Mass Output Orientation of Operations Technology and Organizational Structure

Pradip N. Khandwalla After briefly reviewing studies of the impact of operations technology on organization, a model of the relationship between mass-output orientation of manufacturing technology and three organizational variables-vertical integration, decentralization in top-level decision making, and the use of sophisticated controls-is developed. Data for 79 manufacturing firms support the model. When the sample is broken down into high-profit and low-profit subsamples that otherwise are comparable, it is found that the data for the highprofit subsample support the model substantially more strongly than the data for the low-profit subsample. Following data analysis, an expanded model is outlined which incorporates the effect that organizational size may have on structural variates. The determinants of technology, as well as alternative or additional structural adaptations to technology, are assessed.