Transcript chapter9
Chapter 9 Designing Adaptive Organizations MGMT Chuck Williams Designed & Prepared by B-books, Ltd. 1 Copyright ©2008 Cengage Learning. All rights reserved Organizational Structure Organizational Structure The vertical and horizontal configuration of departments, authority, and jobs within a company. Organizational Process The collection of activities that transform inputs into outputs that customers value. 2 Copyright ©2008 Cengage Learning. All rights reserved Organizational Structure Process View of Microsoft’s Organization 3 Copyright ©2008 Cengage Learning. All rights reserved Designing Organizational Structures After reading these sections, you should be able to: 1. describe the departmentalization approach to organizational structure. 2. explain organizational authority. 3. discuss the different methods for job design. 4 Copyright ©2008 Cengage Learning. All rights reserved Departmentalization Functional Customer Product Geographic Matrix 1 5 Copyright ©2008 Cengage Learning. All rights reserved Functional Departmentalization 1.1 6 Copyright ©2008 Cengage Learning. All rights reserved Functional Departmentalization Advantages Disadvantages Work done by highly skilled specialists Lowers costs through reduced duplication Communication and coordination problems are lessened Cross-department coordination can be difficult May lead to slower decision making Produces managers with narrow experiences 1.1 7 Copyright ©2008 Cengage Learning. All rights reserved Product Departmentalization United Technologies 1.2 Carrier UTC Fire and Security Hamilton Sundstrand Otis Pratt & Whitney Sikorsky --Administrative services --Communication & public relations --Customer service & support --E-Business --Engineering --etc… UTC Power 8 Copyright ©2008 Cengage Learning. All rights reserved Product Departmentalization Advantages Disadvantages • Managers specialize, but have broader experiences • Easier to assess workunit performance • Decision-making is faster • Duplication of activities • Difficult to coordinate across departments 1.2 9 Copyright ©2008 Cengage Learning. All rights reserved Customer Departmentalization 1.3 10 Copyright ©2008 Cengage Learning. All rights reserved Customer Departmentalization Advantages • Focuses on customer needs • Products and services tailored to customer needs Disadvantages • Duplication of resources • Difficult to coordinate across departments • Efforts to please customers may hurt the company 1.3 11 Copyright ©2008 Cengage Learning. All rights reserved Coca-Cola Enterprises Territories of Operation Geographic Departmentalization 1.4 12 Copyright ©2008 Cengage Learning. All rights reserved Geographic Departmentalization Advantages • Responsive to the demands of different market areas • Unique resources located close to the customer Disadvantages • Duplication of resources • Difficult to coordinate across departments 1.4 13 Copyright ©2008 Cengage Learning. All rights reserved Matrix Departmentalization Procter & Gamble Baby Care, Family Care North America Beauty Care, Feminine Care Fabric & Home Care 1.5 Snacks & Beverages Western Europe Asia, India, Australia Country Managers in Spain, UAE, Kenya, etc. Country Managers in India, South Korea, etc. 14 Copyright ©2008 Cengage Learning. All rights reserved Matrix Departmentalization Advantages Disadvantages • Efficiently manage large, complex tasks • Pool of available resources • Requires high levels of coordination • Conflict between bosses • Requires high levels of management skills 1.5 15 Copyright ©2008 Cengage Learning. All rights reserved Organizational Authority Chain of Command Line versus Staff Authority Delegation of Authority Degree of Centralization 2 16 Copyright ©2008 Cengage Learning. All rights reserved Chain of Command • The vertical line of authority in an organization • Clarifies who reports to whom • Unity of command – matrix organizations violate this principle – workers report to only one boss 2.1 17 Copyright ©2008 Cengage Learning. All rights reserved Line versus Staff Authority • Line authority – the right to command immediate subordinates in the chain of command • Staff authority – the right to advise but not command others 2.2 18 Copyright ©2008 Cengage Learning. All rights reserved Delegation of Authority Delegation of Authority The assignment of direct authority and responsibility to a subordinate to complete tasks for which the manager is normally responsible. 2.3 19 Copyright ©2008 Cengage Learning. All rights reserved Delegation of Authority 2.3 20 Copyright ©2008 Cengage Learning. All rights reserved How to be a More Effective Delegator 1. Trust your staff to do a good job. 2. 3. 4. 5. Avoid seeking perfection. Give effective job instructions. Know your true interests. Follow up on progress. 6. 7. 8. Praise the efforts of your staff. Don’t wait to the last minute to delegate. Ask questions, expect answers, assist employees. 9. 2.3 Provide the resources you would expect if doing the assignment yourself. 10. Delegate to the lowest possible level. 21 Copyright ©2008 Cengage Learning. All rights reserved Degree of Centralization Centralization of authority • primary authority is held by upper management Decentralization • significant authority is found in lower levels of the organization Standardization • solving problems by applying rules, procedures, and processes 2.4 22 Copyright ©2008 Cengage Learning. All rights reserved Decentralization at Whole Foods Beyond the Book • Operating decisions at Whole Foods—from what to stock, what to charge for it, and whom to hire—are made not from the top, but by individual work teams. • Each team is in charge of a department, like wine or seafood, or produce. • New employees are assigned to a team for a 4-week trial. At the end of 4 weeks, the new member must be approved by 2/3 vote of the team to remain on it. • Whole Foods believes that decisions should be made by those most impacted by them. Source: “Break Free!,” Fortune, 1 October 2007, 122-123. 23 Copyright ©2008 Cengage Learning. All rights reserved Job Design Job Specialization Job Rotation, Enlargement, Enrichment Job Characteristics Model 3 24 Copyright ©2008 Cengage Learning. All rights reserved Job Specialization A job that is a small part of a larger task or process Jobs are simple, easy to learn, & economical Can lead to low satisfaction, high absenteeism, & employee turnover 3.1 25 Copyright ©2008 Cengage Learning. All rights reserved Job Rotation, Enlargement, and Enrichment • Job Rotation – periodically moving workers from one specialized job to another • Job Enlargement – increasing the number of tasks performed by a worker • Job Enrichment – adding more tasks and authority to an employee’s job 3.2 26 Copyright ©2008 Cengage Learning. All rights reserved Job Characteristics Model A job redesign approach that seeks to increase employee motivation Emphasizes internal motivation experience work as meaningful experience responsibility for work outcomes knowledge of results 3.3 27 Copyright ©2008 Cengage Learning. All rights reserved Motivation by Job Design: The JCM • Job Characteristics Model (JCM) – Hackman and Oldham’s concept that any job can be described through five core job dimensions: • Skill variety – Requirements for different tasks in the job. • Task identity – Completion of a whole piece of work. • Task significance – The job’s impact on others. • Autonomy – Level of discretion in decision making. • Feedback – Amount of direct and clear information on performance. – The way elements in a job are organized (job design) impacts motivation, satisfaction, and performance. 28 Copyright ©2008 Cengage Learning. All rights reserved The Job Characteristics Model Employee growth-need strength moderates the relationships. Source: J.R. Hackman and G.R. Oldham, Work Design (excerpted from pp. 78–80). © 1980 by Addison-Wesley Publishing Co., Inc. Reprinted by permission of Addison-Wesley Longman, Inc. 29 Copyright ©2008 Cengage Learning. All rights reserved Guidelines for Enriching a Job Source: J.R. Hackman and J.L. Suttle, eds., Improving Life at Work (Glenview, IL: Scott Foresman, 1977), p. 138. 30 Copyright ©2008 Cengage Learning. All rights reserved Designing Organizational Processes After reading these sections, you should be able to: 4. explain the methods that companies are using to redesign international organizational processes (i.e., intraorganizational processes). 5. describe the methods that companies are using to redesign external organizational processes (i.e., interorganizational processes). 31 Copyright ©2008 Cengage Learning. All rights reserved Two Kinds of Organizational Designs (Burns and Stalker) Mechanistic Organic 32 Copyright ©2008 Cengage Learning. All rights reserved Intraorganizational Processes Reengineering Empowerment 4 33 Copyright ©2008 Cengage Learning. All rights reserved Reengineering The fundamental rethinking and radical redesign of business processes Intended to achieve dramatic improvements in performance Change the orientation from vertical to horizontal Change task interdependence 4.1 34 Copyright ©2008 Cengage Learning. All rights reserved Reengineering and Task Interdependence 4.1 35 Copyright ©2008 Cengage Learning. All rights reserved Empowerment Empowering Workers Permanently passing decision-making authority and responsibilities from managers to workers by giving them the information and resources they need to make good decisions A feeling of intrinsic motivation Workers perceive meaning in their work Employees are capable of self-determination 4.2 36 Copyright ©2008 Cengage Learning. All rights reserved Interorganizational Processes Modular Organizations Virtual Organizations 5 37 Copyright ©2008 Cengage Learning. All rights reserved Modular Organizations 5.1 38 Copyright ©2008 Cengage Learning. All rights reserved Modular Organizations Advantages Disadvantages • can cost less to run than traditional organizations • lets organizations focus on core competencies • loss of control from outsourcing • may reduce their competitive advantage 5.1 39 Copyright ©2008 Cengage Learning. All rights reserved Virtual Organizations 5.2 40 Copyright ©2008 Cengage Learning. All rights reserved Virtual Organizations Advantages Disadvantages • let companies share costs • fast and flexible • being the best should provide better products • difficult to control the quality of partners • requires tremendous management skills 5.2 41 Copyright ©2008 Cengage Learning. All rights reserved