ORGANISATION STRUCTURE,

THEORY & DESIGN

Submitted To: Prof. Alpha Lokhande

STRATEGY, ORGANISATION

DESIGN & EFFECTIVENESS

GROUP MEMBERS

NISHA SALIAN 014122 PRIYANKA SHAH 014128 NAZNEEN SHEIKH 014137 ANIES VARGHESE 014164

STRATEGY Strategy can be defined as the determination of

the basic long-term goals and objectives of an enterprise, and the adoption of courses of action and the allocation of resources necessary for carrying out these goals.

The term is derived from the Greek word for generalship or leading an army.

A method or plan chosen to bring about a desired future, such as achievement of a goal or solution to a problem.

LEVELS OF STRATEGIESCorporate-level Strategy

Business-level Strategy

Functional-level Strategy

CORPORATE LEVEL STRATEGY

If an organization is in more than one business, it will need a “Corporate-level strategy”

In What set of Business should we be?

It determines the roles that each business plays in the organization.

BUSINESS-LEVEL STRATEGY

This level of strategy seeks to answer the question, How should we compete in each of our Business?

Same as that of Corporate-level.

Strategy as organization in multiple business, each division will have its own strategy that defines the product and services that they will offer.

FUNCTIONAL-LEVEL STRATEGY

It is in support of Business level Strategy.

Looks its management decisions as specific to a functional area of the organization.

It sees people and resources as an end and not means to an end.

FOUR DIMENSIONS OF CORPORATE-LEVEL STRATEGY

INNOVATION STRATEGY Marketing Differentiation Strategy

BREADTH STRATEGY COST CONTROL STRATEGY

PORTER’S COMPETITIVE STRATEGIES

Miles and Snow’s Four Strategic TypesRaymond Miles & Charles Snow classified the

organization into four strategic types: Prospectors, Defenders, Analyzers and Reactors

Managers seek to formulate strategies that are congruent with the external environment

1) Prospector: innovate, take risks, seek out new opportunities and grow

Finding and exploiting new product and market opportunities.Creativity over efficiency Examples: FedEx, Microsoft, Google

2) Defender: stability or even retrenchment (opposite to prospector)

Offer products to a narrow domainStrategy is concerned with stability and seeks

hold onto customers.They strive aggressively to prevent the

competitors to enter into their “turf”

Example: Manufacturer of Soft-soap

3) Analyzer: try to maintain a stable business while innovating on the periphery

In between the prospector and the defender

Examples: Microsoft (e.g., Win 8), IBM

4) Reactor: not really a strategy… ad-hoc response to threats and opportunities in the market

No long-term plan

Examples: Xerox and Kodak, which struggled to keep up recently

Organizational design is the way an organization is to be structured and operated by its members.

It is both a plan and process.

ORGANIZATIONAL DESIGN

ORGANIZATIONAL DESIGN

A process involving decisions about six key elements:

• Work specialization• Departmentalization• Chain of command• Span of control• Centralization and decentralization• Formalization

PURPOSES OF ORGANIZING

Divides work to be done into specific jobs and departments

Assigns tasks and responsibilities associated with individual jobs

Coordinates diverse organizational tasks Establishes relationships among individuals,

groups, and departments Establishes formal lines of authority Allocates organizational resources Cluster jobs in to units

DESIGNING ORGANIZATIONAL STRUCTURE

Work Specialization◦The degree to which tasks in the

organization are divided into separate jobs with each step completed by a different person

DEPARTMENTALIZATION BY TYPE

Functional ◦ Grouping jobs by

functions performedProduct

◦ Grouping jobs by product line

Geographical◦ Grouping jobs on

the basis of territory or geography

Process ◦ Grouping jobs on

the basis of product or customer flow

Customer◦ Grouping jobs by

type of customer and needs

Functional Departmentalization

+ Efficiencies from putting together similar specialties and people with common skills, knowledge, and orientations

+ Coordination within functional area+ In-depth specialization– Poor communication across functional areas– Limited view of organizational goals

Plant Manager

Manager,Engineering

Manager,Accounting

Manager,Manufacturing

Manager,Human Resources

Manager.Purchasing

Geographical Departmentalization

+ More effective and efficient handling of specific regional issues that arise

+ Serve needs of unique geographic markets better

– Duplication of functions– Can feel isolated from other organizational

areas

Vice President of Sales

Sales DirectorWestern Region

Sales DirectorSouthern Region

Sales DirectorCentral Region

Sales DirectorEastern Region

Product Departmentalization

+Allows specialization in particular products and services

+Managers can become experts in their industry

+Closer to customers– Duplication of functions– Limited view of organizational goals

Source: Bombardier Annual Report.

CEO.

Truck Division

Bus Division

Car Division

Process Departmentalization

+ More efficient flow of work activities

– Can only be used with certain types of products

Plant

Manager

FinishingWeavingDyeingSpinning

Customer Departmentalization

+ Customers’ needs and problems can be met by specialists

– Duplication of functions– Limited view of organizational goals

ManagerRetail Accounts

ManagerWholesale Accounts

ManagerGovernment Accounts

Director Of Sales

ORGANIZATIONAL EFFECTIVENESS

WHAT IS EFFECTIVENESS?

The degree to which objectives are achieved and the extent to which targeted problems are solved

Effectiveness means "doing the right thing”

ORGANIZATIONAL EFFECTIVENESS

“Organizational effectiveness is the concept of how effective an organization

is in achieving the outcomes the organization intends to produce.

METHODS TO MEASURING THE EFFECTIVENESS OF THE ORGANIZATION

A. Goal Approach;B. Internal Process Approach;C. System Resource

Approach;D. Strategic Approach

COMPARISON OF THE FOUR OE APPROACHESApproach Definition When Used

An organization is effective Preferred when: to the extent that:

Goal Approach it accomplishes its stated goals goals are clear, time

bound and measurable

System Resource it acquires needed resources a clear connection exists

between inputs and outputs

Strategic Approach all strategic constituencies constituencies have powerful are at least minimally

influence on the organization, satisfied

and the organization must

respond to demands

Internal Processes combines internal efficiency costs, outputs & satisfaction and affective health

are easily measurable

WHAT BENEFITS WILL IT GIVE TO THE ORGANIZATION.

Improved:

• profitability• competitiveness• customer satisfaction• management-employee

relation• communications• teamwork• employee morale• company image• revenue• work environment

Reduced:• customer complaints• warranty claims• cost• Rework

Greater:

• market share• adaptability

Increased: • Employee involvement• Employee satisfaction • Ability to attract new

customers

CONCLUSION Organizational

effectiveness is the degree of achievements of an organizational objectives.