functional organizational design

8/2/2019 Functional Organizational Design

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Section A

1. Definition of organizational designIn an organization there must be a definite way of determining the flow of operations,

grouping the employees, hierarchy of power distribution among employees. So the organizational

designs are built as frameworks to achieve that need.

So we can define organizational designs as the framework, which defines its line of

authority and communication, and how to allocate rights and duties.

For further clarification,

Organizational design determines the manner and extent to which roles, power and

responsibilities are delegated, controlled and coordinated, and how information flows between levelsof management.


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2. Description on five organizational designsI. Functional organizational design

Functional organizational design groups similar or related occupational specialties in an

organization into groups. In other words it creates work units based on similar activities, skills,

expertise and resources.

Figure 1: Functional organizational chart

Source: http://www.cliffsnotes.com/study_guide/Principles-of-Management.topicArticleId-

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II. Divisional organizational designIn an organization there can be separate or semi-autonomous units or divisions. Under

divisional organizational design there is an independency among those divisions. Divisions have been

given there own goals to accomplish under its own manager. But those divisional goals must support

to meet the overall organizational goal. As examples, divisions can be created based on variation

among products, customer service, and geographical categories.

Figure 2: The divisional structureDisney in the early 1990s.


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III. Matrix organizational designIn an organization there can be one or more ongoing projects at the same time. Under matrix

organizational design, specialized people from different functional departments are assigned to those

projects. There is a project manager who is responsible for the particular project and there are

managers for the established functional departments. So the each specialist have to report to two

managers.

Figure 3: Matrix organizational design


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IV. Team organizational designUnder this design, the whole organization is composed of teams. They are working for a

common goal regardless of hierarchy or chain of command. Teams can accomplish organizational

functions free and innovatively according to the ideas of the team members. Sometimes there can be a

team leader for each team and him responsible for the performance of the team.

Figure 4: The team structure


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V. Network organizational designThe organizations which are formed according to network design, relies on other external

organizations to perform some critical functions. External organizations supply those functions on the

contractual basis.

Figure 5: The network structure


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3. List of advantages and disadvantages of above organizational designs

I. Functional organizational designAdvantages Disadvantages

High communication within the functional

departments.

Low communication among different functional

departments.

Clearly defined authority/responsibility

relationship.

Decision making is slow due to centralized

authority.

Minimize duplication of equipment and

specialist.

Forget the overall goals of the organization while

achieving the departmental goals.

Making employees comfortable. Narrow view of the management on management

duties.

Simplifies training.

II. Divisional organizational designAdvantages Disadvantages

Allows managers to better focus on results and

resources of the division.

Duplication of resources.

Top level managers can easily monitor the

performance.

Competition can be occurred among divisions for

limited resources.

Easy to identify the responsible points for low

performances.

III. Matrix organizational designAdvantages Disadvantages

Better cooperation and problem solving. Power struggle between functional manager and

project manager.

High flexibility. Employees suffer from task confusion.

Better customer service. Over loyalty for the team can be a cause to loss

the focus on organizational goals.

Improved strategic management.Better communication among employees.


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IV. Team organizational designAdvantages Disadvantages

Breaks the functional barriers amongdepartments. Conflicting loyalties among team members.

Effective relationship among team members. Time management problems.

Reduce the decision making and response time. Increased time spent in meetings.

Employees are motivated.

Levels of managers are eliminated.

Reduced administrative costs.

Teams are given power to be innovative as they

want.

V. Network organizational designAdvantages Disadvantages

Reduce the size of the staff and operations. Unpredictability of supply and lack of control due

to management relying on external parties.

Low wastage of the resources.

Operations are done by the high specialized

parties. So the quality of the output can be high.


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Section B

1. Reasons for resistant to changeThere can be number of reasons for resistance to change inside of organizations. Given

below are some of main reasons.

Reasons for employee resistances

I. Prediction of changed environment be difficult than the currentenvironment:-

As a result of the long experience of the old system and unfamiliarity of new

system, employees feel new system difficult than the previous one.

II. Low understanding on vision and need of the change for the organization :-Most of times employees dont know the vision of the change project. They

also don not have the proper understand about how it affects to their roles.

III. Comparing the present change projects with past experiences :-There can be past unsuccessful change projects. So employees tend to compare

the new project with previous projects and develop suspicion on present project.

IV. Change was seen as adding unwanted works, responsibility and accountability.As a result of unfamiliarity, employees feel new change is adding unnecessary

burden on their job.

V. Feeling of change would eliminate the need of their job:-When a change happened most of times employees become fear of their job

because change can be a reason to lose their jobs.

VI. Unsure of their abilities and skills in the new environment:-As a result of being specialized for the current system, employees may not be

confidence for their ability to work in a new system.

Manager resistances

I. Fear of loss of power and control:-When a change is going to occur, managers fear of loss of his power and

control from some regions that he had with current system.

II. Feeling of change is an additional burden:-Managers may think that the new change may increase more problems and

complexities inside the organization.

III. Lack of skills and experiences to handle environment which changed:-After a change in an organization, most of new problems may arise. Managers

must have to have abilities to successfully face to the sudden change. Lack of

experiences may discourage the management.

IV. Idea of this change will not be the solution for the problem:-Before experience the outcome of the new change, managers may feel new

change is not the solution for the problem. So they become discourage to implement

the change.


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Common resistances

I. Belief that fellow employees or managers are incompetent in decision making:-Outside managers or employees may suspect the competency of the people who

designed the change. So they would not warm up to implement the change or accept

the change.

II. Lack of faith in their ability to learn new skills:-New changes may make the need of learning new technologies or concepts. In

that case managers and employees may refuse to be change due to their low self-

confidence on ability to learn new things.

III. Loss of personal or family time:-After a change has been done, it needs some more attention of all the members

of an organization until change become established and familiar thing. So membersmay have to over work for some period of time. That can be a reason to loss of

personal or family time.


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2. Analyzing resistant to change through force field analysis.

Force field analysis technique was introduced by Kurt Lewing. This analysis is used for

analyze net impact of all forces that has an impact of the change. Driving forces are forces which push

and promote changes. Restraining forces are making the change more difficult. Restraining forces

impact on driving forces and make avoidance or resistance to make changes. In a point this forces can

be equal. That point is called equilibrium point where no movement towards or away from change is

happening.

To implement the change, we have to reduce the restraining forces and increase the driving

forces. When we are going to do that we need a complete analysis on the amount of each force. That

kind of analysis is called force field analysis.

There are number of ways to do a force field analysis. But common steps can be seen amongthem.

First we have to identify and understand the current situation. Then we should have a clear

goal state relative to the proposed change. After that we have to list out all the driving and resistant

forces even some forces show low amount of effect. After listing, we have to assign a level of

influence using a numerical scale. Then we need to include those forces and their numerical values

and total strength of each force to chart as below.

Then we can determine that change is viable or not. Then we need to understand how to

implement the change by reducing resistant force and increasing driving force. After that we have

decide action strategies to overcome the resistant forces.


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Section C

1. Communication processCommunication process means the transmission of a message from sender to receiver in an

understandable manner.

There are six main key components in a communication process. Those are

I. Context:-Context of a communication process means the environment where the communication

process occurs. They context or the environment can be physical, cultural, social or chronological.Context straightly affect to the communication.

II. Sender/Encoder:-Sender or the encoder is the person who sends the message. He uses symbols to

communicate. He uses verbal or non-verbal communication methods according to the situation.

Success of his participation is crucial for a better communication.

III. Message:-Message is the key idea which the sender needs to send to the receiver. Communication

process starts with the identification of required message to be sent. Message should be clear to

maintain an effective communication.

VI. Medium:-Medium means the way that the sender uses to send the message to the receiver (As

examples written or verbal medium.). Medium can be varying. It depends upon the features of the

communication. Sender should choose the correct medium to transmit the required message

effectively to the receiver.

VII. Recipient/Decoder:-Recipient or the decoder is the person to whom the message is targeted. The understandable

of the decoder about the message depends on the decoders knowledge, mental state, responsiveness

to the message and the reliance of encoder on decoder.

VIII. Feedback:-Feedback is the response of the receiver to the sender which can be used to confirm whether

the receiver understood the required message accurately. Feedback can be verbal (memos, reports

etc.) or non-verbal (smiles, sighs).


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Source: http://www. mindtools.com

To maintain an effective communication process, all the key components should be

performed clearly and accurately. Corruption of any component may cause to a transmission of wrong

or unclear idea to the receiver.


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Media richness hierarchy

Source: -

http://www.fsc.yorku.ca/york/istheory/wiki/index.php/Media_richness_theory

2. Selecting a proper communication channel by emphasizing the channelrichness concept

Channel richness theory was developed by Richard L. Daft. This theory was based on

number of assumptions.

First assumption is organizations process information to reduce uncertainty and

equivocality. Uncertainty is defined as the difference between the amount of information required to

complete the task and the amount of information organization already generated. Equivocality is

defined as the ambiguity of task due to conflicting interpretations about a group situation or

environment. According to those definitions when Equivocality is high, individuals dont know the

question. When uncertainty is high, whether group knows the question but lacks the necessary

information. So when the information increases, Equivocality and uncertainty decreases.

The second assumption of this method is that the commonly used media in an organization

is better for certain tasks than others.

Based on those two assumptions Daft & Lengel understood channel richness is a function

of

I. Mediums capacity for immediate feedback.II. Number of cues and channels available

III. Language varietyIV. The degree to which intent is focused on the recipient.

Then they introduced media richness hierarchy which incorporates four media

classifications; face-to-face, telephone, addressed documents, and unaddressed documents


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3. Difference between upward communication and downwardcommunication.

Upward and downward communications are two types of communications under internal

business communication.

I. Upward communication:-Upward communication is the flow of information from the subordinates to supervisor. In

other words from employees to management.

As an example, when a labourer gives a feedback on a new change to the supervisor, that

can be called as upward communication. Because the flow of information starts from the lower level

and flow to the high level.

This is useful when the high levels of organizational hierarchy needs information to make

decisions about the organization.

http://www.rizwanashraf.com/2008/02/04/business-communication-and-its-types/

Upward communication process


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II. Downward communication:-Downward communication is the flow of information from the supevisors to subordinates.

In other words from management to employees.

As an example, when a supervisor gives instructions to a labourer on how to do task, is

called downward communication. Flow of information starts from high level and ends with lower

level.

This communication method is crucial when the high levels in the hierarchy needs to

establish the made decisions within the organization.

Both upward and downward communication is compulsory for an organization to maintain

the process of their organization. However upward communication should be happened before starts

the downward communication because downward communication carries the decisions from high

level to low level which created based on the information which has been flown from low level to

high level.

http://www.rizwanashraf.com/2008/02/04/business-communication-and-its-types/

Downward communication process


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4. Communication Barriers

There can be seen number of barriers for an effective communication process in an

organization.

The few of most commonly seen barriers are:

I. Perceptual barriers:Opinions of group of people are differing. So in a communication process most of times

receiver does not like to accept what is opposite to his opinion from the sender.

II. Emotional barriers:Personal feelings that occur in our mind during the communication process can be a great

barrier to an effective communication. As examples mistrust, fear and anger about the sender.

III. Language barriers:Language the main method that we use in verbal communication can be a communication

barrier due to its variation. Receiver may not understand the message accurately if the sender is not

familiar on receivers local language.

IV. Cultural barriers:If the receiver and sender belongs to different cultural environments, (such as different

religion, states or countries) individuals may feel difficulties during the communication process.

V. Physical barriers:When considering the organizational structure physical isolation between the sender and

receiver create a huge barrier for a communication process. As an example the communication

between a manager who is in a door closed office and an employer who is working far away is not

effective due to the low physical relationship.


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5. Overcoming the barriers to communication

Overcoming communication barriers is crucial to an organization to improve the accuracyand efficiency of flow of information throughout the organization. There are number of solutions to

reduce the impact of communication barriers. But it is not possible to eliminate communication

barriers because each individual is naturally separate from others.

I. Eliminating difference in perception:When people are recruited to an organization, interviewers should be aware of recruiting the

people who can follow the vision of the organization. All the employees should be comfortable and

agreement with the organizational vision. Then only we can reduce perception difference among

individuals in an organizational communication process. Becoming to a same vision reduces the

opinion differences among individuals.

II. Use of simple language:Employees must be motivated to use simple language styles and not to use ambiguous

words and jargons during the organizational communication process.

III. Active Listening:Listener should actively participate to the communication. It is crucial to raise questions

when there is an unclear point of the communication. Asking question is a successful way to speaker

to understand whether the listener got his point or not.

IV. Showing internal feelings as postures and gestures:Sender or the speaker can easily understand the effectiveness of his message by looking at

the natural postures and gestures which generated from the true feelings of the receiver. As an

example, problematic mood can be a sign of showing misunderstanding about a delivered message.

V. Simple organizational structure:Numbers of hierarchical levels should be optimum. Span of control within the organization

should be ideal. More complex organizational structures can be not good for effective communication.

VI. Giving constructive feedbacks:Constructive feedback is a good way to improve the effective communication among

superiors and subordinates. Even the content of the feedback is negative, it should be delivered

constructively.

VII. Use of proper media:Managers should properly select the communication media. That should be done according

to the concept of channel richness. To deliver simple messages oral medium is the best while the

written medium is recommending for complex messages.


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VIII. Delivering message with good emotional state:Sender should deliver the message within a good emotional state; if not sender will

misunderstand or disagree with the message. If sender participates to a communication process with

anger, receiver will not appreciate to accept the message as sender wishes.

IX. Building close relationship with the sender and receiver:When considering an organization, superior should create close relationship with the

subordinates (when superior acts as a sender.). Working together and should listen to them to get face

to face feedbacks.


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References

CliffsNotes (2012) Five Approaches to Organizational Design [OnLine].

Available from- http://www.cliffsnotes.com/ [Accessed: 29 Jan 2012]

MGMT 307 Group project (2005) Types of organizational design [OnLine].

Available from- "http://www.emaytrix.com/mgmt307/project.php" [Accessed: 29 Jan 2012]

BPR Online Learning Center (2002) Top reasons for change resisitance-288 companies

reporting [OnLine].

Available from- "http://www.prosci.com/index-bpr.htm" [Accessed: 30 jan 2012]

Management Study Guide (2012) Overcoming communication Barriers [OnLine]

Available from- http://www.managementstudyguide.com/index.html [Accessed: 31 jan2012]

RizwanAshraf.com (2008)Business Communication and its Types [OnLine]

Available from- "http://www.rizwanashraf.com/" [Accessed: 30 Jan 2012]

Stephen Wells, 2006. Force field analysis.[E-book]

Available from: www.freequality.org/documents/knowledge/Mini-

Tutorial.doc[Accessed: 30 Jan 2012]

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