Module 3: Horizontal Differentiation (Coordination Of Activities) (Means)

Question 1

What is horizontal differentiation?

Answer 1

The degree of task specialisation across the hierarchy.

Question 2

What is vertical differentiation?

Answer 2

The depth of hierarchy - top to bottom

Question 3

What is the irresolvable tension for organisations?

Answer 3

Achieving integration (of a firm’s activities) while attempting to maintain differentiation (horizontal & vertical).

Question 4

What are the key issues in organisational structure (design)?

Answer 4

• effective information & communication flows
• effective control of decision-making
• effective coordination of subunit activities

Question 5

The questions raised in choosing an appropriate organisational structure are:

Answer 5

• Who makes what decision based upon what information?
• Who talks with who about what, or what is the structure of communication?

Question 6

What makes up organisational complexity?

Answer 6

Firms organisational structure really answers the question of:
- the number of departments (refers to functional units).
- the number of vertical levels in the hierarchy (also know as chain of command).

Question 7

Birkenshaw’s 4 Management Models

Answer 7

• Planning Model (Tight Means & Tight Ends)
• Quest Model (Tight Means & Loose Ends)
• Science Model (Loose Means & Tight Ends)
• Discovery Model (Loose Means & Loose Ends)

Question 8

What are the two components of an organisational configuration model?

Answer 8

• Functional specialisation (Efficiency)
• Product/Service/Customer Orientation (Effectiveness)

Question 9

What is functional specialisation?

Answer 9

The primary partitions of the firm’s task into smaller specialised tasks & the efficient completion of each task.

Question 10

What is product/service/customer orientation?

Answer 10

The primary partitioning of the firm’s task into smaller tasks by the output orientation & their effective completion.

Question 11

What is efficiency in organisational design?

Answer 11

Consistent quality & reduction of waste

Question 12

Birkinshaw’s Coordination Spectrum

Answer 12

Managing Across: Coordination: Coordinating activities through Bureaucracy (formal rules) or emergence (autonomy)

Question 13

How do you define Bureacracy?

Answer 13

“Bureaucracy is a means of coordinating economic activity that relies on formal rules & procedures to ensure conformity of behaviour & to generate consistent outputs.” (Birkinshaw, 2012, p.56)

Question 14

What are the benefits of adhering more to a bureaucratic model for managing activities?

Answer 14

• provides needed guidance to employees which eases role stress & helps individuals feel more effective.
• clarifies responsibilities since employees & departments are following same rules
• offers consistency & structure to organisations for efficiency work to take place.

Question 15

What are the challenges of adhering to a highly bureaucratic model for managing activities?

Answer 15

• depersonalised nature of work can lead to weak customer responsiveness, ineffective processes, & disengagement on the part of employees.
• Stifles individual creativity & autonomy, which can foster dissatisfaction and demotivate employees, lowering worker productivity.

Question 16

Impact of bureaucracy on USYD processes:

Answer 16

Usyd’s formalised rules & strong governance constrains employee autonomy i.e., lecturers have less freedom to add input in course design & teaching).

Question 17

What are the different types of horizontal differentiation models (different approaches for coordinating activities)?

Answer 17

• Traditional Bureaucracy (Weber’s Model)
• Flexible Bureaucracy
• Internal Market Models
• Network Model
• Pure Market Model

Question 18

Traditional Bureaucracy

Answer 18

• formalised rules & procedures
• efficiency- oriented
• impersonal

Question 19

Flexible Bureaucracy

Answer 19

• large structure & scale
• small flexibility & responsiveness

Question 20

Internal Market Model

Answer 20

• hybrid: transfer prices & service level agreements

Question 21

Network Model

Answer 21

• network relationships: coordination between independent companies & individuals (freelancers & platforms) to create high levels of collaboration & trust between parties.

Question 22

Pure Market Model

Answer 22

• work coordinated through purely commercial transactions.
  (Autonomy is unreal haha)

Question 23

Birkinshaw’s Quote on Bureaucracy:

Answer 23

“No large company is immune from Bureaucracy”

Question 24

What do you need to know about organisational structure & coordinating work?

Answer 24

The larger a company grows (particularly in terms of employee numbers), the more it tends to develop formal processes for structuring work & for maintaining control.

Question 25

Transparency & Organisations

Answer 25

Achieving transparency (openness of information) is an issue in bureaucratic organisations because people see only part of the system & its impossible for employees to resolve problems or act on opportunities in a thoughtful way (since they only really know how things best run in their function/specialisation - there’s no or very little collaboration or communication with other functions unless needed).

Question 26

What is a risk of using a flexible bureaucratic model?

Answer 26

Managers & companies are taking a risk in sharing their information. They are hoping that in their being transparent with this information the firm can gain new insights, yet it is possible for others to take advantage of their newfound openness (Birkinshaw, 2012, p.70)

Question 27

Is transparency important in organisations & why?

Answer 27

Transparency is important in organisations because it enables employees in different parts of the company to COORDINATE more effectively. It is a signal by the companies that they trust their employees, & want the employees to understand the bigger picture of the work that they are doing.

Question 28

What is Emergence?

Answer 28

Emergence is the spontaneous coordination of activity through the self-interested behaviours of independent actors.

Question 29

What are the benefits of an emergence model of coordinating work?

Answer 29

Employees are given complete independence & autonomy & individuals can work creatively, substantially increasing levels of innovation within the organisation.

Question 30

What are the challenges of adhering to an emergence model?

Answer 30

Could lead to a lack of communication, organisation, and direction (‘loose’ - everyone is doing their own thing - Google Oxygen - Contextual ambidexterity) with a risk of losing sight of overall organisational objectives.