Chapter 2: Organisational Purpose and Structural Design Flashcards
What are the Operating goals /Organisational Purpose
Overall Performance
Resources
Market
Productivity
What is Galbraith’s Star Model/Frameworks for organisation design
Strategy
Structure
Processes
Rewards
People
What are Porter’s Competitive Strategies
Differentiation Strategy: Uniqueness
Low-Cost Leadership: Efficiency
What are the 4 Miles and Snow’s Strategy typologies
1) Prospector: broad market and lead change in the industry => Learning Orientation (creativity, flexibility, innovation)
2) Defender: limited range and focus on efficiency and process improvement => Efficiency Orientation (authority, control)
3) Analyser: between prospector and defender => balances efficiency and learning
4) Reactor: no consistent strategy, no clear organisational approach
How does Strategy affect Organisation Design
Strategy impacts internal organisation characteristics
Managers must design organisation to support competitive strategy
What are the 3 basic components of Structure
Design of Systems: effective communication, coordination efforts
Formal Reporting Relationships: span of control, number of levels
Grouping of individuals into departments: creation of departments
What are the 5 Basic Departmental Grouping Options
1) Functional: place together employees doing similar work
2) Divisional: organised according to what organisation produces
3) Multi-focused: 2 structure grouping simultaneously (=> Matrix Organisation)
4) Horizontal: organised around 1 process
5) Virtual Network: organised loosely connected (spread all over the world)
What are the strengths and weaknesses of the Functional Structure
Strengths: enables organisation to accomplish functional goals, best for 1 or few products
Weaknesses: slow response to changes, less innovation
What are the strengths and weaknesses of the Divisional Structure
Strengths: Customer Satisfaction, best in large corporations with several products
Weaknesses Duplication of functions, poor coordination accros product lines
What is the Geographical Structure
It focuses on managers and employees on specific regions
Strengths and weaknesses similar to divisional structure
What is the Matrix Structure
It has two different sub-structures: product-region and function-product
It only introduced if other structure don’t work efficiently enough
What are the strengths and weaknesses of the Matrix Structure
Strengths: suited to complex decisions, best in organisations with multiple products, provides opportunities
Weaknesses: needs good interpersonal skills and extensive training
What are the strengths and weaknesses of the Horizontal Structure
Strengths: promotes flexibility and rapid responses to changes, focus on teamwork
Weaknesses: requires substantial changes, significant training
What are the strengths and weaknesses of the Virtual Network and Outsourcing
Strengths: enables even small businesses to attract top talent, high flexible organisation
Weaknesses: loss of control, risk of failure
What is the Holding Structure
Financial Holding: management of financial assets
Strategic Management Holding: defines group strategy
Strategic Operative Holding
What are Value-adding activities
Coaching and Facilitating
Intervening
Envisioning
What are Value-destroying activities
Adding management costs
Adding complexity
What are the 4 stages of the Organisational Lifecycle
1) Entrepreneurial Stage: creating
2) Collectivity Stage: begin to develop goals
3) Formalisation Stage: Installation, procedures
4) Elaboration Stage: Collaboration, teamwork
What are the 2 New Design Essentials
1) Agility: ability to renew, adapt, change quickly and succeed
2) Ambidexterity: Ability to explore and exploit
