impact of environment and cultural variables on organization structure and style 1 facilitator and...
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Impact of Environment and Cultural Variables on Organization Structure and
Style
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Facilitator and Course Coordinator:
Vinayshil Gautam PhD, FRAS(London)(Founder Director IIM K; Leader Consulting Team IIM S)
A Al_Sager Chair Professor and First Head,
Management Department, IIT D
Chairman, DKIF
TOPICS COVERED
• External EnvironmentFirst Tier
General EconomySuppliersCustomersCompetition
Second TierPolitical Legal ForcesTechnologyInternational ForcesCustoms/CulturesSocio Cultural Forces
• Internal EnvironmentManagers
ValuesEthics
WorkersWork EthicsWork Values 2
Open System
General system approach
Property of Dynamic Homeostasis
Goal Oriented Growth
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External Environment
There are two types of forces:
First Tier Second Tier
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First Tier
General Economy Suppliers Customers Competition
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Second Tier
Technology Customs/Cultures Political Legal Forces International Forces Socio Cultural Forces
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Technology
Defining technology Types of technology Technology and structure Interaction of technology and culture
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Defining Technology
Technology of work refers to the process by which an organization converts input (knowledge, skills and techniques) to outputs.
Technology must be developed in conjunction with the resources needed for capturing and retaining the customer.
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Role of Organizational Technology
InputsInputs TRANSFORMATIONTRANSFORMATION Output Output
PROCESS PROCESS
(technology)(technology)People product
Materials service
Equipment job satisfaction
Money profits
Plant and facility
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Types of Technology
Based on work of Thompson’s and Perrow, the three kinds of technologies are Mediating Technologies, Long Linked Technologies and Intensive Technologies
Their categorization is based on task interdependence, identifying low, medium and high levels of interdependence needed to perform tasks.
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Types of Technology
Mediating Technologies
This type of technology is low interdependence, which is to say that the different parts of the whole organization are relatively independent of each other. Few demands are placed on coordination of the parts, cooperative decision making, and the like. This type of technology is best suited for bureaucratic structure with high standardization as the dominant integrator.
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Types of Technology
Long Linked Technologies
Characterized by moderate interdependence, technologies with sequential interdependence are typified by auto assembly plants or school cafeterias. Because these technologies demand coordination among the parts, management needs to plan ahead.
A bureaucratic structure with planning is best suited for this technology.
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Types of Technology
Intensive Technologies
The third type of technology, reciprocal interdependency, has the greatest amount of task interdependency. It makes the greatest demand on managerial decision making and communication/coordination.
Examples of organization using this type of tech include construction firms, mental health clinics and hospitals.
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Thompson’s Classification By Task Interdependence
Mediating Pooled interdependence
Commercial bank
Long linked
Sequential interdependence
Assembly line automobile
Intensive Reciprocal interdependence
General hospital
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Technology and Structure :By Perrow
Based on Degree of Non routine ness
Task Variety
Task Coping Difficulty
Few Exceptions Many Exceptions
Craft Work Non Routine Work
Routine Engineering
Engineering Technology
High
Low
Task Variability
Task Coping Difficulty
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Technology and Structure
The key dimensions on which differing technologies rest are routine ness and interdependence. Technology seem to be a determinant of structure but perhaps not the major one.
Routine ness technologies do seem to be associated with low complexity. The greater the routine ness, the less training is required by incumbents . Thus, organization with routine technology need high formalization at the technology’s core.
Routine technology goes with centralization if formalization is low; otherwise, with high formalization and routine technology we can easily have a decentralized structure.
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How new technologies are affecting Organizations and Work Flow
New information technologies are radically transforming
organizational structure and strategy. Staff members find themselves using a much more
elaborate network of communication that includes both personal contacts and task related interactions.
Power based on hierarchical position was replaced by power based on competency as demonstrated throughout the system.
The job of members became more flexible and the time available for getting work done increased.
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Technology
Technology and individual Technology and group Technology and Industrial relation
Technology and organization structure study by J Woodward
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Culture
What is culture
Common elements of culture
Determinants of Culture
Dimensions of culture
Characteristics of culture
How cultures are analyzed?
Maintaining the culture
Organization cultures and effectiveness
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What is culture
Culture is a pattern of basic assumptions- invented, discovered or developed by a given group as it learns to cope with its problems of external adaptations and internal integration-that has worked well enough to be considered valuable and to be taught to the new members.
-Edger Schein.
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Common Elements of Culture
Beliefs, values and attitudes Artifacts Language Behavior patterns Norms of behavior Ethical codes
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Determinants of organizational culture
History and ownership Size Technological base Goals and Objectives The state of environment Organizational members
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Dimensions / Typology of Culture
Harrison / Handy Typology Power Culture Role Culture Task Culture Person Culture
Deal and Kennedy Typology Tough-guy, macho culture Work-hard/play hard culture Bet-your company culture Process Culture
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Harrison / Handy Typology
Harrison suggested four types of organizational culture called power, role, task and person.
Later Handy reworked describing four cultures using simple pictograms and making reference to Greek mythology.
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Power Culture(The Web)
Advantages Ability to react quickly
Disadvantages Not feasible for large and complex
organizations Cant adjust to change in
Leadership
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Role Culture(Greek Temple)
Advantages Reliance on formal rational rules It generate economies of scale
Disadvantages Inability to innovate and adapt
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Task Culture(Lattice)
Advantages
Emphasizes technical expertise rather than formal authority
Disadvantages Creates high level of stress and conflicts Management controls problems
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Person Culture(Cluster)
Advantages
Existence of organizations for individuals
Disadvantages
Difficult to Manage
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Deal Kennedy Typology
Bet Your CompanyTough
Guy/Macho
ProcessWork Hard/
Play Hard
Slow Fast
High
Low
Speed of Feedback
Degreeof
Risk
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The Deal and Kennedy typology
The tough-guy, macho culture
High risk, rapid feedback culture Focus on speed and the short-term Places enormous pressure on individual Burn-out is a a common problem Internal competition, tension and conflict are normal Tend to have high turnover of staff
Example: Xerox, McDonald’s
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The Deal and Kennedy typology
The work-hard/play-hard culture
Low-risk, quick-feedback culture. Highly dynamic and customer-focused. Tendency for volume to displace quality. Pursue ‘quick-fix’ solutions when things go wrong.
Examples: Silicon Valley companies, IT companies
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The Deal and Kennedy typology
Bet-your-company culture
High risk, low feedback Focused primarily on the future, decision making tends
to be top-down. Respect of authority and technical competence. Strength to deal with the high-pressure decisions Good at producing high quality inventions and scientific
breakthroughs.
Examples: Boeing, Shell
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The Deal and Kennedy typology
The process culture
Low-risk, slow-feedback culture Focus on how to do rather than what to do. Orderly, punctual and attend to details. Emphasis on job titles and formality. Effective when dealing with known predictable
environment Unable to react quickly, lack of vision and creativity.
Examples: banks, insurance companies, civil services.
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Characteristics of culture
Innovation and risk taking Outcome orientation Team orientation Stability Aggressiveness Dominant values Attention to detail
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How cultures are analyzed
Weather forecast type by Harry C Miller
Trade winds
The organization's purpose
Temperature
The hotness or coldness of morale
Ceiling level The level of desire, commitment and energy for organizational goals.
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Maintaining the culture
By group processes
By constant reinforcement of core values and beliefs
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Organization cultures and effectiveness
Reactive Organization Responsive Organization Proactive Organization Interactive Organization Inspired Organization
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Internal Environment
Managers Values
• Theoretical values• Economic values• Aesthetic values• Social values• Political values• Religious values
Ethics
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Phase 1
Profit Maximizing Management
Phase 2
Trusteeship Management
Phase 3
Quality of Life Management
Economic ValuesRaw self interest Self interest
Contributor's interest
Enlightened self interest
Contributors interest
Society’s interest
What's good for me is good for my country
What's good for GM is good for our country
What’s good for society is good for our company
Profit maximizer Profit satisfier Profit is necessary but
Money and Wealth are most important
Money is important but so are people
People are more important
Let buyer beware Let us not cheat the customer
Let the seller beware
Labor is commodity to be bought and sold
Labor has certain rights which need to be recognized
Employee dignity has to be satisfied
Comparison of Managerial Values
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Comparison of Managerial Values
Technology Values
Technology is very important
Technology is important but so are people
People are more important than technology
Social Values
Employee personal problems must be left at home
Employee have needs beyond their economic needs
Hire the person as a whole
manage business as he please
Recognize the value of group participation
Group participation is fundamental to success
Minority groups are inferior
Minority groups have their place in the society
Minority group members are people are you and I are
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Comparison of Managerial Values
Political Values
Government which govern lest is the best
Government is a necessary evil
Business and government must cooperate to solve society's
Environmental Values
Environment controls the destiny of man
Man can control and manipulate environment
We must preserve the environment in order to lead a quality life
Aesthetic Values
Aesthetic values?? What are they?
Aesthetic values are okay but not for us
We must preserve our aesthetic values and we will do our part.
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Workers
Work ethics Consists of the beliefs people have about their jobs
and about carrying them out.
Work valuesWork ethic in some degree is accepted by most workers. There are differences between the age groups.
Internal Environment
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Bibliography
Name Of The Book
Author Publication House
Date & Place of Publication
Organizational Culture
Andrew Brown Pitman Publications
Great Britain, 1995
Organization Management
Prof. Vinayshil Gautam
Class Notes New Delhi
Designing Effective Organizations
T. Elaine Gagne & David K. Banner
Sage Publications
U.S.A, 1995
Management Process & Organizational Behaviour
Amrik Singh Sudan & N.Kumar
Anmol Publications
New Delhi, 2003
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ThankThank YouYou
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