The Role of Environment in a Configurational Theory of Organizations

This paper refines existing conceptualizations of organizational task environments by distinguishing among environmental complexity, diversity, instability, uncertainty, dependence, and hostility. Based on these concepts, a typology is presented that suggests that certain combinations of environmental dimensions are important for classifying organizations. Further, the various combinations of environmental dimensions are used to specify a configurational theory of organizations by suggesting interaction effects between the various environmental dimensions and internal organizational design. Based on the typology of environmental dimensions and three premises, twelve propositions are derived for empirical testing. The existing literature relevant to some of the propositions is reviewed, the strengths and limitations of the theory are presented, and some implications for organizational research are discussed, particularly in terms of constructing more comprehensive theories of organizations.