Organizational configurations are defined as groups of firms sharing a common profile of organizational characteristics.
Mintzberg’s Organizational Configurations
There is no one right organizational configuration for all businesses. The best way to arrange one business could be completely wrong for another, based on a variety of factors.
The main successful organizational structures that Mintzberg identifies are as follows:
- The Entrepreneurial Organization: This type of organization has a simple, flat structure. It consists of one large unit with one or a few top managers. The organization is relatively unstructured and informal compared with other types of organization, and the lack of standardized systems allows the organization to be flexible.
A young company that's tightly controlled by the owner is the most common example of this type of organization. However, a particularly strong leader may be able to sustain an entrepreneurial organization as it grows, and when large companies face hostile conditions, they can revert to this structure to keep strict control from the top.
The entrepreneurial organization is fast, flexible, and lean, and it's a model that many companies want to copy. However, as organizations grow, this structure can be inadequate as decision-makers can become so overwhelmed that they start making bad decisions. This is when they need to start sharing power and decision-making. Also, when a company's success depends on one or two individuals, there's significant risk if they sell up, move on to new entrepreneurial ventures, or retire.
- The machine organization (bureaucracy).
- The professional organization.
- The divisional (diversified) organization.
- The innovative organization ("Adhocracy").
- Defining Organizational Configurations David J. Ketchen Jr et al.