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Abstract
This study investigated whether the adoption of new technology (computerization) had a moderating effect on the relationship between decision making structure and organizational performance. The general propositions were that the combination of centralized strategic decision making and a high level of computer use leads to greater performance, and that the combination of decentralized operational decision making and a high level of computer use leads to greater performance. Specific hypotheses were tested involving the fit between decision making structure (strategic and operational), and the level of computer use in five functional areas (administration, advertising, circulation, news, and production).
Data sets made up of technology (computer use) and centralization (strategic and operational) information collected in 1980 and 1982, and performance (market share) information collected from 1980-1987 were used in this study. Hypotheses were tested within the context of a partial cross-sectional research design and within the context of a between groups longitudinal research design.
Although there was not total convergence between the results from the cross-sectional and longitudinal analyses, the hypothesis that organizations perform better with a high level of computer use in administration and a centralized strategic decision making structure, and the hypothesis that organizations perform better with a high level of computer use in advertising and a centralized strategic decision making structure were supported by both designs.
It can be concluded that in some functional areas the adoption of computer technology had a moderating effect on the relationship between decision making structure (strategic and operational) and organizational performance (change in market share). These findings suggest that firms may need to adjust their decision making structures when computer technology is adopted by the organization. The findings also suggest that the field of strategic management needs to place emphasis not only on explaining how the fit between strategies and the environment affect organizational performance but also on explaining how internal fits, such as structure and technology affect performance.
