1 The Structural View of Things. 2 Organization Structure How work is formally divided, grouped and...
-
date post
18-Dec-2015 -
Category
Documents
-
view
214 -
download
1
Transcript of 1 The Structural View of Things. 2 Organization Structure How work is formally divided, grouped and...
1
The Structural View of Things
2
Organization Structure
How work is formally divided, grouped and then-hopefully-coordinated
3
Reliability
Clarity
Speed
Efficiency
The Metaphor: The Organization as an Efficient Machine
Effectiveness
4
The Fundamental Assumptions•1. Organizations exist to achieve established goals and objectives.•2. Organizations work best when rationality prevails over personal preferences and external pressures.•3. Structures must be designed to fit an organization’s circumstances (including its goals, technology and environment).•4. Organizations increase efficiency and enhance performance through specialization and division of labor.•5. Appropriate forms of coordination and control are essential to ensuring that individuals and units work together in the service of organizational goals.•6. Problems and performance gaps arise from structural deficiencies and can be remedied through restructuring.
5
The Structural View• Metaphor: complex
machine• Leader: analyst, architect• Strategy: do your
homework, analyze, design, weigh, measure, be rational, manage
• Focus: data, logic, structure, plans, policies,(the stuff that makes up most of the MBA degree )
6
Key elements in org.structure
• Work specialization: how much should one person know?
• Departmentalization: how to put people together with similar tasks
• Chain of command: line of authority• Span of control: how many to manage• Centralization and decentralization: tall or flat• Formalization: how many rules, formal policies
7
The Organization ChartThe Organization Chart
Organization Chart Organization Chart is a box-and-lines illustration showing the formal lines of authority and the organization’s official positions or division of labor
8
There are many ways, different options, and various rationale for
dividing up the work…all with different consequences
9
Simple Structure
T he or ganiz at ion is composed of a t op manager (owner ) and ar elat ively small number of or ganiz at ional member s (t echnical
wor ker s, suppor t per sonnel).
O rg an iza tion a l M em b er O rg an iza tion a l M em b er O rg an iza tion a l M em b er
O w n er - M an ag er
10
TOWER BUILDING: AN EXERCISE IN LEADING,CENTRALIZING- DECENTRALIZING AUTHORITY, AND SPAN OF CONTROL
11
Chain of command: to establish authority
• To whom individuals and groups report?• Chain of command is an unbroken line
of authority than extends from the top to the lowest level of organization
• Don’t confuse authority with influence• There are many other patterns of
influence
Such as>>> you tell me.
12
Span of Control
How many individuals can a manager direct?
The following factors are often considered:
• Required Contact
• Degree of Specialization
• Ability to Communicate
13
Spans of Control: Narrow versus WideSpans of Control: Narrow versus Wide
FF
CEOCEO
NarrowNarrow
Key:Key:T = Top managerM = Middle managerF = First-line (supervisory) manager
TT
MM MMMM
FF FF FF FF
FF FF FF FF
FF
TT
MM
FF
FF FF
MM
FF
FF
FF
TT
MM MMMM
FF FF FF
FF FF FF FF
FF
MM
FF
FF FF
WideWide CEOCEO
MM
FF FF
FF
MM
FF
FF FF
MM
FF FF
FF
MM
FF FF
FF
MM
FF
FF FF
MM
FF FF
FF
MM
FF
FF FF
MM
FF FF
FF
MM
FF
FF FF
14
Centralized Vs. Centralized Vs. Decentralized OrganizationsDecentralized Organizations
Centralized Authority Centralized Authority important decisions are made by higher-level managers
Decentralized Authority Decentralized Authority important decisions are made by middle-level and supervisory-level managers
15
TOWER BUILDING: AN EXERCISE IN LEADING, STRUCTURE, AND SPAN OF CONTROL
• Task: Build a tower of sugar cubes as high as you think you can with your non-dominant hand, in five minutes, e.g. if you are right handed use your left hand or vice-versa. Your group score is based upon the number of cubes standing at the end of each round for the two builders. Then add up the three rounds. No practicing before the exercise begins.
• Form groups of three for three rounds of tower building.• Change leaders for each round.• The other two, who are the builders, blindfold themselves.• If you are done or your tower falls before the end of five minutes,
remain silent until the end of the five minutes.• Begin building your tower as instructed by your group leader when
the instructor says to begin.• If the tower falls, the score is zero. Score the number of cubes that
remain standing at the end of each five minutes. Each group keeps track of total score per round, then sums all three rounds.
• Between rounds two and three there are three minutes to talk tactics and/or time to practice. Time for training and integration.
16
• 1. How did the tactics of the leader change from round to round? What helped? What hindered?
• 2. Was more help given than asked for? Did this change?
• 3. Were the structures flat or tall? Rank each of the three structures 1 to 10
• 1Tall: almost all action directed by the leader. • 10 Flat: builders work with little direction• 4. Return to your regular groups Discuss: What do
you think would be the maximum span of control with what kind of structure, flat or tall, to maximize the score? Max number of workers is five. Try a round with the structure you think works best. We'll see which group wins.
•
17
Then There is Functional Structure?
So What Is it?
18
Functional Organization: One of the Most Common Ways to Structure
F unct ional st r uct ur es gr oup or ganizat ional member s based on t hef ocus of t heir wor k act ivit y.
M anufacturing M arketing H um an R esources A ccounting and F inance
C hief E xecutiv e
19
Other options for dividing the work (continued):
20
Organization Chart for a Hospital: A Basic Example of a Function Organization Chart for a Hospital: A Basic Example of a Function Structure Designed to Assure Tension and ConflictStructure Designed to Assure Tension and Conflict
Director of
Personnel
Director of
Admissions
Director of Nutrition &
Food Services
Director of X-Ray &
Laboratory Services
Chief Physician
Director of
Pharmacy
Director of Patient &
Public Relations
Director of Accounting
Director of Surgery
Director of Outpatient Services
Board of Board of DirectorsDirectors
Strategic Strategic Planning AdvisorPlanning Advisor
Chief Executive Chief Executive OfficerOfficer
Legal CounselLegal Counsel
PresidentPresidentCost Containment Cost Containment
StaffStaff
Executive Administrative
Director
Executive Medical Director
21
How Might You Lessen the Conflict
In Groups Discuss
What Might You Do? For example, is there a structural change that might help?
22
Baldrige performance excellence criteria are a framework that any organization can use to
improve overall performance. Seven areas of examination
Baldrige National Quality Program
• Leadership—Examines how senior executives guide the organization and how the organization addresses its responsibilities to the public and practices good citizenship.
• Strategic planning—Examines how the organization sets strategic directions and how it determines key action plans.
• Customer and market focus—Examines how the organization determines requirements and expectations of customers and markets; builds relationships with customers; and acquires, satisfies, and retains customers.
• Measurement, analysis, and knowledge management—Examines the management, effective use, analysis, and improvement of data and information to support key organization processes and the organization’s performance management system.
• Human resource focus—Examines how the organization enables its workforce to develop its full potential and how the workforce is aligned with the organization’s objectives.
• Process management—Examines aspects of how key production/delivery and support processes are designed, managed, and improved.
• Business results—Examines the organization’s performance and improvement in its key business areas: customer satisfaction, financial and marketplace performance, human resources, supplier and partner performance, operational performance, and governance and social responsibility. The category also examines how the organization performs relative to competitors.
23
2003 Saint Luke’s Hospital of Kansas City
National Baldridge Award Winner
http://www.nist.gov/public_affairs/baldrige2003/St.Lukes_3.3.04.pdf
24
IN GROUPS:
25
• Meet with your group• Among those presently working, someone share with others an answer to
the question, on what basis is work divided up at your organization?• With what consequences? Where do things break down?
26
McDonaldization
Deskilled Jobs
Tightly ControlledAct as Robots
Ruthless Efficiency
Mass Production
Speed
Division of Labor
Success
27
Basic Factors to Consider
Grouped By:
*Knowledge or Skill
*Customers or Clients
*Time
*Process
*Place or Geography
28
Basic Structural Tensions
How to divide up the work: differentiation
How to coordinatedifferent roles and units afterresponsibilities have been parceled out: integration
Division of Labor and Coordination ofEffort
29
Vertical Coordination
Authority
Rules and Policies
Planning and Control Systems
30
Strengths of Vertically Integrated Structure
*Efficiencies derive from straightforward processes
*Works well with a stable environment.
*Precision is a premium measured against clear standards
*Maximize responses to predictable markets
31
Weaknesses
*Slow to change.
*Difficulty dealing with idiosyncratic problems.
*Stovepipes create subcultures.
*Possible dehumanizing effect on employees.
*Apathy, carelessness and lack of pride.
*Caps on human capacities.
32
So….
• How do we do to integrate?
33
Ad Hoc Teams Meetings/Committees Task Forces/Teams Matrix Structures NetworksCoordinating Roles
In General We Flatten
34
But………
Lateral Coordination
is usually where things usually bog down
35
First Semester
LeadershipResidency
Module ITools
CompetitiveAnalysis
Managerial AccountingEconomicsFinancial ManagementQuantitative Decision SkillsExecutive Leadership
Bloch School - EMBA
36
Module IIManagingPeople &Systems
Wash D.C.Residency
Operations ManagementHuman ResourcesManagement Info. SystemsOrganizational & Group Behavior
LeadershipResidency
Module ITools
CompetitiveAnalysis
Managerial AccountingEconomicsFinancial ManagementQuantitative Decision SkillsExecutive Leadership
Bloch School - EMBA
First Semester
Second Semester
37
First Semester
StrategicAssessment
Project
Module IIIThe
EnterpriseandIts
Environment
EntrepreneurshipExecutive LeadershipInternational BusinessStrategic MarketingStrategic Management
Bloch School - EMBA
Third Semester
38
First Semester Second Semester
Module IVStrategic
Leadership
International BusinessLeadership of Strategic ChangeStrategic Management of TechnologyOrganizational Behavior
InternationalResidency
StrategicAssessment
Project
Module IIIThe
EnterpriseandIts
Environment
EntrepreneurshipExecutive LeadershipInternational BusinessStrategic MarketingStrategic Management
Bloch School - EMBA
Third Semester
Fourth Semester
39
Contingency Design Contingency Design
Contingency Contingency DesignDesign the process of fitting the
organization to the environment
40
Discuss
• What are the major factors to consider in the environment?
41
The Organizational Environment
Organization
Specific Forces
Demographic / Cultural Forces
General Forces
Work Force Issues
Economic Forces
Technological Forces
International Forces
Political Forces
Customers
Government
Suppliers Unions
Distributors
Competitors
42
Sources of Environmental Uncertainty:complexity, dynamism, and richness
As the environment becomes morecomplex, less stable, and poorer, the level of uncertainty increases.
43
. Contingency theory states that in order to
manage its environment effectively, an
organization should design its structure
to fit with its environment.
A poor fit between structure and environment
leads to failure, a close fit leads to success
44
The Relationship Between Environmental Uncertainty and Organizational Structure
Centralized hierarchy of authorityCentralized hierarchy of authority Decentralized hierarchy of authorityDecentralized hierarchy of authority
Many rules and proceduresMany rules and procedures Few rules and proceduresFew rules and procedures
Specialized tasksSpecialized tasks Shared tasksShared tasks
Formalized communicationFormalized communication Informal communicationInformal communication
Few teams or task forcesFew teams or task forces Many teams or task forcesMany teams or task forces
Narrow span of control, taller structureNarrow span of control, taller structure Wider span of control, flatter structureWider span of control, flatter structure
Organic Organic organizationsorganizations
Mechanistic Mechanistic organizationsorganizations
Environmental UncertaintyStable In flux (variable)
45
Types of Organizational Types of Organizational StructuresStructures
1.1. Simple StructureSimple Structure2.2. Functional StructureFunctional Structure3.3. Divisional StructureDivisional Structure4.4. Conglomerate StructureConglomerate Structure5.5. Hybrid StructureHybrid Structure6.6. Matrix StructureMatrix Structure7.7. Team-Based StructureTeam-Based Structure8.8. Virtual Network StructuresVirtual Network Structures
46
Hybrid StructuresHybrid Structures
Vice-President, Production
Vice-President, Marketing
Vice-President,
Finance
Vice-President,
Human Resources
Functional Functional divisional divisional structurestructure
PresidentPresident
President President CadillacCadillac
PresidentPresidentBuickBuick
PresidentPresidentPontiacPontiac
PresidentPresidentChevroletChevrolet
Product Product Divisional Divisional StructureStructure
ManagerManagerRegion IRegion I
ManagerManagerRegion IIRegion II
ManagerManagerRegion IIIRegion III
ManagerManagerRegion IVRegion IV
Geographical Geographical divisional structuredivisional structure
A Hypothetical example of what GM might useA Hypothetical example of what GM might use
47
Matrix Structure: The Customer as a Member of the CompanyMatrix Structure: The Customer as a Member of the Company
PresidentPresident
Vice Vice President, President,
EngineeringEngineering
Vice Vice President,President,FinanceFinance
Vice Vice President, President, ProductionProduction
ViceVicePresident.President.
SalesSales
Project Manager
and Customer
Project Manager,
and Customer
Project Manager,
and Customer
Project Manager,
and Customer
Functional Functional StructureStructure
Subordinate reports to both Vice President of Sales & to ProjectManager
Project Project structurestructure
At a Kansas City Manufacturing Co.At a Kansas City Manufacturing Co.
48
Advantages of Matrix Organization
• Efficient use or resources• Flexibility in conditions of change and
uncertainty• Technical excellence• Freeing top management for long-run planning• Improving motivation and commitment• Providing opportunities for personal
development
49
Team-Based StructuresTeam-Based StructuresPresidentPresident
ViceVicePresident, President, Research &Research &
DevelopmentDevelopment
ViceVicePresident, President,
DesignDesign
ViceVicePresident, President,
EngineeringEngineering
ViceVicePresident, President, MarketingMarketing
Product TeamProduct TeamManager,Manager,
ManufacturingManufacturingLight TrucksLight Trucks
Product TeamProduct TeamManager,Manager,
ManufacturingManufacturingSedansSedans
Product TeamProduct TeamManager,Manager,
ManufacturingManufacturingSport CarsSport Cars
Project team members
Functional structure
Project teams
50
Network StructureNetwork Structure
Core of Core of personal personal computer computer companycompany
USAUSA
Design Design StudioStudio
SwedenSweden
Engineering Engineering CompanyCompany
JapanJapan
Components Components AssemblyAssembly
Mexico, AsiaMexico, Asia
DistributionDistributionCompanyCompany
CanadaCanadaAccountingAccounting& Finance& Finance
USAUSA
51
Summary of Structural Frame
*Looks beyond individuals and operates at organizational level of analysis.
*When structure is overlooked, energy and resources are often misdirected.
*Right structure is a contingency; its character depends on goals, strategies, technology and environment of organization.
*Structures can work for, rather than against both people and the purpose of organizations.
52
• While a poor structure makes a high performance impossible, the best structure in the world will not ensure good performance
Peter Drucker
53
The Structural Frame
• Structure Iis the fundamental and relatively unchanging features of an organization which are officially sanctioned by those who control it and consist of the way activities and component parts are grouped , controlled and coordinated in order to achieve specific aims and outcomes
• taken alone, structure rarely tells the full story about why folks behave the way they do