A Conceptual Framework for the Design of Organizational Control Mechanisms

OUCHI'S THREE CONTROL MECHANISMS
NO.	REQUIREMENTS		MARKET	BUREAUCRACY	CLAN*
1.	Social agreements		Reciprocity.	Reciprocity and authority (i.e., the employee gives up autonomy for pay).	Reciprocity, authority and shared values and beliefs.
2.	Information needs	Nature.	Explicit competitive price for each task or exchange.	Explicit rules and regulations - e.g., accounting systems.	Implicit - traditions, e.g., the U.S. Senate.
		Completeness.	Complete.	Incomplete, but stated.	Complete, but unstated.
		Accessibility and understandability to newcomers.	Accessible and understandable	Accessible and understandable	Inaccessible and not understandable.
		How developed.	Supply and demand.	Must be created or designed.	Develops naturally.
		Information systems capability of coping with participants heterogeneity and turnover.	Capable.	Capable.	Incapable.
3.	Applicable method of controlling people		Self select based on price mechanism.	Select employees with little screening and design a system to instruct, monitor and evaluate them.	Select employees with careful screening to insure the skills and values needed.

OUCHI'S THREE CONTROL MECHANISMS
NO.	REQUIREMENTS	MARKET	BUREAUCRACY	CLAN*
4.	Cost of system: Search & acquisition. Training Supervision.	Variable. Zero. Zero.	Low cost. Low cost. High cost.	High cost. High cost. Low cost.
5.	Timing, need and feasibility of defining the process and measuring efficiency.	Not needed.	Short run, critical need.	Long run, less significant need. Process may be black box plus high interdependence and synergy.
6.	How participant's commitment to organization's objectives is obtained.	Self interest based on price mechanism.	Self interest supported and motivated by training, rules and close supervision insure compliance.	Self interest based on common values.
7.	When the control mechanism should be emphasized, i.e., will be the most efficient method. (Note that high interdependence causes low clarity of performance measurement.)	When interdependence is low, or zero and there is a single task or exchange, or when it is feasible and economical to establish a competitive market price for each multi-task or exchange.	When the levels of worker diversity and employee turnover are high, the level of interdependence is low and the clarity of individual performance measurement is high. These requirements tend to produce many specialties and sub-specialties to reduce the interdependence. Rules and close surveillance are required for each specialty and sub-specialty.	When the levels of worker diversity and turnover are low and the level of interdependence is high. The clarity of individual performance is low and teamwork is critical.