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48 Cards in this Set
- Front
- Back
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Organizational Structure
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How job tasks are formally divided, grouped, and coordinated.
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Six key elements when designing an organization's structure
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1. work specialization
2. departmentalization 3. chain of command 4. span of control 5. centralization 6. formalization |
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Work Specialization
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To what degree are activities subdivided into specific jobs
Extreme work specialization: division of labor at Ford manufacturing Benefits: less time, less costly, increased efficiency and production, economies of scale Drawback: human diseconomies: boredom, fatigue, absenteeism, stress, low productivity, poor quality, high turnover |
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Departmentalization
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On what basis are jobs grouped together
Grouped by: function (engineering, accounting, manufacturing - advantage gained from putting specialists together hard tasks call for cross functional teams) product or service (Proctor&Gamble - accountability for performance focus on single product) geography (valuable when customers are scattered) customer (consumers, large corporations, software developers for microsoft) |
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Chain of command
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To whom do individuals and groups report - unbroken line of authority
Why change: low line employee can now access information that a top manager used to only have access to, increased communication, new structural designs |
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Span of control
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how many individuals can a manager efficiently and effectively direct
determines the number of levels and managers an organization has wider span of control: efficient in cost, cheaper, speed decision making, empower employees, increase flexibility, not enough leadership and support reduce effectiveness and employee performance narrow: maintain close control, BUT 1. expensive 2. added levels of hierarchy slows decision making 3. discourage employee autonomy trend recently to wider span but to ensure performance doesn't suffer: invest heavily in organizational training |
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Centralization and decentralization
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Where does the decision making authority lie
centralized: top managers make all the decisions, only formal authority decentralized: decision making pushed down to managers closest to the action -faster decision making - more input -employees less likely to feel alienated trend towards decentralized |
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Formalization
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To what degree will there be rules and regulations to direct employees and managers
degree of standardized jobs highly formalized: -minimal control -uniform output -lots of rules -clear procedures -employees don' t consider alternatives :( low formalization: -employee freedom |
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Authority
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The rights inherent in a managerial position to give orders and expect them to be obeyed
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Unity of command
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how many superiors
Helps preserve the concept of an unbroken line of authority says a person should have one and only one superior to whom he or she is directly responsible if broken employee may have to cope with conflicting demands or priorities from several superiors |
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Simple Structure
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-low departmentalization
-wide spans of control -centralized authority -little formalization "flat" - two or three vertical levels small business benefits: fast, flexible, inexpensive, clear accountability - some companies go to simple structure in times of crisis to focus resources weakness: -does not work for bigger organizations because the little formalization and high centralization = info overload at the top -decision making gets slower as size increases -dependent on one person |
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Bureaucracy
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Standardization!
Routine operating tasks from: specialization formalization narrow span of control departmentalization by function specific chain of control adv: -efficient for standard activities -economies of scale -departmentalization: minimum duplication -less talented middle managers required b/c rules -centralization results from the lack of need for innovative lower levels disadv: -rules are too stringent |
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Matrix
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Common in ad agencies, universities, hospitals, government agencies
Gains the advantages of both a product departmentalization and function departmentalization (the former: coordination to achieve on time completion and meet budges, and pooling resources and ideas) Breaks unity of command! conflicting priorities and authority, but better communication |
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New Design options
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1. Virtual organization
2. Boundless organization |
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Virtual organization
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Small core business organization that outsources all other major business functions
highly centralized with no departmentalization ex) movie-making: get best staff for specific project, no long term risk and costs maximum flexibility complete opposite of bureaucracy managers spend most of their time controlling and coordinating external resolutions drawbacks: unclear roles, goals, and responsibility - sets stage for political behavior |
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The boundless organization
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Eliminates the chain of command in order to have limitless spans of control, and replace departments with empowered project teams
complete interaction |
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How to reduce horizontal barriers
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cross functional teams:
-organize activities around processes -work together on single process not narrow functional tasks lateral transfers: -rotating people into and out of different functional areas -turns specialists into generalists |
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Downsizing
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Making the organization leaner, more focused, and flexible
ex: selling off units, closing locations, reduce staff negative effects on employees (their stress reactions - lead to absenteeism, low concentration, low creativity) positive effect on wage costs, stock price BUT only if you restructure |
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Preparing for Downsizing
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1. investment
-in high involvement work practices 2. communication -discuss downsize, less likely for employees to worry 3. participation -voluntary retirement packages 4. assistance - severance, extended health care benefits, job assistance |
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Why do structures differ?
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1. Strategy
2. Organization Size 3. Technology 4. Environment |
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Mechanistic Model (bureaucracy)
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- high specialization
- rigid departmentalization - clear chain of command - narrow spans of control - centralization - high formalization similar to bureaucracy |
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Organic Model (adhocracy)
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- cross functional teams (communication across depart.)
- cross hierarchical teams (lowers centralization) - free flow of info - wide spans of control - decentralization - low formalization similar to Boundless |
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Different Organizational Strategies
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1. innovation
-achieve meaningful and unique innovations - employee risk = employee autonomy = wide span of control - mechanic structure elements: well-devo communication channels, policies for enhancing long term commitment, clear channels of authority for rapid changes |
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Cost minimization strategy
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controls costs, refrains from incurring unnecessary expenses, and cuts prices in selling a basic product
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Imitation strategy
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minimize risk and maximize opportunity for profit
move into new products or new markets after proven viable by competitors |
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Organizational size
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more people = more specialization, more departmentalization, more vertical levels, and more rules and regulations
size becomes less important as organizations expand because 2,000 already mechanistic 500 makes no difference |
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Technology
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way an organizations transfers inputs and outputs
technology is differentiated by the degree of routineness - routine activities = automated and standard operations - nonroutine activities = customized (require frequent revision |
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Environment
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Outside institutions or forces that can affect its performance - suppliers, customers, competitors, government regulation, public pressure groups
Any org's enviro has 3 dimensions: 1. capacity 2. volatility 3. complexity organizations that operate in environments characterized as scarce, dynamic, and complex face the greatest degree of uncertainty so it should have a more organic organization vary greatly on the required precision, the nature of the workforce and demand for product |
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Capacity
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The degree to which the enviro can support growth
rich and growing enviro's generate excess resources, which an buffer the organization in times of scarcity |
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Volatility
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The degree of instability in the enviro
dynamic enviro w/ high degree of unpredictable change = difficult to predict more organizations are become volatile because of the speed of technological changes |
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Complexity
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Degree of heterogeneity and concentration among environmental elements
simple enviro: concentrated and homogeneous complex: numerous competitors, heterogeneous and dispersed |
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Maximizing employee performance
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managers must take individual differences such as experience personality and work task into account
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Division of labor
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1. craft models
2. segmented models 3. mixed models |
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Craft models
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people who are extremely specialized in their labor and become mentors and teach an apprentice
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Sequential models
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when employs are specialized in one area of a giant component and work in sequence to produce the final good or service
ford |
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Mixed model
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when generalist employees coordinate the work and call on specialists
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Scientific Management -Taylor
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- increases the efficiency of work practices through analysis
- separates the planning and design of work from its execution - breaks down tasks into specialized components - work designed to eliminate wasted motion, effort, and second - people work like machines |
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Effects of Taylor's Scientific Management
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- increased production
- deskilled and alienated workers - quality and innovation problems |
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Structural contingency theory - which structure works best?
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It varies based on their context w/ competitors, customers, economics conditions, suppliers, and regulations
different tasks and environments call for different structures |
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McDonaldization - Weber's concerns
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That the rigid, routine, standardized, repetitive society would impede creativity, self actualization, and meaningful social relations
BUT creates a stability in society |
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Four types of rationality
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1. practical (accepts given realities and calculates the most expedient way of dealing with realities - means to an end)
2. theoretical (actions are guided by abstract intellection concepts rather than through prior actions) 3. substantive (actions guided by cluster of values - religion 4. formal - use of formal rule "without regard to persons" - bureaucracy |
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Formal rationality
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rejects arbitrariness
decisions are made according to established principles and formal rules indifferent to situation or person selection of most adequate means of production |
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Four parts of McDonaldization
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1. Efficiency
2. Predicability (can anticipate process and outcomes) 3. Calculability (measurable standards, self surveillance) 4. control (over humans with non-human technology ex. cubicles, uniforms, instructions, assembly lines) |
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McDonaldization negative impacts
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- dehumanizes
- lower quality - inability to deal with exceptions - implications for skill |
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McDonaldization elsewhere in our lives
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high-skilled work
valuation of our life dating death |
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Irrationality of Rationality
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inefficient
not less expensive for consumer or client require the consumer or client to work |
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Velvet, rubber, and iron cages
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velvet cage claims that McDonaldization is a comfortable existence and not a threat
rubber cage claims that McDonaldization is escapable by creating life and choosing a career path off the beaten path iron cage claims that McDonaldization is deeply problematic and sees little change of escaping - disenchantment |
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How bureaucracy isn't cagey
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equal hiring process because of standardized process
rules and procedures can protect employees and consumers because everyone is treated the same and the rules and procedures hold management accountable and the process allows to see where there was an error no room for politicking or impressions management improve safety and reliability of products - easy regulations to inspect |
