This article derives hypotheses from the threat-rigidity model about organizational responses tofinancial adversity. These hypotheses are tested in a national sample of 72 randomly selected drug abuse treatment organizations. We propose that decreasing funding levels and numbers of funding sources will be associated with four classes of rigidities in organizations: (a) restriction in information processing (rigid use of existing organizational procedures), (b) constriction of control (less participative decision making), (c) conservation of resources (work force reduction), and (d) competition among members. The threat-rigidity thesis is supported by findings that decreases in total budgets are associated with rigid use of existing procedures, work force reduction, and competition among organization members. Further; decreases in number offunding sources are associated with less participative decision making, work force reduction, and more competition among members.
ASJC Scopus subject areas
- Strategy and Management