Chapter 13 - Enabling success and strategic change Flashcards
What are the different types of organisational structure?
- Simple/entrepreneurial - sole traders
- Functional - organised according to type of work
- Divisional - semi-autonomous units based on geography, product or market
- Holding company - divisions are separate legal entities
- Transnational structure - some independence for national units with certain functions run globally e.g. R&D function based in one country used globally
- Matrix - used for project work, co-working across functions
What are the advantages of a simple structure?
- Decision making quick
- Strong control
- Strong goal congruence
What are the disadvantages of a simple structure?
- Not effective once passed certain size
- Reliance on leader
What are the advantages of a functional structure?
- Work based on specialism
- Economies of scale
- Clear career progression
What are the disadvantages of a functional structure?
- Co-ordination and communication problems
- Silos - people do not understand how whole business works
What are the advantages of a divisional structure?
- Specialism
- Clear accountability to divisional managers
- Authority to divisional managers - prepared for senior management
What are the disadvantages of a divisional structure?
- Duplicate each others functions - waste
- More bureaucratic due to performance measures by strategic apex
What are the disadvantages of a holding structure?
Complexity of management and reporting
What are the advantages of a transnational structure?
- Improve responsiveness to local condition
- Economies of scale
What are the disadvantages of a transnational structure?
- Complex relationships
- Difficulties in control
What are the advantages of a matrix structure?
- Flexible deployment of staff as requirements change
- Improved communication
What are the disadvantages of a matrix structure?
- Increased potential manager conflict
- Complexity leading to slow decisions
Define decentralisation
A greater degree of delegated authority to regions or sub-units
What are the advantages of centralisation?
- Control
- Standardisation
- Corporate view
- Experience
What are the advantages of decentralisation?
- Reduce workload of senior management
- Job satisfaction for delegates
- Local knowledge
What are the approaches to running divisionalised conglomerates?
- Strategic planning style - divisional managers make contributions to strategic thinking
- Strategic control style - centre leaves planning to divisional managers
- Financial control style - controlled by strict financial targets
Define a boundary-less organisation
Those which have structured their operations to allow for collaboration with external parties
Define hollow structure
Non-core processes are outsourced
Define modular structure
Production processes are outsourced
Define a network structure
Groups of organisations who co-operate to deliver services to customers e.g. building contractor manages other specialists such as electriction
Define a virtual structure
Appears as single entity from outside but is a network of nodes linked through technology
Define internal partnering
Working between functions to increase co-operation and efficiency
What are the advantages of outsourcing?
- Removes uncertainty about cost - long-term contract
- Arrangements can be established for many years - future planning
- Greater skills and knowledge
- Flexibility - resources scaled up or down depending on demand
What are the disadvantages of outsourcing?
- Sharing confidential information
- Potentially locked in unsatisfactory contract
- Does not encourage awareness of potential costs and benefits of certain processes
- If decision made to move back in house there is no guarantee specialist skills available in market
Define offshoring
Outsourcing involving an external entity based in a different country
Define shared servicing
Shared service centres consolidate transaction-processing activities of many operations within organisation - alternative to outsource
What are the advantages of shared servicing?
- Reduction in premises and other overhead costs
- Knowledge sharing leads to improvement of quality of service
- Standard approach across organisation
What are the disadvantages of shared servicing?
- Loss of business-specific knowledge e.g. if there is a finance function for whole organisation, rest of organisation may have lack of understanding
- Removed from decision making - unable to provide meaningful financial information
- Weakened relationships - geographical distance
Define a global business service
A service that brings together existing shared service and outsourcing arrangements to form an integrated framework to co-ordinate global operations in areas such as IT, finance, procurement
What does the Baldrige Criteria do?
Provides a framework for assessing performance, with a view to improve performance and achieve excellence through identifying strengths, opportunities and areas for improvement.
Key to answering questions is asking HOW the business meets the criteria
What are the core values and concepts found in high-performing organisations according to the Baldrige Criteria?
- Visionary leadership
- Ethics and transparency
- Societal responsibility
- Customer-focused excellence
- Delivering results
What are the seven criteria in the Baldrige Criteria?
SCWOLAR
- Strategy - implementation and development
- Customers - meeting needs of customers, listen to them, engage
- Workforce - skilled and motivated staff, environment
- Operations - efficiency and effectiveness
- Leadership - governance, performance expectations
- Analysis, measurement and knowledge management - provide feedback to leaders about results
- Results - compared to other organisations, over time
What are the four dimensions for Baldrige Criteria 1-6?
- Approach - how do they accomplish work?
- Deployment - how consistently are key processes used?
- Learning - how well has organisation improved key approaches? How have improvements been shared?
- Integration - how well are approaches aligned to current and future needs?
What are the four dimensions for results in the Baldrige Criteria?
- Levels - current performance level?
- Trends - improving, staying the same?
- Comparisons - performance against other organisations?
- Integration - use the results in decision making?
Define empowerment
Making workers responsible for achieving and setting targets
Define delayering
Reducing the number of management levels from bottom to top
Define talent management
Attracting and identifying, developing and retaining individuals within organisation who are important for future success
What are the advantages of talent management?
- Create learning organisation where they challenge assumptions and improve
- Help develop new products
- Succession planning`
What are the activities associated with talent management?
- Coaching in leadership skills
- Attending networking events with other talented individuals
- Communication with senior management
What does the Balogun and Hope Hailey model do?
Analyses change on axes of ‘nature’ and ‘scope’.
What are the categories of the ‘nature of change’ axis in the Balogun and Hope Hailey model?
- Incremental - built on existing methods
- Big bang - rapid response requirements
What are the categories of the ‘scope of change’ axis in the Balogun and Hope Hailey model?
- Realignment - within existing paradigm
- Transformation - replaces paradigm
What are the sections in the Balogun and Hope Hailey diagram?
- Adaptation - incremental, realignment - does not require development of new paradign
- Evolution - incremental, transformation - incremental process leading to new paradigm e.g. learning process
- Reconstruction - big bang, realignment - existing paradigm with rapid and extension action e.g. cost cutting
- Revolution - big bang, transformation - rapid wide changing response e.g. strategic drift crisis
What are the eight headings proposed by Balogun and Hope Hailey for contextual features of change?
Some Times Dips Candy Canes Red & Purple
- Status symbols - preservation of organisational characteristics
- Time available
- Diversity of general experience
- Capability to manage and implement
- Capacity to undertake change
- Readiness of workforce - could have resistance
- Power to effect change
What is the POPIT model (four-view model)?
Interrelated aspects when analysing opportunities for organisational improvement. It helps identify where problems lie in each of the four aspects.
- People - skills, motivation
- Organisation - management support, cross-functional working
- Processes - IT support, manual processes
- IT - information systems
What does Lewin’s three-stage model do?
Suggests that organisational changes have three steps
- Unfreeze - creating motivation to change, highlight forces driving change, weaken restraining forces
- Change - identifying new norms, communication them, five styles of change management used here
- Refreeze - setting policies, new standards, positive reinforcement
What are the approaches to the unfreeze stage of Lewin’s model?
- Remove individuals from routines
- Confront perceptions
- Reinforce willingness to change
- Consult individuals about change
