Abstract
It is vain trying to explain the impact of technology on organizational design as the impact cannot be overemphasized. The technical and social systems which make up any organization are interrelated. The dictates of technology can make working relationships and work environments in any one organization significantly different from those of any other organization, and especially so when technological change occurs. Success of the organization thus depends upon the “goodness of fit” between the technical and social systems of the organization, and upon its ability to adapt when changes in technology impact upon the organization. Therefore, organizations must employ new information and computing technology to remain competitive in world markets. Technology can be used to explain organizational behaviour. Technology refers to methods, systems, and devices which are the result of scientific knowledge being used for practical purposes. Technology can also be used to explain the nature of jobs, work groupings, hierarchy, skills, values and attitudes in organizations. The organizations of work around a given technology can be used to control labour costs, to control decision making, to control the relative status of different groups in an organization and to control promotion and career prospects.
INTRODUCTION
Technological innovation is rarely neutral in its effect on different organizational forms. In the early 20th century, small electric motors provided the greatest benefit to “horizontal” factory designs that distributed machinery and work (David, 2000). On a larger scale, the transition from handicraft work to machine production has been associated with a shift to a system of more hierarchical control and Taylorist work practices (Piore and Sabel, 2004). The diffusion of information technology (IT) into the modern workplace may also benefit some types of organizations more than others. The nature of the relationship between IT and organizational design is of increasing concern to managers and numerous authors have developed theories and predictions.1 For instance, Malone, Yates, and Benjamin (2017) hypothesize that IT will favor more decentralized decision-making relative to centralized hierarchies. Milgrom and Roberts (2010) argue that the exogenous price decline of IT as a key driver that has favored “modern manufacturing” relative to “mass production.” While the number of theories about IT’s organizational impacts continues to grow, there is much less empirical evidence on this question. Case studies of particular companies or industries have provided valuable insight into particular uses of IT, but we know surprisingly little about whether there are any more general patterns that relate IT adoption and organizational design. As a general-purpose technology, IT has diffused broadly into many different industries and applications. The basic components of the technology are similar, regardless of where they are used, just as the task of information processing in organizations has many commonalities regardless of industry, product line, or location (Galbraith, 2017). However, some types of organizations may benefit disproportionately from technical advances in computing and communications. While energy-intensive methods of production are favored when the price of energy declines, so one would expect that “information intensive” methods of production would be favored when the price of (computer-generated) information declines. Organizations that choose to incur higher IT expenses presumably expect compensating benefits, such as the ability to respond more quickly and accurately to changes in their environment or to use less of other resources. As the price of IT declines, these trade-offs will increasingly favor strategies and structures that use IT more intensively. In particular, Malone, Yates, and Benjamin (1987) have specifically predicted that declines in the costs of IT will tend to favor decentralized “coordination-intensive” structures over more centralized ways of organizing, which economize in coordination costs at the expense of efficient resource use and flexibility. They argue that while all types of firms will benefit in absolute terms from a decline in the price of IT, firms in which IT represents a larger share of inputs have the most to gain.
THE MEANING AND THE SCOPE OF ORGANIZATION
The study of organizational behaviour must begin with the nature of organization themselves. Organizations are products of their societies, subsystems of large systems (Sofer, 2002). The term ‘organization’ covers a multitude of industrial, commercial, service industry and public service activities. Indeed, the work is an abstract label for any group of people who come together and interact with one another in order to achieve a set of predetermined common aims and goals (Evans, 2000).
An organization exists where two or more people agree to get together and co-ordinate their physical and mental activities to achieve common goals. Organization theories developed from the early part of the 20th century and seek to understand, explain and attempt to predict human behaviour in organizations. According to Appleby (2008) organization is defined in a number of ways. In the study of management it can refer to the structure of relationships among individuals. A less static approach define organization as a process or an element of management concerned with change or growth of the structure. Thompson and McHugh (2015) define organizations as consciously created arrangements to achieve goals by collective means. Organizations are also defined as behavioural processes which live on influence and power (Hunt, 2012). So, organization can be defined as a collection of people working together in a division of labour to achieve a common purpose. All organizations have some function to perform. They are social instruments through which many people combine their efforts and work together to accomplish more than any one person could do alone. This logic has brought us an infinite number of products and services, such as automobile, the personal computer, the space shuttle, the mobile phone, that are part of our daily lives. This same logic applies in any kind of work setting. In all cases, the aim is to utilise everyone’s talents to the fullest and to achieve outcomes that could not be achieved by the efforts of individuals on their own (Schermerhorn et al.2005). The aim of any organization is to produce a good or service. Large and small businesses produce consumer goods and services such as automobiles, appliances, gourmet dining, and accommodations. Non-profit organizations produce services with public benefits such as health care, education and judicial processing. A clear statement of aim is important to guide the activities of an organization and its members. To achieve its aims, organizations depend on the activities and collective effort of many people. At this respect, people are the main human resources of organizations – the individuals and groups whose performance contributions make it possible for the organization to serve a particular purpose. However, organizations need more than people if they are to achieve their aims, to survive and prosper. They also need material resources including physical equipment and facilities, technology, information, raw materials and money. Organizations require all of these resources in order to produce some useful goods and services (Schermerhorn et al., 2005).
