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Foundations of organizational design robbins&coulter ch11 moghimi

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Information about Foundations of organizational design robbins&coulter ch11 moghimi
Business & Mgmt

Published on April 8, 2013

Author: bmoghimi

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Foundations of organizational design Robbins&Coulter Ch11 Moghimi
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Management Robbins. St - Coulter. MChapter 11: Organizational design Bahman Moghimi Doctor of business Administration Master of Electronic Commerce

Management, Chapter 11. 3B.Moghimi@yahoo.co.uk

Planning Ahead — Chapter 11 Study Questions  What are the essentials of organizational design?  How do contingency factors influence organization design?  What are the major issues in subsystems design?  How can work processes be reengineered? Management, Chapter 11. 4 B.Moghimi@yahoo.co.uk

Study Question 1: What are the essentials oforganizational design? Organizational design: – Choosing and implementing structures that best arrange resources to serve the organization’s mission and objectives. – A problem-solving activity that should be approached from a contingency perspective. Management, Chapter 11. 5 B.Moghimi@yahoo.co.uk

Figure 11.1 A framework for organizational design-aligning structures with situational contingencies. Management, Chapter 11. 6 B.Moghimi@yahoo.co.uk

Study Question 1: What are the essentials oforganizational design? Organizational effectiveness – Sustainable high performance in using resources to accomplish mission and objectives. – Approaches: • Systems resource approach  focuses on inputs. • Internal process approach  focuses on transformation process. • Internal process approach  focuses on outputs. • External process approach  focuses on environment. Management, Chapter 11. 7 B.Moghimi@yahoo.co.uk

Study Question 1: What are the essentials oforganizational design? Short-run, medium-run and long-run criteria for evaluating organizational effectiveness: – Short-run focus. • Goal accomplishment. • Performance efficiency in resource utilization. • Stakeholder satisfaction. – Medium-run focus. • Adaptability in the face of changing environments. • Development of people and systems to meet new challenges. – Long-run focus. • Survival under conditions of uncertainty. Management, Chapter 11. 8 B.Moghimi@yahoo.co.uk

Study Question 1: What are the essentials oforganizational design? Bureaucracy – A form of organization based on logic, order, and the legitimate use of formal authority. – Bureaucratic designs feature … • Clear-cut division of labor. • Strict hierarchy of authority. • Formal rules and procedures. • Promotion based on competency. Management, Chapter 11. 9 B.Moghimi@yahoo.co.uk

Study Question 1: What are the essentials oforganizational design? Contingency perspective on bureaucracy asks the questions: – When is a bureaucratic form a good choice for an organization? – What alternatives exist when it is not a good choice? Environment determines the answers to these questions. – A mechanistic design works in a stable environment – An organic design works in a rapidly changing and uncertain environment. Management, Chapter 11. 10 B.Moghimi@yahoo.co.uk

Figure 11.2 A continuum of organizational design alternatives:from bureaucratic to adaptive organizations. Management, Chapter 11. 11 B.Moghimi@yahoo.co.uk

Study Question 1: What are the essentials oforganizational design? Structural characteristics associated with design alternatives: – Goal  predictability versus adaptability. – Authority  centralized versus decentralized. – Rules and procedures  many versus few. – Spans of control  narrow versus wide. – Tasks  specialized versus shared. – Teams and task forces  few versus many. – Coordination  formal and impersonal versus informal and personal. Management, Chapter 11. 12 B.Moghimi@yahoo.co.uk

Study Question 1: What are the essentials oforganizational design? Mechanistic Designs  Organic Designs – Predictable goals – Adaptable goals – Centralized authority – Decentralized authority – Many rules and – Few rules and procedures procedures – Narrow spans of – Wide spans of control control – Shared tasks – Specialized tasks – Many teams and task – Few teams and task forces forces – Informal and personal – Formal and impersonal means of coordination means of coordination Management, Chapter 11. 13 B.Moghimi@yahoo.co.uk

Study Question 2: How do contingencyfactors influence organization design? Checklist for identifying contingency factors in organizational design: – Does the design fit well with the major problems and opportunities of the external environment? – Does the design support implementation of strategies and the accomplishment of key operating objectives? – Does the design support core technologies and allow them to be used to best advantage? – Can the design handle changes in organizational size and different stages in the organizational life cycle? – Does the design support and empower workers and allow their talents to be used to best advantage? Management, Chapter 11. 14 B.Moghimi@yahoo.co.uk

Study Question 2: How do contingencyfactors influence organization design? Environment and organizational design — – Certain environment … • Relatively stable and predictable elements. • Bureaucratic organizations and mechanistic designs are appropriate. – Uncertain environment … • More dynamic and less predictable elements. • Adaptive organizations and organic designs are appropriate. Management, Chapter 11. 15 B.Moghimi@yahoo.co.uk

Study Question 2: How do contingencyfactors influence organization design? Strategy and organizational design — – Structure follows strategy. – Stability strategy is supported by: – Bureaucratic organizations using mechanistic designs. – Growth strategies are is supported by: – Adaptive organizations using organic designs. Management, Chapter 11. 16 B.Moghimi@yahoo.co.uk

Figure 11.3 Environmental uncertainty and theperformance of vertical and horizontal designs. Management, Chapter 11. 17 B.Moghimi@yahoo.co.uk

Study Question 2: How do contingencyfactors influence organization design? Technology – The combination of knowledge, skills, equipment, computers, and work methods used to transform resource inputs into organization outputs. Management, Chapter 11. 18 B.Moghimi@yahoo.co.uk

Study Question 2: How do contingencyfactors influence organization design? Core manufacturing technologies: – Small-batch production. • A variety of custom products are tailor-made to order. – Mass production. • A large number of uniform products are made in an assembly- line system. – Continuous-process production. • A few products are made by continuously feeding raw materials through a highly automated production system with largely computerized controls. Management, Chapter 11. 19 B.Moghimi@yahoo.co.uk

Study Question 2: How do contingencyfactors influence organization design? Technology and organization design — – The technological imperative • Technology is a major influence on organizational structure. • The best small-batch and continuous process plants have more flexible organic structures. • The best mass-production plants have more rigid mechanistic structures. Management, Chapter 11. 20 B.Moghimi@yahoo.co.uk

Study Question 2: How do contingencyfactors influence organization design? Core service technologies: – Intensive technology • Focuses the efforts of many people with special expertise on the needs of patients or clients. – Mediating technology • Links together parties seeking a mutually beneficial exchange of values. – Long-linked technology • Functions like mass production, where a client is passed from point to point for various aspects of service delivery. Management, Chapter 11. 21 B.Moghimi@yahoo.co.uk

Study Question 2: How do contingencyfactors influence organization design? Organization size, life cycle, and design — – Larger organizations tend to have more mechanistic designs, but it is not always best. – Organizational life cycle: • Birth stage — small size, simple structure. • Youth stage — rapid growth in size, simple structure experiences stress. • Midlife stage — growing to large size, more complex and formal structure. • Maturity stage — stabilizes at large size, mechanistic structure. Management, Chapter 11. 22 B.Moghimi@yahoo.co.uk

Figure 11.4 Simultaneous “loose-tight” properties ofteam structures support efficiency and innovation. Management, Chapter 11. 23 B.Moghimi@yahoo.co.uk

Study Question 2: How do contingencyfactors influence organization design? Coping with the disadvantages of large size: – Downsizing. • Reducing the scope of operations and number of employees. – Intrapreneurship. • The pursuit of entrepreneurial behavior by individuals and subunits within large organizations. – Simultaneous structures. • Organizations that combine mechanistic and organic designs. Management, Chapter 11. 24 B.Moghimi@yahoo.co.uk

Study Question 2: How do contingencyfactors influence organization design? Human resources and good organization design — – Provides people with supporting structures needed for both high performance and work satisfaction. – Produces a good “fit” between organization structures and human resources. – Allows the expertise and talents of organization members to be unlocked and utilized. Management, Chapter 11. 25 B.Moghimi@yahoo.co.uk

Study Question 3: What are the major issuesin subsystems design? Basics of subsystem design … – Subsystem — • A department or work unit headed by a manager. • Operates as a smaller part of the larger organization. – Ideally, each subsystem supports other subsystems, working toward interests of entire organization. Management, Chapter 11. 26 B.Moghimi@yahoo.co.uk

Figure 11. 5 Subsystems differentiationamong research and development (R&D),manufacturing, and sales divisions. Management, Chapter 11. 27 B.Moghimi@yahoo.co.uk

Study Question 3: What are the major issuesin subsystems design? Lawrence and Lorsch’s findings on subsystems design … – The total system structures of successful firms match the challenges of their environments. – The subsystems structures of successful firms match the challenges of their respective subenvironments. – Subsystems in successful firms worked well with each other. Management, Chapter 11. 28 B.Moghimi@yahoo.co.uk

Study Question 3: What are the major issuesin subsystems design? Managing subsystem differentiation: – Differentiation is the degree of difference that exists among the internal components of an organization. – Common sources of subsystems differentiation: • Time orientation • Objectives • Interpersonal orientation • Formal structure Management, Chapter 11. 29 B.Moghimi@yahoo.co.uk

Study Question 3: What are the major issuesin subsystems design? Managing subsystem integration: – Integration is the level of coordination achieved among an organization’s internal components. – Organization design paradox — • Increased differentiation creates the need for greater integration. • Integration is more difficult to achieve as differentiation increases. Management, Chapter 11. 30 B.Moghimi@yahoo.co.uk

Study Question 3: What are the major issuesin subsystems design? Mechanisms for achieving subsystem integration: – Rules and procedures – Hierarchical referral – Planning – Direct contact – Liaison role – Task forces – Teams – Matrix organizations Management, Chapter 11. 31 B.Moghimi@yahoo.co.uk

Study Question 4: How can work processes bereengineered? Process reengineering – Systematic and complete analysis of work processes. – Design of new and better work processes. Work process – “A related group of tasks that create a result of value for the customer.” (Michael Hammer) Workflow – Movement of work from one point to another in the manufacturing or service delivery process. Management, Chapter 11. 32 B.Moghimi@yahoo.co.uk

Study Question 4: How can work processes bereengineered? Steps in reengineering core processes: – Identify core processes. – Map core processes in respect to workflows. – Evaluate all tasks for core processes. – Search for ways to eliminate unnecessary tasks or work. – Search for ways to eliminate delays, errors, and misunderstandings. – Search for efficiencies in how work is shared and transferred among people and departments. Management, Chapter 11. 33 B.Moghimi@yahoo.co.uk

How reengineering can streamline coreFigure 11.6business processes. Management, Chapter 11. 34 B.Moghimi@yahoo.co.uk

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Management, Chapter 11. 36B.Moghimi@yahoo.co.uk

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