Part 4: Behavioural aspects

Question 1

Different type of information according to Kennedy & Schleifer (2006)

Answer 1

1. Decision facilitating information
   - Reduce decision uncertainty before judgement is made
2. Decision influencing information
   - Motivate employees and align behaviour with owners’ interest

Question 2

Traditional vs collaborative organisations

Answer 2

1. Traditional organisations
   - Vertically structured
   - Layers of management within reporting hierarchy
   - Clear responsibility
   - Slow reaction to change
   - Inefficient communication process
2. Collaborative organisations
   - Enhanced communication
   - Teams empowered to make decisions
   - Quicker response time and more innovative
   - Unclear accountability

Question 3

Simons (1995) relationship between empowerment and control

Answer 3

More empowerments require more control because decisions are no longer centralized

Question 4

Amabile et al. model of Innovation (and needs)

Answer 4

1. Encouragement of creativity
   - through goals and performance evaluations
2. Autonomy
   - sense of ownership over decisions and processes, empowerment
3. Allocation of resources
   - to team projects
4. Pressures
   - excessive workload pressure & unattainable goals -> negative, “a good challenge” -> positive
5. Organisational impediments
   - structure, conflict, and conservatism hindering creativity

Question 5

Empowerment

Answer 5

Giving authority to make decisions to a level or people in the organisation, which thanks to knowledge and closeness to the activity, is the most able to make a correct, quick, and effective decision.

(Empowerment increases information asymmetry)

Question 6

Kirkman & Rosen model of Empowerment

Answer 6

1. Potency
   - Collective belief that a team can be successful in reaching its goals
2. Meaningfulness
   - Perception of how valuable the team’s task is
3. Autonomy
   - The degree of decision-making authority
4. Impact
   - Teams’ perception of the value their work brings to the organisation

Question 7

The Amabile et al. and Kirkman & Rosen models contain overlapping and complementary dimensions in

Answer 7

1. Autonomy is overlapping
2. Encourage creativity is linked with meaningfulness
3. Allocation of resources is influencing perception of potency and impact
4. Pressures can increase or decrease potency

Question 8

Needs of control

Answer 8

1. Guide allocation of resources
2. Guide actions
3. Meeting shared objectives

Question 9

Simons levers of control

Answer 9

1. Diagnostic controls
   - Ensure goal achievement in complex environments
2. Interactive controls
   - Encourage search for new information and promote innovative thinking

Question 10

Empowerment and accountability

Answer 10

Accountability needs metrics but too much reliance on metrics takes away room for narrative and additional responsibility

Question 11

Merchants three controls

Answer 11

Result controls
- Rewarding people or holding them accountable for
certain outcomes
- Hinders innovation and empowerment
- Particular financial targets are not as useful for team
structures

Action controls
- Make people perform a certain type of action
- Physical or administrative
- Constrains creativity and innovation as it constrains
possible actions
- More action controls in relation to timely feedback
and social mechanisms

Personnel controls
- Assumes that people are internally motivated
- Self-control and social control
- Enable empowerment and innovation
- Develop human capital through training,
empowerment and peer pressure

Question 12

Innovations form in a tension field of three interrelated domains

Answer 12

1. Information and dialogue
   - Use of information to control and guide actions
2. Empowerment
   - Creating conditions for creativity and empowerment
3. Control balance
   - Selecting appropriate control mechanisms and control mix

Question 13

Taylor et al. (2019)’s control problem and empirical dilemma

Answer 13

Control problem
How do organisations with diverse interdependent functions, with different evaluative principles and differing ideas about desirable behaviour, make decisions about which competing ideas to pursue, in order to achieve innovation?

Empirical dilemma
Encouraging, sorting, and selecting innovative ideas
Making functions aware of their interdependencies

Question 14

Two features of heterarchies that enable innovation

Answer 14

1. Distributed intelligence
   - Situation where the “search” for innovative solutions is generalised and distributed across the organisation
2. Productive dissonance/friction
   - Debates actively encouraged
   - Challenging/disrupting cultural norms and routines
   - Only productive if organised

Question 15

Control problems three sources

Answer 15

1. Lack of direction and unclear expectations
2. Motivational
   - Where there is a lack of goal congruence
3. Personal limitations
   - Due to lack of training, experience, or necessary information

Question 16

Innovation is….

Answer 16

• A new idea (or recombination of old)
• A scheme that challenges present order
• A formula
• A unique approach
  (Consists of two phases: 1) initiation phase, and 2) implementation phase)

Question 17

Heterarchy

Answer 17

Organisations where there is an unclear power and responsibility distribution

Question 18

Using MCs in a heterarchical context (Taylor et al, 2019)

Answer 18

1. Heavy reliance on informal, organic controls
2. Little reliance on formal controls
3. However, formal controls were necessary
   - To manage information sharing
   - To co-ordinate between teams

Question 19

Coyte (2019)’s control context and empirical dilemma

Answer 19

Control context
Hierarchical structures with coercive MCs create limited communication, loss of local knowledge, and no sense of local responsibility

Empirical dilemma
Resistance to change
Prior organisational changes to improve quality and process management failed

Question 20

Enabling MCs

Answer 20

1. Freedom of scope and intelligence
   - Autonomy/empowerment to meet the contingencies of their work environment
2. Internal transparency
   - Interdependency of organisational processes
3. Global transparency
   - How interdependencies effect business performance
4. Flexibility
   - Discretion over MC use
5. Ability to repair
   - Change aspects of MC

(Enabling controls could be understood as attempts to mobilize local knowledge and experience in support of central objectives)

Question 21

Intellectual capital

Answer 21

1. Human capital
   - Knowledge & competences
2. Relational capital
   - How people act, responds, co-operates, and co-ordinates
3. Organisational capital
   - Knowledge embedded in processes, work practises, databases, systems, culture, structure, and hierarchy

Question 22

Situated learning perspective

Answer 22

Learning takes place through an individual’s understanding and from interaction with others

(Knowledge represents structures of symbolic meaning produced in fields of social interaction)

Question 23

Intellectual liabilities

Answer 23

Non-physical organisational deterioration caused by reductions in the value employees bring to the organisation with knowledge, experience, and motivation

Question 24

According to Coyte (2019), how did MCs foster intellectual capital development?

Answer 24

Stimulated situated learning which developed knowledge of the technical system and its control

The enabling control achieved

• Ability to repair
• Flexibility and increased local knowledge

Operatives developed local knowledge and relationships (human & relational capital)

Operatives embedded and encoded this knowledge into databases, operational documentation, and work practises (organisational capital)

Question 25

Self-control

Answer 25

Probably the strongest and most subtle form of control

Question 26

Control and behaviour depend on

Answer 26

Vertical vs horizontal control
Empowerment and accountability
Formal control and flexibility

Question 27

Four levels of accountability (Epstein & Birchard, 2000)

Answer 27

1. Governance
2. Measurement systems
3. Management systems
4. Reporting