So far we have considered organizations as unitary actors, either adapting to their environments or remaining inert. This is simplistic in that it ignores the obvious fact that some parts of organizations change more quickly than others, and that adaptive changes are sometimes not difficult to discern or implement. Universities, for example, constantly change their roster of courses. They do so in an adaptive way, by keeping up with the constantly evolving knowledge in their various fields. Persuading a university faculty to change its mission, for example to abandon liberal arts for the sake ot vocational training, is something else again.
Why would the university’s mission be so difficult to change? A number of answers come quickly to mind. The mission embodies the university’s identity with reference both to the broader society and to its faculty, students, staff, administration, and alumni. The mission also represents one of the bases on which resources are distributed. A change toward a more vocationally oriented mission threatens entrenched interests; professors of classics and other humanistic fields that would have a lesser role in such an institution could be expected to resist such a change. The mission is difficult to change, then, because it represents the heart of the university’s organizational identity and underlies the distribution of resources across the organization. In these ways, it can be said to lie at the university’s core. The view that organizations have a core that is more difficult to modify than more peripheral parts of its structure is not new. As Parsons (1960, pp. 59-69) pointed out, hierarchies of organizational authority are not continuous; qualitative breaks occur between the technical, managerial, and institutional levels. The technical system is that part of the organization that directly processes the materials used by the organization. The resources used by the technical system to do the organization’s basic work are allocated by a broader organizational apparatus, the managerial or administrative system, which also relates those technical activities to the public served. Although each depends on the other, the managerial level stands in a superordinate position: it both controls and services the technical level’s operations, while the reverse is less often the case. The third part, the institutional system, links the organization with the broader society. Parsons emphasized its role in legitimating the organization. Boards of trustees and directors are responsible for long-run policy and for the conduct of the organization with regard to its reputed goals. Because the institutional and managerial levels of the organization stand prior to the technical level in controlling the flow of resources, any important change in their operations leads to changes in the details of the operations of the technical system, while the reverse is less often true.
Thompson (1967) adopted these distinctions in arguing that organizations are designed to protect structural units carrying out the core technology from uncertainties emanating from the environment. Thompson, however, drew core-periphery distinctions with reference to the organization’s operating technology. Since we think that the importance of technology in determining structure varies greatly across kinds of organizations, we emphasize institutional characteristics more than technical ones. In this way our approach is closer to Parsons than to Thompson.
An argument similar to ours has been advanced by Downs (1967, pp. 167- 168) in his use of the metaphor of organizational depth: “Organizations have different structural depths. Our analysis recognizes four ‘organizational layers’. The shallowest consists of the specific actions taken by the bureau, the second of the decision-making rules it uses, the third of the institutional structure it uses to make those rules, and the deepest of its general purposes. The layers supposedly differ in characteristic speeds of response. We might add that the different layers are typically oriented to environmental conditions that change at different rates as well.
Earlier (Hannan and Freeman 1984) we suggested defining organizational forms in terms of four core characteristics: stated goals, forms of authority, core technology, and marketing strategy. Although these four properties encompass much of organizational strategy and structure, they do not come close to exhausting the dimensions of structure that interest social scientists. In particular, the list does not include structure in the narrow sense of numbers and sizes of subunits, number of levels in authority structures, span of control, patterns of communication, and so forth. Nor does it contain what Scott (1987) calls peripheral structures, the detailed arrangements by which an organization makes links with its environment and tries to buffer its technical core, for example, by forming interlocking directorates and joint ventures.
We think that organization charts and patterns of specific exchanges with actors in the environment are more plastic than the core set. The former aspects tend to change as organizations grow and decline in size, as technologies change, and as competitive and institutional environments change. They can be transformed because attempts at changing them involve relatively little moral and political opposition within the organization and in the environment, since they do not raise fundamental questions about the nature of the organization. In short, inertial forces on these aspects of structure and on peripheral or buffering activities tend to be weaker than those on core features.
Most organization theories assume that peripheral structures are premised on and adapted to a core structure. Changes in core structures usually require adjustment in the peripheral structures. However, the reverse is not true.18 If a core structure is subject to strong selection pressure, peripheral structures will also be subject to at least weak indirect selection. In such cases, ecological theory applies at least indirectly to changes in peripheral structures. The tighter the coupling between the core and peripheral structures, the more direct is the applicability of our theory.
Source: Hannan Michael T., Freeman John (1993), Organizational Ecology, Harvard University Press; Reprint edition.