard Emerson an organization is dependent from a given element of
its task environment 1) direct proportional way to the needs of resources or
performances that such element can supply and 2) it is inversely proportional to the
capacity of other elements to provide to the same resource or performance. Under
Emerson “dependency” is the contrary of “power” or its inverse part. An organization
has the power to an element of its task environment based on the ability that possesses
to satisfy the needs of such element and its “monopolization”.
Un organization moreover being powerful towards those they supply to it input and
allocate output or towards solo one of the two. In the first case there is a “prevailing
power”.

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An impotent organization indeed in according to Clark is an organization that is based
on “precarious values” where it does not succeed to have efficiency.
Un organization has power in it confronts to the competitors, without to hold account of
their actions if the competitors do not create contingency factors. In fact in the
“Leadership of prices” and any initiative taken by the leader it becomes example also
for the followers. Thus an organization can be powerful in its task either when it gains
advantages and when it does not gain advantages. The concept of the power does not
refers to any task on the “understanding” or the “use of power”.
The “power to sum zero” it is to mean that a group composed by A and B, the power of
A is present only to the expenses of B. The “power of to sum different to zero” means
indeed a power of interdependence between A and B where A and B increase at the
same time their power graces to their relationship of interdependences.
The competitive strategy
The Task Environment is defined as the dependency of the organization from the Task.
Thus for the organization could be better to avoid this dependency.
Proposition 2.1. The organizations operating in according to rationality and in
competition for otteining support they move to look for prestige.
To take prestige is the more economic way for acquire power.
If an element of the external environment it consiers prestigious to entertain a
relationship of exchange with a certain organization which it gains a quota being able on
such element without to engage itself. The organization gains power without yield
some.
In according to Perrow if an organization and its products are considered positively it
can easily to attract staff, to influence legislation, to exercise a informal power on the
comunity and to assure un adapt number of clients, costumers and donors or investors.
Proposition 2.2. When the capability of support is concentrated in one or some elements
of the task environment, the organizations operating in according to rationality try to
take to be able reagarding those companies of which the organizations depend.

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Such power in the proposition induces 1) the power represents a way to deal those
which otherwise would be the serious ones contingecies and 3) the rationality is not
achieved by impotent organizations or organizations that they depend from the task.
Thus the organizations that they are bound to take support stretches to acquire a power
in order to limit such tie. But how can acquire such power?
The acquisition of power
The complex organization acquire dependency when they establish their domain and the
can take advantage of the situation of other organization that they have problem to
acquire support. The organizations, with this, adopt cooperative strategies. Cyert and
March say that the organizations want to avoid the obligation to anticipate the action
from the external environment, proposition 1.4. to the aim to arrange negotiated
environment.
Cooperative strategies
When it is rerun to cooperation for obtaining power on a element of the task
environment, the organization need dimonstrate “own ability to reduce the uncertainty”
related to such element and it need take also a engagement to exchange this its ability.
An agreement between A and B, precinding that A supplies support to B and B acquires
it, it reduces the uncertainty of both. A has a better competition of their output.
The possibility to persuade an element of the external environment that the
organization’ ll satisfy the future needs it depends on the passed experiences of the
organization where a precedent satisfactory performance it induces to believe that this
experience’ ll repeat in the future. Thus the organization prefers mantain a relationship
that is already exisist indeed to invent a new relationship.
In the cooperative strategy the effective attainment of the power rests on the exchange
engagements and on the reduction of potential uncertainty for both the parts. The
organization ottains engagement giving engagement, while reduces them reducing the
uncertainty of other.
The different grades of cooperation are contracting, coopting and coalescing.
Contracting refers to the negotiation of an agreement for the exchange of future
performances that regard either future agreements legal recognized that not leagal
recognized. In this last case the contractual agreements can be founded on the

23
confidence and on conviction that other part’ ll be in agreement to the aim to conserve
own reputation or prestige (proposition 1.2.).
Coopting is a process of absorption of new element in the leadership and in the political
line of the organization, it is understanding as instrument for moving away the
maneuvers to its stability or exsistence. Coopting increases the certainty that “the
organization coopted supports the organization that it has abosorbed. The acceptance of
representatives in the financial institutions from an organization increases the
probability of access from financial resources for all the duration of coopting. Coopting
results thus more binding than contracting as since coopting is in vigor it puts an
element in the external environment in the condition to discuss on the choises and to
excercise an influence the other aspects of the organization.
Coalescing at last refers at an “association” or “joint venture” with other organization or
with plus organizations being in the external environment. A colaition can be instable or
to term but since it is in vigor the organizations involved act as they are only one
organization respect to determined oprational goals. The coalition not only procures the
conditions for the exchange but implies an combined engagement for the future process
of decision that implies thus the colalition is more binding than coopting. The
proposition 2.2. asserted that the capability to support is concentrated of few elements of
the task environment, the organizations under rationality try to use power regarding
those companies which the organization depend.
In the relation of the grade of cooperation and engagement
Proposition 2.3.a. When the capability of support is concentrated and balanced towards
concentrated demands, the organizations invloved try to tackle to their dependency
through contracting.
Proposition 2.3.b. When the capability of supporti is concentrated but the demand
dispersed, the organization more weak try to tackle to its dependency through coopting.
Proposition 2.3.c. When the capability of support is concentrated and balanced towards
concentrated demands, but the power ottained through contracting is insufficient, the
organization involved try to form a coalition.

24
Defense of domains
The realization of a vital domain is a political problem as it demands the resource and
the maintenance of a position that it can be recognized from all the indispensable
sovereign organizations like more convenient regarding the alternatives available. It
demands moreover that is established a position which different organizations in
different situations can find same intersests. It can be also dynamic when the external
environment changing can expel some elements of the task environment.
Thus the complex organizations concentrated to a specific goal the “compromise” is
inevitable and the problem constists in finding the optimal points between the reality of
the interdependence with the external environment and the norms of rationality.
Proposition 2.4. Since the organization that operates in according to rationality is
bound to varies sectors, more the roganization try to obtain power on the rest sectors on
its task environment.
The organizations that are in recession use the power on task for reducing the costs.
Proposition 2.5. The organization that has in forehead plus ties it is not able to achieve
power in other sectors of its task environment and it tries to enlarge the same task
environment.
The organizzations prisoners of plus ties they see their rationality threatened or
overwhelmed, in this case the organization creates new organizations, in the task
environment, able to define stanard of rationality.
In relation of the the power of the organization to preserve or confer prestige, the new
organizational element is able to loosen certains ties which operating in the organization
as public hospitals affected by a loss of staff to such point that who control the financial
input it is forced to increase the support.

25
Figure 2 – Domains of organizational action
Francesco Di Tommaso September 2012
1.3. The Organizational Design4
The organizational rationality is incorporated either in the yask environment either in a
technology and a organization that defines its domain, the technological and task
variables define the principal ties and contingecies of an organization. Thus the
organizations can remove or reduce these ties and contingecies through organizational
design.
Proposition 3.1. The organizations operating in according to rationality try to trace
their borders around those activities that if abandoned to the task would become of the
critical contingencies.
Based on this proposition the organizations include in their domains also those activities
that they could be carried out by the task environment without to prejudice the principal
engagement of the organization. Is important also to indicate where are adressed these
domains and thus we can be more precise in tracing the direction of the organizational
4

26
expansion which it refers to the type of the technology demanded and of the principal
egagement.
The organizational domain is defined by 1) technology available, 2) the served
population and 3) the lend services where the changing in the organizational design
regards the modification of the mix of these three elements.
Proposition 3.1.a. The organizations that operate with long – linked technology and in
according to rationality, they try to expand their domains through vertical integration.
The long – linked technology regards the industrial areas and the combination in a only
technology of seccessive productive stages where every stage uses as its input the
product of the precedent stage and it produces other outputs for the successive stage.
Every stage thus it could take part of a distinguished organization. The vertical
integration regards not only a “toward integration”, that is the acquisition of marketing
competition for dealing their output problems, but also the “backward integration” that
regards the control of output allocation. The vertical integration is a used way for
widing the organizational domain and thus it is more realizable when it uses a long -
linked technology where every activity depends from precedent activity. The hospital
for instance they are transformed in organizations that they don’ t offer only the cure of
the health, but they are also formative organizations that guarantee the availability the
future of the trained staff with internal programs of formation.
The limits of the vertical integration can be the fact that the precedent activities that
follow the principal activity they disperse themself. Thus an organization of different
and multiple inputs it finds difficult the backward integration to their suppliers for the
possibility that these multiple output and different suppliers can disperse themself and
they do not contribute in way effectiveness to the organizational action.
Every time that the precedent activity that followes the principal activity it being
dispersed rapidly, the vertical integration becames selective and it choses the support
and crucial activity for the organization.
Proposition 3.1.b. The organizations that operate with mediating technology in
according to rationality, they try to expand their domains increasing the population
which assigning their performance.

27
This expansion can be territorial or of saturation that is to the complete acquisition of
the subject or object where the output is adressed. As in the modern banking system of
bank association where they wide their services with a omogeneous product
(standardization) in different areas.
Proposition 3.1.c. The organizations operating with intensive technology in according
to rationality, they try to expand their domain incorporating the object of which they
take care.
When the intensive application of specialistic competences accumulated iy expresses a
change operated on the client indeed a service and the activity of the client becames a
important contingency for the same organization.
The organization that operate in a intensive way on the client, they try to fix their
borders in relation of the same client. These organizations are called inducting
organizations where they induce the clients to operate in the production process.
The organization incorporates their clients to the aim of reduction the possibility that the
activity of the client is influenced from the external variable to the organization that it
can some reduce the efficiency of the organizational action to the client.
When the client is completely incorporated by the organizational action there is in
according to Goffman a “total intuition” that is a place of residency and work, where the
people excluded from the society for a defined period of time they share a common
situation leading a close life style and formally administered.
In the hospital the full control on the pazients to operate surgical it means the
supervision of the organizational action of the organization to the patient having a
premail infrastructure as the operating theatres.
Thus the possibility for the organization to modify the external environment using the
same patient. But also when there is not a full control on the client or costumer, the
client must contribute to the organizational action of the organization through the
disposition of infrastructure necessary either for the client either for the organization as
the construction companies that they must go to the client or adresee of the construction
for having the use of the necessary informations for the building.

28
Equilibrium of the components
Therefore we have explained because the complex organizations grow that is the
incorporation of the critical contingecies for the organization. In fact the roganization
that extends their borders it assumes an engagement that goes beyond own principal
engagement and thus the organization sets the problem to find an equilibrium between
principal engagement and new engagement taken by the roganization. The organization
does not possess more only technological nucleus but plus technological nucleus and the
problem of equilibrium is found in the long – linked technologies to which we lead back
to the capacities of all complex components. The problem rises as such abilities are not
divisible in continuation. An organization vertical integrated it can possess a greater
ability in some productive stages that in others, where the integration has happened with
integration of other organizations that they have not succeeded to operate at the same
production rhythm of the organization that it has it acquired. But the fondamental cause
of the equilibrium problems are it resides in the task environment and the technology
where certains resources can be had only in certains measures and quantity. Un example
is that for offering o trimestral sociology course in a university the university must
engage an sociologist at full – time.
The problem rises not in terms of “all or nothing”, that is the possibility to acquire or
not these resources, but in terms of economy of scale important for all complex
organizations. The economy of scale are related with the availability of technical
nucleus where as defined by Knauth “greater it is an organization and greater is its
capability to find financing with low costs and the possibility to resolve organizational
problems with plus minds prepared to the research and at a marketing system more
accurate and adaptable. Thus even if a continuous division were possible of the
capability their incorporation of a small scale it does not possible as a organization that
decides to enlarge its production in other territory it cannot satisfy a only costumer but
all population of these territory needing not only a single technology but all
technological complex of the organization. the highest price of such resources profit for
the organizational capabilities it can be transfer in other organization in exchange to
other resources giving the characteristic of duration, transfer and the availability to those
resources which are subordinates to the organizational rationality or as they are
maintained or transfered by the same organization.

29
With this the complex organization, that has a series of technological capabilities, it has
technologies susceptible to variation and where such organizations acquire
technological capabilities that are not balanced.
Proposition 3.2. The organizations with more components and operating in according to
the rationality try to raise their capabilities until the point in which the last reducible
member approximately it is occupied for entire.
From this proposition it is deduces that an organization with a toward integration that it
has acquired a advanced distributive ability to that its output it rises then this ability.
This determined the capability of the task environment to abosorb this plus output
produced, where in according to rationality, it establishes an equilibrium not only
between the organizational capability but also between output and demand.
One of the way for balancing the capability of the organization to the demand it consists
to stimulate such demand until the point in which it reaches the level of the capabilities
and however this method it does not guarantee that the channels of distribution are used
to full load and thus another possibility it is that to draw the abilities to channel of
output with the demand but it does not guarantee in the end that the technological
nucleus is completely used. Even if this last case would happen is not reached to a stable
equilibrium between the technological nucleus of the organization with the damand as
such demand can vary from factors that any organizations can anticipate even if it can
estimate them. In the end the progresses in the technical process can transalte in more
capability upsetting therefore the equilibrium.
Proposition 3.3. The organization with the capability exceeding the absorption limits of
the task environment try to enlarge their domains.
A response to the capability in exceeding of the organization respect to the task
environment and the diversification with the development of new industrial products
and services. The domains are products and services offered and where such
diversification implies a widening of domains and the development of new domain.
The simpler form of diversification of exceed technological capacity is the production
of new products to which such ability is adaptable and increased.

30
When the recession influenced the oil price increasing it the organization of oil refining
they were engaged to diversify the production with diesel oil for domestic heating,
railway sector and electricity.
Also the diversification that it derives from widening of channels leads to the
organization to transfer the same products to plus channels.
The diversification therefore can be actuated from the demand where it has a
reconversion of the technological capability of the organization included the output
channel. An example can be Apple with the “iPhone” product with the demand for
improvement from the costumers of the new product “iPhone 4” and with the
introduction from Apple of a new product with the name “iPhone 4s” that satisfied the
demands made from the costumers.
In the end the diversification that derives from initial demand of a new product and not
of a derivated product as the production of CD lecturer than indeed only telephones.
The technology influences the same universities to diversify in terms of degree courses
demanded from the market and from the same students that they seeing a higher
specialization with new possibilities of access in the market.
Some limitations
The government or the governamental apparatus it places of the limits and ties to the
organizations try to destroy the propositions up to here defined.
Also if an activity is crucial the organization it does not have need to incorporate it if it
is sure that such activity is available on the market in reasonable terms.
In fact if an organization has a power on the other organization and it controls the
demanded activity it does not to have to incorporate this last one formally (proposition
2.1., 2.2., 2.3.). The deficiency of power can limit the possibility to wide the domains of
the organization as an vertical integration that can to need of reasonable resources often
advanced regarding the ability to the organization. The market saturation can to happen
only with new opportunities of acquisition and thus the consequent diversification of the
organization. The territorial expansion indeed is a maneuver that it demands more as it
demands the pendetration to the territory where the opportunities are insufficient and it
implies staff, warehouse and stock. Thus the decisions to take limits around the clients it
requests a obligation of support too much exspensive. With this the norms of rationality
can be subordinated to other norms following the previous propositions. Un university
that offers courses part time it does not offer the better instruction possible.

31
The design of an organization that in hindsight is logic it can to emerge or not beacause
the administrative power it does not affected by the beneficiary of the hindsight. This
because the administrative environment it operates inside on environments that it
contains ambiguous data and conflicting data where the process of collection of these
data it can be slow and uncertain.

32
Figure3–Theorganizationaldesign
FrancescoDiTommasoSeptember2012

33
1.4. Technology And Structure5
The principal component of a complex organization are determined by the
organizational design. The structure, thus, is the “segmentation” or the “settorialization”
of different activities of the organization, which is composed by human resources and
non human resources for developing such activites. Great importance keeps the social
structure of the organization composed by human elements which they interact each
other. The “strumentality” of the organization imposes the acquisition of a efficiency.
The synthetic organization
The synthetic organization is an organization that operates in a external environment
with high level of risk and problems. In this contest there is not an “programmed
organization” but an organization costituted by a series of isolated efforts, which is
costituted by two parts: 1) consensus of the partecipants on the state of the things to
achieve and 3) great freedom inside of the organization to be profitable the resources
where the istitutions of autority and contracts are not operating. The elements inside of
the synthetic organization they leave spontaneously from the organization where the
same proprierty rights are derogated. These resources are rational as the intervent of
synthetic organizational domain it must be carried out. It cannot propose thus the
organizational plan as the external environment does not afford it.
Thus this put in to effect that the synthetic organization’ll uses necessary resources for
the intervevent acting in effective way on the technological and economic plan all in a
great uncertainty. In fact under the assumption of the so-called Simon’ limits in normal
organization determinated from a limitation of responsability and controll of the
structure where the efficiency is a “objective way”, where the structure procures a
limited rationality due by the limitation of responsibility and management of resources
but it must facilitate the coordinated actions of such interdependent elements. Thus what
internal interdependence of the roganization means?
The internal interdependence
An organization composed by interdependent parts it does not mean that every part
sustains other part. A branch A cannot interact directly with a branch B. However be
interdependent, in this case it means that if a branch does not operate well in peril there
is all organization in its whole. This it means that “every component of the organization
5

34
contributes to the organizational action”. This kind of the interdependence is called
pooled interdependence.
The interdependence can take also a serial shape. The branch A produces element that
are input for the branch B. Both branches contribute to the complex organization. A
cannot operate if B does not entry in action where in this case there is a sequential
interdependence.
The reciprocal interdependence where the input of all part of the organization became
the output of other part and other way around.
In the scale of Guttman type every organizations are correctly interdependent for
pooling, the organizations more complex from the sequential interdependence and the
organization still more complex from reciprocal interdependence.
This three degrees of the interdependence are difficult to coordinate as they possess
increasing degrees of contingency. Remembering in the sequential interdependence
every postion must placed in the total context of the organization and it must be fit to
the every other reciprocal element. Thus given these three types of interdependence
domanded a coordination, what does coordination mean?
The coordiantion
Coordination permits the interdependence inside of the organization. Inside of
determined conditions of semplicity the coordination can be acquired by standardization
with the intuoition of routines and norms which are based on stable norms.
In the coordination plan, implies the istitution of oppurtune outlines for the
interdependence untits based on which the actions of the unities can be governed, it is fit
a dynamic situation with a low grade of stability and routinatization characterizing the
coordination by standardization.
Another type of coordination is the coordination by mutual adjustment, and it involves
the trasmission of new information during the action’ process.
The coordination by standardization is adapted to pooled interdependence, the
coordination plan is adapted to the sequential interdependence and the coordination by
mutual adjustement regards the reciprocal interdependence.
The three types of coordination imposes increasing burden of comunication and
decision, where the standardization requires decision less frequent through of routines,
the coordination by plan requires a series of decisions and comunication to a lesser

35
degree respect the mutual adjustment. But the coordination involvs anyway higher
costs.
The settorialization
In according to Luther Gulick, one of pioneer of the Administrative Management,
assembling the organized components, that is the structure happens under four types of
base: 1) scope or common contribution to the organization, 2) common problem, 3)
specific use and 4) a specific georgraphic area that is alternative “homogenization” of
positions or components.
The assembling of positions is formulated in terms of dispositions of determinated
positions so they are tangent one with the other.
Proposition 4.1. Under rationality the organizations assembles the positions for
minimizing the costs of coordination.
The coordination being expensive it leads the organization to minimize the coordination
costs.
Proposition 4.1.a. The organizations try to dispose the positions reciprocal
intereipendent in a way that they are tangent one with other in way of common group
that is: a) geographically concentrated and b) conditionally autonomous.
Given the coordination by mutual adjustement is expensive the organization’ll choose
small groups, where the reciprocal interdependence is obligated.
The autonomy of these groups is conditionated by a “superior level” thus this means
that is not a real autonomy.
Thus the organizations try to assemble the positions reciprocal interdependent in a local
autonomy unit inside of defined ties determined through the planning and
standardization.
Proposition 4.1.b. In essence of reciprocal interdependence, the organizations operating
in according the rationality try to place the interdependent sequential position in the
way tangent one with the other in a common group that is: a) localizated and b)
conditionally autonomous.

36
The cost of planning increases rapidly with a number of variables end the lenght of the
comunication lines. The costs are thus minimized where the plan regards the small
unities indeed big unities and is likely that the organization to have in store the work of
planning to the whole smallest position serial interdependent.
Proposition 4.1.c. In essence of reciprocal interdependence and sequential, the
organization operating in according to rationality try to assemble the positions in a way
homogeneously with the goal to make easy the coordination by standardization.
An complex organization contains different components and thus heterogeneous. But if
their technology inside of the organization permits (proposition 1.1.), the acquisition of
the positions activating similar process it permits to deal the coordination in a less
coostly way. “The homogeinitization makes easily the coordination as a group of rules
change these changes are applicated to all position of the structure”.
The hierarchy
The reciprocal interdependence is dealed by unity of base, but in absence of reciprocal
interdependence is dealed a sequential interdependence. In the scale of Guttman when
the organizations presented the pooled interdependence, the organizations more
complex have as said either sequential and reciprocal interdependence. Thus in base of
he complexity level there is a different level of integration related to it.
Proposition 4.2. When the reciprocal interdependence it cannot be confined inside of the
group, the organizations operating in according to the rationality, try to collect the
group available forming a single group of second level as possible lecated and
condizionally autonomous.
Often the reciprocal interdependence is very wide and the connection to all positions
available in a one group would press more the comunication’ flows. When this is
happened the organizations to assemble for levels the interdependent positions under the
contingency that everyone produces to other one. The positions that have the higher
level makes a group while the rest groups are reunited in a remained group
“overlooking” of second level. Every level thus is not simply upper to the level lower,

37
but it represents a grouping more inclusive repects to a combination of a single
component.
Clastern Barnard assumes that for every group presents in a complex organization there
is a position that it belongs also to another group by representatives of others groups.
The composition of every group more inclusive are determined by requirements of
coordination that is the interdependence or contingency.
The first rule for the component for the prime level, it is to estimate the reciprocal
interdependence not adequately faced by the assembling of the first psition.
In according to Berling the hierarchy is a system for the resolution of conflicts of
underlooking level.
The probability of conflicts between positions or groups is directly proportionate to the
their degree of interdependence.
Proposition 4.3. Once have assembled for minimizing the coordination for mutual
adjustment, the organizations operating in according to rationality, try to take groups
sequential interdependent in a way that they result tangent one with other in a
coordinated and conditionally autonomous assembling.
The criterior of the interdependence is adopted later to solve the problem of reciprocal
interdependence through assempling groups.
Proposition 4.4. After assembled every unit for solving the reciprocal and sequential
interdependence’ problems the organizations operating in according to rationality, try
to unify the groups in homogeneous unities for making easily the coordination by
standardization.
In the simplex organization the unifying’ method of group of order more high and in the
complex organizations the reciprocal and sequential interdependence’ criterior, they try
to satisfy the possibility of assembling.
Proposition 4.4.a. When the requirements of coordination of higher superior prevent the
assembling of the positions of similar group, the organizations try to connect the
homogeneous positions with trasversal rules respect to the boundaries of the similar
groups with trasversal rules rispect to the division lines.

38
When the organizations coordinate by mutual adjustment or for position, the
organizations try to localize the interaction and to form it to the groups conditionally
autonomous, to the goal to incorporate positions or groups in unities inclusive as more
small possible minimizing the costs of coordination.
The coordination by standardization indeed used till when the standardizations are
pervading in all structural whole of the organization.
When the assembling on the base of the common previsions is not relaizable the
organizations can still to go back o the standardization defining rules applicable to
determined process or category of activities.
Proposition 4.4.b. When use a trasversal standardization respect to a multiple
assembling, the organizations developing also process of assembling that they unify
different groups and the being for the regulation.
The staff apparatus stays in a complex organization and is a position operating between
working groups and centres of standard formulation.
The position of staff are fit when the interdependence is more pooled and requires the
formulation , the integration and application of standardization’ rules.
Indeed the complex organizations go back to a coordination and interdependence that it
goes beyond the formal structure.
Proposition 4.4.c. The organization which the sequential interdependence it does not
contained through settorialization and they use central comitee for realizing the rest
coordination.
Proposition 4.4.d. The organization which the reciprocal interdependence is not costant
through settorialization and they make reliance on a task or groups of projects for
realizing the rest of coordination.

39
Figure4–Technologyandstructure

40
1.5. Organizational Rationality And Structure6
The autonomous divisions in of structure of the organization define the complexity if
the coordination inside of the organization.
The tecnical rationality is maximum when all organizational variables are under the
complete control of the organization.
The organization operates in a system of other organizations which are dependent to it
and the organization for interacting to these organizations it uses a mutual adjustment as
these organizations are variables that the organization can not control.
The determination of a input and output’ structure inside of an organization is due to the
protection of the tecnical nucleus from the external environment contingecies.
The variety of the ties
The elements of the task environment which the organization must adapt to them, they
vary in relation of the type of the organization where the nature of these elements can
vary during the time.
Some organizations must face the ties of the input related to the source of raw materials
and these organizations are forced to install themself where the demanded abilities and
knowledges are available.
The impact of the variation of the task environment on the organization is “escaping” as
the nature of a tie of external environment is not perfectly correlated to the proprierty of
the organization.
The organizations find their ties localized in the geographical space on in the social
composition of their task environment. The geographical space is the distance between
the points that characterized it and it is misured in terms of shipping cost and
communication costs.
The social composition of the task environment as defined by March and Simon are
divided in homogeneous-heterogeneous and stable-shifting.
Dill cosidered two kinds of companies, ones called Alfa with homogeneuous task
environment and the other ones called Beta with heterogeneous task environment. This
distinction refers to the costitution of the task environment of the two companies that
regards for Alfa groups in terms of competitors, cients and suppliers that are relatively
similar (homogeneuous task environment) while for Beta the competitors, clients and
suppliers are different (heterogeneous task environment). Another differnce in
6

41
according to Dill of the two task environment are stability and shifting where the task
environment of Alfa was stable for a defined period of time while the task environment
of Beta was shifting.
Border structures
The adaptation to the task envoronment for the organization it costitutes the border that
the organization has with the external environment where the organizational structure
faces the characteristics of the task environment.
The organizational structure is an istrument for realizing the limited rationality of the
organization, more complex is the task environment more the organization’ ll assignes a
small part of its task environment control to the control’ unity.
Proposition 5.1. In according to the rationality the organizations meet task
heterogeneous environment, try to identify homogeneous segments and they institute
structural unities that they take care some.
With this proposition the organizations institute “semiindipendent divisions” dislocated
in the territory.
The society that sell by retails a plurality of products create specific unities in charge for
their purchases.
Proposition 5.2. In according to the rationality, the components of border that meet
homogeneous segments of task environment are divided ulteriorly for to come to an
agreement their capacities of supervisory to the external environment action.
If is big the volume of interaction between a component of border and the task
environement of the organization, the organization divides this interaction in the
geographical space in plus regions in the geographical space.
The capacity of supervisory varies in relation of the difference of trasmission of dates.
The degree of stability of the task represents a ulterior tie.
Proposition 5.2.a. The component of the organization that meet a stable task
environment’ ll uses of reles to the aim of relazing its adaptation to this environment.

42
The adaptation through rules is the way less costly and it is preferred by the
organizations that operate in a efficency way.
Proposition 5.2.b. When the range of variation manifested by the segment of the task
environment is note, the component of the organization tries to use this variation as tie
and the component adapts itself through a standardized pictures of rules.
The organization could define that when the task environment behaves as A way, the
organization reacts in relation of rules number 1, when indeed the task envornment
behaves as B way the organization racts in relation of rules number 2.
These conditions conduct to the born of bureocatic rules which they can became heavy
in a wide variety logic of task environment and they are a burden to the capacity of the
organization to value the amount of external environment ties that the same organization
meets in every points and time in the space.
Proposition 5.2.c. When the range of variation of the task environment is wide and it
cannot be estimated, the responsible component of the organization must realize the
adaptation necessary keeping under the control this task and planning the responses and
it needs localized unities.
The precedent propositions recognises every indipendent dimensions with this the
organizations are independent in their actions.
The organizations face task environment that are dislocated in according to the
homogeinity-hetereogeinity and stability-shifting. This facing can be resumed as:
Task Environment Stable Shifting
Homogeneous
Heterogeneous
The organization is simple in the structure when the task environment is stable and
homogeneous. This organization is characterized by few functional divisions that if they
are divided they would create numerous sectrors. This organization’ ll use standardized
rules of adaptability and the sectors became places for appling of rules and the
administration would worry about the application of these rules.

43
In the case ideed that it faces a heterogeneous task environment but stable, there is a
variety of functional divisions everyone corrispondent to a segment of the task
environment relatively homogeneous based on rules for realizing adaptation. These
divisions could be divided also in geographical base.
In the case where the organization faces a dynamic or shifting task environment
and not stable the complicances born for the organization and thus the organization must
plan where and how to act.
In the case where the task environment is dynamic and homogeneous, the border
component is divided or differentiated till the point to control the task environment
responsible to the unity. In relation of the dynamic task environment the division’ ll be
decentralized with the use of “planning” of organizational action in answering to the
external environment shifting indeed the standardized rules.
In the end the case where the task environment of the organization is dynamic and
heterogneous the unities of border of the task are differentiated by functional levels
to the aim of the unities to make an agreement with these functional levels for adapting
to the segments of the task environment where every unity operates on decentralized
base for take under control its task.
We can resume thus that more the task environment is heterogeneous and more are the
ties faced by the organization. Thus the rational organization must define the limits of
control to the quantity and to the amount of the necessary adaptation to the organization
with the aim to institute specialized structural unities for facing a limited range of
contingencies in a task limited of ties. More higher are the ties that the roganization face
more the border component is segmented.
If fact in according to Simon and March the process of specialization is used in the
stable task while in the dynamic task the specialization is sacrified for assuring
separated programs for facing this dynamicity.
Organization as result
There is not a one correct way to structure the complex organization, but the
organization is the way for solving the problems of organizational action respect to ties
and technological contingiencies of the external environment. These conditions vary in
relation of 1) changing task environment, 2) innovations that modify the technology and
3) the organization changes its organizational action and thus its task environment.

44
This reasoning assumes equirements of coordination and adaptability as base of this
adaptability. Every divisions must have sufficient resources for facing every
contingency. Aimportant variable regards to the configuration of the organization in
according to the complexity and the degree where the components of the nucleous they
can be isolated one from others as the grade where the organizations achieve to beyond
their limits of rationality from their external environment. In the Dill studies Beta
company must control contemporaneously clients and supplers while Alfa does not.
Proposition 5.3. Where the activities related to the technical nucleous and the activities
of border can be isolated one from other one, except programming, the organization in
according to the rationality’ ll centralized in a suprior level, formed by functional
divisions.
This is valid indipendetly from technological complessity of the task environment. This
it’ ll affect on the numer and nature of the divisions inside of the functional areas but it
gives changes on the functional division of directive offices. An example is an
organization with long-linked technlogy integrated vertcally which it faces two kind of
costant problems 1) the efficient development of every stage, 2) the coordination of
every stage in a central program careful to the changing of the external environment.
The organizational structure for acing these type of contingency is a structure that it
divides the organization in funzional inties as procurement, production and sale where
the coordination of every of these activities is made by a central planning and
programming.
This way of assembling it puts the responsibility on a efficiency of an activity to the
groups that working isolating the unity of action from other variables. The central
planning permits the adaptation of every functional activities to the needs of widen
action through the adaptation of people of where the functional decisions are based.
Some organizations use a centralized structure but they are sectorialized on the fit
functions for facing the complication of the operations of planning and coordination of
functional activities. The number of divisions vary in relation of the type of organization
and their discretional margin. The heterogeinity of the task conducts an increment of
discretionality of plus “subdivisions” of the organization where this increment depends
to the capacity of supervisory of the same organization. Chandler known in fact that
some companies reintroduced the centralizetion of actions where their markets became
more homogeneous from the industrialization of the nation but also with an increment

45
of the capacity of elaboration of the data inside of the organization and an incremented
use of electronic. The divisions situated in different places where the organization
operates they are devided in functions. The central office of the insurance company tries
to standardize services in a way that the similar risks in every regions are covered in the
same way with standardized costs and where its central activities try to finance the
activities in every divisions.
Thus every divisions as internal division of different functional unity the central
direction plays a essential central planning activity.
Proposition 5.4. In condition of complexity, when the principal components of an
organization are mutual interdependent, these components are segmented and disposed
in independent groups and every assembling has its domain.
This structure is called “decentral division” where in an heterogeneous environment it
faces seroius problems of adaptation with complex technical nucleous, with the
subsequent variety of ties and contingencies that exceeds the capacity of adaptation and
coordination of the organization. This structure composed by a central component put
in to effect that the groups around of this nucleous define a limited rationality.
Every division is assigned to different territory in relation of its adequancy.
Chandler affirms that the organizations have a “functional structure” are the industrial
companies that produce only different product line with group of client every different.
Indeed the organizations that produce only line of product use a ‘centralized structure”
for different divisions. The organization completed integrated is in relation with other
components of the task creating “federation and association”. Is not exsist a ottimal
structure that it permits to minimize the costs and the contingencies and facing the
inevitable ties localizing and isolatng them. In relation of this ties or contingencies that
are present in different wais there i salso different structures that respond to these
different contingecies.
Every controlled variable by the organization or every division it is subordinates to the
ties or contingencies of the task of competence of division.
More the task and its contingecies tries to destroy the division of the organization more
the organization must defend its integrity.
High is the organizational control where high is the number of contingencies. In this
case is necessary a double necessity between “standardization” and “flexibility”
denominated conflict in line staff.

46
Complexity and shifting
More the organization is complex more its periferic groups are engaged in multiples
types of interdependece with multiple way of coordination. In organization s more
complex the periferic groups assure them coordinated actions but their actions are
limited by programme and procedures standardized. But given the complexity of this
structure the coordination can stick between autonomous group creating “neifita”
precences of choise between standardized rules and the capability to acquire a
strumental rationality. The same kind of problemi s analized to a higher level called
slipping of the aims through use of instrument and personality due to this choise and the
consequent motivation. These situations are verified during significative changing of the
task environment hiding the reorganization in the way of assembling and decentalising.
In the modern society the scientific component does not accept the reorganization. More
the external environment is dynamic and more the organizations try to be more flexible
and adaptable using another form od adaptability and flexibility denominated task force
or project management.
Proposition 5.5. The organizations created for playing only orders or not repetible and
operates in according to rationality, they put in to effect homogeneous specialistic
groups with aims of “internal management”, but they use these groups in the way of
task force for operational aims.
The task force or “administrative craft way” as called by Stinchombe is used in the
synthetic organization for facing the colletive disaters. The organizations that use the
principle of task force the coordination is adopted through mutual adjustment, while the
adaptation by plan is adopted through use of groups where are inserted the specialists.
The moment of coordination is relative to the contest of occupational associations
external to the organization.

47
Figure5–Organizationalrationalityandstructure

48
1.6. The Human Variable And Concept Of Strategy7
The human variable is influenced by the contingents of external environmentand the
presence of this variable does not permit the satisfaction of the technological requests
demanded by the task environment.
The components of the action for the aim
The human action is determined by the interaction between 1) the individual that
presents ambitions, standards and knowledge or behaves related to the causality and 2)
the situation that presents opportunities or ties. The interactions between the individual
and situation is indicated by the perceptions and cognitiones of the individual.
The individual acts for acquiring its aim conditioned by their “ambitions” and
“opportunites”.
The individuals that have similar ambitions they’ ll have similar actions for assembling
their aims.
Uniformity between individuals
The omologated influences of the culture
The behaviours determined by the structural contest it frees the individual from the
necessity to do ponderated choises in a contest of plus possibilities.
These behaviours are referred to waies of perception and classfy the reality, behaves
related to the relations of cause and effect, legitimity definitions, behaviuors in front of
the autorities, orientations toward to the time an personal aspirations.
The definition of the value life and the parameters for the evaluation of the success are
influeced by the culture that limites the range of diffused ambitions in the society.
The omologated influences of the culture are individuable clearly in the society of
transaction toward the modernization. The norms of rationality that lead the complex
organizations they are in contrast with the value and the orientation of the culture.
The characteristics of the societies of transaction regards the fact that these societies
influence standardized rules that they does not concile with the casuality imposed by a
heterogeneous task environment.
The omologant effect of the culture for the complex omologated organization is
incosistent.
7

49
The complex societies are of different nature being characterized by the field of
knowledge, field of the competence and the multiculturality where different cultures are
subordinated to the common topic. Every members of an complex organization they
share a similar way. The culture is a tie for every types of an complex organization and
transaction organization as it absorbs only gradually the technologies domanded by the
task environment. The problem consists in training the heterogeneity to the different
needs of the organization taking in consideration the development of the social system.
The canalizing functions of the social system
The social systems are every structured.
In the complex societies the economic activities are assembles in occupation where the
individuals are subjected by a specific training for developong careers.
The individuali s helped to choose the type of occupation from fitted infrastructures as
shool and family.
The process of business selection of the candidates offer a long range of career
prototype where the individuals make esperience early and the competition and the
knowledge acquired to a specific level are profit for the development of the successive
work stage.
The career prototype gives a vison of the possible evelution tha the carrer can make as
to characterize clarily the distribution points. An nurse knows that a infermieristic level
is difficult to shift in the up level.
The individual acquires the knowledge of a range of occupational limits. Inside of this
range he appraises one or plus prototype of career that they define the limits and the
directions of its anbitions and they give him a pictures of aspirations concerned the type
of career that is possible to build.
The income in an occupation gives to the individual behaves of the nexus of causes and
effercts in the costitution of these carriers of standards through is possible to judge the
progresses and success obtained.
Inside of the occupation there are differences of temperament, personality, age and
experience but the society must select the individuals in the occupational categories
giving to them ambitions, knoledge, and fit standards channelling them toward sectors
present in the labor market.

50
In relation to the dimensions ties to the technological asset of the occupations, every
occupational category is homogeneous and this homogeinity consents to the individuals
and the organizations to meet in the labor market.
Dealings of markets and contributions
The theory of inducementscontributions of Barnard, March and Simon defines the
decision of an individual to partecipate to an organization and the organizational
decision to employ him inside of the organization through dealings. The dealing is that
the parts they’ ll offer and that the parts’ ll receive.
The dealings of inducements and contributions defines the limits of behaviour of the
individual must have in the organizational contest reducing the heterogeneity of the
human behaviour.
The dealings detemines also the limits of the organization. There is a “indiffernce zone”
that it indicates inside of the margin of the contract the organization can attualize one of
the different behaves that it has on hand that is the discrezionality that push the
organization to define the fit behaviour for answerinng to the continuous shifting and
changing of the task environment. This gives to the members of the organziation to be
passive for these decisions and it taking in to account their individual differences.
The quid pro quo in the dealings of inducements and contributions is the definition of
the labor hours of the individuals that work inside of the organzation with duties and
contributions.
The duty offers to the individual an arena or sphere of action where find solutions to the
problems that can born during the career in answering to the market.
In the society of a complex organization the individuals protect their occupation.
Proposition 6.1. In the modern society the contribute of dealings of inducements and
contributions is determined through political power process.
The duty has a meaning different for the organization and individual and it is defined
from the consensus and power of the parts.
In according to Emerson the power is based on the “dependency” of every parts of
other.
When the individual wants a duty higher than the duty offered by the organization and
there are not other alternatives for the individual, the organization enjoys of a power
position.

51
But also the individual can enjoy of a power position versus the organization in relation
as the organization must have qualified individuals whiches only few individuals have.
The duties considered as spheres of actions that they can vary, they are called the
“opportunity of apparaisal” that are competences fitted with other duties of higher
level. A second dimension of the fact that the duties can vary is the “opportunities of
visibility”. These duties are determined by the interaction between non-human
components of the technology inside of the organization. Under standardized ripetible
modalities where they have a scarce opportunities for visiblity most favorable. In fact in
this case the individual is seen in a higher way resus other organizational memebrs.
The types of evaluation on the individual performance depends on the collocation of the
duties in the technical rationality scheme and the possibility to apply measures of
effinciency and satisfaction to the duty and performance of the individual.
Technologies and strategies of action
The spheres of actions expressed by the duties are differed in relation to the applied
technologies.
The action of standardized duties
The technological duties of long-linked technology and mediation technology in
technical nucleous protected, they are standardized and repetible beacuse these
technologies are away from the external environment that they are carefully developed
and because the structure connects these duties in fixed configuration. The duties are
fully determined till the point where the discretionality adopted it can affect a efficiency
loose.
In the societies that use these standardized duties are little developed as they are based
on the common abilities that they can be achieve rapidly in the market. The market
characterized by these duties gives a scarce opportunity to the individuals for apprising
new competences and the need of discretionality is eliminated by these duties. A perfect
knoledge of relations of causes and effects of an organization put in to effect
organization to calculate maximum standard behaviuor where every divergence between
the effective behaviuor and the calculated behaviour is interpreted in negative terms. In
the end given the duties are protected by the exetrnal environment, the individuals are
considered reciprocal changing and the singolar individual has scarce opportunities to
be visible outside of the organization.

52
The occupation of these duties offers insufficient careers for the individual.
This social contest creates hard pressions on the individuals engaged in these
occupations with repidly plafond that leads these individuals to escape from these
occupations and conduct to others.
But when the possibilities are little, the individual protects its current occupation and in
these conditions only “collective action” became the main solution for develop career.
Propositions 6.2. The controls of inducements and contributions related to the duties in
the standardized technologies are determined through the collettive dealings.
The duties thus, of standardized technologies have a limited sphere of actions where the
individuals resort to the political power process. In fact in this case the collettive action
helps for wideling the limited sheres of actions. The contract of these duties where the
individuals are rapidly reciprocal changing, it defines the clauses of securities, the labor
rights, the limitation of the standard and their application and interpretation.
The labor union can limite the development of collettive dealings and the technological
development where there are two contactors, the organization sees the technological
development while the individual sees the construction of career.
A changing power of every parts is crucial for both.
Proposition 6.2.a. In the collettive dealings, both parts have higher interest for the
governamental processes that define burdens and rules of the same collective dealings.
The dealings depend by the ability to deny of the agency of dealings, the possibility to
access to suitables activities and the “labor strike” became an efficient instrument for
limiting these process.
The societies that accomodate the complex organization with activities of routines, they
turn off all relationships of the organization with the xternal environment.
The action in the duties to the contingent borders
The duties of the unities of border depend from type of sphere of action and from
homogeinity and heterogeinity of a stable or shifting external environment.

53
In the case where the external environemnt sector is homogeneous and stable the duties
of border are standardized and they use common competence for offering scarce
opportunities of appraisal or visibility for the career.
In this conditions the duties are standardized and the contracts are defined through
collettive action.
In the case in which the task environment is heterogeneous and shifting the duties of
border require the exercise of discretionality with the aim to face the environemtal
contingecies offering the opportunities of appraisal through the visibility.
The collective action can connect the retribuition to the results as happens in the modes
of payment and planning and the standards of valuation follow the expirations of the
organizational rationality.
If the retribuition is made in according to a established quota or superable scale in base
on the results, the maximum level of a career in collettive occupations through border of
high contingency it is acquired late.
The worker that gives a good test of it relatively to a limited border, he can attend of
being noticed to have the possibility to face for having a duty of higher and critical
level. Since this duties are frequentely accessible with the common competences but
they offer their maximal points of career late during the time and available individual
and motivated to take advantage of these careers, these occupations of borders
represents a important prospective for the social mobility toward high society managed
for complex organizations.
Proposizione 6.3. The dealings of inducements and contributions related of the
contingencies borders of the organizations are determined by: 1) the power of a element
of a task environment and b) the ability of the individual to do about the dependecies of
the organization for this element.
Also in this case the power is a crucial element of the dealings where here is important
the individual action respect to the colletive action consenting the individuals to
exercise the discretionality, the duties of contingencies borders put in to effect the
individuals to reduce the uncertainty for the organization.
In th misure of the individual succeeds to contain the contingencies is the individual to
enjoy of a mayor power of in the process of dealings.

DI TOMMASO Francesco JAGUAR ADMINISTRATIVE MANAGEMENT AND ORGANIZATIONAL STRUCTURE DESIGN Edizioni Accademiche Italiane

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