The Configuration Approach: Organizational Strategies

In his doctoral thesis at Carnegie Mellon University, Pradip Khandwalla uncovered that organizations function effectively by putting different characteristics together in complementary ways. His arrival at McGill University’s Faculty of Management in the early 1970’s, stirred interest in the configuration approach. This resulted in Mintzberg’s two books on the subject, one about structure, and the other on power relationships.

In 1971, a major research project began at McGill that tracked strategies of various organizations over thirty to fifty or more years. Distinct stages were identified in the histories of the organizations. These stages sequenced themselves and four main patterns emerged: periodic bumps, oscillating shifts, life cycles, and regular progress (Mintzberg, Ahlstrand, and Lampel 306, 310).

Danny Miller, initially affiliated with McGill University, wrote a doctoral dissertation using published studies of companies to pattern ten archetypes of strategy formation; four failures and six successes. His work integrated different attributes of organizations and covered a combination of large samples and specific firms. Later, Miller and Friesen describe the concept of organizational change as quantum, as in viewing the changing of many elements concurrently, rather than piecemeal, which involves changing one element at a time. Miller indicates that success within organizations is often achieved by exploiting the strategies already in place. When the configuration gets out of sync, a strategic revolution has to take place where many things change at once. The company will try to leap to a new stability as quickly as possible (Mintzberg, Ahlstrand, and Lampel 312-314).

In another published study about configuration in strategy and structure, Chandler identified four stages in a firms’ life cycle after researching the evolution of the large American industrial enterprise.

• Initial acquisition of resources
• Establishment of functional structures
• More growth and diversification
• A second shift in structure

Large firms now usually concentrate on core competencies. Together with Chandler’s stages, this suggests oscillating cycles of control and release (Mintzberg, Ahlstrand, and Lampel 317-318).

Background

The configuration approach is characterized by terms such as holistic, universalistic, integrative, and systemic. This stance asserts that the parts cannot be understood in isolation but order emerges from the interaction of the whole (Meyer, Tsui, and Hinings 1178). It focuses on the mutual influence of four variables: leadership, environment, structure, and strategy. Think of these elements as the causes, and the organizational design as the effect. While each is likely to have a role in all configurations, most often one influence will dominate (Miller 686).

This school of thought suggests that for a period of time, the organization will adopt a structural form, matched within some type of context that causes particular behaviors to give way to a set of strategies (Mintzberg, Ahlstrand, and Lampel 305). Organizations will alternate between equilibrium and disequilibrium. Change, as episodic, occurs in rapid transformations from one stable state to another. Transitions between the four influences may happen during the course of a firm’s life cycle, but organizations will change easier within their major influence and original theme. For example, a bureaucratic firm may strive for more standardization. Destroying an old configuration to build a new one is a disruptive undertaking. Such a move requires significant incentives. The most common changes are due to serious performance declines, or replacement of top management (Miller 698).

The configuration approach shares many elements of chaos theory such as, disorder, instability, and nonlinear relationships. It embraces the concept that certain patterns are within systems of apparently random behavior. It accommodates equifinality because there is more than one way to succeed in each setting but cohesive configurations reduce the number of ways the elements combine. This allows for some commonality between organizations, especially between structure types and strategies (Meyer, Tsui, and Hinings 1178-1179).

Works Cited:

Meyer, Alan, Anne Tsui, and C.R. Hinings. “Configurational Approaches to
Organizational Analysis.” Academy of Management Journal 36.6 (1993): 1175-1195.

Miller, Danny. “The Genesis of Configuration.” Academy of Management Review 12.4 (1987): 686-701.

Mintzberg, Henry, Bruce Ahlstrand, and Joseph Lampel. Strategy Safari. New York: Free Press, 1998.