Differentiation in Organizations: A Comment on Miller and Conaty

Abstract

One of the most extensively researched theories in sociology is that of social differentiation. This is especially the case in the specialty of complex organizations (Blau; Gillespie and Mileti; Kimberly; Scott; and others). Indeed, a basic tenet of organization theory is that the net effect of organization growth is a more differentiated structure. This theory has been formalized by Blau and Blau and Schoenherr: (1) size is positively related to vertical and horizontal differentiation; (2) vertical differentiation is negatively related to horizontal differentiation; (3) geographical differentiation is interchangeable with size, thus adding little merit to the theory; and (4) relationships in the theory are not all of the same shape, some are linear while others are curvilinear. Recently, Mileti et al. (208) have claimed to alter and extend the formal theory of differentiation in organizations as put forth by Blau. They claimed; (1) size and geographical differentiation are not interchangeable: (2) geographical differentiation is a cause of increased vertical and horizontal differentiation, as revealed when the effects of size are controlled; and (3) vertical and horizontal differentiation are positively related when geographical differentiation is introduced into the theory. In addition to the theoretical significance attached to geographical differentiation, Mileti et al. concluded (1) that organizations continuing to grow in size (but not in geographical differentiation) will eventually stabilize in terms of vertical differentiation, whereas organizations which continue to increase their geographical differentiation are likely to experience continued vertical differentiation at an increasing rate regardless of changes in size; and (2) that increased vertical differentiation will continue to cause greater differentiation in horizontal differentiation. These conclusions altered significantly Blau's original theory that vertical differentiation results in less pronounced horizontal differentiation. Most recently, Miller and Conaty, in a reanalysis of Mileti et al., and