Most research relating organization structure to external factors has been conducted on large, multidivisional companies, particularly focusing on the underlying drivers of divisionalisation¹. The evidence is strong that product and market diversity² and the resulting overall size³ of the organization are the major factors that cause companies to divisionalise, either by geography, market or product. There is less clarity in the research on the structural implications for (usually smaller) units, where the component parts exhibit higher levels of interdependence and for individual business units within divisionalised organizations.

 The research usually investigates the extent to which the control and structure of the organization is bureaucratized⁴ (i.e.specialized and formalized) and centralized. Such studies attempt to demonstrate a contingent relationship between an external factor, the structural model and business performance. The most commonly studied external factor is the complexity of the business environment. Size⁵ is a factor in this, but other parameters such as the technology employed⁶, the business strategy⁷ and the competitive environment⁸. 

The majority of studies find one pole of the structural model to be centralized, formalized and specialized. This is a model that is familiar as the mechanistic, centrally controlled, mass production model initially developed by Taylor⁹, used by Henry Ford and which has evolved into the high efficiency, cost focused mass market organization of today.

The findings for the second pole have been less consistent. Whilst it is commonly accepted that increases in size drives organizations to be increasingly bureacratized, some studies have found that bureacuracy increases as organisations decentralize while others showed have shown the opposite effect, i.e. bureaucratization decreases as organizations decentralized.

It is the contention of this research that the anomalous findings about the nature of bureacracy may be explained at least in part by differences in the nature of the transaction information being processed by the core activities of the organisations studied, and also that the differences correspond to different organisation configurations

These two orthoganal aspects to task complexity also appear in models based on the nature of the information processed to perform individual tasks.

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