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209 Cards in this Set
- Front
- Back
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As people take on new tasks it is hard to coordinate activities and know who is accountable.
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Design Challenge 1:
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Specified tasks/roles decrease coordination /communication.
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Design Challenge 2
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Differentiation Balancing Integration
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Design Challenge 2
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Miss opportunities & decision-making is slow because people don’t take risks/responsibility.
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Design Challenge 3:
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Centralization Balancing Decentralization
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Design Challenge 3:
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Too much emphasis is placed on the rules & company loses ability to adapt.
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Design Challenge 4:
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Standardization Balancing Adjustment
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Design Challenge 4:
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Process used to allocate resources, and establish task and authority relationships.
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Differentiation
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Establishes: ________, which controls level of specialization.
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Division of Labor
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Division of labor is Low
Differentiation is Low |
Simple Organization
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Division of labor is High
Differentiation is High |
Complex Organization
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Authority: power to hold people accountable
Control: ability to coordinate and motivate people |
Organizational Role
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power to hold people accountable
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Authority:
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ability to coordinate and motivate people
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Control:
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group of people working together, with similar skills, knowledge, tools or techniques.
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Functional Subunit
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control stakeholders
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Support Functions:
Functional Subunit |
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manage conversion
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Production Functions:
Functional Subunit |
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departmental
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Maintenance Functions:
Functional Subunit |
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adjust to change
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Adaptive Functions:
Functional Subunit |
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control coordination
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Managerial Functions:
Functional Subunit |
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Collection of functions or departments that share responsibility for producing a particular good or service.
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Divisional Subunit:
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The ways an organization designs its hierarchy of authority and creates reporting relationships to link roles w/ subunits.
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Vertical Differentiation:
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The way an organization groups tasks into roles and roles into subunits.
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Horizontal Differentiation:
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A tendency to view role in organization strictly from within one’s own subunit.
Design Challenge ? |
Subunit Orientation:
Design Challenge 2 |
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Differentiation Balancing Integration
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Design Challenge 2
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Hierarchy of authority
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Integration Mechanisms:
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Direct contact
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Integration Mechanisms:
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Liaison role
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Integration Mechanisms:
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Task force
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Integration Mechanisms:
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Team
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Integration Mechanisms:
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Integrating role
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Integration Mechanisms
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Integrating department
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Integration Mechanisms
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Centralization Balancing Decentralization
Design Challenge ? |
Design Challenge 3
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Standardization Balancing Mutual Adjustment
Design Challenge ? |
Design Challenge 4
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written rules and standard operating procedures.
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Formalization:
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process by which members learn unwritten rules and norms – can be either standardized or innovative.
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Socialization:
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Mechanistic Organic
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Design Challenge 4
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individual specialization
simple integration centralization standardization |
Mechanistic
Design Challenge 4 |
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joint specialization
complex integration decentralization mutual adjustment |
Organic
Design Challenge 4 |
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A management approach in which the design of an organization’s structure is tailored to sources of uncertainty
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Contingency Approach
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When environment is uncertain, organization is more effective if more organic
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Contingency Approach
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Hinder communication
Distortion |
Communication Problems
Problems with tall Hierarchies |
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Hierarchy = Managerial authority
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Motivation Problems
Problems with tall Hierarchies |
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Managers cost money
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Bureaucratic Costs
Problems with tall Hierarchies |
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Increase subordinates, not rivals
Thereby, creating more work for themselves |
The Parkinson’s Law Problem
Problems with tall Hierarchies |
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An organization should choose the minimum number of hierarchical levels consistent with its goals and the environment in which it operates.
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Chain of Command:
How to keep flat structure |
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The number of subordinates reporting to a manager.
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Span of Control:
How to keep flat structure |
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Increase the __________to prevent another level in the hierarchy, BUT balance ability to supervise and control
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span of control
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When subordinate tasks are complex the span of control needs to be _____.
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small
Complex = Small Complexity |
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When subordinates tasks are simple the span of control can be _____.
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large
Simple = Large Complexity |
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When subordinates tasks are dissimilar the span of control needs to be ______
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small.
Complex = Small Interrelatedness |
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When subordinates tasks are similar the span of control can be_____
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large.
Simple = Large Interrelatedness |
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Larger ______ needs complex Integrating Mechanisms
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Span of Control
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High complexity/high differentiation =
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high integration.
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Low complexity/low differentiation=
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low integration
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Complex & dissimilar tasks = .
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small span of control
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Large & simple tasks =
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large span of control.
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Horizontal Differentiation increases ________~ need more managers to control more width/breadth
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vertical differentiation
Control ~ factors affecting the shape of the hierarchy. |
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~ where is decision making done? Need more managers if more decisions are centralized at the top
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Centralization
Control ~ factors affecting the shape of the hierarchy. |
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~ Need fewer managers if jobs are standardized and do not need direct oversight
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Standardization
Control ~ factors affecting the shape of the hierarchy. |
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~ Rules of authority and control
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Bureaucracy
Control ~ factors affecting the shape of the hierarchy. |
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MBO
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MGMT By Objective (pages 150-151)
Control ~ factors affecting the shape of the hierarchy. |
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~ powerful, but unseen force
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Informal Organizational Culture
Control ~ factors affecting the shape of the hierarchy. |
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~ any number of mechanisms used to help reduce the need for managers; usually team based
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Complex Integrating Mechanisms
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Advantage
Ground rules for authority & interaction |
Rational-legal authority
Principles Bureaucracy |
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Advantage
Minimizes role conflict & ambiguity |
Roles bases on technical competence
Principles Bureaucracy |
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Advantage
SOPs substitute for direct control |
Clearly defined authority
Principles Bureaucracy |
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Advantage
Separates person from position |
Establishes chain of command
Principles Bureaucracy |
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Advantage
Provide stability |
SOPs
Principles Bureaucracy |
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Advantage
Keep records of everything. |
Write it down!
Principles Bureaucracy |
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As an organization grows, a functional structure does not create _____.
communication problems learning problems location problems customer problems |
learning problems
p 163 |
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All of the following are potential disadvantages of the multidivisional structure except:
conflict over resources. high bureaucratic costs. inability to monitor divisions transfer pricing problems. |
inability to monitor divisions
pg 172 NB 167 Old Book |
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One important difference between an integrating role and a liaison role is:
the liaison role is a more complex integrating mechanism. the integrating role is located outside the departments that are being coordinated. the integrating role is a formal position inside one of the departments and the liaison role is informal. the liaison role is a formal position inside one of the departments and the integrating role is informal. |
the integrating role is located outside the departments that are being coordinated
p107 NB 98 OB |
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Standardization
enables a manager to increase his or her span of control causes a manager to reduce his or her span of control increases the number of managers needed can be used only in a centralized hierarchy |
enables a manager to increase his or her span of control
p 143 |
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___________ is the process by which an organization allocates people and resources to organizational tasks and establishes the task and authority relationships to reach goals.
Structure Differentiation Strategy Management |
Differentiation
p 95 |
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Which is not a part of horizontal differentiation?
Division of labor Specialization Centralization Increased productivity |
Centralization
p 102 |
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In a simple organization, differentiation is______ and the division of labor is _____.
low/low low/high high/low high/high |
low/low
p96 |
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of the following statements about property rights is true?
Top managers have the strongest property rights. Internal power struggles occur more often when property rights are too weak. An organization can never make property rights too strong. Top managers should assign property rights based on performance. |
Top managers should assign property rights based on performance
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______ can sometimes overcome control problems in a functional structure, making it unnecessary to move to a more complex structure
Improving integration Increasing horizontal differentiation Increasing vertical differentiation Diversification |
Improving integration
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_______ is the power to hold people accountable for their actions and to make decisions concerning the use of resources.
Control Authority Function Differentiation |
Authority
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If a company desires predictable behavior, it should _____authority nad adopt a(n) ____ structure.
centralize/organic decentralize/organic centralize/mechanistic decentralize/mechanistic |
centralize/mechanistic
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An advantage of decentralization is that it:
ensures predictable behavior. allows top managers to keep the organization focused on organizational goals. simplifies the coordination process may increase the motivation of mangers. |
may increase the motivation of mangers.
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It is easier to increase the span of control when tasks:
are routine or similar are complex are highly interrelated are dissimilar |
are routine or similar
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Which of the following is one of Weber's bureaucratic principles?
Work expands to fill the time. Horizontal tasks are loosely defined because vertical roles are clearly defined. Employees should be hired based on their competence. Authority should be based on tradition. |
Employees should be hired based on their competence.
nb 145 ob 131 |
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Adding more managers to a company results in:
better decision making flattening of the organizational structure improved communication higher bureaucratic costs |
higher bureaucratic costs
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Company A has 1,000 employees and six hierarchical levels. Company B has 3,000 employees and seven levels. What is the relationship between Company A's and Company B's hierarchies?
Company A's hierarchy is considered to be relatively taller than Company B's. Company B's hierarchy is considered to be relatively taller than Company A's. Both A and B have average size hierarchies for their size. Both A and B have hierarchies that are too tall. |
Company A's hierarchy is considered to be relatively taller than Company B's.
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Parkinson's Law states that:
a division of labor increases efficiency. the hierarchy should be based on rational-legal authority organizations should have a maximum of 10 hierarchical levels. hierarchies grow because managers make work for one another. |
hierarchies grow because managers make work for one another.
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1. Differentiation entails establishing and controlling the division of labor.
T F |
True (page 95, moderate)
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2. In a simple organization, differentiation is low because division of labor is low T F
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a. True (page 96, easy)
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3. In a complex organization, both the division of labor and differentiation are high T F
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a. True (page 96, easy)
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4. Subunit orientation is the tendency to view one’s role in the organization strictly from the perspective of one’s own subunit, or department T F
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a. True (page 103, easy
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5. To prevent subunit orientation, management should have clear job descriptions in place. T F
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b. False (page 103, moderate)
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6. Integration is the way in which a company allocates people and resources to organizational tasks. T F
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b. False (page 104, moderate)
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7. If an organization has a high degree of integration, then it should have a low degree of differentiation. T F
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b. False (page 104, moderate)
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8. The primary difference between a task force and a team is that a task force is designed to be temporary T F
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a. True (page 105, moderate)
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9. External rules often become internalized norms T F
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a. True (page 112, moderate)
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10. An organization that differentiates too much will experience higher costs in terms of the amount of time spent on coordinating activities. T F
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a. True (page 108, moderate
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11. An organization that integrates too much will experience higher costs in terms of the amount of time spent on coordinating activities. T F
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a. True (page 108, moderate)
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12. Mechanistic structures usually have a high level of formalization. T F
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a. True (page 114, moderate)
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13. The informal organization is very status conscious in a mechanistic structure.. T F
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a. True (page 114, moderate)
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14. Employees are encouraged to use their judgment in making decisions in a mechanistic structure.. T F
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b. False (page 114, moderate
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15. Organic structures promote flexibility.. T F
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a. True (page 117, moderate
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16. Lawrence and Lorsch found that subunits in an organization respond to subparts of the environment.. T F
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a. True (page 120, moderate
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17. Formalization is more appropriate in an environment that requires high levels of mutual adjustment.. T F
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a. True (page 112, moderate
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1. Companies with tall organizational structures have a minimum of 10 hierarchical levels.
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b. False (page 131, moderate)
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2. The hierarchy begins to emerge when subunit orientations become so prevalent that the organization cannot control employees
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b. False (page 130, difficult)
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3. An organization can do two things to improve its ability to control. They can either increase the number of managers, or increase the number of levels in the hierarchy.
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True (page 130, moderate)
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4. Managers in a flat organization are generally more motivated than managers in a tall
organization. |
a. True (page 134, moderate)
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5. Parkinson’s Law states that it is a natural human tendency to try and reduce bureaucratic costs
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b. False (page 135, easy)
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6. Parkinson’s Law states that “Work expands so as to fill the time available.”
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a. True (page 135, easy)
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7. As the number of levels in the hierarchy increases, motivation problems occur because workload tends to increase.
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b. False (page 134, moderate
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8. As the number of levels in the hierarchy increases, the relative difference in the authority possessed by managers at each level decreases.
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a. True (page 134, easy)
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9. The principle of minimum chain of command states that an organization should avoid hierarchies because individuals prefer to be empowered.
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b. False (page 136, moderate
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10. A manager’s span of control includes subordinates he or she supervises directly and subordinates
he or she supervises indirectly (by supervising their direct boss). |
b. False (page 137, moderate)
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11. With a growth in organizational size, there is a design choice between increasing the number of levels in management and decreasing the span of control.
T F |
b. False (page 137, moderate)
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12. Research and development laboratories use small spans of control because the content of each
member’s work is unrelated. T F |
b. False (page 139, difficult)
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13. Increasing horizontal differentiation increases vertical differentiation T F
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a. True (page 139, moderate)
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14. Standardization makes it easier to increase span of control. T F
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a. True (page 143, moderate
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15. According to Weber, rational-legal authority emerges as managers develop a reputation for making rational decisions T F
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b. False (page 145, easy
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16. According to Weber, rational-legal authority emerges due to qualities that the leaders possess, such as charisma T F
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b. False (page 145, moderate
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17. According to Weber, rational-legal authority emerges from the level of authority that is associated with the position a person occupies. T F
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a. True (page 145, easy)
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18. In a bureaucratic structure, norms should be used to control relationships between roles. T F
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a. True (page 146, moderate)
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19. Contingent workers are employees who belong to self-managed teams. T F
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b. False (page 154, moderate
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20. Weber’s bureaucracy should reduce both role conflict and role ambiguity. T F
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a. True (page 146, moderate)
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1. People in a group can supervise each other in a functional structure.
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a. True (page 163, moderate)
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2. One disadvantage of the functional structure is that people are not able to supervise one another. T F
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c. False (page 163, moderate)
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3. When a company moves from a functional structure to the more complex product division
structure, a corporate headquarters staff is added. T F |
c. False (page 167, moderate
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4. As organizations grow, they typically move to a more complex structure due to the inability to coordinate activities under a traditional functional structure. T F
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b. True (page 163, easy)
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1. A divisional structure groups functions according to the specific demands of products, markets, or customers. T F
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a. True (page 167, easy)
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6. A product division structure enables a company to compete in more than one business. T F
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b. False (page 168, difficult)
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7. Each division within a product division structure can have a different organizational structure. T F
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a. True (page 169, easy)
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8. In a product division structure, a centralized set of support functions service the needs of a number of different product lines. T F
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a. True (page 168, moderate)
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9. Decision-making authority is more decentralized in a product team structure than in a product
division structure. T F |
a. True (page 176, moderate)
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10. Multidivisional structures have support functions that are placed in self-contained divisions. T F
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a. True (page 170, moderate)
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11. Corporate headquarters staff often plays an integrating role in the organization by helping managers in different divisions share information. T F
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a. True (page 171, moderate)
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12. Because managers in each division hire managers and workers independently, the lack of an internal labor market is one disadvantage to a multidivisional structure. T F
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b. False (page 172, moderate)
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13. Transfer pricing is used in a multidivisional structure so that one division can sell its product or service to another division. T F
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a. True (page 175, easy)
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14. Product team structures consist of groups of individuals whose allegiance is to specific products as opposed to specific functions. T F
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a. True (page 176, moderate)
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15. Balancing centralization and decentralization is a concern in a geographic structure. T F
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a. True (page 179, moderate)
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16. A matrix structure is a mechanistic structure. T F
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b. False (page 185, difficult)
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17. Employee roles are clearly defined in a matrix structure. T F
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b. False (page 186, moderate)
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18. One problem with the matrix structure is that employees must report to two different bosses. T F
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a. True (page 182, easy)
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19. A high-tech company is likely to experience more disadvantages using a network structure than a
low-tech company. T F |
a. True (page 189, moderate)
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1. Cultural values control how members respond to the organization’s environment. T F
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a. True (page 195, moderate)
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2. An instrumental value is defined as a value that is critical to have for the organization to achieve its goals. T F
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b. False (page 196, easy)
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3. Instrumental values help the organization achieve its terminal goals. T F
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a. True (page 196, moderate
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4. Terminal values are reflected in an organization’s mission statement. T F
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a. True (page 196, moderate)
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5. Top managers have the strongest property rights. T F
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b. False (page 198, moderate)
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6. Shareholders have the strongest property rights. T F
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a. True (page 198, moderate)
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7. Customers have the strongest property rights. T F
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b. False (page 198, moderate)
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8. An office Christmas party is an example of a rite of integration. T F
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a. True (page 203, moderate)
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9. Organizational structure is a source of organizational culture. T F
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a. True (page 215, moderate)
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10. An organization with an accommodative stance on corporate social responsibility simply follows and obeys the law. T F
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b. False (page 219, moderate)
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11. An organization with an accommodative stance on corporate social responsibility agrees that organizational members should behave ethically. T F
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a. True (page 219, moderate
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12. An organization with an obstructionist stance on corporate social responsibility attempts to lobby to have existing laws changed. T F
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b. False (page 218, moderate)
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13. Holding all other variables constant, socially responsible companies are less risky investments than unethical companies. T F
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a. True (page 221, easy)
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14. Whistle-blowing is informing an outside agency or the media about a company’s illegal or
immoral activities. T F |
a. True (page 221, easy)
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A design grouping people on the basis of common expertise or resource use.
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Functional Structure: (simple)
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Increased learning
Facilitates supervision Easier to integrate & coordinate activities, within function. Increase motivation & commitment Develop norms A or D |
Functional Structure: (simple)
Advantages |
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Hard to integrate & coordinate activities across functions.
Communication problems Measurement problems Location problems Customer problems Strategic problems A or D |
Functional Structure: (simple)
Disadvantages |
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A structure grouping functions according to the specific demands of products, geographic location or customer markets
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Divisional Structure: (more complex)
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Advantages
Division of labor increases organizational effectiveness Corporate control increases Individual profit centers Motivation and rich labor market |
Divisional Structure: (more complex)
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Disadvantages
Corporate-Division tension Cross-divisional coordination problems Transfer pricing Bureaucratic costs Communication problems |
Divisional Structure: (more complex)
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Structures institutionalizing complex integrating mechanisms: Hybrid, Matrix, Network structures.
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Hybrid Structures: (most complex)
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Reduce functional barriers
Overcome subunit orientation Increase communication Maximize labor skills Promotes quality & cost |
Matrix Structure
Advantages: |
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Lacks control structure
Hard to manage |
Matrix Structure
Disadvantages: |
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Reduce production costs
Reduce bureaucratic costs Promotes organic behavior Replace network partners Increase global richness |
Network Structure
Advantages: |
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Outsourcing difficulty
Coordination difficulty Lose long-term competency |
Network Structure
Disadvantages: |
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Increase vertical differentiation
Increase horizontal differentiation Increase integration |
The move from simple to complex structures…
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you will need more managers to control the additional workload generated by growth.
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Increase vertical differentiation
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you will need to specialize into functions to control quality as new demand is created
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Increase horizontal differentiation
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you will need more control mechanisms to manage increased vertical and horizontal differentiation, and the complexity created by them.
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Increase integration
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Simple Product Structure
More Complex Product Division Structure More Complex Multidivisional Structure Most Complex Product Team Structure |
Product Structures
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Divisional structure grouping products into separate divisions
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Simple Product Structure
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Divisional structure centralizing support functions needed by all product divisions
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More Complex Product Division Structure
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Divisional structure where support functions are placed in self-contained divisions
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More Complex Multidivisional Structure
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Support specialists form development teams
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Most Complex Product Team Structure
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A divisional structure in which divisions are organized according to the requirements of the different locations of operation.
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Geographic & Geographic Divisional
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A divisional structure in which divisions are organized according to the requirements of the different customer markets targeted.
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Market Structure
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each “box” on the organization chart is a departmental function (i.e. marketing, HR, engineering)
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Functional:
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each “box” on the organizational chart is a division (containing the necessary functions…)
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Divisional:
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“Boxes” for widgits, staplers, & paper, each with own functional resources
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Product: mini-org, divided by product groups…
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“Boxes” for CA, OR, & NY, each with own functional resources
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Geographic: mini-org, divided by region…
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The set of shared values & norms that control interactions between internal and external organizational members/stakeholders.
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Organizational Culture:
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General criteria, standards or guiding principles determining desirable or undesirable behaviors.
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Values:
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A desired end state or outcome that people seek to achieve. (Content ~ operative or official goal)
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Terminal: Values:
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A desired mode or pattern of behavior. (Process ~ How things get done)
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Instrumental: Values:
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Standards or styles of behavior that are considered acceptable or typical for a group of people.
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Norms:
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Socialization & Role orientation
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Transmitting Culture to members
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The process by which members learn and internalize the values and norms of an organization’s culture.
(force of organization on people): |
Socialization
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The characteristic way newcomers respond to a situation.
(force of people on organization): |
Role orientation
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taught to respond in same way.
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Institutionalized:
Role orientation |
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encouraged to respond in new way.
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Individualized:
Role orientation |
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Collective
Formal Sequential Fixed Serial Divestiture |
Tactics that lead to an institutionalized orientation
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Individual
Informal Random Variable Disjunctive Investiture |
Tactics that lead to an individualized orientation
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Socialization via status quo
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Tactics that lead to an institutionalized orientation
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Socialization via creativity
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Tactics that lead to an individualized orientation
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Learn and internalize norms and values. E.g. New employee orientation, retirement party
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Rite of Passage
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Build common norms and values. E.g. Office holiday party, bring kid to work day
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Rite of Integration
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Motivate commitment to norms and values. E.g. Award presentation, company newsletter
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Rite of Enhancement
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Characteristics of People within firm
Organizational Ethics Property Rights Organizational Structure |
Where does Culture come from?
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People make the place…
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Characteristics of People within firm
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Creating policies that incorporate individual and professional ethics…
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Organizational Ethics
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Rights organization gives to its members to receive and use organizational resources…
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Property Rights
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Structure encourages or inhibits behaviors…
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Organizational Structure
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Golden parachutes
Stock options Large salaries Control over organizational resources Decision-making Prestige/reputation |
Manager’s Rights
Property Rights |
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Layoff notice
Severance pay Lifetime employment Long-term employment Pension & Benefits Stock ownership Decision-making participation |
Worker’s Rights
Property Rights |
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Obstructionist lowest level of commitment
Defensive commits to ethical behavior Accomodative acknowledges need to support Proactive actively embrace |
Jones, G. (2004)
Less positive Social Responsibility |
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Inactive minimum compliance
Reactive addresses only problems Proactive actively embrace Interactive Seek stakeholder partnership |
Lawrence, A. et al. (2005)
More engaged Social Responsibility |
