Organizational growth and hierarchical change in formal structure

Abstract

Three hypotheses about aggregate change in organizational size (measured as number of employees) and formal structure over time are tested: (1.) the frequency of hierarchical change is higher at lower levels of hierarchy; (2.) periodic pressures for organizational change are translated into periodic changes in organizational size; and (3.) changes in size are more readily translated into increases in structure at lower levels of hierarchy. These hypotheses are tested by using spectral analysis to decompose the variance in the time series of size and structure. The implications of the confirmation of these hypotheses for organizational change over time are discussed.