Do All Roads Lead to Rome... or Berlin? The Evolution of Intra- and Inter-organizational Routines in the Machinebuilding Industry

Abstract

Contingent and institutional perspectives have been contrasted in order to explain the evolution of organization structures and inter-firm relations in the Italian and German machine-building industries, both of which were racked by a massive change in their competitive and technological environments. The result was an increasing similarity in their internal and external organization. The change was guided by an interplay of autonomous problem solving, mimetic isomorphism of fashionable practices and societal features. The different education and industrial relations systems appeared to be functionally equivalent. The task characteristics (type of strategy, the variability of customer demands, and technological complexity) were related to configurational and functional differentiation, the rigidity of functional specialization and the intensity of interfunctional coordination; the exceptionality of customer demands was related to features of the internal processes. Task characteristics were also related to the level of outsourcing and the mode of inter-firm coordination; the measurability of a supplier's performance was related to inter-firm coordination mechanisms. The characteristics of both internal and external organization affected each other.