The larger the organization, the more complex it is. Managers tend to deal with complexity by introducing new controls, which in turn are likely to increase complexity. This study explores how this vicious circle works and how firms can get out of it. We draw on complexity theory to explore how control mechanisms are related to complexity and why the interplay between the two changes over time. We adopt a process view, drawing on in- depth data from a large newly created European organization consisting of six local offices distributed over different countries. Our analysis demonstrates that top management primarily implements input and behavior controls and thereby increases regulative and manifest complexity. In contrast to that, office managers implement input and behavior controls that primarily serve to reduce relational complexity. We develop the concept of “prescriptive” and “synergic” controls to differentiate between controls that, respectively, increase and decrease organizational complexity. In addition, we identify three generative mechanisms explaining the dynamics of controls in complex organizations, for instance one where control first increases complexity, creates non-working control mechanisms and then reinforces the need for new controls. Our findings provide important insights for rolling out a balanced system of controls as a response to complexity.
|Titel||Academy of Management Proceedings|
|Subtitel||Organization & Management Theory|
|Status||Gepubliceerd - 2015|