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Chapter 16: Organizational Design and Structure - PowerPoint PPT Presentation
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Understanding And Managing Organizational Behavior 4th Edition. Chapter 16: Organizational Design and Structure. JENNIFER GEORGE & GARETH JONES. Chapter Objectives. Understand the relationship between organizational design and an organization’s structure
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Presentation Transcript
And
Managing
Organizational
Behavior
4th Edition
Chapter 16:Organizational Design and Structure
JENNIFER GEORGE
& GARETH JONES
Chapter Objectives
- Understand the relationship between organizational design and an organization’s structure
- Explain the main contingencies affecting the process of organizational design and differentiate between a mechanistic and an organic structure
Chapter Objectives
- Cite the advantages of grouping people into functions and divisions and distinguish between the main forms of organizational structure from which an organization can choose
- Explain why coordination becomes a problem with the growth of an organization and differentiate between the three main methods it can use to overcome this problem and link its functions and divisions
Chapter Objectives
- Gain an understanding of the enormous impact modern information technology has had on the process of organizational design and structure both inside organizations and between them
Opening Case: A New Approach to Organizing at Sun Life
- Why did Sun Life Change Its Structure?
- Rigid and bureaucratic structure
- Customer response too slow
- Reorganization into series of cross-functional product teams
Designing Organizational Structure
- Organizational Structure: Formal system of task and job reporting relationships
- Organizational Design: Arrangement of tasks and job relationships that comprise the organizational structure
Figure 16.1 Contingencies Affecting Organizational Design
- Organization’s Environment
- Technology
- HR and Employment Relationships
Routine vs Complicated Technology
- Task Variety
- Task Analyzability
Kinds of Technology
- Small Batch
- Mass Production
- Continuous Process
Organic
Dynamic, flexible
Empowered teams
Continuous improvement
Norms and values
Mechanistic
Formal, controlling
Centralized decision-making
Clearly defined tasks
Rules and regulations
Organic and Mechanistic StructuresAdvantages
Coordination
Communication
Skill Improvement
Motivation
Controlling
Disadvantages
Limited growth under existing structure
Limits to number of products and services
Coordination difficulties at larger size
The Functional StructureDivisional Structures
- Product
- Market
- Geographic
Advantages
As size and complexity of organization increases,
Coordination
Communication
Motivation
Autonomy
Disadvantages
Increased costs
Duplication of functions
Miscommunication across divisions
Competition for resources
Conflict
The Divisional StructureThe Matrix Structure
- Complex network of reporting relationships among product teams and functions
- People and resources grouped by
- Function
- Product
Advantages
Coordination
Fast new product development
Communication
Cooperation
Innovation
Creativity
Autonomy
Disadvantages
Role conflict
Role ambiguity
Stress
Unclear individual contributions to team performance
The Matrix StructureTechniques for Enhancing Coordination
- Allocating Authority
- Mutual Adjustment and Integrating Mechanisms
- Standardization
Allocating Authority
- Span of control
- Tall and Flat Hierarchies
- Chain of Command
- Centralization versus Decentralization
Mutual Adjustment and Integrating Mechanisms
- Direct contact
- Liaison roles
- Teams and task forces
- Cross-functional teams
Standardization
- Standardizing inputs
- Standardizing conversion processes
- Formalization
- Standardizing outputs
The Effects of IT
- Virtual organizations
- Network structure
