Centralization or Formalization? Indifference Curves for Strategies of Control

Drawing on previous research on patterns of organization structures, this paper examines the question of strategic structural choice between centralized and formalized means of control. An alternative approach in conceiving and operationalizing the problem of choice is suggested. This uses the 'Indifference Curves' postulate as put forward in neo-classical economic theory. An operational model featuring 'trade-offs' between centralized and formalized control is proposed. The conclusions are that the framework based on the notion of 'indifference' provides reasonable theoretical strength in portraying and explaining trade-offs in structural choices. Theoretically infinite trade-offs in choices between means of control find limits in the purposive search for equilibrium (optimum choice), for example in matching the amount/type of structuring with constraints such as size.