Organization theory and design Chapter 9 Daft

What are five techniques that can be used if downsizing is necessary?

1. Establishing criteria for future work needs. 2. Search for alternatives. 3. Communicate more not less. 4. Provide assistance to displaced workers. 5. Help the survivors thrive.

What is organizational decline?

A condition in which a substantial, absolute decrease in an organization's resource base occurs over time.

Why are large firms less centralized?

As an organization grows larger and has more people and departments, decisions cannot be passed to the top because senior managers would be overloaded.

What is the crisis: need for leadership?

As the organization starts to grow, the larger number of employees causes problems. At this time of crisis, entrepreneurs must either adjust the structure of the organization to accommodate continued growth or else bring in strong managers who can do so.

The model of decline stages, suggests that decline, if not managed properly, can move through five stages resulting in organizational dissolution. What are the 5 stages?

Blinded, Inaction, Faulty action, Crisis, Dissolution

What did Weber perceived as a threat to basic personal liberties, but also recognized it as the most efficient possible system of organizing?

Bureaucracy

What three strategies come from a framework for organizational control proposed by William Ouchi?

Bureaucratic control, Market control, Clan control

Along what dimensions do large organizations differ from small ones?

Bureaucratic structure, including formalization, centralization, and personnel ratios.

What is the big company/small company solution.

Combines a large corporation's resources and reach with a small company's simplicity and flexibility. These companies incorporate structures and processes that enable them to be both adaptable and efficient at the same time.

Organizations are taking a number of steps to reduce bureaucracy, often driven by top leaders, what are they.

Cutting layers of the hierarchy, keeping headquarters staff small, and giving lower level employees greater freedom to make decisions rather than burdening them with excessive rules and regulations.

What is the Inaction stage, in the model of decline stages?

Denial occurs despite signs of deteriorating performance. Leaders may try to persuade employees and other stakeholders that all is well.

What does "Establish criteria for work needs" mean?

Downsizing should be used as a way to make the organization stronger and more competitive when conditions change, not just as a way to cut workers.

How can organizations overcome the problems of bureaucracy in rapidly changing environments?

During times of high uncertainty, however, the most effective structure is one that loosens the lines of command and enables people to work across departmental and hierarchical lines to anticipate, avoid, and solve unique problems.

What are the characteristics of large organizations?

Economies of scale Global reach Vertical hierarchy, mechanistic Complex Stable market "Organization men"

That is the life cycle Collectivity Stage?

Employees identify with the mission of the organization and spend long hours helping the organization succeed. Members feel part of a collective. Leads to Crisis: Need for delegation.

What are the four stages of life cycle development?

Entrepreneurial stage, Collectivity stage, Formalization stage, Elaboration stage

When does organizational atrophy occur?

Follows a long period of success because an organization takes success for granted, becomes attached to practices and structures that worked in the past, and fails to adapt to changes in the environment.

What is the life cycle Formalization stage?

Involves the installation and use of rules, procedures, and control systems. In the formalization stage, communication is less frequent and more formal, and more likely to follow the hierarchy of authority. Leads to Crisis: Too much red tape.

What is "traditional authority"?

It I s the belief in traditions and in the legitimacy of the status of people exercising authority through those traditions. It is the basis for control for monarchies, churches, and some organizations in Latin America and the Persian Gulf.

What is "Rational-legal authority".

It is based on employees' belief in the legality of rules and the right of those elevated to positions of authority to issue commands. It is the basis for both creation and control of most government organizations and is the most common base of control in organizations worldwide.

What kind of organization is a professional partnership.

It is made up completely of professionals. These organizations include accounting firms, medical practices, law firms, and consulting firms.

Weber predicted the triumph of bureaucracy because of what?

Its ability to ensure more efficient functioning of organizations in both business and government settings.

What does "search for alternatives" mean when considering downsizing?

Managers can use creative approaches to cut costs and limit the number of people they have to let go during a decline.

What does "Communicate more not less" mean when considering downsizing?

Managers should remember that it is impossible to "overcommunicate" during turbulent times. Remaining employees need to know what is expected of them, whether future layoffs are a possibility, and what the organization is doing to help co-workers who have lost their jobs.

What does "Help the survivors thrive" mean when considering downsizing?

Many people experience guilt, anger, confusion, and sadness after the loss of colleagues, and managers should acknowledge these feelings. Survi- vors also might be concerned about losing their own jobs, lose confidence in company management, and grow depressed and cynical. It is extremely important that managers don't hide behind closed doors, no matter how depressed they might be feeling them- selves.

What is "organizational Atrophy"?

Occurs when organizations grow older and become inefficient and overly bureaucratized. The organization's ability to adapt to its environment deteriorates.

Describe Market control.

Occurs when price competition is used to evaluate the output and productivity of an organization or its major departments and divisions.

What is an organizational life cycle?

Organizations are born, grow older, and eventually die.

What is environmental decline or competition?

Refers to reduced energy and resources available to support an organization. When the environment has less capacity to support organizations, the organization has to either scale down operations or shift to another domain.

Why is organizational vulnerability?

Reflects an organization's strategic inability to pros- per in its environment. This often happens to small organizations that are not yet fully established. They are vulnerable to shifts in consumer tastes or in the economic health of the larger community.

What are the characteristics of small organizations?

Responsive, flexible Regional reach Flat structure, organic Simple Niche finding Entrepreneurs

The economic vitality of the United States as well as most of the rest of the developed world is tied to what?

Small and midsized businesses.

How has the increasing professionalism of employees changed bureaucracy?

Studies of professionals show that formalization is not needed because professional training regularizes a high standard of behavior for employees, which acts as a substitute for bureaucracy.

What is the Blinded stage in the model of decline stages?

The first stage of decline is the internal and external change that threatens long-term survival and may require the organization to tighten up. The organization may have excess personnel, cumbersome procedures, or lack of harmony with customers.

What does professionalism refer to?

The length of formal training and experience of employees.

What does "Provide assurance to displaced workers" mean when considering downsizing?

The organization has a responsibility to help displaced workers cope with the loss of their jobs and get reestablished in the job market. The organization can provide training, severance packages, ex- tended benefits, and outplacement assistance.

What is the faulty action stage, in the model of decline stages?

The organization is facing serious problems, and indicators of poor performance cannot be ignored. Failure to adjust to the declining spiral at this point can lead to organizational failure.

What is the Crisis: Need for delegation?

The organization needs to find mechanisms to control and coordinate departments without direct supervision from the top.

What is the Crisis: Too much red tape?

The organization seems too large and complex to be managed through formal programs.

What is the Crisis: Need for revitalization?

The organization shifts out of alignment with the environment or perhaps becomes slow moving and over-bureaucratized, so it must go through a stage of streamlining and innovation. Every 10 to 20 years the company it may enter periods of decline an a renewal will occur.

What is the Crisis stage in the model of decline stages?

The organization still has not been able to deal with decline effectively and is facing a panic. The organization may experience chaos, efforts to go back to basics, sharp changes, and anger.

What is the paradox of big company/small company hybrid?

The paradox is that the advantages of small companies sometimes enable them to succeed and, hence, grow large. Small companies can become victims of their own success as they grow, shifting to a mechanistic design emphasizing vertical hierarchy and spawning "organization men" rather than entrepreneurs.

How does bureaucracy relate to personnel ratio?

The ratio of top administration to total employees is typically smaller in large organizations, indicating that organizations experience administrative economies as they grow larger.

What is the life cycle Elaboration stage?

The solution to the red tape crisis is a new sense of collabora- tion and teamwork. Throughout the organization, managers develop skills for confronting problems and working together. Leads to Crisis: Need for revitalization.

What is leading to less bureaucracy in corporate North America.

The trend of increasing professionalism combined with rapidly changing environments.

Describe Bureaucratic control.

The use of rules, policies, hierarchy of authority, written documentation, standardization, and other bureaucratic mechanisms to standardize behavior and assess performance.

Describe Clan control.

The use of social characteristics, such as shared values, commitment, traditions, and beliefs, to control behavior. Organizations that use clan control have strong cultures that emphasize shared values and trust among employees.

Why large firms more formalized?

They rely on rules, procedures, and paperwork to achieve standardization and control across their large numbers of employees and departments.

What is the Dissolution stage, in the model of decline stages?

This stage of decline is irreversible. The organization is suffering loss of markets and reputation, the loss of its best personnel, and capital depletion. The only available strategy is to close down the organization in an orderly fashion and reduce the separation trauma of employees.

What is the life cycle Entrepreneurial stage?

When an organization is born, the emphasis is on creat- ing a product or service and surviving in the marketplace. Leads to Crisis: Need for leadership.

What is "Charismatic authority"?

is based on devotion to the exemplary character or to the heroism of an individual person and the order defined by him or her. Revolutionary military organizations are often based on the leader's charisma, as are North American organizations.