IntroductionThompson (1967) has taken much interest in his unique concepts, such as the technical core (Shimizu, 2010). However, his book's overall assertions are difficult to understand, and not much focus has been placed on them. The book comprises two parts, one and two, without any titles. This study reconfigures one in its entirety as a theoretical study of Strategy and Structure (Chandler, 1962). 1 Chandler advocated the proposition that follows when discussing growth and multidivisional forms, but Thompson rightfully proposed that strategy and structure follow in essence.Technical CorePeople find organizations in non-random, planned, and reasonable/rational actions. Organizations in Action is the appropriate title. This pioneering idea by Thompson is also linked with Weick's (1979) notion of organizing (Takahashi, 2009). In other words, Thompson's unique notion of the organization is open system subject to the criteria of (Thompson, 1967, p. 11).The non-random and planned actions are based on technologies. Technical rationality is evaluated according to (a) instrumental criteria and (b) economic criteria, where (b) economic criteria are considered after (a) instrumental criteria have been met. Since (a) instrumental criteria are primarily important (Thompson, 1967, pp. 14-15), we first consider (a) instrumental rationality.A purposive organization must have core technologies for achieving goals at its core. The existence of these core technologies generates a type of homeostasis or self-stabilization. Complex organizations are formed to operate technologies that would be impossible for each individual to operate (Thompson, 1967, p. 15).Open systems that follow these rational criteria have three levels, as noted by Parsons (1960, chap. 2): technical, managerial, and institutional. At the institutional level, open systems exist as a part of broader social systems; however, at the technical level-which is the lowest-technical rationality is pursued as a closed system by eliminating uncertain variables from the technical core as much as possible (Thompson, 1967, p. 11).Direction of Expansion of OrganizationsAn organization usually has only some core technologies within its domain and never possess all core technologies. Thus, organizations are not self-sufficient (Thompson, 1967, p. 26). Simultaneously with these deficiencies, an organization also has excess unused resources. As an organization grows, the direction of growth is not random. Excesses and deficiencies orientate organization's growth or growth strategy.Three dimensions of domainThe following three dimensions determine organizational domain (Thompson, 1967, p. 40).21. Technology included2. Population served3. Services renderedEach of these three dimensions of organizational domain correspond to the following examples of instrumental criteria for technology (Thompson, 1967, pp. 15-18).31. Serial interdependence, as conceived by scientific management42. Standardization, as conceived in a bureaucracy3. Specialization, as conceived in administrative theoryAn organization grows to set organizational boundaries around activities that would be crucial contingencies (Proposition 4.1).5 This provides the following subpropositions.1. When continuous reciprocal interdependence is high, a domain expands such that the technology in it expands through vertical integration (Proposition 4.1a).2. When standardization occurs, a domain expands by increasing the population that is receiving a service (Proposition 4.1b).3. When specialization occurs, a domain expands by taking on clients6 (Proposition 4.1c).In other words, an organization grows along the three dimensions of organizational domain corresponding with the instrumental criteria of technology, thereby leading to a clear orientation in organizational growth and emergence of growth strategy. …
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