effective organizing & org.culture

8/13/2019 Effective Organizing & Org.culture

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EffectiveOrganizing

andOrganizational

Culture


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Organizational Structure and Culture

Organizational

Structure

Organizational

Culture

The formal system of work roles and

authority relationships that govern

how associates and managers

interact with one another.

Involves the values and normsshared by managers and associates

that influence behavior. It is a

powerful force in organizations.


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Functional Organization

VP

Research and

Development

VP

Research and

Development

VP

Operations

VP

Human

Resources

VP

Finance

VP

Marketing

CEO


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Divisional OrganizationCEO

Head of

Operations

Head of

R&D

Head of

Human

Resources

Head of

Finance

Head of

Marketing

V.P.Product/Service

Area 1

Head of

Operations

Head of

R&D

Head of

Human

Resources

Head of

Finance

Head of

Marketing

V.P.Product/Service

Area 1

Head of

Operations

Head of

R&D

Head of

Human

Resources

Head of

Finance

Head of

Marketing

V.P.Product/Service

Area 1


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Structuring Characteristics

Centralization Standardization

Formalization Specialization


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The Modern OrganizationFlexible empowering type of structure

Organic

Learning

Boundaryless

Mechanistic

Non-Learning

Traditional

Fewer management levels, broader spans of control, less

centralization, standardization, formalization and specialization.


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Factors Affecting Structure

Corporate

StrategyGrowth

Diversification


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Business Strategy

Low cost/low price

Product/service differentiation

Supporting structure including strategic business units

SBUs

How a firm competes for success against other

organizations in a particular market.


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Developing Organizational Culture

OrganizationalCulture

NormsReinforcingOutcomes

SharedValues

Individual and

Group Behavior


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Organizational Structure

Organizational Architecture

The organizational structure, control systems,

culture, and human resource management

systems that together determine howefficiently and

effectively

organizational

resources are used.


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10-12

Designing Organizational Structure

Organizing

The process by which managers establishworking relationships among employees to

achieve goals. Organizational Structure

Formal system of task and reportingrelationships showing how workers use

resources.


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10-13

Designing Organizational Structure

Organizational design

The process by which managers create a specific

type of organizational structure and culture so

that a company can operate in the most efficientand effective way


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10-14

Factors Affecting Organizational Structure

Figure 10.1


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10-15

The Organizational Environment


The quicker the environment changes, the more

problems face managers.

Structure must be more flexible (i.e.,

decentralized authority) when environmental

change is rapid.


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10-16


Strategy

Different strategies require the use of different

structures.

A differentiation strategy needs a flexible structure,low cost may need a more formal structure.

Increased vertical integration or diversification also

requires a more flexible structure.


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10-17


Technology

The combination of skills, knowledge, tools,

equipment, computers and machines used in

the organization.

More complex technology makes it harder for

managers to

regulate the

organization.


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10-18


Technology

Technology can be measured by:

Task variety: the number of new problems a manager

encounters. Task analyzability: the availability of programmed

solutions to a manager to solve problems.


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10-19


Human Resources

Highly skilled workers whose jobs require

working in teams usually need a more flexible

structure.

Higher skilled workers (e.g., CPAs and doctors)

often have internalized professional norms and

values.


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10-20


Human Resources

Managers must take into account all four factors

(environment, strategy, technology

and human resources) when designing thestructure of the organization.


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10-21


The way an organizations structure works

depends on the choices managers make

about:

1. How to group tasks into individual jobs

2. How to group jobs into functions and

divisions

3. How to allocate authority and coordinate

functions and divisions


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10-22

Job Design

Job Design

The process by which managers decide how to

divide tasks into specific jobs.

The appropriate division of labor results in an

effective and efficient workforce.


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10-23

Job Design

Job Simplification

The process of reducing the tasks each worker

performs.

Too much simplification and boredom results.


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10-24

Job Design

Job Enlargement

Increasing the number of different tasks in a

given job by changing the division of labor

Job Enrichment

Increasing the degree of responsibility a worker

has over a job


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Job Enrichment

1. Empowering workers to experiment to find

new or better ways of doing the job

2. Encouraging workers to develop new skills

3. Allowing workers to decide how to do the

work

4. Allowing workers to monitor and measure

their own performance


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The Job Characteristics Model


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Job Characteristics Model

Job Characteristic

Skill variety Employee uses a wide range of skills.

Task identity Worker is involved in all tasks of the jobfrom beginning to end of the production

process

Task significance Worker feels the task is meaningful toorganization.

Autonomy Employee has freedom to schedule tasks

and carry them out.

Feedback Worker gets direct information about howwell the job is done.


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10-28

Grouping Jobs into Functions

Function

Group of people, working together, who possess

similar skills or use the same kind of knowledge,

tools, or techniques to perform their jobs


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10-29

Grouping Jobs into Functions

Functional Structure

An organizational structure composed of all thedepartments that an organization requires to

produce its goods or services.


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Advantages

Encourages learning from others doing similar

jobs.

Easy for managers to monitor and evaluateworkers.

Allows managers to create the set of functions

they need in order to scan and monitor thecompetitive environment


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Disadvantages

Difficult for departments to communicate with

others.

Preoccupation with own department and losingsight of organizational goals.


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Divisional Structures

Divisional Structure

Managers create a series of business units to

produce a specific kind of product for a specific

kind of customer


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Types of Divisional Structures

Product Structure

Managers place each distinct product line or

business in its own self-contained division

Divisional managers have the responsibility fordevising an appropriate business-level strategy

to allow the division to compete effectively in its

industry


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Product Structure

Allows functional managers to specialize in

one product area

Division managers become experts in their

area

Removes need for direct supervision of

division by corporate managers

Divisional management improves the use of

resources


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Geographic Structure

Divisions are broken down by geographic location

Global geographic structure

Managers locate different divisions in each of the

world regions where the organization operates.

Generally, occurs when managers are

pursuing a multi-domestic strategy


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Global Product Structure

Each product division takes responsibility for

deciding where to manufacture its products and

how to market them in foreign countriesworldwide


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Market Structure

Groups divisions according to the particularkinds of customers they serve

Allows managers to be responsive to the needsof their customers and act flexibly in makingdecisions in response to customers changingneeds


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Matrix Design Structure

Matrix Structure

An organizational structure that simultaneouslygroups people and resources by function and

product. Results in a complex network of superior-

subordinate reporting relationships.

The structure is very flexible and can respond rapidlyto the need for change.

Each employee has two bosses (functional managerand product manager) and possibly cannot satisfyboth.


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Matrix Structure

Figure 10.6


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Product Team Design Structure

Product Team Structure

Does away with dual reporting relationships and

two-boss managers

Functional employees are permanently assigned

to a cross-functional team that is empowered to

bring a new or redesigned product to work


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Product Team Design Structure

Product Team Structure

Cross-functional team is composed of a group of

managers from different departments working

together to perform organizational tasks.


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Hybrid Structures

Hybrid Structure

The structure of a large organization that hasmany divisions and simultaneously uses manydifferent organizational structures

Coordinating Functions:


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Allocating Authority

Authority

The power vested in a manager to make

decisions and use resources to achieve

organizational goals by virtue of his position inan organization


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Hierarchy of Authority

An organizations chain of command, specifying

the relative authority of each manager.

Span of Control: the number of subordinates whoreport directly to a manager


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Line Manager

Someone in the direct line or chain of

command who has formal authority over

people and resources

Staff Manager

Managers who are functional-area specialists

that give advice to line managers.


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Tall and Flat Organizations

Tall structures have many levels of authority

and narrow spans of control.

As hierarchy levels increase, communication

gets difficult creating delays in the time beingtaken to implement decisions.

Communications can also become distorted as it

is repeated through the firm.

Can become expensive


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Tall Organizations

Figure 10.9


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10-48

Tall and Flat Organizations

Flat structures have fewer levels and wide

spans of control.

Structure results in quick communications but can

lead to overworked managers.


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Flat Organizations

Figure 10.9


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Minimum Chain of Command

Minimum Chain of Command

Top managers should always construct a hierarchy

with the fewest levels of authority necessary to

efficiently and effectively use organizationalresources

C t li ti d D t li ti f


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Centralization and Decentralization of

Authority

Decentralizing authority

giving lower-level managers and non-managerial

employees the right to make important decisions

about how to use organizational resources


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Decentralizing Authority

Disadvantages

Teams may begin to pursue their own goals at the

expense of organizational goals

Can result in a lack of communication amongdivisions


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Integrating Mechanisms

Figure 10.10


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Organizational Culture

Organizational culture

shared set of beliefs, expectations, values, and

norms that influence how members of an

organization relate to one another and cooperateto achieve organizational goals


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Sources of an Organizations Culture

Ch t i ti f O i ti l


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Characteristics of Organizational

Members

Ultimate source of organizational culture is

the people that make up the organization

Members become similar over time which

may hinder their ability to adapt and respond

to changes in the environment


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Organizational Ethics

Organizational Ethics

moral values, beliefs, and rules that establish the

appropriate way for an organization and its

members to deal with each other and peopleoutside the organization


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Employment Relationship

Human resource policies:

Can influence how hard employees will work to

achieve the organizations goals,

How attached they will be to it

Whether or not they will buy into its values and

norms


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In a centralized organization:

people have little autonomy

norms that focus on being cautious, obeying

authority, and respecting traditions emerge

predictability and stability are desired goals


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In a flat, decentralized structure:

people have more freedom to choose and control

their own activities

norms that focus on being creative andcourageous and taking risks appear

gives rise to a culture in which innovation and

flexibility are desired goals.


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Strong, Adaptive Cultures

Adaptive cultures

values and norms help an organization to build

momentum and to grow and change as needed to

achieveits goals and be

effective


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Weak, Inert Cultures

Inert cultures

Those that lead to values and norms that fail to

motivate or inspire employees

Lead to stagnation and often failure over time


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