Casestudy pascalconsult

UNIVERSITÄT ZU KÖLN

SEMINAR FÜR

ALLGEMEINE BETRIEBSWIRTSCHAFTSLEHRE,

UNTERNEHMENSFÜHRUNG UND LOGISTIK

Direktor: Prof. Dr. Dr. h.c. Werner Delfmann

(Managing Organizations and Supply Chains – SS 2011)

Referent: Dr. Sasha Albers

pascal consult

Analysis of the organizational structure
based on Mintzberg’s theory

Prüf.-Nr.: 25621

Matr.-Nr.: 4816110

Anschrift: Bonner Str. 7 50677 Köln

Tel.-Nr.: 0152 01989725

Email: nina@winkler-suesse.de
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Table of Contents

1 Introduction................................................................................................... 3

2 Method of Data Collection ............................................................................ 4

3 Pascal Consult and the Network Concept .................................................... 4

4 Analysis ........................................................................................................ 5

4.1 Contingency Factors .............................................................................. 5

4.2 Organizational “Building Blocks” ............................................................ 6

4.3 Coordination Mechanisms ..................................................................... 6

4.4 Design Parameters ................................................................................ 7

5 Limitations of this Study................................................................................ 8

6 Conclusion.................................................................................................... 9

6.1 Theoretical Classification ....................................................................... 9

6.2 Drawbacks, Preconditions and Benefits of the Network Concept .......... 9

6.3 Outlook ................................................................................................ 10

7 List of References ...................................................................................... 11

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1 Introduction

When asked what a consultancy looks like, one might imagine a large company
filled with experts across various industries, functions and regions. Alternately,
one might expect a small, specialized agency seeking to find individual
solutions within its customer segment. Can a consultancy be a combination of
both? How could its organizational structure look like? What would be the
drawbacks, preconditions and benefits?

“pascal consult is a consultancy specializing in international expansion and
international restructuring projects, addressing large and large midsized
companies."1

This research paper illustrates in form of a qualitative case-study how
Mintzberg’s organizational configurations model can be applied to pascal
consult to describe an organization that lies somewhere in-between the
aforementioned ideas of consultancies.

The reason I chose to analyze this company is my ambition to understand more
about its organizational concept, which is based on a network of temporarily
employed experts.

In the following, firstly the method of data collection will be explained. Secondly,
the organizational concept of pascal consult will be illustrated. Thirdly it will be
analyzed according to several concepts of Mintzberg’s model. Finally, the
limitations of this paper will be expressed and results and possible outlooks will
be concluded. 2

1
See: Hansen 2011
2
See: Mintzberg et al. 2003
3

2 Method of Data Collection

This paper is based on Mintzberg’s configuration theory and information given
by Anna-Lena Hansen, the founder and CEO of pascal consult. The information
on pascal consult was collected in an interview. The interview questions were
closely structured around the Mintzberg model.3

3 Pascal Consult and the Network Concept

Pascal consult works in projects almost worldwide, and in any industry. “The
current project focus is on M&A buy-side mandates, joint ventures, regulatory
barriers to entry, and talks with potential customers about the attractiveness of
different product features to those customers' countries"4. Future goals are to
become an influential and renowned organization. When questioned, the
founder said, she wanted to be the first to know – on anything interesting that
happened in the world.

Anna Lena Hansen works as a freelancer. At the age of 26, she founded pascal
consult, a very successful company that does not have a single fixed employee
Instead she puts much work into building and maintaining a network of over 100
professionals. All work is done on single contract basis. These contracts may be
temporary, but generally cooperation is repetitive. Outside these contracts,
members usually have fixed duties elsewhere. “Personal meetings are very
important” Mrs. Hansen said.5 She wants to talk to people, create contacts, on a
personal and professional basis. Some of her contacts have been friends for
years.

.

3
4
See: Hansen 2011
5
See: Hansen 2011
4

4 Analysis

4.1 Contingency Factors

Mintzberg has defined a series of contingency factors to describe the
environment surrounding a company.6 These are:

 Age and size
 Technical system
 Environment
 Power

Pascal consult was founded in 2004, which makes it a rather young company.
Its size is a first distinctive feature. All staff is employed on contract basis or
services are bought in from external providers. Thus size varies according to
demand (project number/ support issues), which makes the company very
flexible by avoiding fixed personnel costs.

The technical system is composed of the personal computers of each member
of the organization. To date project management is accomplished via a
standardized excel sheet, since the project management system (Integra) did
not work well in the past due to technical complications (e.g. long logon times
from older systems) and too little flexibility. The use of Excel however creates
synchronization issues. Another problem is the project transparency for clients,
which is why an interactive intranet platform is currently under construction. A
central database for knowledge sharing has not been installed on purpose,
since pascal consult aims to work on individual project basis, seeking
customized solutions to clients’ issues. Furthermore, due to the utilization of
informal knowledge, most information is market or region-bound and very
temporary. On the whole the technical system cannot be judged as very
restricting or formalized.

The environment of consultancies appears very complex. The use of informal
knowledge and local contacts requires the development of “prototype” solutions.
Work cannot be standardized. Furthermore projects swerve between expansion

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and restructuring, and that in ever-changing countries. The environment is very
dynamic.

The company is rather independent from outward control. Tax authorities and
investors have some influence. Staff, on the other hand, despite the
professional status, has little sway. In fact, due to the number of contacts and
potential contract employees, there is no scarcity of expertise, and thus little
dependence. In contrast, poor availability of good child care facilities is a
problem that constrains the working time and flexibility of the CEO. Sadly,
sexism is also an issue that cannot be disregarded.

4.2 Organizational “Building Blocks”

According to Mintzberg, there are six building blocks of organization. 7 In the
case of pascal consult, the strategic apex is the CEO and founder Mrs. Hansen.
As the linchpin of the communication network, the CEO is in a very central
position. The technostructure is small, since little formalization occurs, and
basically merged with the strategic apex, as many of its customary tasks
(controlling, strategic planning) are executed by the CEO. There is a rather
developed body of support staff, including legal, administrative and technical
support and advisory. The middle line is comprised of the project leaders, who
fulfill leadership tasks only. The operating core consists of the members of the
project teams.

4.3 Coordination Mechanisms

Acquisition is the CEO’s responsibility. During and after that phase certain goals
and milestones are set with the client. These are then given to the project
leaders as target outputs. Project team members are chosen by relevant skills
and knowledge, which include certain standards of behavior (see training).
These mechanisms are however interwoven with intensive mutual adjustment.
Information exchange happens verbally to a very large degree.

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4.4 Design Parameters

Mintzberg defined nine parameters to describe organizations.8 In the following,
each will be applied to pascal consult.

Job specialization is horizontal for all staff, since work is bundled according to
specific knowledge. Projects will be assigned to the person with the best fit to
the client in regard of region (to utilize local experience), then industry and
function. Support, respectively, is often given by specialists.

Behavior formalization is rather low. This does not mean that behavioral
standards do not exist; in many cases they appear just not to have been
formally established. This is reflected in the coordination mechanisms.

Training happens externally. For project teams, knowledge and skills are the
essential assets. Generally, professional expertise, excellent soft skills and
practical experience are mandatory for project team staff. Just as important for
recruiting is the perceived potential of the person. This is estimated by certain
tests, membership in clubs for intellectually gifted people and degrees from
renowned private universities with a practical focus.

Indoctrination can be interpreted as a facet of the relationship between staff and
the CEO. Building on trust and personal commitment might substitute for a
more formal internal program to align values and ideas. Staff is chosen with
attention to a common background from private universities, which includes a
set of values, norms and related skills.

Unit grouping is relevant for project teams. Since project leaders assign their
own team after consultation with the CEO, units are probably grouped by the
individual requirements of the project. This flexibility seems to be the key asset
for optimally combining skills and knowledge.

Unit size is 25 people in one project on average.

Planning and Control systems fall into the responsibility of the CEO and project
leader. The CEO evaluates the PL’s performance by delivery time of set outputs,
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setup time for the project team, the smoothness of cooperation, and customer
complaints. Respectively the PL should control his team. If this does not happen
to the satisfaction of the CEO, she controls the project team herself.

Liaison devices are in effect insofar, as that the CEO often consults with experts
who are part of the network, but not directly involved in a project. Furthermore
the criteria by which staff is categorized (region, industry, function) resembles a
matrix structure. Project leaders coordinate these different people.

Decentralization is necessary. In such a complex and project-based
environment the CEO cannot have the full overview. pascal consult is vertically
decentralized, since decisions are delegated to project leaders. By assumption,
issues are then further spread among team members. Horizontally it could be
selectively decentralized, since support staff can be divided into simple service
providers with little decision making power (e.g. couriers) and service experts
(e.g. lawyers), who will make decisions based on their expertise.

5 Limitations of this Study

This paper is very focused on one theory and therefore ignores aspects which
other models and approaches to organization would encompass. It does not
critically examine the applied theory. Also, it is very short by requirement. Due
to the personal involvement of the source in the company, the data certainly
contains biases. To find more diverse information, at the minimum, contractors
and clients would need to be interviewed. Furthermore, derived conclusions are
only valid for this case. The search for more general findings would require a
broader comparison of similar cases.

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6 Conclusion

6.1 Theoretical Classification

The organizational structure of pascal consult is very close to the ideal type of
an operating adhocracy. Supporting this thesis are the following arguments,
summarized form the text above:

The strategic focus is on individual, thusly innovative, customer solutions. The
structure is very organic. Top Management tasks are the acquisition of projects,
to assemble a fitting project team and project monitoring. Project teams come
together only temporarily (ad hoc!) to solve the client’s problem. Each member
is an expert, trained externally. The organization appears to be selectively
decentralized. The most prominent coordination mechanism is mutual
adjustment. The expertise of the support staff plays an important role to keep
the organization running.

This configuration is also appropriate under the environmental contingencies:
The company is young, the service offered complex. Environment is very
dynamic. The technical system is simple and unrestricting.

6.2 Drawbacks, Preconditions and Benefits of the Network Concept

Problems usually attributed to adhocracies are inner conflict due to ambiguity,
and inappropriate transition to a bureaucratic structure.

The network concept might reduce both:

Firstly, staff usually has fixed duties elsewhere, or, as a freelancer, deals with
ambiguity anyhow. Then all project members come from a background, where
they have learned to deal with conflict. Due to the temporariness of the
contracts, there is also less time for conflicts to harden.

Secondly, the change of people and lack of a common knowledge base makes
formalization harder, and thus, the danger of standardization (in contrast to
innovation) decreases.

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Therein lies of course the precondition that pascal consult can rely on its
sophisticated network. There might be a limit to growth, if formalization is to be
avoided. Without Mrs. Hansen as CEO, the business seems likely to collapse.

In turn, a network like this is hard to duplicate. Since it is causal to the success
of pascal consult, it should be considered to be a long-term competitive
advantage.

6.3 Outlook

Pascal consult has access to extraordinary people. It has found an
extraordinary way of getting these people together. It can utilize its resources
with significant success.

It could be especially interesting to find out if success hinges on the people
involved, if their education and potential are preconditions to the success of this
organizational structure. How economically successful this organizational
concept is in itself could be examined and how it might reflect developments in
the work market or if it actually increases the capacity of innovation.

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7 List of References

Literature

Mintzberg et al. (2003): Mintzberg, Henry; Lampel, Joseph; Quinn, James
Brian; Ghoshal, Sumantra: The Strategy Process: Concepts, Contexts, Cases:
4th ed., Harlow: Pearson Education, 2003.

Interview

Hansen (2011): Hansen, Anna-Lena: CEO, pascal consult, 25.05.2011 in
Cologne, 120 min, email: Hansen@pascal-consult.com

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Casestudy pascalconsult

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