Organization Design

Technology Factor

More *complexity.* Must be adaptable to come up with new solutions, but if technology is more *routine* structure can be more formal.

Human Resources Factor

More highly skilled professionals working in teams needs an adaptable, decentralized structure.

Key Elements of Organization Design

Organization design determines *how employees will work together with other resources* through.. Key Elements: 1. Laying out *Flows of Information* 2. Specifying *Interactions and Collaborations* 3. Defining *Authority & Responsibility* 4. Providing knowledge of everyones *role in the value creation process.*

Skill Variety, Task Identity, Task Significance

Skill Variety - extent to which a job requires employee uses of wide range of skills, abilities or knowledge. Task Identity - extent to which a job requires worker to perform all task necessary to complete job from beginning to end of production process. Task significance - degree to which worker feels his or her job is meaningful from its effect on people inside the organization.

Key Considerations in Designing Structure

1. *Flows of information/knowledge* are enabled and supported. 2. Key individuals may *effectively interact routinely and spontaneously* with each other to create value. 3. *Clarity of responsibility and authority.* 4. *Clear roles* in the context of vision, mission, and goals. 5. *Meaningful connection to organization.*

*Creating Productive and Meaningful Jobs (Step 1)*

*Create enriched jobs* because increasing workers' *responsibility* increases their *involvement* in work and their interest in doing *quality work.*

Sources of Organizational Culture

1. Character of members 2. Employment relationships 3. Organization structure 4. Organization ethics

4 Steps in Organization Design

1. Create Productive and Meaningful jobs. 2. Group Jobs & Create Organizational Structure. 3. Integrate & Coordinate Work Flows 4. Establish Organization Culture

Structural Models

1. Functional Structure 2. Product Structure & Geographical Structure 3. Matrix Structure 4. Product Team Structures

Factors Affecting Organizational Structure

1. Organizational Environment 2. Strategy 3. Technology 4. Human Resources These 4 factors may suggest the need for adaptive structures.

Integration Mechanisms

1. Strategy - Direction, promotes collaboration towards goals. 2. Structure - Links designs roles and teams. 3. Culture - Creates collaborative environments. 4. Monitoring - Highlights problems. 5. Incentives - Motivates and encourages workers to behave collaboratively.

Functional Structure

An organizational structure composed of *all departments* that an organization requires to produce its goods or services.

Product Structure & Geographical Structure

An organizational structure composed of *separate business units,* within which are the functions that work togethers to produce a *specific product for a specific customer.*

Product Team Structure

An organizational structure in which *employees are permanently assigned to a cross functional team* and *report only to the product team manager or* to one of his or her *direct subordinates.*

Matrix Structure

An organizational structure that simultaneously *groups* people and resources *by function and by product.*

*Group Jobs & Create Organizational Structure (Step 2)*

Create a structure of working relationships among employees to allow them to achieve an organization's goals effectively and efficiently.

*Establish Organization Culture (Step 4)*

Create, develop and maintain an organizations culture.

Autonomy

Degree to which a job gives an employee freedom and discretion needed to schedule different tasks and decide how to carry them out.

Feedback

Extent to which actually doing a job provides a worker with clear and direct information about how well he or she has performed the job.

Organization Structure

Formal system of *task and reporting relationships* *coordinating & motivating* members to work together and achieve goals. Organizational structure is important because tasks require collaboration to create value. Work units make it easier for workers to organize their work and requires less management attention. People working in well designed *work units will take initiative* to work together and other task that create value. This is all aimed at the self organization of work.

Environment Factor

Greater uncertainty, *more change*. Need speedy decisions and lots of communication to provide *stability.*

Organizational Hierarchy & Flat Structures

Organizations have hierarchy layers. The goal is to move towards flatter structures or fewer chains of command. Also known as *Minimum Chain of Command.* Flat Structures have fewer layers and wide spans of control. This structure results in quick communications but can lead to overworked managers with too many direct reports.

*Integrate and Coordinate Workflows (Step 3)*

Self explanatory. Integration and coordination of workflows provide *unity of effort towards the same goal with work groups, while avoiding silo mentality.* Traditional hierarchy models of integration are no longer useful, now heterarchical or many to many links are now the norm. Managers must choose the structure that allows them to integrate and coordinate their workflows.

The Job Characteristics Model

The idea that *job characteristics* lead to *physcological states* and then *outcomes.* - *Skill variety, task identity, and task significance* lead to experienced meaningfulness of work. - *Autonomy* leads to experienced responsibility for work outcomes. - *Feedback* leads to knowledge results of work. All of which lead to high motivation, high performance, and high satisfaction.

Organization Design

The process by which managers *create specific type of organization structure and culture* so that a company may operate in the most efficient and effective way. It is the flow of work across the entire organization and it helps to smoothly connect inputs, human resources, financing, and other resources, along with strategy to create outputs.

Job Design

The process by which managers decide how to divide task into specific jobs.

Organizational Culture

The shared set of *beliefs, expectations, values, and norms* that influence how members of an organization *relate to one another and cooperate* to achieve the organizations goals.

Strategy Factor

To *differentiate* and increase the value customers perceive. Must value innovation, which require adaptability in organizational design.