Two Factors Affecting Changes of Structure

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In some historical period, the technique factor's influence was significant also acts as a donimant factor in many activies at these recent years. The reason why technology plays crucial role is the character of organization and the ability of productivity of it rely on technology (Perrow, 1967, P194). The positive processes of it develop competitive advantages over those that do not. It exsits the process of certain bussiness activities adjust certain structures. Plenty of facts demonstrate that the technological impact on organiztional structure is the leading component of many companys' bankrupt or rebirth.

In addition, technical change widen the degree of open system between organization and environment to achieve the diffusion of technology in organization also between organization and environment.

Depend on interaction between organization and environments, organization will change structure or performance as the environmental situation changes. The definition of open system is: organization in order to achieve its goal that will rely on the interaction with environment in which it exsits (i.e. capability, information and materials). Uncertainty and complexity of environment stimulate the structure of organization and open system to display diversity and changeaility.

Technology influences on the structure of organization:

The definitions of technology have been well explained by organizational researchers, one of these definitions is from Joan Woodward, "the specific technology of the organization is, the collection of plant, machines, tools and recipes available at a given time for the execution of the production task and the rationale underlying their utilization." (Reeves, Turner and Woodward, 1970,p.4)

Later, the British sociologist Alan Fox has suggested that technology be seperated into material technology and social technology. Material technology is which can be seen, touched and heared; while social technology is which relates to the behaviour and relationships in the organizaiton, include job definitions, payment systems, motivation and so on.

From these arguments, technology does not controled by our mind and organizaiton structures, which appear to be determined by its demands. Technology development forces organizations to use new technologies, which appear competitive pressures.The process of technical innovation makes development of production and new services as a result of competitive advantage in international trade. In this research, they think that technology as a "dependent variables" in contingency theory in organization structure, however called an "independent variable" which affect environment change, organizaiton structure change and competitive situation change. In my essay briefly talk about technology as dependent factor.

The relationship between technology and organization structure was categorized by Joan Woodward for three parts: unit or small batch, large batch or mass production, and continuous processes. This is the representative of technological determinism, related technology to the organizational structure, when technology become complex then the command's chain increased; chief executives' span of control increased; labour's proportion increased; and the proportion of managers to the total employed workforce increased. In addition, the technology-structure link is close to the effectiveness of performance so that technology is defined the nature of work in the organization. From the figure we can clearly realised the technology factor as a dependent variables in the organization.

Genernal economic condition

External environment

Human resources

Financial resources





Raw materials



Source: R.A. Barcon and Jerald Greenberg, Behaviour in organization (third edition), Allyn and Bacon, London,1990,p. 534.

Enviornment influences on the structure of organization

In the early researchers' arguments, they tend to ignore and undervalued the important of the relationship between environment and organization because managers indeed have the false impression that organization is nothing to do with their interest and control. However, the change of organization environment becomes even more violent, its effect on performance of organization increasing important, so environment factor has been explored frequently. Hence, some researchers consider that it should separate organization environment into interior and exterior sides. Focus on internal operation to missing the complexity of outside environmental measures may leaves organization in danger. While internal environment mainly designed by culture and organization structure result in ignore the significance of the generral environment and specific environment. In this article, exterior environment shoud be analyzed.

In contingecy theory which categorized organization environment two aspects: the general environement and specific environment. To define the relation of them should be consulting Stephen P. Robbins' organizational model:

Political factor

Economic factor

The genernal environment


Specific environment


Potential entrants





Social factor

Technological factor


Before an organization attempts to success, the roles of technology and environment should be settled actually. Few organizations could be equipped themselves with R&D capacity and sufficient technical power to provide their benefits, while most of them choose to introduced technology from environment, there is no doubt that technology is a part of environment if from this point. That is, technology not only belongs to environment but also as an element of organization structure, which as a condition connects with each other.

The environment has been a principal area of organization and technological emphasis, also the knowledge about environmental impacts is still essential in most industries, which may withstand uncertainty and complexity about changes for managers. In 1960s, Danel.Katz, Robert.Kahn and James.Thompson contributed to the "theory of open system", it is one of the most influential arguments surround the world. The view actually develops an open system in the organization, the necessary apporach is to input the data from extrior environment to satisfied the organization structure and performance otherwise will be die off, emphasis environemnt important to organization.Their arguments completely break the traditional theory that organization exsiting in a close environment. Furthermore, British researchers Tom.Burns, G.M.Stalker presented the "contingency theory", which thought that different environments need different patterns of organization and organization should choose suitable structure and type to organization based on the situation of it. Even in the organization there should be have not same types to systems. In comparison, contingency theory rather than open system theory to stressing on how to adjust environment not only consider open system to organization.

Case Study:

With the rapid development of computer technology, this kind of new economic form is emerging and developing presently, people call that "new economy". The concept may explained that new economy makes knowledge economy as a foundation and take innovation as core task, keeping high-tech industry centered on information technologies. It locates global level has a very wide range of internet market channel, many worldwide market, in other words, that is a new economic type of sustainable development. For instance, Wal-Mart found itself require emerging technologies to control cost and enhancing development result in whether investing in satellite system become an important proposal. While many shareholders as technicists advised that should be investing in satellite system program because of new technology's huge benefits and broader market. At first, Sam Walton did not think it is a "reasonable level of investment", but these technicists experienced a number of data that proved the feasibility of investing satellite system and would bring great economic benefits, as well as pressed on Sam, finally entire board accepted the program's performance that value of four billion dollars'satellite, which tested and launched by Hughes. The new method proved and result in more than 4,000 stores involved in worldwide computer connection, an improvement in average capacity of goods management that could calculate the whole goods of each store's inventory, how many new arrival and sales volume, as well as noticed to drivers that up-to- the-minute traffic reports and adjusted optimal route to them. Control through technology to adjust environment change, the success of Wal-Mart achieving sales and delivery come into step also distribution center and suppliers consistent with each other, that is, to be efficiency in production, declining the cost of production so that become selection objects.for customers. This corrective action happened in the change of environment to select technical innovation, it effects on the structure of organization and performance, the organization initiative choice change itself to adjust to environment change.

Another example is the move of media industry during the financial crisis. From the sight of global media business, US-led and other western countries selttled absolute advantages than China. Under the guidance of Time Warner, Sony and Disney, these media giants, 95% of the world market is held by over 50 western media companies. Especially American media industry development more than it was in any other era (not only in the span of industry but also in division is subdivided, global expansion). So American economicst claim that there is no one can survive if appear a long lasting economic weakness. The center of financial crisis was outbreaked in U.S., the effects rapid diffused all over the world, although from the historical financial crisis to analyse, media, computer equipment, communication industry, medical and tobacco industry had little influence, the result can not be undervalued. The issue of advertising industry should be concerned, because most media industry mainly depends on ad revenue. Hence, enterprise must be hurt and make a series of chain reaction of reduce advertise investment and media industry relatively damaged if break financial crisis. According to American media CBS, most profit rely on advertise, a report by Goldman Sachs' analyst said that the most underrated and unappreaciated enterprise was CBS in the interested entertainment plates. In addition, JP Morgon's analyst reported that CBS's income of broadcast would be decreased 2% to 6%, a economicst of Sanford C Bernstein added that CBS's profit of per share may declined 20% if suffer economic recession. Related to a certain degree ad of real estate in newspaper, due to this subprime crisis affect to financial crisis, the real estate in U.S. indeed suffered extremly deprivation so that these ads speedy decreased and then influence on the profit. At the situation of financial crisis, the poor economic environment has a great effect to media industry, while most media enterprises particular emphasis on television and internet than ad in damaged industries. That is change the structure of organization to adjust environment.


To sum up, the environmental changes should always be the main concerning issue of the company's manager. In order to enhance the work efficiency, organization should restructure in respond to the changing surroundings. Secondly, to consider the impact of technology is the result of management decisions about the aim or purpose of the organization and how to achieve purpose in what ways for managers. Technical change acts as an engine to the processes of mangement of decision-making.

Limited by the effect of subjective factor, there are some lacking or imperfect arguments in it.The materials of cases not entirely and deeply and the part of theory's analyse limited in the degree of learner in the first stage result in the results of research have some error. Hope to arguing effectiveness and profoundly.