Basic attributes of organizations Flashcards
What is an organization?
Open system
Exists over extended periods of time
Goal-directed
Social entity (made up from individuals and groups)
Structured:
- Often with division of labour
- And a hierarchy of responsibility
Goals in an organization
Individual vs. organizational goals
Multifaceted and conflicting goals
Open vs. hidden goals
Output goals (production) vs. system goals (improving efficiency)
The business control process
Set standards
-> measure output
-> compare output with standard
-> take corrective actions if necessary
-> set standards (with changes (standard, output), or no changes)
Signs of too much control
- Too much emphasis on one measured goal
- Controls that are unnecessary and that do not meet individual needs
Output controls
- Controls that focus on desired targets
- Allow managers to use their own methods for reaching defined targets
Process controls
- Policies, rules and procedures
- Formalization and standardization
- Quality management
Formal Organization Structure
The formal structure:
- The intended configuration of positions, jobs duties, and lines of authority among the component parts of an organization.
Organization charts:
- Diagrams that depict the formal structures of organizations
Organigraph
Elements & Characteristics:
- Sets (Machines, buildings, people)
- Chains (Transformation processes, value chains) - - - Hubs: Coordination centers
- Webs: Grids with no center, allowing the movement of people and ideas
Management Function:
Sets:Allocate.
Chains:Control.
Hubs:Coordinate.
Webs:Energize
Organigraph
Elements & Characteristics:
- Sets (Machines, buildings, people)
- Chains (Transformation processes, value chains) - - - Hubs: Coordination centers
- Webs: Grids with no center, allowing the movement of people and ideas
Management Function:
Sets:Allocate.
Chains:Control.
Hubs:Coordinate.
Webs:Energize
Critical evaluation organigraph and organizational chart
- Authority structures are not visualized (as in org charts)
- Organigraph is quite arbitrary (hubs can be sets can be chains etc.)
- It does not necessarily provide more information than the matrix structure
- Organigraph may enhance transparence of processes, particularly if used together with traditional org charts
Formal authority
centralization
decentralization
Schein’s Organizational Socialization model
- Socialization to higher levels of management (going up in the pyramid)
- Socialization to more central roles/influence in the orga. (going to the center)
Vertical spezialisation
- Chain of command (supervisors are defined)
- Unity of command (each person has only one supervisor)
- Span of Control (few employees reporting to one supervisor)
Line and Staff Personnel
- Line personnel conduct the major business of the organization.
- Staff personnel are groups that assist the line units.
New organizational paradigms:
Organization of the past:
Top-level management -> Middle management -> Operating staff. (inside line units & supported by staff units)
New:
Line-staff in the middle — Outsourcing organisations and contracting staff from outside
Horizontal specialization
The division of labour through the formation of work units within the organization
Departmentalization by function (functional specialization)
Functional departmentalization is the grouping of individuals and resources by skill, knowledge, and action.
Advantages:
* Clear task assignments
* Build on each other’s knowledge
* Excellent training ground
* Easy to explain
Disadvantages:
* May lead to boring and routine jobs
* May have top management overload
* May result in lack of focus on products / service
Departmentalization by Division
Departmentalization by product, geography, customer
Advantages:
* Provides adaptability and flexibility
* Allows for spotting of external changes
* Provides for integration of personnel
Disadvantages:
* Does not provide pool of highly trained individuals * Can lead to a duplication of effort
* Divisional goals may be given priority
Departmentalization by Matrix
Functional and divisional forms simultaneously
-> Individuals are assigned to more than one type of unit (e.g. Functional groups like : production, marketing, engineering with Project groups for products)
Advantages:
* Combines strengths
* Helps provide blend of technical and market emphasis
* Managers can converse with technical and marketing personnel
Disadvantages:
* Expensive (you need more managers)
* Unity of command is lost
* Overlapping authorities and responsibilities
Mixed hybrid forms of departmentalization
(multinational companies) (e.g. -production : domestic(with product a,b,c,d ), foreign (with product a,b,c,d) - marketing ….
Mechanistic structure
(Old bureaucratic way)
- High horizontal differentiation
- Rigid hierarchical relationships
- Fixed duties
- High formalization
- Formalised communication channels
- Centralised decision authority
Organic structure
- Low horizontal differentiation
- Collaboration (both vertical and horizontal)
- Adaptable duties
- Low formalization
- Informal communication
- Decentralized decision authority
