This study examined the relationship between three structural variables (size, vertical complexity, and administrative intensity) and the operating efficiency of all 234 metropolitan branches of a financial services company. As hypothesized, negative relationships were found between (a) size and productivity and (b) vertical complexity and productivity; however, the predicted negative relationship between (c) administrative intensity and productivity was not found — instead a curvilinear relationship emerged. On average, the smallest branches were approximately 31% more efficient than the largest ones; those with the least vertical complexity (one hierarchical level) were roughly 44% more productive than those with the greatest complexity (five levels).
Get full access to this article
View all access options for this article.
References
1.
Adams, W., & Brock, J.W. (1986). The bigness complex. New York : Pantheon.
2.
Armandi, B.R., & Mills, E.W., Jr. (1985). Bureaucratic and personalized strategies for efficiency and organization: An investigation of structures and efficiency in a set of 104 profit-seeking firms. American Journal of Economics and Sociology, 44, 261-277.
3.
Azumi, K., & Hull, F. (1982). Predictors of productivity and innovation in Japanese factories. Proceedings: 19th Annual Meeting of the Eastern Academy of Management, 59-64.
4.
Blackburn, R.S. (1982). Dimensions of structure: A review and reappraisal . Academy of Management Review, 7, 59-66.
5.
Blau, J.R., & McKinley, W. (1979). Ideas, complexity, and innovation. Administrative Science Quarterly, 24, 200-219.
6.
Blau, P.M. (1970). A formal theory of differentiation in organizations . American Sociological Review, 35, 201-218.
7.
Blau, P.M., Falbe, C.M., McKinley, W., & Tracy, P.K. (1976). Technology and organization in manufacturing. Administrative Science Quarterly, 21, 20-40.
8.
Bridges, E.M., Doyle, W.F., & Mahan, D.J. (1968). Effects of hierarchical differentiation on group productivity, efficiency, and risk taking. Administrative Science Quarterly, 13, 305-319.
9.
Child, J., & Mansfield, R. (1972). Technology, size, and organization structure. Sociology, 6, 369-393.
10.
Cicco, J.A., Jr. (1982, January 5). Wanna fix your firm? New York Times, p. A15.
11.
Cummings, L.L., & Berger, C.J. (1976). Organization structure: How does it influence attitudes and performance? Organizational Dynamics, 5, 34-49.
12.
Dalton, D.R., Todor, W.D., Spendolini, M.J., Fielding, G.J., & Porter, L.W. (1980). Organization structure and performance: Acritical review. Academy of Management Review, 5, 49-64.
13.
Ford, J.D., & Slocum, J.W., Jr. (1977). Size, technology, environment and the structure of organizations. Academy of Management Review , 2, 561-575.
14.
Forrester, J.W. (1980). More productivity will not solve our problems . Business and Society Review, 35, 10-18.
15.
Fry, L.W. (1982). Technology-structure research: Three critical issues. Academy of Management Journal, 25, 532-552.
16.
Gerwin, D. (1981). Relationships between structure and technology . In P. C. Nystrom & W. H. Starbuck (Eds.), Handbook of organizational design (Vol. 2, pp. 3-38). New York: Oxford University Press.
17.
Gooding, R.Z., & Wagner, J.A. Iii ( 1985). A meta-analytic review of the relationship between size and performance: The productivity and efficiency of organizations and their subunits. Administrative Science Quarterly, 30, 462-481.
18.
Greenberg, E.R. (1987). Downsizing: Results of a survey by the American Management Association. Personnel, 64(10), 35-37.
19.
Guzzo, R.A., & Bondy, J.S. (1983). A guide to worker productivity studies in the United States, 1976-1981. New York: Pergamon.
20.
Hage, J. (1984). Organizational theory and the concept of productivity . In A. P. Brief, Productivity research in the behavioral and social sciences (pp. 91-126). New York: Praeger.
21.
Hage, J., & Aiken, M. (1967). The relationship of centralization to other structural properties. Administrative Science Quarterly, 12, 72-92.
22.
Hall, R.W. (1977). Organizations: Structure and process (2nd ed.). Englewood Cliffs, NJ: Prentice-Hall.
23.
Hickson, D.J., Pugh, D.S., & Pheysey, D. (1969). Operations technology and organization structure: An empirical reappraisal. Administrative Science Quarterly , 14, 378-397.
24.
Hornbruch, F.W., Jr. (1977). Raising productivity. New York: McGraw-Hill.
25.
Ivancevich, J.M., & Donnelly, J.H. , Jr. (1975). Relation of organizational structure to job satisfaction, anxiety-stress, and performance. Administrative Science Quarterly, 20, 272-280.
26.
Kilborn, P.T. (1990, February 7). Companies that temper ambition. New York Times, pp. D1, D6.
27.
Kimberly, J.R. (1976). Organizational size and the structuralist perspective: A review, critique, and proposal. Administrative Science Quarterly , 21, 571-597.
28.
Klein, F.C. (1982, February 5). Manageable size: Some firms fight ills of bigness by keeping employee units small. Wall Street Journal, pp. 1, 16.
29.
Kopelman, R.E. (1986). Managing productivity in organizations. New York: McGraw-Hill.
30.
Kopelman, R.E., Brief, A.P., & Guzzo, R.A. (in press). The role of climate and culture in productivity. In B. Schneider (Ed.), Organizational climate and culture. San Francisco: Jossey-Bass.
31.
Lawrence, P.R., & Lorsch, J.W. (1967). Differentiation and integration in complex organizations . Administrative Science Quarterly, 12, 1-47.
32.
McKinley, W. (1987). Complexity and administrative intensity: The case of declining organizations. Administrative Science Quarterly , 32, 87-105.
33.
Meltzer, L., & Salter, J. (1962). Organizational structure and the performance and job satisfaction of physiologists. American Sociological Review , 27, 351-362.
34.
A new era for management [Special report]. (1983, April 25). Business Week, pp. 50-86.
35.
Payne, R.L., & Pugh, D.S. (1976). Organization structure and climate. In M. D. Dunnette (Ed.), Handbook of industrial and organizational psychology (pp. 1125-1173). Chicago: Rand McNally.
36.
Peters, T. (1987). Thriving on chaos. New York : Knopf.
37.
Peters, T., & Austin, N. (1986). A passion for excellence. New York: Warner.
38.
Peters, T.P., & Waterman, R.H. , Jr. (1982). In search of excellence . New York: Harper & Row.
39.
Porter, L.W., & Lawler, E.E. (1965). Properties of organization structure in relation to job attitudes and job behavior. Psychological Bulletin , 64, 23-51.
40.
Pugh, D.S., Hickson, D.J., Hinings, C.R., & Turner, C. (1968). Dimensions of organization structure. Administrative Science Quarterly, 13, 65-105.
41.
Routamaa, V. (1985). Organizational structuring: An empirical analysis of the relationships and dimensions of structures in certain Finnish companies . Journal of Management Studies, 22, 498-522.
42.
Van deVen, A.H., & Ferry, D.L. (1980). Measuring and assessing organizations. New York: Wiley-Interscience.
43.
Woodward, J. (1965). Industrial organization: Theory and practice. London: Oxford University Press.
