Dwo - Project Report Final

7/29/2019 Dwo - Project Report Final

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Effect of Organizational Design on Job Satisfaction with

Specific Reference to Organic and Mechanistic Designs

Submitted to Prof. Yamini Prakash Submitted by Group No. 10, Section C

Group Members:

Sunitha R (Team Coordinator) FPM13011

Naveena Raja PGP28114

Swamy Mahesh PGP28119

Prakash Prabu M PGP28120

Ulaganathan N PGP28124

Preethi Viswanathan PGP28137

Mukul Gupta FPM13008


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Table of Contents1. Introduction ........................................................................................................................................ 3

1.1 Job Satisfaction ............................................................................................................................. 3

1.2 Organic and Mechanistic designs.................................................................................................. 3

2. Review of Literature ............................................................................................................................ 4

3. Research Methodology ....................................................................................................................... 7

3.1 Research Objective ....................................................................................................................... 7

3.2 Propositions .................................................................................................................................. 7

3.3 Research Design ............................................................................................................................ 7

3.4 Sampling Plan ................................................................................................................................ 8

3.5 Target Population.......................................................................................................................... 8

3.6 Sampling Technique ...................................................................................................................... 8

3.7 Sample size and Design ................................................................................................................. 8

4. Data Analysis ....................................................................................................................................... 9

5. SAMPLE PROFILE ............................................................................................................................... 10

6. DATA ANALYSIS ................................................................................................................................. 12

6.1 Satisfaction pertaining to Working hours ................................................................................... 13

6.2 Satisfaction pertaining to Relationship with co-workers/Superiors ........................................... 13

6.3 Satisfaction pertaining to Opportunity to utilize your skills and talents .................................... 13

6.4 Satisfaction pertaining to Salary ................................................................................................. 14

6.5 Satisfaction pertaining to Growth/Opportunities for promotion ............................................... 14

6.6 Satisfaction pertaining to variety of Job responsibilities ............................................................ 15

6.7 Satisfaction pertaining to Recognition and rewards ................................................................... 15

6.8 Satisfaction pertaining to Participation in decision making ....................................................... 15

6.9 Satisfaction pertaining to Motivation from superiors ................................................................ 16

7. Recommendations ............................................................................................................................ 16

8. Conclusion ......................................................................................................................................... 17

REFERENCES .......................................................................................................................................... 18

APPENDIX .............................................................................................................................................. 19


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1. Introduction

Organizational Design is a process that enhances the probability of success of the

organization. More specifically, Organization Design is a formal, guided process for

integrating the people, information and technology of an organization. It is used to matchthe form of the organization as closely as possible to the purpose(s) the organization seeks to

achieve. Through the design process, organizations act to improve the probability that the

collective efforts of members will be successful. Organizations can be categorized along a

continuum ranging from a mechanistic design to an organic design. Employee Job

satisfaction depends on number of factors pertaining to work itself, relations of the employees

with their subordinates and superiors, goal personality compatibility etc. Apart from these,

organizational design also influences the level of job satisfaction an employee derives. In the

light of this observation, this study tries to understand the effect of organic and mechanistic

designs of the organization structures on employee job satisfaction.

1.1 Job Satisfaction

Job satisfaction is in regard of ones feeling or state of mind regardi ng the nature of their

work. Job satisfaction describes a positive feeling about a job, resulting from an evaluation of

its characteristics. A person with a high level of job satisfaction holds positive feelings about

his or her job, while a person with a low level holds negative feelings. Job satisfaction can be

influenced by a variety of factors, e.g., the quality of one's relationship with their supervisor,

the quality of the physical environment in which they work, degree of fulfillment in their

work, etc.

1.2 Organic and Mechanistic designs

In general, a mechanistic design means that the organization is characterized by machine-like

standard rules, procedures, and a clear hierarchy of authority. These organizations are highly

formalized and are also centralized, with most decisions made at the top. An organic design

means that the organizations is much looser, free flowing, and adaptive. Rules and

regulations often are not written down or, if written down, are flexibly applied. People may

have to find their own way through the system to figure out what to do. The hierarchy of

authority is looser and not clear-cut. Decision-making authority is decentralized.


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Various contingency factors will influence whether an organization is more effective with a

primarily mechanistic or a primarily organic design. The differences in organic and

mechanistic designs are explained by the variables given as under;

Centralization versus decentralized structure: centralization means that decision authority is

located near the top of the organizational hierarchy. In decentralization, decision making

authority is pushed down to lower organizational levels.

Specialized tasks versus empowered roles: in a mechanistic design, tasks are broken down

into specialized, separate parts, as in a machine, with each employee performing activities

according to a specific job description. In an organic design, employee play a role in the team

or department and roles may be continually redefined or adjusted.

Formal versus informal systems: with mechanistic design, there are numerous rules,

regulations and standards procedure. With an organic design, on the other hand, there are few

rules or formal control systems.

Vertical versus horizontal communication: Mechanistic organization emphasizes vertical

communication up and down the hierarchy. In an organic design, there is a greater emphasis

on horizontal communication, with information flowing in all directions within and across

departments and hierarchical levels.

Hierarchy of authority versus Collaborative Team work: In organizations with a mechanistic

design, there is a close adherence to vertical hierarchy and the formal chain of command. An

organic design on the other hand, emphasizes collaborative team work rather than hierarchy.

2. Review of Literature

Alexander Nikolenko1, Brian H. Kleiner, (1996) said, Organizations are subject to a variety

of constantly changing internal and external influences, such as organizational strategy and

environmental conditions in his work titled "Global trends in organizational design". Of

these, of particular importance are the development of the global marketplace and increasing

global competition, and the emergence of a knowledge-based economy that is characterized

by a high level of development of communications and information technologies. In response

to these factors, new forms of organization structure have emerged: the horizontalorganization, the network organization and the virtual corporation. Asks whether such


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structures are adequate to meet the constant change of the world into which we are moving,

and whether they can meet the needs of organizations in varying situations in different

economies in disparate countries and with different cultures.

Rachid Zeffane2, (1992) in his "Organizational Structures: Design in the Nineties", Reviews

and discusses some major issues and controversies of the early 1990s. Focuses on issues

pertaining to organizational restructuring and design in the face of emerging contemporary

forces and examines corporate responses to those forces. Examines, in particular, the problem

of choice of appropriate structures and the controversies and implications relating to

downsizing in the light of dominant suggestions and various research findings from different

platforms of management thinking. This concludes with suggestions for organizational

success in these areas.

Michael W. Stebbins3, Abraham B. Shani, (1995) supposed in his study titled

"Organization design and the knowledge worker", that the field of organization design is

changing rapidly, reflecting contributions from managers and diverse organizational

consultants. One of the most recent developments is in the design of non-routine systems.

Explores non-routine systems design from a socio-technical systems (STS) perspective.

Includes a brief discussion of non-routine systems and an examination of alternative methods

for diagnosing and redesigning organizations composed of knowledge workers. The results of

two STS case studies provide new learnings and point to special design principles for non-

routine systems. This concludes with implications for both managers and STS consultants

interested in management of knowledge workers.

Richard A. Yoder4, Scott L. Eby, using Swaziland's Ministry of Health as a case study

assessed the extent to which the empirical data supports anecdotal information and trends

towards decentralized and participatory management systems. Specifically, this study

measures the level of participation in decision making and assesses its impact on job

satisfaction, measures the level of and analyses differences in job satisfaction by job

classification, and identifies and analyses the determinants of employee job satisfaction. Data

were obtained from a survey questionnaire which was constructed and administered to 447

employees of the Ministry of Health, a 42 per cent sample, at fifteen representative locations

throughout the country. Simple descriptive statistics and multivariate techniques are used to

analyze the data. From the analysis, policy implications are developed for designing


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administrative structures and systems that respond to emerging quality of work life needs,

strengthening productivity, and improving the quality of services provided.

Acorn5

S, et al tested a theoretical model of the following variables, decentralization,

professional autonomy, job satisfaction, and organizational commitment. Data were collected

through a comprehensive survey of first-line nurse managers (N = 200) in acute care hospitals

with more than 100 beds in British Columbia, Canada. The final model excluded all explored

personal characteristics of the nurse manager-gender, health or vitality status, marital status,

age, education, and years of supervisory or management experience. Job satisfaction was

found to be an important predictor of organizational commitment. However, decentralization

was most important because it affected organizational commitment directly, as well as

indirectly, through professional autonomy and job satisfaction.

Daulatram B. Lund6, (2003) found in his paper titled, "Organizational culture and job

satisfaction", this empirical investigation examines the impact of organizational culture types

on job satisfaction in a survey of marketing professionals in a cross-section of firms in the

USA. Cameron and Freemans (1991) model of organizational cultures comprising of clan,

adhocracy, hierarchy, and market was utilized as the conceptual framework for analysis. The

results indicate that job satisfaction levels varied across corporate cultural typology. Within

the study conceptual framework, job satisfaction invoked an alignment of cultures on the

vertical axis that represents a continuum of organic processes (with an emphasis on flexibility

and spontaneity) to mechanistic processes (which emphasize control, stability, and order). Job

satisfaction was positively related to clan and adhocracy cultures, and negatively related to

market and hierarchy cultures.

Mary S. Thibodeaux7, Sandy K. Faden, (1994) in their study "Organizational Design for

Self-managed Teams", explores the organizational components deemed necessary to the

development of heterogeneous self-managed work teams. Explains the interrelationship

between organizational structure and strategies. Describes the organic structure, with

emphasis on formalization, socialization, training and empowerment/ decentralization, as the

cornerstone of the development of these teams. This outlines strategies for effective use of

communication, shared values and trust.


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3. Research Methodology

3.1 Research Objective

This study has one major research objective. It is to determine the effect of organizational

design elements on Job satisfaction of the employees. There are few secondary objectives like

studying different structural design elements, and its varying effect on different aspects of

employee job satisfaction. Based on these objectives following research question is formed:

Q1. What is the influence of Mechanistic structure of the organization and Organic structure

of the organization on the employee Job satisfaction?

3.2 Propositions

The following propositions were proposed for understanding the relationship between

organizational design and level of employee job satisfaction.

1. Mechanistic organizational design results in lesser employee Job satisfaction.2. Organic organizational structure results in higher employee job satisfaction.

3.3 Research Design

In order to determine the perspective of employees in different organizations the Descriptive

Research method of Conclusive Research Design is followed in human resource studies. In

this study, we tried to understand the employees level of satisfaction with respect to the

organizational structure they belong to. This study is more of exploratory and combined with

descriptive research. Since the objective of Descriptive research is to describe the

characteristics on the basis of the prior formulation of specific assumptions, it is very much

relevant for this study. At the same time exploratory research was useful in understanding the

research problem clearly. For this we used extensive secondary data research, expert opinion

and conducted telephonic conversations with the sample respondents. In the descriptive

research, the primary emphasis is on data collection through a survey and Interview method

of data collection. It includes selecting the right kind of respondents, designing an appropriate

questionnaire, administering questionnaire, conducting interviews, collecting the data

preparing it, and finally concluding with the findings of the research tools. In order to


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perform the descriptive research, in this study, single cross-sectional design is followed. In

this methodology of descriptive research one sample of respondents is drawn from the target

population and information is obtained from this sample once. Thereafter the assumptions

would be analyzed using the appropriate research tools.

3.4 Sampling Plan

Sampling is the act, process, or technique of selecting a suitable sample, or a representative

part of a population for the purpose of determining parameters or characteristics of the whole

population. Sampling is one of the components of a research design. It is the only feasible

way to collect research data in this organizational structure and behavior problem.

3.5 Target Population

The target population is people who are working in organizations having organizational

structures appropriate to this study. People who are working at different hierarchy level and

playing different roles in the organization from different organizational designs are in the

target population.

3.6 Sampling Technique

The study is a single cross sectional study because the data were collected at a single point of

time. For the purpose of present study, a related sample of population was selected on the

basis of convenience.

Reasons for using Convenience Sampling Technique:

Convenience sampling is least expensive. Convenience sampling is least time consuming. In convenience sampling the sampling units are accessible easily. In this kind of sampling the sampling units are easy to measure and cooperative.3.7 Sample size and Design

Sample size- A sample 54 employees have responded for the questionnaire. Thereafter respondents were contacted again telephonically and through emails to understand the

design elements of their organization. The actual employees were contacted on the basis of

convenience sampling.


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Data collection mode- Online questionnaire and Telephonic Interview. Research period- Research work is carried out for a period of 10 -12 days. Research Instrument- The research work is carried out through self-administeredquestionnaires and Structured Telephonic Interview.

4. Data Analysis

As the study is more of exploratory than descriptive qualitative Data analysis techniques were

employed to analyzed the data, rather than using quantitative techniques. Analysis tools used

for the study are, Single frequency tabulations, Joint Frequency Tabulations, Custom Tables

using SPSS and Pie charts.

Initially Data was collected by administering structured online questionnaire composed of

Job satisfaction questionnaire sourced from www.salisbury.edu/careerservices to support

the findings and strengthen the study respondents were contacted again using telephonic

method and Emails and were asked to describe whether their organization is Mechanistic

or Organic after making the respondents understand the difference. Then the responses were

recorded using dichotomous questions.

Composition of Employees: In telephonic interview the respondents were asked following

questions.

1. Whether their organization is Centralized or Decentralized?2. Whether they have specialized Tasks or Empowered roles?3. Whether their systems are Formal or Informal?4. Whether they have vertical or horizontal communication in place?5. Whether they have hierarchy of authority or Collaborative team work?Based on the responses to these questions the respondents were categorized into mechanistic

organization design structure organizations and organic organization design structure

organizations. From the respondents studied 43 % of the respondents are categorized into

mechanistic structure organizations and rest 57 % of the respondents were categorized into

organic design organizations.


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5. SAMPLE PROFILE

The data has been collected from a sample of 54 people covering organizations such as CTS,

TCS, Infosys, L&T and BHEL. The major percentage of the sample is from IT systems

profile constituting 35% of the sampled data. These 54 samples are spread across various

levels of management from Entry level management to senior level management. While a

majority of 35% belongs to entry level management there is a considerable response from

senior management of about 9%.


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The table no 1: The data collected from the respondents on the various parameters

relating to job satisfaction. (Data in percentages)

1 ( Very

Dissatisfied)

2

(Dissatisfied)

3

(Neutral)

4

(Satisfied)

5

(Very

Satisfied)

Working Hours 9.3 13.0 24.1 22.2 31.5

Relationship with co-

workers/Superiors

1.9 11.1 13.0 44.4 29.6

Opportunity to utilize your

skills and talents

18.5 20.4 22.2 29.6 9.3

Salary 13.0 22.2 31.5 20.4 13.0

Growth/Opportunities from

promotion

7.4 42.6 25.9 18.5 5.6

Variety of Job

responsibilities

7.4 29.6 13.0 37.0 13.0

Recognition and Rewards 9.3 27.8 29.6 25.9 7.4

Participation in decision

making

7.4 25.9 25.9 35.2 5.6

Motivation from Superiors 7.4 22.2 22.2 38.9 9.3

The various parameters on which the data was collected were working hours, relationship

with co-workers and superiors, independence given to utilize their talents, satisfaction with

respect to salary, career growth, diversity in the work, rewards and recognition, participatory

decision making and motivation from the superiors. Most of the responses were skewed

towards the neutral point in all aspects. One of the striking inference from the data collected

was that majority of the people (about 35%) are very satisfied with the working hours. Also

the data shows that there is a considerable percentage of people (about 18.5%) think that they

were not given opportunities to use their skills and talents.


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6. DATA ANALYSIS

Table no 2: Frequency tabulation showing the relationship between Job satisfaction &

Organizational Design

Type of Organization structure

Mechanistic structure Organic structure

HD D N S HS HD D N S HS

Working Hours 13 13 13 17 43 6 13 32 26 23

Relationship with co-

workers/Superiors

4 17 4 35 39 0 6 19 52 23

Opportunity to utilize

your skills and talents26 17 22 30 4 13 23 23 29 13

Salary 13 17 26 26 17 13 26 35 16 10

Growth/Opportunities

from promotion9 43 26 17 4 6 42 26 19 6

Variety of Job

responsibilities

13 35 4 30 17 3 26 19 42 10

Rewards and

Recognition13 30 26 26 4 6 26 32 26 10

Participation in

decision making9 30 17 39 4 6 23 32 32 6

Motivation from

Superiors13 22 22 30 13 3 23 23 45 6

HDHighly dissatisfied

DDissatisfied

NNeutral

SSatisfied

HSHighly Satisfied


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Findings: In this table we tabulated the relationship between different variables pertaining to

job satisfaction on the kind of organization design where the employee is working. As part of

Job satisfaction, different elements were measured on a scale starting from highly dissatisfied

with 1 point to highly satisfied with 5 points. Coming to the findings;

6.1 Satisfaction pertaining to Working hours

60% of the employees from Mechanistic structure and 49% of the employees from organic

structures are satisfied with their working hours. 13% from the Mechanistic organizations and

32 % from the organic organizations are neutral about their working hours, where as 26% of

the employees from the mechanistic design structures and 19% of the employees from the

Organic structures are dissatisfied with their working hours.

Inference: Employees are satisfied with working hours of Mechanistic designs than with the

Organic structures as they work for fixed working hours in Mechanistic structures unlike

Organic structures.

6.2 Satisfaction pertaining to Relationship with co-workers/Superiors


structures are satisfied with their Relationship with co-workers/Superiors. 4% from the

Mechanistic organizations and 19 % from the organic organizations are neutral about their

Relationship with co-workers/Superiors, where as 22% of the employees from the

mechanistic design structures and 6% of the employees from the Organic structures are

dissatisfied with their Relationship with co-workers/Superiors.

Inference: satisfaction level of the employees pertaining to relationship with co workers and

superiors is similar for mechanistic structures and organic structures but dissatisfaction levels

are higher in mechanistic structures.

6.3 Satisfaction pertaining to Opportunity to utilize your skills and talents


structures are satisfied with their Opportunity to utilize your skills and talents. 22% from the


Opportunity to utilize your skills and talents, where as 43% of the employees from the


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mechanistic design structures and 35% of the employees from the Organic structures are

dissatisfied with their Opportunity to utilize your skills and talents.

Inference: satisfaction level of employees pertaining to utilize skills and talents is lesser in

mechanistic organization as they have little scope for creativity in their specialized tasks.

With reference to this aspect very good percentage of respondents from organic designs are

satisfied comparatively.

6.4 Satisfaction pertaining to Salary


structures are satisfied with their salary. 26% from the Mechanistic organizations and 35 %

from the organic organizations are neutral about their salary, where as 30% of the employees

from the mechanistic design structures and 39% of the employees from the Organic structures

are dissatisfied with their salary.

Inference: coming to satisfaction pertaining to salary mechanistic structure employee are

more sissified and less dissatisfied compared to organic structure designs. Here the jobs are

evolving and employees take more responsibility, hence they expect better salary than

mechanistic structures.

6.5 Satisfaction pertaining to Growth/Opportunities for promotion


structures are satisfied with their Growth/Opportunities for promotion. 26% from the


Growth/Opportunities for promotion, where as 52% of the employees from the mechanistic

design structures and 48% of the employees from the Organic structures are dissatisfied with

their Growth/Opportunities for promotion.

Inference: satisfaction levels in organic structures are higher and dissatisfaction levels are

lower compared to mechanistic structures in case of growth/opportunities for promotions.

Though organic structures have lesser levels they do go for job enlargement and helps

employee growing along the organization, this results in higher satisfaction compared to

mechanistic structures where growth opportunities are lesser.


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6.6 Satisfaction pertaining to variety of Job responsibilities


structures are satisfied with their variety of Job responsibilities. 4% from the Mechanistic

organizations and 19 % from the organic organizations are neutral about their variety of Job

responsibilities, where as 48% of the employees from the mechanistic design structures and

29% of the employees from the Organic structures are dissatisfied with their variety of Job

responsibilities.

Inference: though satisfaction levels are similar and higher in both the structures with respect

to variety of job responsibilities, dissatisfaction levels are varying. Almost half of the

mechanistic structure respondents are dissatisfied with respect to variety of job

responsibilities, where as organic structures have a much lower dissatisfaction on this factor.

6.7 Satisfaction pertaining to Recognition and rewards


structures are satisfied with their Recognition and rewards. 26% from the Mechanistic

organizations and 32 % from the organic organizations are neutral about their Recognition

and rewards, where as 43% of the employees from the mechanistic design structures and 32%

of the employees from the Organic structures are dissatisfied with their Recognition and

rewards.

Inference: though satisfaction levels are similar in both the structures with respect to

recognition and rewards, dissatisfaction levels are varying. Almost half of the mechanistic

structure respondents are dissatisfied with respect to recognition and rewards, where as

organic structures have a lower dissatisfaction on this factor compared to mechanistic

structures. .

6.8 Satisfaction pertaining to Participation in decision making


structures are satisfied with their Participation in decision making. 17% from the Mechanistic

organizations and 32 % from the organic organizations are neutral about their Participation in

decision making, where as 39% of the employees from the mechanistic design structures and

29% of the employees from the Organic structures are dissatisfied with their Participation in

decision making.


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Inference: satisfaction levels in organic structures are higher and dissatisfaction levels are

lower compared to mechanistic structures in case of Participation in decision making. As is

evident from the results organic structures support Participation in decision making where as

mechanistic structures follows centralized decision making system.

6.9 Satisfaction pertaining to Motivation from superiors


structures are satisfied with their Motivation from superiors. 22% from the Mechanistic

organizations and 23 % from the organic organizations are neutral about their Motivation

from superiors, where as 35% of the employees from the mechanistic design structures and

26% of the employees from the Organic structures are dissatisfied with their Motivation from

superiors.

Inference: in general both the categories of employees are satisfied with the motivation they

receive from the super visors, with a positive bent from organic structures. The same way

higher level of dissatisfaction is recorded in mechanistic structures than in organic structures

on this element.

7. Recommendations

With mechanistic design structure, albeit there are numerous rules and regulations, the

standard working conditions influence the workers more than organic structure. Particularly,

standard working hour is one of the factors which satisfy the workers more. Based on

Inference 2, the relationship between co-workers in mechanistic and organic structures is of

no big different. However, it is good to have a situation where everybody in the organization

is easily approachable any time.

In the aspects of utilizing the skills of workers, mechanistic design needs to improve its ways

to utilize the skills of workers which serve better for improvement of the firm. In the purview

of salary packages, organic structure organizations need to improve as they expect a lot

different responsibilities from their employees.

As the satisfaction levels of organic structure are higher in terms of career growth indicates

that mechanistic structure design needs to assign more responsibilities to workers rather than

having monotonous work. This improves the morale of the workers leads to development of


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the company which in turn, generates more rewards and recognition to the workers. The

feeling of job satisfaction takes multiple folds when it is clubbed with high responsibility

with deserved rewards and recognition. This may be lacking in mechanistic design firms but

it is not something which could not be improved. Though, organic structure firms take the

upper hand when compared with mechanistic firms, the latter has its own merits which could

not be quantifiable by the former.

8. Conclusion

As they say, every coin has its flip side, both organic and mechanistic design structures

possess certain positives which are missing in the other design. However, these positives

could be developed in any kind of firm and at the end of the day, it is all about taking the firm

and its employees in the right direction towards growth. Now, the balance may look heavier

towards organic design structure but nevertheless, mechanistic design structure, developing

its certain aspects, takes its weight and makes the balance even.


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REFERENCES

[1]. Alexander Nikolenko, Brian H. Kleiner, (1996) "Global trends in organizationaldesign", Work Study, Vol. 45 Iss: 7, pp.2326

[2]. Rachid Zeffane, (1992) "Organizational Structures: Design in the Nineties",Leadership & Organization Development Journal, Vol. 13 Iss: 6, pp.1823

[3]. Michael W. Stebbins, Abraham B. Shani, (1995) "Organization design and theknowledge worker", Leadership & Organization Development Journal, Vol. 16 Iss: 1, pp.23 -

30

[4]. Richard A. Yoder, Scott L. Eby, Participation, job satisfaction and decentralization:The case of Swaziland, Public Administration and Development, Volume 10, Issue 2, pages

153163, April/June 1990.

[5]. Acorn S et al, Decentralization as a determinant of autonomy, job satisfaction, andorganizational commitment among nurse managers, Nurs Res.1997, Jan-Feb; 46(1): 52-8.

[6]. Daulatram B. Lund, (2003) "Organizational culture and job satisfaction", Journal ofBusiness & Industrial Marketing, Vol. 18 Iss: 3, pp.219236

[7]. Mary S. Thibodeaux, Sandy K. Faden, (1994) "Organizational Design for Self-managed Teams", Industrial Management & Data Systems, Vol. 94 Iss: 10, pp.20 - 25


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APPENDIX

Dwo - Project Report Final

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