Exam 1: Chapter 7- Organizational Design Flashcards
Organizational Design
The formal systems, levers, and decisions an organization adopts or employs in pursuit of its strategy
Division of Labor
the manner in which work in a firm is divided among employees
Organizers
Those who believe that more control is warranted in organizational design to ensure that jobs are performed satisfactorily and efficiently
Bureaucratic Approach
an extreme form of organizational control in which systems are highly formalized and are characterized by extensive rules, procedures, policies, and instructions
Extreme control is seen within the….
Bureaucratic approach
Behaviorists
those who support a more open organizational structure where roles and responsibilities are loosely defined
Clan Approach
a type of organizational control that includes self-supervising teams that are responsible for a set of tasks
Organizational Structure
the pattern of organizational roles, relationships, and procedures that enable coordinated action among employees
Functional Structure
A structure that organizes a firm in terms of the main activities that need to be performed, such as production, marketing, sales, and accounting
Division Sturcutre
a structure that groups diverse functions into separate divisions
Matrix Structure
a structure where both divisional and functional managers have equal authority in the organization
combines both aspects
The Organizational Structure’s three primary functions
1) Allows a firm to perform a variety of activities by diving the firm’s labor force according to tasks and functions
2) Allows the members of a firm to coordinate their activities through mechanisms such as supervision, formal rules and procedures, plans and budgets, training and socialization
3) defines the borders of a firm and its relationships with both the business environment and other firms
The functional structure works very well for….
small businesses with a limited number of products or services
Functional organizational structures are best suited for….
competitive situations where the most important aspect of competition is efficiency of production or functional expertise
One main weakness of functional organizational structure is…
its inability to deal with changes in the business environment
Network Structure
a structure where “knowledge workers” are organized to work as individual contributors or to be a part of a work cluster that provides a certain expertise for the organization
Decision rights
Rights that include initiating, approving, implementing, and controlling various types of strategic or tactical decisions
Delegation
the process by which managers transfer decision rights to individual employees
Centralized organization
an organizational structure characterized by formal structures that control employee behavior by concentrating decisions in a top-down, hierarchical fashion
Decentralized Organization
an organizational structure where key decisions are made at all levels of the firm, not mandated form the top
Centralized organizations tend to be…
larger and older, exist in more mature industries, often imposes a rigid structure that constrains employees’ activity
Mutual Adaptation
the process by which firms impact the nature of their overarching industrial environment and adapt their organization in response to evolving contextual factors
Four stages in a business’ “life cycle”
Start-up, growth, maturity, and decline
Recently, firms’ have been more customer focused with four specific activities into their organizational design
Coordination, cooperation, capability development, connection (with external partners)
Silos
a functional or divisional unit that operates by its own rules and guidelines and does not openly share information with other units
