Chapter 8 - Creating a Flexible Organization Flashcards
Organization Design:
process that results in an organizational structure representing job design, departmentalization, centralization of authority, and span of management.
Has direct impact on how well a company achieve its goals.
Four common objectives companies use to evaluate when building their organization:
- Efficiency
- Control
- Responsiveness
- Empowerment
Efficiency:
the ability to complete a task using a minimum amount of resources.
Some most be efficient to keep costs low but others have other priorities such as safety or accuracy.
Control:
ability to make decisions and specify how those decisions will be carried out.
- Some require managers with high level of control for quality or even legal reasons.
-Others businesses find that too much control can get in the way of creativity.
Responsiveness:
speed at which an organization can improve the products they have as a response to customer feedback, employee suggestions, or competitive pressures.
- Not to be confused with good customer service.
- It’s the company’s overall flexibility when it comes to innovation.
Empowerment:
degree to which employees can make decisions on their own.
- May be related to solving a customer service situation, refining production process, or designing / implementing employee training and development programs.
- Higher levels often result in a more creative work environment but can also create inefficiencies from lack of management control.
Departmentalization:
process of grouping jobs into manageable units.
Most Common Forms of Departmentalization
- Function: groups employees who perform the same organizational activity (marketing, production, etc.)
–> supervision is simplified but can lead to “silos.” (Employees can emphasize their department’s needs rather than the company as a whole.) - Product: groups employees based on the product or service the firm offers. (Food division, drinks, etc.)
–> Decisions making is easier and can improve responsiveness but can create inefficiency (duplication). - Location: based on the geographic area they serve. From whole countries, regions in countries, foreign countries, etc.
–>Can improve responsiveness but also can create inefficiencies. - Customer: based on customer populations (demographics).
–>Deal effectively with unique customer groups can also be difficult to coordinate resource needs.
Job Design
- Structuring the tasks and activities requires to accomplish a business’s objectives into specific jobs so as to foster productivity and employee satisfaction.
- Can seem simple for small businesses.
In larger organizations, activities can be divided in many ways.
Job Specialization
○ Can increase efficiency
○ But can lead to boredom or dissatisfaction due to the low empowerment that may come with the job.
- Job Rotation: systematic shifting of employees from one job to another.
- Task Variety: degree a job requires different activities.
- Task Identity: how each job contributes to the final product or result.
- Task Significant: importance of the task.
Delegation:
assigning tasks and some degree of authority to others
Manager –> Worker
1) Assign Task
2) Grant Authority
3) Assign Accountability
The Span of Management
- Number of workers who report directly to one manager, aka “Span of Control.”
Organizational Height: number of layers/levels of management in a business.
–> Wide Span and Narrow Span
Organizational Structures
- Line: the chain of command goes directly person to person throughout the organization.
-Line-and-Staff: includes both line and staff positions.
–> Staff Managers: Human Resources, Legal Affairs, Public Affairs
-Matrix: where individuals from different functional areas work on project teams.
Advantages and Disadvantages of Basic Forms of Structure:
○ Line: clear lines of communication, fast decision-making. But may make managers feel isolated and lack of resources.
○ Line-and-Staff: managers have specialized support. But can create conflict.
○ Matrix: increased flexibility, collaboration, and innovation. But employees have two supervisors.
Cross-Functional Team:
team of individuals with varying specialties, expertise, and skills that are brought together to achieve a common task.
Corporate Culture:
aka “Organizational Culture,” “Workplace Culture,” and “Business Culture.” Which are the inner customers, traditions, and values of an organization.
○ Some are rigid and formal
Some are agile and informal
4 Distinct Types of Corporate Culture
○ Clan: family-like.
○ Adhocracy: emphasizes individual ingenuity and experimentation.
○ Market: results-driven, market-oriented, and extremely competitive.
○ Hierarchy: structure and control, formal with efficiency and consistency.
Grapevine
informal communications network within an organization.
