From the Wikipedia article at http://en.wikipedia.org/wiki/Adhocracy
"Adhocracy is a type of organization being an opposite of bureaucracy. The term was first popularized in 1970 by Alvin Toffler and has since become often used in the theory of management of organizations (particularly online organizations), further developed by academics such as Henry Mintzberg.
The word is a portmanteau of the Latin ad hoc, meaning 'for purpose', and the suffix -cracy, from the ancient Greek cratein (κρατείν), meaning 'to govern', and is thus a heteroclite. The term was first popularized in 1970 by Alvin Toffler and has since become often used in the theory of management of organizations, further developed by academics such as Henry Mintzberg.
Robert H. Waterman, Jr. defined adhocracy as "any form of organization that cuts across normal bureaucratic lines to capture opportunities, solve problems, and get results." For Henry Mintzberg, an adhocracy is a complex and dynamic organizational form. It is different from bureaucracy; like Toffler, Mintzberg considers bureaucracy a thing of the past, and adhocracy one of the future. Adhocracy is very good at problem solving and innovations and thrives in a changing environment. It requires sophisticated and often automated technical systems to develop and thrive." (http://en.wikipedia.org/wiki/Adhocracy)
From an article on Mintzberg at http://socrates.berkeley.edu/~fmb/articles/mintzberg/ :
"In adhocracy, we have highly organic structure, with little formalization of behavior; job specialization based on formal training; a tendency to group the specialists in functional units for housekeeping purposes but to deploy them in small, market-based project teams to do their work; a reliance on liaison devices to encourage mutual adjustment, the key coordinating mechanism, within and between these teams. To innovate means to break away from established patterns. So the innovative organization cannot rely on any form of standardization for coordination. Of all the configurations, adhocracy shows the least reverence for the classical principles of management, especially unity of command. The adhocracy must hire and give power to experts - professionals whose knowledge and skills have been highly developed in training programs.
Unlike the professional bureaucracy, the adhocracy cannot rely on the standardized skills of these experts to achieve coordination, because that would lead to standardization instead of innovation. Rather, it must treat existing knowledge and skills merely as bases on which to build new ones. Moreover, the building of new knowledge and skills requires the combination of different bodies of existing knowledge. So rather than allowing the specialization of the expert or the differentiation of the functional unit to dominate its behavior, the adhocracy must instead break through the boundaries of conventional specialization and differentiation. Whereas each professional in the professional bureaucracy can operate on his own, in the adhocracy professionals must amalgamate their efforts. In adhocracies the different specialists must join forces in multi-disciplinary teams, each formed around a specific project of innovation.
Managers abound in the adhocracy - functional managers, integrating managers, project managers. The last named are particularly numerous, since the project teams must be small to encourage mutual adjustment among their members, and each team needs a designated leader, a "manager." Managers become functioning members of project teams, with special responsibility to effect coordination between them. To the extent that direct supervision and formal authority diminish in importance, the distinction between line and staff blurs."
From an article explaining Henry Mintzberg's taxonomy of organizational forms, more details about different forms of adhocracy, at http://socrates.berkeley.edu/~fmb/articles/mintzberg/ :
To proceed with our discussion and to elaborate on how the innovative organization makes decisions and forms strategies, we need to distinguish two basic forms that it takes.
The Operating Adhocracy
The operating adhocracy innovates and solves problems directly on behalf of its clients. Its multidisciplinary teams of experts often work under contract, as in the think-tank consulting firm, creative advertising agency, or manufacturer of engineering prototypes.
A key feature of the operating adhocracy is that its administrative and operating work tend to blend into a single effort. That is, in ad hoc project work it is difficult to separate the planning and design of the work from its execution. Both require the same specialized skills, on a project-by-project basis. Thus it can be difficult to distinguish the middle levels of the organization from its operating core, since line managers and staff specialists may take their place alongside operating specialists on project teams.
The Administrative Adhocracy
The second type of adhocracy also functions with project teams, but toward a different end. Whereas the operating adhocracy undertakes projects to serve its clients, the administrative adhocracy undertakes projects to serve itself, to bring new facilities or activities on line, as in the administrative structure of a highly automated company. And in sharp contrast to the operating adhocracy, the administrative adhocracy makes a clear distinction between its administrative component and its operating core. The core is truncated - cut right off from the rest of the organization - so that the administrative component that remains can be structured as an adhocracy.
This truncation may take place in a number of ways. First, when the operations have to be machinelike and so could impede innovation in the administration (because of the associated need for control), it may be established as an independent organization. Second, the operating core may be done away with altogether - in effect, contracted out to other organizations.
A third form of truncation arises when the operating core becomes automated. This enables it to run itself, largely independent of the need for direct controls from the administrative component, leaving the latter free to structure itself as an adhocracy to bring new facilities on line or to modify old ones. With this change in the operating work force comes a dramatic change in structure: the operating core transcends a state of bureaucracy - in a sense it becomes totally bureaucratic, totally standardized, ... and the administration shifts its orientation completely. The rules, regulations, and standards are now built into machines, not workers. And machines never become alienated, no matter how demeaning their work. So out goes the need for direct supervision and technocratic standardization and with it the obsession with control. And in comes a corps of technical specialists, to design the technical system and then maintain it." (http://socrates.berkeley.edu/~fmb/articles/mintzberg/)
"Characteristics of an adhocracy:
- highly organic structure
- little formalization of behavior
- job specialization based on formal training
- a tendency to group the specialists in functional units for housekeeping purposes but to deploy them in small, market-based project teams to do their work
- a reliance on liaison devices to encourage mutual adjustment, the key coordinating mechanism, within and between these teams
- low standarization of procedures, because they stifle innovation
- roles not clearly defined
- selective decentralization
- work organization rests on specialized teams
- power-shifts to specialized teams
- horizontal job specialization
- high cost of communication
- culture based on democractic and non-bureaucratic work
All members of an organization have the authority to make decisions and to take actions affecting the future of the organization. There is an absence of hierarchy.
Alvin Toffler noted in his book Future Shock that adhocracies will get more common and are likely to replace bureaucracy." (http://en.wikipedia.org/wiki/Adhocracy)
Mintzberg's Taxonomy of Organizational Forms, explained at http://socrates.berkeley.edu/~fmb/articles/mintzberg/ [defunct link]