Restructuring Configurations –An Exploratory Study of Indian Organizations

Organizational restructuring changes the structure and simultaneously the total organizational characteristics consisting of strategy, culture, management systems, managerial competencies, and extent of use of IT (Khandwalla 1999). This paper develops an empirical typology of organizational restructuring as configuration of the changes in organizational characteristics based on an exploratory study of forty seven Indian organizations. Three restructuring configurations – Incremental Realigning Restructuring (IRR), Adaptive Transformational Restructuring (ATR) and Entrepreneurial Transformational Restructuring (ETR) were identified. These configurations are configurations of quality of the restructuring or changes in organizational characteristics and across categories configurations (configuration of different classes of variables) (Miller 1996). The binding theme in IRR is realignment, incremental change, maintaining status quo and internal orientation; ATR is adaptation i.e. restructuring to improve customer orientation to adapt to changes in external environment; and ETR is entrepreneurial transformation of the organization in response to opportunities in the external environment. The findings of the study suggest that restructuring changes all the organization’s characteristics simultaneously; the structural variables and cultural variables are internally sticky and tightly coupled; there is simultaneous tight and loose coupling of change in organizational characteristics variables during restructuring; and the initial conditions in terms initial characteristics and effectiveness determine the emergent configuration moderated by the restructuring drivers.