Literature review 14

To address these criticisms, scholars of the configurational school strive for a holistic
synthesis of environment, strategy, and structure in their research (Fiss 2007; Miller 1981;
Sinha and van de Ven 2005). They understand organizations as interconnected variables that
should be analyzed in their entirety. The term configuration describes these interconnected
variables. According to Miller and Mintzberg (1983, p. 57) configurations are “(…)
commonly occurring clusters of attributes (…) that are internally consistent, such that the
presence of some attributes can lead to the reliable prediction of others.”
The concept of configurations is closely linked with the concept of fit in the
configurational school. The scholars of the configurational school assume that configurations
need to have consistent design variables (Doty, Glick, and Huber 1993; Drazin and van de
Ven 1985; Qiu, Donaldson, and Luo 2012; Sinha and van de Ven 2005). Thus, the concept of
fit is extended to encompass fit between the design variables to achieve a consistent
configuration and fit with the situational determinants (Miller 1992). The relationships
between determinants and design variables are considered to be reciprocal and non-linear
(Miller 1981; Sinha and van de Ven 2005). Hence, the organization is assumed to be able to
influence its environment (Child 1972; Katz and Kahn 1978). Moreover, the relationships are
not only additive but could be synergistic in some cases. Scholars of the configurational
school assume that organizations change in episodic revolutionary change (Romanelli and
Tushman 1994; Tushman, Newman, and Romanelli 1986). They achieve punctuated
equilibriums by leapfrogging from one configuration to the next (Miller and Mintzberg 1983;
Romanelli and Tushman 1994). The time of the change is considered to be driven by factors
like a decline in performance that outweighs the benefits of constant transition (Greve 1998;
Short, Payne, and Ketchen 2008). The configurational school breaks with the idea of one best
way to organize and posits equifinality. In this context, equifinality means that several
different configurations can lead to equal performance (Gresov and Drazin 1997). The
concept of equifinality originates in system theory (Bertalanffy 1949; Short, Payne, and
Ketchen 2008) which states that “(…) a system can reach the same final state from differing
initial conditions and by a variety of paths.” (Katz and Kahn 1978, p. 30). The concept of
equifinality provides flexibility to organizational designers in the configurational school,
since they are not supposed to search for the one best organizational solution (Gresov and
Drazin 1997).

In a recent review of the status of contingency theory, Qiu, Donaldson, and Luo (2012)
find that the published research of the configurational school does not completely break with
the classic school. Thus, Qiu, Donaldson, and Luo (2012) propose to revise contingency
theory and adapt some of the earlier assumptions of the classic school. This is a mind-set
shift, since Donaldson (2001; 2006) is one of the strongest proponents of the classic school of
contingency theory. They suggest to include the notion of consistency between the design
variables in the concept of fit and to embrace the assumption of episodic change.