Transcript Structural Frame

The Structural View of
Things
1
Organization Structure
How work is formally divided, grouped and
then-hopefully-coordinated
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The Metaphor: The
Organization as an
Efficient Machine
Reliability
Efficiency
Effectiveness
Clarity
Speed
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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.
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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 )
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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
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The 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
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There are many ways,
different options, and
various rationale for
dividing up the
work…all with different
consequences
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Simple Structure
T h e o rgan iz atio n is c o m po se d o f a to p m an age r (o w n e r) an d a
re lative ly sm all n u m b e r o f o rgan iz atio n al m e m b e rs (te c h n ic al
w o rk e rs, su ppo rt pe rso n n e l).
O wn er - M an ag er
O rg an ization al M em b er
O rg an ization al M em b er
O rg an ization al M em b er
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TOWER BUILDING: AN EXERCISE IN
LEADING,CENTRALIZINGDECENTRALIZING AUTHORITY,
AND SPAN OF CONTROL
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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.
11
Span of Control
How many individuals can a manager
direct?
The following factors are often
considered:
• Required Contact
• Degree of Specialization
• Ability to Communicate
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Spans of Control: Narrow versus Wide
Key:
T = Top manager
M = Middle manager
F = First-line (supervisory) manager
CEO
Narrow
T
M
F
T
M
F
F
M
F
F
M
F
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F
M
F
F
F
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F
M
F
F
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M
F
F
M
F
F
F
F
F
F
CEO
M
M
F
F
M
F
Wide
F
T
M
F
F
F
F
M
F
F
M
F
F
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F
M
F
F
M
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F
M
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13F
Centralized Vs.
Decentralized Organizations
Centralized Authority
important decisions are made by
higher-level managers
Decentralized Authority
important decisions are made
by middle-level and
supervisory-level managers
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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.
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• 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.
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•
Then There is Functional Structure?
So What Is it?
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Functional Organization: One of the
Most Common Ways to Structure
F unctional structures group organizational m em b ers b ased on th e
focus of th eir w ork activity.
C hief E xecutiv e
M anufacturing
M arketing
H um an R esources
A ccounting and F inance
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Other options for dividing the work
(continued):
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Organization Chart for a Hospital: A Basic Example of a Function
Structure Designed to Assure Tension and Conflict
Board of
Directors
Strategic
Planning Advisor
Chief Executive
Officer
Legal Counsel
President
Cost Containment
Staff
Executive
Administrative
Director
Director
of
Personne
l
Director of
Admissions
Director of
Patient &
Public
Relations
Executive
Medical Director
Director of
Nutrition &
Food
Services
Director of
Accounting
Director of
X-Ray &
Laboratory
Services
Director
of
Pharmac
y
Director of
Surgery
Chief
Physician
Director of
Outpatient
Services20
How Might You Lessen the Conflict
In Groups Discuss
What Might You Do? For example, is
there a structural change that might help?
21
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.
22
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
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IN GROUPS:
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•
•
•
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?
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McDonaldization
Deskilled Jobs
Act as Robots
Tightly Controlled
Division of Labor
Ruthless Efficiency
Speed
Mass Production
Success
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Basic Factors to Consider
*Knowledge or Skill
*Time
Grouped By:
*Customers
or
Clients
*Process
*Place or Geography
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Basic Structural Tensions
Division of Labor and Coordination of
Effort
How to divide up the
work: differentiation
How to coordinate
different roles and units after
responsibilities have been
parceled out: integration
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Vertical Coordination
Authority
Rules and Policies
Planning and Control Systems
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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
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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.
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So….
• How do we do to
integrate?
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In General We Flatten
Ad Hoc Teams
Meetings/Committees
Task Forces/Teams
Matrix Structures
Networks
Coordinating Roles
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But………
Lateral Coordination
is usually where things
usually bog down
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Bloch School - EMBA
First Semester
Leadership
Residency
Module I
Tools
Competitive
Analysis
Managerial Accounting
Economics
Financial Management
Quantitative Decision Skills
Executive Leadership
35
Bloch School - EMBA
First Semester
Leadership
Residency
Module I
Tools
Competitive
Analysis
Managerial Accounting
Economics
Financial Management
Quantitative Decision Skills
Executive Leadership
Second Semester
Module II
Managing
People &
Systems
Wash D.C.
Residency
Operations Management
Human Resources
Management Info. Systems
Organizational & Group
Behavior
36
Bloch School - EMBA
First Semester
Third Semester
Strategic
Assessment
Project
Module III
The
Enterprise
and
Its
Environment
Entrepreneurship
Executive Leadership
International Business
Strategic Marketing
Strategic Management
37
Bloch School - EMBA
First Semester
Second Semester
Third Semester
Strategic
Assessment
Project
Module III
The
Enterprise
and
Its
Environment
Entrepreneurship
Executive Leadership
International Business
Strategic Marketing
Strategic Management
Fourth Semester
Module IV
Strategic
Leadership
International
Residency
International Business
Leadership of Strategic
Change
Strategic Management of
Technology
Organizational Behavior
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Contingency Design
Contingency
Design the
process of fitting the
organization to
the
environment
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Discuss
• What are the major factors to consider in
the environment?
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The Organizational Environment
International Forces
Demographic / Cultural
Forces
Customers
Suppliers
Political Forces
Distributors
Organization
Government
Unions
Competitors
Work Force Issues
Technological Forces
Economic Forces
General Forces
Specific Forces
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Sources of Environmental Uncertainty:
complexity, dynamism, and richness
As the environment becomes more
complex, less stable, and poorer, the
level of uncertainty increases.
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. 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
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The Relationship Between Environmental
Uncertainty and Organizational Structure
Mechanistic
organizations
Organic
organizations
Centralized hierarchy of authority
Decentralized hierarchy of authority
Many rules and procedures
Few rules and procedures
Specialized tasks
Shared tasks
Formalized communication
Informal communication
Few teams or task forces
Many teams or task forces
Narrow span of control, taller structure
Wider span of control, flatter structure
Stable
Environmental Uncertainty
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In flux (variable)
Types of Organizational
Structures
1.
2.
3.
4.
5.
6.
7.
8.
Simple Structure
Functional Structure
Divisional Structure
Conglomerate Structure
Hybrid Structure
Matrix Structure
Team-Based Structure
Virtual Network Structures
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Hybrid Structures
Product
Divisional
Structure
President
President
Cadillac
VicePresident,
Production
Manager
Region I
President
Buick
VicePresident,
Marketing
Manager
Region II
President
Pontiac
VicePresident,
Finance
Manager
Region III
Manager
Region IV
VicePresident,
Human
Resources
President
Chevrolet
Functional
divisional
structure
Geographical
divisional structure
A Hypothetical example of what GM might use
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Matrix Structure: The Customer as a Member of the Company
President
Project
structure
Vice
President,
Engineering
Vice
President,
Finance
Vice
President,
Production
Functional
Structure
Vice
President.
Sales
Project
Manager
and Customer
Project
Manager,
and Customer
Project
Manager,
and Customer
Project
Manager,
and Customer
At a Kansas City Manufacturing Co.
Subordinate
reports to
both Vice
President of
Sales & to
Project
Manager
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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
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Team-Based Structures
Functional
structure
Vice
President,
Research &
Development
Project
teams
Product Team
Manager,
Manufacturing
Light Trucks
Project
team
members
President
Vice
President,
Design
Vice
President,
Engineering
Product Team
Manager,
Manufacturing
Sedans
Vice
President,
Marketing
Product Team
Manager,
Manufacturing
Sport Cars
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Network Structure
Design
Studio
Components
Assembly
Sweden
Mexico, Asia
Core of
personal
computer
company
USA
Engineering
Company
Distribution
Company
Japan
Canada
Accounting
& Finance
USA
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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.
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• While a poor structure makes a high
performance impossible, the best
structure in the world will not ensure
good performance
Peter Drucker
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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
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