UCF MAN Exam 2 (Chapters 6-9)

Location departmentalization

groups jobs on the basis of defined geographic sites or areas. The defined sites or areas may range in size from a hemisphere to only a few blocks of a large city.

Functional departmentalization

groups together those jobs involving the same or similar activities. (The word function is used here to mean organizational functions such as finance and production, rather than the basic managerial functions, such as planning or controlling.)

External recruiting

involves attracting persons outside the organization to apply for jobs.

The Weberian perspective

suggests that a bureaucracy is a model of organization design based on a legitimate and formal system of authority.

Unity of command

suggests that each person within an organization must have a clear reporting relationship to one and only one boss (as we see later, newer models of organization design routinely—and successfully—violate this premise).

The scalar principle

suggests that there must be a clear and unbroken line of authority that extends from the lowest to the highest position in the organization.

Radical innovations

are new products, services, or technologies developed by an organization that completely replace the existing products, services, or technologies in an industry.

Individual differences

are personal attributes that vary from one person to another. Individual differences may be physical, psychological, or emotional.

Intrapreneurs

are similar to entrepreneurs except that they develop a new business in the context of a large organization.

Benefits

are things of value other than direct compensation that the organization provides to its workers. (Benefits are sometimes called indirect compensation.) The average company once spent an amount roughly equal to a third of its wage and salary payroll on employee benefits.

External forces for change

come from the organization's general and task environments. For example, steep increases in oil prices a few years ago caused consumer demand for low gas mileage big cars and trucks to plummet and demand for fuel efficient smaller cars and trucks to increase.

Development

generally refers to teaching managers and professionals the skills needed for both present and future jobs. Most organizations provide regular training and development programs for managers and employees.

Technology

consists of the conversion processes used to transform inputs (such as materials or information) into outputs (such as products or services).

Integration

the degree to which the various subunits must work together in a coordinated fashion. For example, if each unit competes in a different market and has its own production facilities, they may need little integration.

Differentiation

the extent to which the organization is broken down into subunits. A firm with many subunits is highly differentiated; one with few subunits has a low level of differentiation.

innovation

the managed effort of an organization to develop new products or services or new uses for existing products or services. Innovation is clearly important because without new products or services an organization will eventually fail.

Delegation

the process by which managers assign a portion of their total workload to others.

Training

usually refers to teaching operational or technical employees how to do the job for which they were hired.

Job enlargement

was developed to increase the total number of tasks workers perform. As a result, all workers perform a wide variety of tasks, which presumably reduces the level of job dissatisfaction. At Maytag, for example, the assembly line for producing washing machine water pumps was systematically changed so that work that had originally been performed by six workers, who passed the work sequentially from one person to another, was performed by four workers, each of whom assembled a complete pump

360-degree feedback

in which managers are evaluated by everyone around them—their boss, their peers, and their subordinates.

Enterprise Resource Planning (ERP)

link virtually all facets of the business, making it easier for managers to keep abreast of related developments. ERP is a large-scale information system for integrating and synchronizing the many activities in the extended enterprise. In most cases, these systems are purchased from external vendors who then tailor their products to the client's unique needs and requirements. Company wide processes—such as materials management, production planning, order management, and financial reporting—can all be managed through ERP.

Internal recruiting

means considering present employees as candidates for openings.

Incremental innovations

new products, services, or processes that modify existing ones. Firms that implement radical innovations fundamentally shift the nature of competition and the interaction of firms within their environments.

Learning organization

one that works to facilitate the lifelong learning and personal development of all its employees while continually transforming itself to respond to changing demands and needs Shell Oil purchased an executive conference center north of its headquarters in Houston. The center boasts state-of-the-art classrooms and instructional technology, lodging facilities, a restaurant, and recreational amenities such as a golf course, a swimming pool, and tennis courts. Line managers at the firm rotate through the Shell Learning Center, as the facility has been renamed, and serve as teaching faculty. Such teaching assignments last anywhere from a few days to several months.

Coordination

the process of linking the activities of the various departments of the organization.

Perceptions.

A manager may make a decision and recommend a plan for change on the basis of his or her own assessment of a situation.A manager may make a decision and recommend a plan for change on the basis of his or her own assessment of a situation.

internal forces for change

A variety of forces inside the organization may cause change. If top management revises the organization's strategy, organization change is likely to result. A decision by an electronics company to enter the home computer market or a decision to increase a ten-year product sales goal by, say, 10 percent would necessitate several related organization changes.

Managerial innovations

are changes in the management process by which products and services are conceived, built, and delivered to customers

Employee Retirement Income Security Act of 1974 (ERISA)

Employers who provide a pension plan for their employees are regulated by this. The purpose of this act is to help ensure the financial security of pension funds by regulating how they can be invested.

Product innovations

are changes in the physical characteristics or performance of existing products or services or the creation of brand-new products or services.

Employee information system (skills inventory)

To facilitate both planning and identifying persons for current transfer or promotion, some organizations also have this, which is usually computerized and contains information on each employee's education, skills, work experience, and career aspirations.

The chain of command has two components

Unity of command and scalar principle

Job evaluation

Wage structures are usually set up through this procedure, attempt to assess the worth of each job relative to other jobs. At Ben & Jerry's Homemade, company policy once dictated that the highest-paid employee in the firm could not make more than seven times what the lowest-paid employee earned.

Process innovations

are changes in the way products or services are manufactured, created, or distributed.

Core technology.

Most organizations use multiple technologies, but an organization's most important one is called its

Three basic forms of technology were identified by Woodward:

1. Unit or small-batch technology. The product is custom-made to customer specifications or produced in small quantities. Organizations using this form of technology include a tailor shop specializing in custom suits, a printing shop that produces business cards and company stationery, and a photography studio. 2. Large-batch or mass-production technology. The product is manufactured in assembly-line fashion by combining component parts into another part or finished product. Examples are automobile manufacturers like Subaru, appliance makers like Whirlpool Corporation, and electronics firms like Philips. 3. Continuous-process technology. Raw materials are transformed to a finished product by a series of machine or process transformations. The composition of the materials themselves is changed. Examples are petroleum refineries like ExxonMobil and Shell, and chemical refineries like Dow Chemical and Hoechst AG.

Virtual organization

Closely related to the team organization but has little or no formal structure. For example, TLG Research Inc. was founded as a virtual organization focused on marketing research for automotive, aviation, marine, and industrial markets for original equipment and replacement parts.

Replacement Chart

Commonly used technique, lists each important managerial position, who occupies it, how long he or she will probably stay in it before moving on, and who (by name) is now qualified or soon will be qualified to move into the position.

Title VII of the Civil Rights Act of 1964

Forbids discrimination in all areas of the employment relationship. The intent of Title VII is to ensure that employment decisions are made on the basis of an individual's qualifications rather than on the basis of personal biases.

Span of management (sometimes called the span of control).

Managers and researchers tried for years to find the optimal span of management Today we recognize that the span of management is a crucial factor in structuring organizations but that there are no universal, cut-and-dried prescriptions for an ideal or optimal span.

Realistic Job Preview (RJP)

One generally successful method for facilitating a good person-job fit which involves providing the applicant with a real picture of what performing the job that the organization is trying to fill would be like. For example, it would not make sense for a firm to tell an applicant that the job is exciting and challenging when in fact it is routine and straightforward, yet some managers do just this to hire talented and motivated people.

Person-Job fit

One important element of managing psychological contracts is managing this, the extent to which the contributions made by the individual match the inducements offered by the organization.

Americans with Disabilities Act

Passed by Congress in 1990 which forbids discrimination on the basis of disabilities and requires employers to provide reasonable accommodations for disabled employees.

neuroticism

People who are relatively less neurotic will be relatively poised, calm, resilient, and secure and experience less anxiety and stress. But people who are relatively more neurotic will be more excitable, insecure, reactive, and subject to extreme mood swings. They are also prone to be anxious and exhibit signs of vulnerability.

performance appraisal

Performance appraisal is a formal assessment of how well employees are doing their jobs. Employees' performance should be evaluated regularly for many reasons.

Uncertainty

Perhaps the biggest cause of employee resistance to change. In the face of impending change, employees may become anxious and nervous. They may worry about their ability to meet new job demands, they may think that their job security is threatened, or they may simply dislike ambiguity.

Conglomerate, or H-form

The conglomerate design is used by an organization made up of a set of unrelated businesses. Thus, the H-form design is essentially a holding company that results from unrelated diversification. Other firms that use the H-form design include General Electric (aircraft engines, appliances, medical equipment, financial services, lighting products, plastics, and other unrelated businesses) and Tenneco (pipelines, auto parts, financial services, and other unrelated businesses).

Organizational Life Cycle

The first stage is the birth of the organization. The second stage, youth, is characterized by growth and the expansion of organizational resources. Midlife is a period of gradual growth evolving eventually into stability. Finally, maturity is a period of stability, perhaps eventually evolving into decline. Firms like Netflix and Starbucks, for instance, are still in their youth stage; Halliburton and Chevron are in midlife; and Ford and Boeing are in maturity.

Kurt Lewin, a noted organizational theorist, suggested that every change requires three steps.

The first step is unfreezing—individuals who will be affected by the impending change must be led to recognize why the change is necessary. The second step is the implementation of the change itself. The third step is refreezing, which involves reinforcing and supporting the change so that it becomes a part of the system. For example, one of the changes that Caterpillar faced in response to the recession noted earlier involved a massive workforce reduction. The first step (unfreezing) was convincing the United Auto Workers (UAW) to support the reduction because of its importance to long-term effectiveness. After this unfreezing was accomplished, 30,000 jobs were eliminated (implementation). Then it worked to improve its damaged relationship with its workers (refreezing) by guaranteeing future pay hikes and promising no more cutbacks. As interesting as the Lewin model is, it unfortunately lacks operational specificity. Thus, a more comprehensive perspective is often needed.

contributions

The individual makes a variety of these to the organization—effort, skills, ability, time, loyalty, and so forth. These contributions presumably satisfy various needs and requirements of the organization.

Validation

The process of determining the predictive value of information

Product departmentalization

a second common approach, involves grouping and arranging activities around products or product groups. Most larger businesses adopt this form of departmentalization for grouping activities at the business or corporate level. Product departmentalization has three major advantages.

Technical innovations

are changes in the physical appearance or performance of a product or service or of the physical processes through which a product or service is manufactured.

The Civil Rights Act of 1991

amended the original Civil Rights Act as well as other related laws by both making it easier to bring discrimination lawsuits (which partially explains the aforementioned backlog of cases) and limiting the amount of punitive damages that can be awarded in those lawsuits.

Team organization

an approach to organization design that relies almost exclusively on project-type teams, with little or no underlying functional hierarchy. Within such an organization, people float from project to project as necessitated by their skills and the demands of those projects. At Cypress Semiconductor, founder and long-time CEO T. J. Rodgers refused to allow the organization to grow so large that it could not function this way.

The matrix design

another common approach to organization design, is based on two overlapping bases of departmentalization Martha Stewart also uses a matrix organization for her lifestyle business. The company was first organized broadly into media and merchandising groups, each of which has specific product and product groups. Layered on top of this structure are teams of lifestyle experts organized into groups such as cooking, crafts, and weddings. Each of these groups is targeted toward specific customer needs, but they work as necessary across all of the product groups. For example, a wedding expert might contribute to an article on wedding planning for a Martha Stewart Living magazine, contribute a story idea for a cable TV program, and supply content for a Martha Stewart website. This same individual might also help select fabrics suitable for wedding gowns for retailing.

Job enrichment

assumes that increasing the range and variety of tasks is not sufficient by itself to improve employee motivation To implement job enrichment, managers remove some controls from the job, delegate more authority to employees, and structure the work in complete, natural units. These changes increase subordinates' sense of responsibility.

The National Labor Relations Board (NLRB)

established by the Wagner Act to enforce its provisions. Following a series of severe strikes in 1946, the Labor Management Relations Act (also known as the Taft-Hartley Act) was passed in 1947 to limit union power.

Diversity

exists in a community of people when its members differ from one another along one or more important dimensions. In the business world, the term diversity is generally used to refer to demographic differences among people—differences in gender, age, ethnicity, and so forth.

Reciprocal interdependence

exists when activities flow both ways between units. This form is clearly the most complex. Within a Marriott hotel, for example, the reservations department, front-desk check-in, and housekeeping are all reciprocally interdependent.

Job rotation

involves systematically moving employees from one job to another. A worker in a warehouse might unload trucks on Monday, carry incoming inventory to storage on Tuesday, verify invoices on Wednesday, pull outgoing inventory from storage on Thursday, and load trucks on Friday. Thus, the jobs do not change, but instead workers move from job to job. Unfortunately, for this very reason, job rotation has not been especially successful in enhancing employee motivation or satisfaction.

Reactive change

is a piecemeal response to circumstances as they develop. Because reactive change may be hurried, the potential for poorly conceived and executed change is increased. Planned change is almost always preferable to reactive change.

Organization development

is a planned effort that is organization-wide, managed from the top, and intended to increase organizational effectiveness and health through planned interventions in the organization's process, using behavioral science knowledge.

The Behaviorally Anchored Rating Scale (BARS)

is a sophisticated and useful rating method. Supervisors construct rating scales associated with behavioral anchors.

Job analysis

is a systematic analysis of jobs within an organization. A job analysis is made up of two parts. The job description lists the duties of a job; the job's working conditions; and the tools, materials, and equipment used to perform it.

Job characteristics approach

is an alternative to job specialization that does take into account the work system and employee preferences 1. Skill variety, the number of things a person does in a job 2. Task identity, the extent to which the worker does a complete or identifiable portion of the total job 3. Task significance, the perceived importance of the task 4. Autonomy, the degree of control the worker has over how the work is performed 5. Feedback, the extent to which the worker knows how well the job is being performed

Functional design

is an arrangement based on the functional approach to departmentalization. This design has been termed the U-form (for unitary) approach. Under the U-form arrangement, the members and units in the organization are grouped into functional departments such as marketing and production.

Organization change

is any substantive modification to some part of the organization

Situational view of organization design

is based on the assumption that the optimal design for any given organization depends on a set of relevant situational factors.

Planned change

is designed and implemented in an orderly and timely fashion in anticipation of future events.

diversity and multicultural training

is designed to better enable members of an organization to function in a diverse and multicultural workplace

Job specialization

is the degree to which the overall task of the organization is broken down and divided into smaller component parts. For example, when Walt Disney started his company, he did everything himself—wrote cartoons, drew them, added the character voices, and then marketed them to theaters. As the business grew, though, he eventually hired others to perform many of these same functions.

Compensation

is the financial remuneration given by the organization to its employees in exchange for their work.

psychological contract

is the overall set of expectations held by an individual with respect to what he or she will contribute to the organization and what the organization will provide in return. Thus, a psychological contract is not written on paper, nor are all its terms explicitly negotiated.

Recruiting

is the process of attracting qualified persons to apply for jobs that are open.

Labor relations

is the process of dealing with employees who are represented by a union

Human resource management (HRM)

is the set of organizational activities directed at attracting, developing, and maintaining an effective workforce

collective bargaining

is to agree on a labor contract between management and the union that is satisfactory to both parties.

Force Field Analysis

it can help overcome resistance to change. In almost any change situation, forces are acting for and against the change. To facilitate the change, managers start by listing each set of forces and then trying to tip the balance so that the forces facilitating the change outweigh those hindering the change.

National Labor Relations Act (also known as the Wagner Act),

passed in 1935, sets up a procedure for employees to vote on whether to have a union. If they vote for a union, management is required to bargain collectively with the union.

The Fair Labor Standards Act

passed in 1938 and amended frequently since then, sets a minimum wage and requires the payment of overtime rates for work in excess of 40 hours per week.

The Age Discrimination in Employment Act

passed in 1967, amended in 1978, and amended again in 1986, is an attempt to prevent organizations from discriminating against older workers. In its current form, it outlaws discrimination against people older than 40 years.

Authority

power that has been legitimized by the organization

A mechanistic organization

quite similar to the bureaucratic model was most frequently found in stable environments. Abercrombie & Fitch and Wendy's use mechanistic designs. Each A&F store, for example, has prescribed methods for store design and merchandise-ordering processes. Little or no deviation is allowed from these methods.

Agreeableness

refers to a person's ability to get along with others. A high level of agreeableness in people causes them to be relatively gentle, cooperative, forgiving, understanding, and good-natured in their dealings with others.

Extraversion

refers to a person's comfort level with relationships. People who are called extroverts are somewhat more sociable, talkative, assertive, and open to establishing new relationships. But introverts are somewhat less sociable, talkative, assertive, and open to establishing new relationships.

openness

refers to a person's rigidity of beliefs and range of interests. People with higher levels of openness are willing to listen to new ideas and to change their own ideas, beliefs, and attitudes as a result of new information.

Conscientiousness

refers to the person's ability to manage multiple tasks and to consistently meet deadlines. People who have higher levels of conscientiousness are likely to be more organized, systematic, careful, thorough, responsible, and self-disciplined as they work to accomplish tasks and meet goals. Others, however, tend to take on more tasks than they can manage and, as a result, are somewhat more disorganized, careless, and irresponsible, as well as less thorough and self-disciplined.

Human capital

reflects the organization's investment in attracting, retaining, and motivating an effective workforce.

Pooled interdependence

represents the lowest level of interdependence. Units with pooled interdependence operate with little interaction—the output of the units is pooled at the organizational level. Old Navy clothing stores operate with pooled interdependence.

Family and Medical Leave Act of 1993

requires employers to provide up to 12 weeks of unpaid leave for family and medical emergencies.

The Equal Pay Act of 1963

requires that men and women be paid the same amount for doing the same job.

Customer departmentalization

the organization structures its activities to respond to and interact with specific customers or customer groups. The lending activities in most banks, for example, are usually tailored to meet the needs of different kinds of customers (business, consumer, mortgage, and agricultural loans, for instance).

Sequential interdependence

the output of one unit becomes the input for another in a sequential fashion. This creates a moderate level of interdependence. At Nissan, for example, one plant assembles engines and then ships them to a final assembly site at another plant, where the cars are completed.

Decentralization

the process of systematically delegating power and authority throughout the organization to middle- and lower-level managers. It is important to remember that decentralization is actually one end of a continuum anchored at the other end by centralization, the process of systematically retaining power and authority in the hands of higher-level managers. Hence, a decentralized organization is one in which decision-making power and authority are delegated as far down the chain of command as possible. Conversely, in a centralized organization, decision-making power and authority are retained at higher levels in the organization.

business process change, or reengineering

the radical redesign of all aspects of a business to achieve major gains in cost, service, or time. ERP, as described earlier, is a common platform for changing business processes. However, business process change is a more comprehensive set of changes that goes beyond software and information systems.

knowledge workers

the skill with which they are managed is a major factor in determining which firms will be successful in the future. Knowledge workers, including computer scientists, engineers, and physical scientists, provide special challenges for the HR manager.

Organizational size

the total number of full-time or full-time-equivalent employees.

An organic organization

was most often found in unstable and unpredictable environments, in which constant change and uncertainty usually dictate a much higher level of fluidity and flexibility. Verizon (facing rapid technological change) and Apple (facing both technological change and constant change in consumer tastes) both use organic designs

Divisional design

which is becoming increasingly popular, a product form of organization is also used; in contrast to the H-form approach, however, the divisions are related. Thus the divisional design, or M-form (for multidivisional) approach, is based on multiple businesses in related areas operating within a larger organizational framework. This design results from a strategy of related diversification.