Organizational Theory, Design And Change: Chapter 2

Front 1

Stakeholders:

Back 1

people who have an interest, claim or stake in an organization, in what it does, and in how well it performs.

Front 2

Inducements:

Back 2

rewards such as money, power an organizational status.

Front 3

Contributions:

Back 3

the skills knowledge and expertise that organizations require of their members during task performance.

Front 4

Inside Stakeholders

Back 4

people who are closest to an organization and have the strongest or most direct claim on organizational resources:
Shareholders
Managers
The workforce

Front 5

Outside Stakeholders

Back 5

People who o not own the organization and are not employed by it, but do have some interest in it:
Customers
Suppliers
The government
Trade Unions
Local communities
The general public

Front 6

Authority:

Back 6

the power to hold people accountable for their actions and to make decisions concerning the use of organizational resources.

Front 7

The top-management hierarchy from top to bottom:

Back 7

1. Ownership (shareholders)
2. Trusteeship (board and committees)
3. Corporate Management (CEO, COO, VP)
4. Divisional Management (GM)
5. Functional Management

Front 8

Chain of command:

Back 8

the system of hierarchical reporting relationships in an organization.

Front 9

Line role:

Back 9

managers who have direct responsibility for the production of goods and services.

Front 10

Staff role:

Back 10

managers who are in charge of a specific organizational function such as sales or R&D.

Front 11

Top management team:

Back 11

a group of managers who report to the CEO and COO and help the CEO set the company's strategy and its long-term goals and objectives.

Front 12

Corporate managers:

Back 12

the members of top management teams whose responsibility is to set strategy for the corporation as a whole.

Front 13

Divisional managers:

Back 13

managers who set policy only for the division they head.

Front 14

Functional managers:

Back 14

managers who are responsible for developing the functional skills and capabilities that collectively provide the core competences that give the organization its competitive advantage.

Front 15

Agency theory:

Back 15

arises whenever one person (the principle) delegates decision-making authority or control over resource to another (the agent). This causes the agency problem: a problem in determining managerial accountability which arises when delegating authority to managers. Shareholders or principals are at an information disadvantage.

Front 16

Moral Hazard Problem:

Back 16

when agents have the opportunity and incentive to pursue their own interests.

Front 17

Governance mechanisms:

Back 17

the forms of control which align the interests of principal and agent so that both parties have the incentive to work together to maximize organizational effectiveness.

Front 18

Stocks-based compensation schemes:

Back 18

monetary rewards in the form of stocks or stock options that are linked to the company's performance.

Front 19

Ethical dilemma:

Back 19

the quandary people find themselves in when they have to decide if they should act in a way that might help another person or group even though doing so might go against their own self-interests.

Front 20

Moral scruples

Back 20

thoughts and feelings that tell a person what is right or wrong.

Front 21

Ethics:

Back 21

moral principles or beliefs about what is right or wrong.

Front 22

Three models for determining whether a decision is ethical

Back 22

utilitarian: produces the greats good for the greatest number of people

moral rights: best maintains and protects the fundamental rights and privileges of the people affected by it.

justice models: distributes benefits and harms among stakeholders in a fair, equitable, or impartial way.

Front 23

Sources of organizational ethics:

Back 23

1. societal ethics - codified in a society's legal system, in its customs and practices, and in the unwritten norms and values that people use to interact with each other.

2. group or professional ethics - moral rules and values that a group of people uses to control the way they perform a task or use resources.

3. individual ethics - personal and moral standards used by individuals to structure their interactions with other people.