OB - Organization Design & Development
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Transcript of OB - Organization Design & Development
Krietner/Kinicki, 2009Krietner/Kinicki, 2009
Organizational Design (OD), Development and Innovation
BUSA 220 - Wallace
Krietner/Kinicki, 2009
OD Background
Krietner/Kinicki, 2009
OD Background
Krietner/Kinicki, 2009
Common Characteristics
Hierarchy of authority
Division of labor
Common goal
Coordination of effort
Krietner/Kinicki, 2009
Typical Org ChartExam ple of H ospital's Organization Chart
Director ofH um an
R esources
D irector ofAdm issions
D irector ofAccounting
D irector ofN utritionand FoodServices
ExecutiveAdm in istrative
D irector
D irector ofX-R ay andLaboratory
Services
D irector ofSurgery
D irector ofPharm acy
Ch iefPhysician
ExecutiveM edicalD irector
President
Ch ief ExecutiveO ffi cer
Board of D irectors
Strategic Planning Officer
Legal Counsel
Cost-Containment
Staff
Director of Patient and
Public Relations
Director of Outpatient Services
Krietner/Kinicki, 2009
Basic Terminology
Span of control• The number of people reporting
directly to a given manager Staff Personnel – (dotted lines)• Provide research, advice, and
recommendations to line managers Line managers – (solid lines)• Have authority to make
organizational decisions
Krietner/Kinicki, 2009
What Do You Think?
True or False?
1. The ideal span of control is 10.
2. Wider spans of control complement employee empowerment trends.
3. Narrower spans of control save costs and are administratively efficient.
4. With wider spans of control, inadequate supervision and less coordination may result
Krietner/Kinicki, 2009
Closed vs. Open Systems
Closed Systems Open Systems
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Open System Organization
Goals and Values
Subsystem
Technical Subsystem
Psychological Subsystem
Structural Subsystem
Managerial Subsystem
Feedback
Inputs
Material
Money
Human effort
Information
Outputs• Products• Services• Human
satisfaction• Organization
survival and growth
• Social benefit
Krietner/Kinicki, 2009
Learning Organizations?
Organizations need to develop and become adaptable
The concept of a “learning organization” was made popular in the ‘90’s but many organizations have yet to reach their potential
A new measure assesses the three building blocks:
• A supportive learning environment• Concrete learning processes and practices• Leadership that reinforces learning
Companies can be strong in some areas and weak in others
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Organizational Learning
Experience Knowledge Purpose
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Org Learning Building Blocks
Supportive Learning Environment
• Psychological safety• Appreciation of differences• Openness to new ideas• Time for reflection
Concrete Learning Processes and Practices
• Experimentation• Information Collection• Analysis• Education and Training
Leadership that Reinforces Learning
Krietner/Kinicki, 2009
Common Structures
Functional
• Organized according to business function (marketing, finance, etc.)
Divisional Structure
• Organized by activities related to outputs (e.g., product or service type)
Matrix Structure
• Horizontal cooperation necessary as is functional knowledge• Typically organized by function vertically and product/service horizontally
Krietner/Kinicki, 2009
OD Background
Wealth of Nations, 1776
The Nature of the Firm, 1937
OD, 1974
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Galbraith, 1974
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Organization Designs
Vertical
Lateral(with Vertical tendencies)
Krietner/Kinicki, 2009
Organization Designs
80’s - Teams 90’s – Communities of Practice
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Organization Designs
2000’s – Networked Organizations
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Organization Designs
2000’s – Complex Global Structures
Krietner/Kinicki, 2009
Organization Designs
2000’s – Complex Global Structures
Krietner/Kinicki, 2009
Holacracy
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Organization Designs
Complexity – Economies of Scope, NOT Scale
Krietner/Kinicki, 2009
Collaboration
Source: http://www.aiim.org/What-is-Collaboration
Krietner/Kinicki, 2009
Collaborative Horizontal Designs
Organize around
complete workflow processes
rather than tasks
Flatten hierarchy and use teams to manage
everything
Appoint process
team leaders to manage internal
team processes.
Let supplier
and customer contact drive
performance.
Provide required expertise
from outside
the team as
required.
Krietner/Kinicki, 2009
The White Spaces (Rummler/Brache)
CEO
Assistant
VP
Line Manager
Individual Contributor
Individual Contributor
Individual Contributor
VP
Line Manager
Individual Contributor
Individual Contributor
Individual Contributor
VP
Line Manager
Individual Contributor
Individual Contributor
Individual Contributor
“A primary contribution of a manager at the second level
or above is to manage interfaces. The boxes
already have managers; the Senior manager adds value
by managing the white space between the boxes.”
Krietner/Kinicki, 2009
Open Boundaries
Hollow
• Outsourcing non-core processes to those more able
Modular
• Outsources parts of a product rather than processes
Virtual
• Temporary company created to respond to an exceptional market opportunity
Krietner/Kinicki, 2009
Mechanistic vs. Organic
Characteristic Mechanistic OrganicTask definition & knowledge
required Narrow: Technical Broad: General
Linkage between individual’s contribution & organization’s
purposeVague or Indirect Clear or Direct
Task flexibility Rigid; Routine Flexible, VariedSpecification of techniques,
obligations, & rights Specific General
Degree of hierarchal control High LowPrimary communication pattern Top-Down LateralPrimary decision-making style Authoritative Participative
Emphasis on obedience and loyalty High Low
Krietner/Kinicki, 2009
What Do You Think?
1. Which decision-making approach tends to be used in mechanistic organizations?a. Decentralized
b. Centralized
2. Which decision-making approach tends to be used in unstable and uncertain environments?a. Decentralized
b. Centralized
Krietner/Kinicki, 2009
Assessing Org Effectiveness
Goal Accomplishment
Resource Acquisition
Strategic Constituencies
Satisfaction
Internal Processes
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Signs of Decline
8. Loss of effective communication
9. Outdated organizational structure
10. Increased scapegoating by leaders
11. Resistance to change
12. Low morale
13. Special interest groups are more vocal
14. Decreased innovation
1. Excess personnel
2. Tolerance of incompetence
3. Cumbersome administrative procedures
4. Disproportionate staff power
5. Replacement of substance with form
6. Scarcity of clear goals and decision benchmarks
7. Fear of embarrassment and conflict
Krietner/Kinicki, 2009
InnovationCreati
vity
Invention
Integration
Innovation
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Seeds of Innovation
1. Hard work in a specific direction
2. Hard work with direction change
3. Curiosity
4. Wealth and money
5. Necessity
6. Combination of seeds
7. Collaboration
Krietner/Kinicki, 2009
Breakthrough Innovators
More than 2/3rds of directors at leading global companies cite innovation as critical for long-term success
How can we
sustain innovatio
n?
Innovative talent is rare
5-10% of high
potential managers
Be aware of organizational processes and practices that squelch innovation
Don’t base promotions on ability to mimic incumbents
Krietner/Kinicki, 2009
Breakthrough Innovators
What innovators look like
Strong cognitive abilities
Strong analytic skills, can focus on most important points
Don’t rely on past successes
Keenly aware of others’ motivations and interests when “selling” their idea
Krietner/Kinicki, 2009
Innovative Hotspots
The Focused Factory• Invest in a
handful of industries or research fields
• Singapore, Denmark
Brute Force• Apply
massive amounts of low-cost labor to different innovative projects
• Microsoft in Beijing
Hollyworld• “Global
creative class”
• Silicon Valley
Large-Scale Ecosystems• End-to-end
innovation systems with government as steward
• Finland
Krietner/Kinicki, 2009
The Design of Business (Martin)
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The Design of Business (Martin)
Krietner/Kinicki, 2009
What’s Your Objective?