Mechanistic vs. Organic Organizational Structure (Contingency Theory)

This article deals with describing the differences between mechanistic and organic organizational structures. The article is based upon the work done by the theorists T. Burns and G.M. Stalker (1961).

The theorists argued that organizations need different kinds of structure to control their activities that will allow the company to adapt and react to changes and uncertainties in the environment. Changes in the environment can be analyzed through a PESTEL analysis, where changes in the factors found in the PESTEL analysis may either stabilize or destabilize the environment of a given company.

Companies facing a dynamic and uncertain environment may have to develop or maintain an organic organizational structure, whereas companies operating in a stable environment may benefit from developing or maintaining a mechanistic organizational structure.

The reason for this is that organic structures can process and distribute information and knowledge faster within the organization, which thus results in an increased ability to respond or react to changes in the environment.

However, mechanistic structures may act as an effective and efficient organizational structure for companies operating in a more stable and certain environment. Companies operating in a stable environment may not need to make decisions quickly. Likewise, many of the day-to-day decisions and operating procedures may be formalized and centralized, because there is no inherent need for constant change or innovation.

Some characteristics for each type of organizational structure are listed below:

Mechanistic Structure

Stable environment	This organizational structure works best when the environment is relatively stable.
Low differentiation of tasks	Tasks will not be differentiated much, because each subtask is relatively stable and easy to control.
Low integration of e.g. departments and functional areas	Due to the stability of tasks, there will be low integration between departments and functional areas, because tasks stay relatively stable, and because the functional areas are not heavily dependent on each other.
Centralized decision-making	When the environment is stable, there is no need for complex decision-making that involves people at lower levels. Therefore, decision-making is centralized at the top of the organization.
Standardization and formalization	When tasks are stable, tasks should be standardized and formalized, so that operations can run smoothly without breakdowns.

Organic Structure

Dynamic and uncertain environment	This organizational structure works best when the environment is relatively dynamic and uncertain.
High differentiation of tasks	Because tasks are often changing, tasks may need to be differentiated, so specialists, each responsible for one or few tasks, are able to respond quickly.
High integration of e.g. departments and functional areas	In complex environments, rapid communication and information sharing is necessary. Therefore, departments and different functional areas need to be tightly integrated
Decentralized decision-making	When the environment is dynamic and uncertain, there is a need for complex decision-making that involves people at lower levels. Therefore, decision-making power should be distributed to lower ranks, which should get empowered in making decisions.
Little Standardization and formalization	When tasks change rapidly, it is unfeasible to institute standardization and formalized procedures. Instead, tasks should be mutually adjusted, so that each subtask is balanced with other subtasks.

As said, Burns and Stalker studies show business leaders that organizations should design their structure to match the dynamism and uncertainty of their environment.

The points given to us by Burns and Stalker are greatly related to contingency theory, which is further described in the article: What is Contingency Theory?

Mechanistic vs. Organic Organizational Structure (Contingency Theory)

T. Burns & G.M. Stalker

Online MBA, Online MBA Courses, T. Burns, G.M. Stalker, Mechanistic, Organic, Organizational Structure, Contingency Theory