1 Challenges of Organizational Design Balancing Differentiation / Integration Balancing...
-
Upload
alvin-king -
Category
Documents
-
view
241 -
download
2
Transcript of 1 Challenges of Organizational Design Balancing Differentiation / Integration Balancing...
1
Challenges of Organizational Design
Balancing Differentiation / Integration
Balancing Centralization / Decentralization
Mechanistic versus Organic Structures
2
Differentiation
Design Challenge 1
People in this organization take on new tasks as the need arises and it’s very unclear who is responsible for what and who is supposedto report to whom. This makes it difficult to know whom to call on when the needarises and difficult to coordinate people’s activities so they work together as a team.
3
Differentiation: assigning people and resourcesto tasks
simple organization -> low differentiation
complex organization -> high differentiation
Differentiation
4
The basic building blocks of differentiation areorganizational roles.
An organizational role is a set of task-relatedbehaviors required of a person by his orher position in an organization.
For example: • Maintenance Technician• Design Engineer
Differentiation
5
As the division of labor increases, managersspecialize in some roles and hire people to specialize in others.
Specialization allows people to develop their individual abilities and knowledge withintheir specific role.
The identification of roles leads to authorityand control issues.
Differentiation
6
Authority is the power to hold peopleaccountable for their actions and to makedecisions concerning the use of resources.
Control is the ability to coordinate andmotivate people to work in an organization’sinterests.
Differentiation
7
In most organizations, people with similar roles are grouped into a subunit.
The main subunits that develop in organizations are:
• functions (or departments) • divisions
Differentiation
8
A function is a subunit composed of a group ofpeople who possess similar skills and knowledge to perform their jobs.
marketing dept. maintenance dept.
A division is a subunit that consists of a collection of functions that are related to a particular good or service.
Motorola’s semiconductor division
Differentiation
9
The number of functions and divisions in an organization is a measure of its complexity.
Differentiation increases control and allowsan organization to accomplish tasks effectively.
Differentiation
10
As organizations grow in size, they differentiateinto five different kinds of functions:
1) Support functions facilitate relations with the environment and stakeholders
purchasing salesmarketing legal affairspublic relations
Differentiation
11
As organizations grow in size, they differentiateinto five different kinds of functions:
2) Production functions manage the efficiency of the conversion processes
production operationsproduction controlquality control
Differentiation
12
As organizations grow in size, they differentiateinto five different kinds of functions:
3) Maintenance functions enable an organization to keep its departmentsin operation
personnelengineeringjanitorial services
Differentiation
13
As organizations grow in size, they differentiateinto five different kinds of functions:
4) Adaptive functions allow adjustment to changes in the environment
research and developmentmarket researchlong-range planning
Differentiation
14
As organizations grow in size, they differentiateinto five different kinds of functions:
5) Managerial functions facilitate the control and coordination of activities withinand among departments.
top managementmiddle managerslower-level managers
Differentiation
15
An organization chart is a drawing that shows the end result of organizational differentiation.
The organization chart is a snapshot of the way things are “divided up” along two dimensions:
vertical horizontal
Differentiation
16
Vertical differentiation refers to the way an organization designs its hierarchy ofauthority (i.e., reporting relationships).
Horizontal differentiation refers to the way anorganization groups tasks into roles androles into subunits (i.e., functions and divisions).
Differentiation
17
Design Challenge 2
We can’t get people to communicate and coordinate in this organization. Specifyingtasks and roles is supposed to help coordinate the work process, but here it builds barriers between people and functions.
Integration
18
Integrating Mechanisms
1) Hierarchy of Authority: “who reports to whom”
2) Direct Contact: subunit representatives meet face to face
3) Liaison Role: a specific person coordinates with other subunits
Integration
19
4) Task Force: temporary committee to coordinate cross-functional activities
5) Team: permanent committee
6) Integrating Role: A new role is establishedto coordinate the activities of two or morefunctions or divisions
7) Integrating Department: A new departmentis created to coordinate the activities of functions or divisions
Integration
20
Balance differentiation and integration.
21
Decision Making
Centralized•High managerial control•Low employee empowerment
Decentralized •Low managerial control•High employee empowerment•Crucial in fast-changing environments
22
Types of Structures
Two general categories of structure types:
organic and mechanistic
23
Mechanistic Structures
Designed to induce people to behave in predictable ways.
Decision making is centralizedSubordinates are closely supervisedInformation flows downward in the hierarchyTasks are clearly definedIntegrating mechanisms are simpleWork is very standardized
24
Organic Structures
Promote flexibility, so people initiate change and can adapt quickly
Decision making is decentralizedRoles are loosely definedIntegrating mechanisms are complexTasks rely on mutual adjustmentInformation flows freely
25
Design GoalDesign Goal
Anticipate environmental, social, and Anticipate environmental, social, and procedural constraints and procedural constraints and opportunitiesopportunities
Satisfy interests of primary Satisfy interests of primary stakeholdersstakeholders