Organisational adaptation processes to external complexity

Abstract

PurposeBased on a conceptual framework of the linkages between strategic manufacturing goals and complexity, the purpose of this paper is to investigate adaptation processes in manufacturing firms to increasing external complexity.Design/methodology/approachHypotheses are tested with statistical analyses (group comparisons and structural equation models) that are conducted with data from the third round of the International Manufacturing Strategy Survey.FindingsThe study shows that manufacturing firms face different degrees of complexity. Firms in a more complex environment tend to possess a more complex internal structure, as indicated by process configuration, than firms in a less complex environment. Also depending on the degree of complexity, different processes of adaptation to increases in external complexity are initiated by organisations.Research limitations/implicationsResearch studies taking into account the dynamics of adaptation processes would be helpful in order to draw further conclusions, for instance, based on longitudinal analyses or simulation studies.Practical implicationsDepending on the level of complexity a firm has been confronted with in the past, different adaptation processes to further growing complexity can be initiated. Firms in high complexity environments have to re‐configure their strategic goals; firms in low complexity environments have to build‐up internal complexity to cope with demands from the outside.Originality/valueThe paper distinguishes between adaptation processes in low and high complexity environments and provides explanations for the differences.