In renewal or decline, tensions between mechanistic and organic tendencies may become unbalanced. The organization may need to be reorganized or restructured to improve coordination across groups or subunits, and managers may need to address fundamental questions about overall direction and administration.

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Structural change concerns changes in the overall formal relationships within an organization. Examples include reorganizing departments or business units, adding employee positions, and revising job roles or assignments.

Structural Change in Organizations

The transition to the renewal or decline phase occurs when an organization expands to the point where its operations are far-flung and need to operate somewhat autonomously. Functional structures become almost essential, and subunits may begin to operate as independent businesses. Tensions between mechanistic and organic inclinations can fall out of balance, so the organization must be reorganized or restructured to achieve higher levels of coordination between and among different groups or subunits. Managers may also need to address fundamental questions about the organization's overall direction and administration.

Renewal or Decline Phase of the Organizational Life Cycle

OpenStax Organizational Behavior. Source pages used for organizational culture and organizational change topics. https://openstax.org/books/organizational-behavior

Organizational Behavior - OpenStax

Structural changes should support broader objectives such as centralizing or decentralizing operations, empowering employees, or finding greater efficiencies.

Objectives Supported by Structural Change

Technological change often induces structural change because it requires different ways of connecting across an organizational system.

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