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ORGANIZATION
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“Thisisanoutstandingcontributiontoliteraturefromaworldclassacademic.Hiscontributiontothe
fieldoforganizationalstudiesiswithoutparallelandthisworkisamonumentalcontributiontotheglobal
literature onorganizational behavior.”
Sir Cary Cooper, Lancaster University Management School
“JohnChildhasdoneitagain.Thisaccessibleandscholarlybookbringstheanalysisoforganizational
formswhere itbelongs at theverycentre ofthefields oforganization andstrategy.”
Andrew Pettigrew, Saïd Business School, Oxford University
“Conventional, sluggish bureaucracies are being introduced to a new structural vocabulary as they
attempttorespondtothechallengeofglobalization.JohnChildprovidesalucidandengagingguideto
thischanging world oforganizations.”
W. Richard Scott, Department of Sociology, Stanford University
“Writtenbyoneoftheforemostscholars,JohnChildcapturestheleadingedgeofscientificandpractical
knowledgeabout organizations andorganizing.”
Andrew H. Van de Ven, Carlson School of Management, Minnesota University
“Professor John Child describes and analyzes clearly some of the important emerging forms of
organizationandmanagement.ThebookoffersvaluablelessonsandwillappealtoMBAandstudents
in generalas wellas executives of large andsmall organizations.”
Marc Verstringhe, Past Chairman, Catering & Allied
“ThisismorethanareiterationofChild’sbest-sellingtextbook.Thenewworkrepresentsapowerfulre-
statement of the ‘design’ approach to management in the context of today’s fluid and indeterminate
circumstances.”
Ray Loveridge, Saïd Business School, Oxford University
“A key text which draws together many of John Child’s landmark contributions to the field of
organizationstudies.Theadditionalnewmaterialinthisbookreflectsanimpressivelevelofscholarly
breadth and depth, revealing John Child as a master of understanding complex organizations and
processes oforganizing.”
David C. Wilson, Open University Business School
“A lucid and comprehensive review of the theory and practice of organization written by one of the
world’sleadingscholarsinthisfield.JohnChildsuccessfullycombinesadeepknowledgeoforganiza-
tionaltheorywithacuteappreciationofitsrelevancetomodernorganizationsfacingthechallengesofthe
twenty-first century. It will be invaluable both as a text book for students and as a guide for those
responsible for runningorganizations.”
Mark Easterby-Smith, Lancaster University Management School
“GivenhisyearsofexperienceinChinaandinotherinternationalactivities,Childhasgiventhebooka
very intercontinental flavour . .. Its comprehensive review of effective management practices is
accompaniedbyboxedcasesthatshowthepracticesinaction.Thebookwillproveusefultograduate
studentsinbusinessschools,aswellasmanagersinappliedsettingslookingforanewperspectiveonthe
problems theyface.”
Howard Aldrich, Department of Sociology, University of North Carolina at Chapel Hill
“JohnChildexcelsonceagainatconnectingthepast,presentandfutureoforganizationalthoughtand
managerialpractice.Bydeepeningitstheoreticalfoundationsandexpandingitsdiscussionof21stcentury
topics, thissecond editionis anexciting andinsightful journeyfor faculty andstudentsalike.”
Guido Möllering, Professor of Organization and Management, Jacobs University Bremen
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ORGANIZATION
Contemporary Principles
and Practice
2nd Edition
John Child
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Thiseditionfirstpublished2015
2015JohnWileyandSonsLtd
Firstedition2005publishedbyBlackwellPublishingLtd
Registeredoffice
JohnWileyandSonsLtd,TheAtrium,SouthernGate,Chichester,WestSussex,PO198SQ,United
Kingdom.
Fordetailsofourglobaleditorialoffices,forcustomerservicesandforinformationabouthowtoapply
forpermissiontoreusethecopyrightmaterialinthisbookpleaseseeourwebsiteatwww.wiley.com.
Allrightsreserved.Nopartofthispublicationmaybereproduced,storedinaretrievalsystem,or
transmitted,inanyformorbyanymeans,electronic,mechanical,photocopying,recordingor
otherwise,exceptaspermittedbytheUKCopyright,DesignsandPatentsAct1988,withouttheprior
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Wileypublishesinavarietyofprintandelectronicformatsandbyprint-on-demand.Somematerial
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LimitofLiability/DisclaimerofWarranty:Whilethepublisherandauthorhaveusedtheirbestefforts
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LibraryofCongressCataloging-in-PublicationData
Child,John,
Organization:contemporaryprinciplesandpractices/JohnChild.–2ndEdition.
pagescm
Includesbibliographicalreferencesandindex.
ISBN978-1-119-95183-4(pbk.)
1. Organizationalbehavior. I. Title.
HD58.7.C48532015
302.3'5–dc23 2014039494
AcataloguerecordforthisbookisavailablefromtheBritishLibrary.
ISBN978-1-119-95183-4(paperback) ISBN978-1-118-77987-3(ebk)
ISBN978-1-118-77990-3(ebk)
Coverdesign:Wiley
Setin10/12.5ptDanteMTStd-RegularbyThomsonDigital,Noida,India
PrintedinGreatBritainbyTJInternationalLtd,Padstow,Cornwall,UK
WEBFTOC 12/02/2014 14:43:44 Pagev
CONTENTS
PrefacetoSecondEdition VII
PrefacefromtheFirstEdition IX
PARTI THEBROADPICTURE 1
Chapter1 OrganizationandItsImportance 3
Chapter2 PerspectivesonOrganizationalDesignuntilRecentTimes 27
Chapter3 NewConditions,NewOrganization 53
PARTII NEWINTERNALFORMS 85
Chapter4 SimplerStructures–ReducingHierarchy 87
Chapter5 AchievingIntegration 109
Chapter6 Control 143
Chapter7 QuestionsofReward 171
Chapter8 PaymentSystems 191
PARTIII NEWNETWORKFORMS 215
Chapter9 OutsourcingandOffshoring 217
Chapter10 VirtualOrganization 241
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vi CONTENTS
Chapter11 StrategicAlliances 269
Chapter12 OrganizingAcrossBorders 291
PARTIV ACHIEVINGEFFECTIVEORGANIZATIONS 331
Chapter13 ManagingOrganizationalChange 333
Chapter14 OrganizingforLearning 371
Chapter15 GeneratingandUtilizingTrust 405
Chapter16 CorporateGovernanceinNewOrganizationalForms 427
PARTV DESIGNINGORGANIZATIONSFOR
THE21STCENTURY 451
Chapter17 MeetingStrategicBusinessNeeds 453
Chapter18 MeetingStrategicSocialNeeds 477
AuthorIndex 497
SubjectIndex 507
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Preface to
Second Edition
ThefirsteditionofOrganizationhasbeenverywellreceived,translatedintoseverallanguages
andusedinmanycountriesaroundtheworld.Itwasoneofthefewcomprehensivetreatments
ofitssubjectthatdrewonresearchandexperienceinordertoadvanceguidelinesforpolicy
and practice. Nevertheless, after ten years, a new edition was called for.
Myaiminwritingthissecondeditionremainsthesameasthatsetoutintheprefacetothe
originaledition(whichfollowsthisone).Organizationisavitallyimportantsubjectthataffects
ourlivesinallsortsofways.Mosttimesitshapeshowweworkwithotherpeopleandhowwe
interactwiththem.Theenvironmentsinwhichwespendmuchofourtime,whetherworkor
leisure,areorganizedones.Thisbookdescribesthemainfeaturesofcontemporaryorganiza-
tion, looks to their principles or rationales, and places them in a relevant context. My basic
intentionistoprovidetheinsightthatwillenableustoappreciatethedegreeofchoicethatis
available in how we go about organizing our collective activities. While it does not neglect
well-establishedwaysoforganizing,thebookfocusesonnewerformsoforganizationthatare
evolving to cope with the changing conditions of the 21st century. Some of these initiatives
pointtowaysinwhichwemaybeabletocopebetterwiththerisingexpectationsweplaceon
organizations.Onthewhole,thereisnowadaysmuchgreaterscrutinyofhowprivateaswell
as public organizations perform in terms of both economic and social criteria.
Thissecondeditionhasbeenthoroughlyrevisedandupdated.Inaddition,itincludestwo
new chapters. One of them, Chapter 2, reviews the historical development of different
perspectivesonorganization.Ihaveaddedthischapterinresponsetosuggestionsthatreaders
wouldbenefitfromhavingmorehistoricalbackground.Itprovidesaninsightintowhen,how
andwhyconventionalthinkingonwaysoforganizinghascomeabout.Despiteitspast-loading,
such conventional thinking continues to exert great influence today.
Theadditionoftheothernewchapter,Chapter18,reflectsthefactthathowweorganize
people and their work activities has huge consequences for people’s well-beingin society at
large.Mostattentiongiventoorganizationseesitasasetofarrangementsforensuring that
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viii PREFACETOSECONDEDITION
collectivetasksareperformedwellineconomicterms,soastoachieveefficiency,adaptationto
changingdemandsandinnovation–allinduemeasure.Chapter18examinestheotherfaceof
organization,whichdistributespower,rewards,andpersonalfulfillmentoftenveryunequally.
The strongly hierarchical basis on which we still tend to organize firms and institutions,
particularly larger ones, contributes to a social problem that is growing to alarming propor-
tions. The scale of the problem is borne out by the widespread breakdown of trust in
leadership,thegrowinginequalityofincomeandwealth,andthegeneralsenseofpowerless-
nessthatthreatenstheveryprincipleofdemocracyitself.Whiletherearenoeasyanswersto
this dilemma, Chapter 18 explores some of the successful organizational initiatives that can
serve to reduce the problem.
Agreatmanyfriendsand colleagues helpedandencouragedme towritethisbook inthe
firstplaceandtheyarementionedwithgratitudeintheprefacetothefirstedition.Manyhave
continuedtoplayanimportantroleinshapingtheknowledgeandawarenessfromwhichthis
new edition has benefitted. In particular, I owe a huge debt to my close collaborators Max
Boisot (now sadly deceased), Suzana Rodrigues and Kenneth Tse. Homa Bahrami, Stuart
Evans, Martin Ihrig, Ray Loveridge, Eugene McKenna, Guido Möllering, and Malcolm
Warner have never ceased to encourage me and to feed me with new ideas and insights.
IalsooweaspecialdebttoJoannaKamowskawhoreadeverychapterindraft,andprovided
invaluable feedback which it is so difficult to obtain in these times when academics are
experiencing ever increasing pressures of work. Jenny Ng, Emma Henshall, and others at
Wiley steered the project through many technical difficulties. Rosemary Nixon, formerly at
Wiley, kept me focused on the need to produce a second edition and she has constantly
encouragedmetopublishoverthecourseofmanyyears.Iamdeeplygratefultoallofyouand,
bynomeansleast,forthetoleranceandsupportthatmywifeElizabethhasshowntoaproject
that too often shut me away from her company.
JohnChild
Birmingham
January2015
