fundamentals of management

compressed workweek

in which employees work more hours per day but fewer days per week. The most common arrangement is four 10-hour days.

Changes in structure

includes any alteration in authority relationships, coordination mechanisms, degree of centralization, job design, or similar variables. For example, restructuring can result in decentralization, wider spans of control, reduced work specialization, and work teams.

Changing technology

includes modifications to the way work is done or to the methods and equipment used. One organizational area where managers deal with changing technology is continuous improvement initiatives, which focus on developing flexible processes to support better-quality operations. Employees committed to continuous improvement are constantly looking for things to fix, so work processes must be adaptable to continual change. This adaptability requires an extensive commitment to educating and training workers in problem solving, decision making, negotiation, statistical analysis, and team-building. Workers must also be able to analyze and act on data.

Facilitation and support

involve helping employees deal with the fear and anxiety associated with the change effort. Such help may include employee counseling, therapy, new skills training, or a short paid leave of absence.

Participation

involves bringing those individuals directly affected by the proposed change into the decision-making process. It allows these individuals to express their feelings, increase the quality of the process, and increase employee commitment to the final decision.

Negotiation

involves exchanging something of value for an agreement in order to lessen the resistance to the change effort. This resistance technique may be particularly useful when the resistance comes from a powerful source.

Work specialization

is the division of work activities into separate job tasks. At the Wilson Sporting Goods factory in Ada, Ohio, workers making NFL footballs specialize in job tasks—such as molding, stitching and sewing, and lacing—to increase work output. When first introduced, specialization almost always generated higher productivity. But at some point, the human diseconomies—boredom, fatigue, stress, low productivity, poor quality, increased absenteeism, and high turnover—exceed the economic advantages, as seen here in Exhibit 6-1. Most managers today see work specialization as an important organizing mechanism because it helps employees to be more efficient.

employee assistance programs

is to get a productive employee back on the job as quickly as possible. Wellness programs are designed to help cut employer health costs and to lower absenteeism and turnover by preventing health-related problems.

transformation process

process requires the right environment to turn those inputs into innovative products or work methods. This "right" environment—that is, an environment that stimulates innovation—includes three variables: the organization's structure, culture, and human resource practices, as seen in Exhibit 8-5.

Changes in people

refer to changes in employee attitudes, expectations, perceptions, or behaviors. To adapt well to change, the workforce must be committed to quality and continuous improvement, which stem from proper employee education and training, performance evaluation, and a reward system that supports and encourages those improvements

Manipulation and co-optation

refer to covert attempts to influence others about the change. These tactics may involve twisting or distorting facts to make the change appear more attractive.

Formalization

refers to how standardized an organization's jobs are and the extent to which employee behavior is guided by rules and procedures. In highly formalized organizations, there are explicit job descriptions, numerous organizational rules, and clearly defined procedures covering work processes.

Organizational leadership

refers to the supervisory style of the organization's managers. Some managers create a culture characterized by tension, fear, and anxiety. They establish unrealistic pressures to perform in the short run, impose excessively tight controls, and routinely fire employees who don't measure up. This style of leadership filters down through the organization and affects all employees.

job sharing

which is the practice of having two or more people split a full-time job. Organizations might offer job sharing to professionals who want to work but don't want the demands of a full-time position. Many companies use job sharing during economic downturns to avoid employee layoffs.

team-based structures

, the entire organization is made up of work teams that do the organization's work.

flextime

(also known as flexible work hours), which is a scheduling system in which employees are required to work a specific number of hours a week but are free to vary those hours within certain limits.

Functional departmentalization

, or grouping activities by function—such as engineering, accounting, information systems, and human resources—is one of the most popular ways of organizing the workplace. Its major advantage is that it achieves economies of scale by placing people with common skills and specializations into common units.

employee's abilities match the job requirements.

A realistic job preview during the selection process can help minimize stress by clarifying job expectations. Ongoing organizational communications keep ambiguity-induced stress to a minimum. Similarly, a performance planning program (such as MBO) states job responsibilities clearly, provides clear performance goals, and reduces ambiguity through feedback.

strategy and structure

An organization's structure should facilitate goal achievement. Research shows that certain structural designs work best with different organizational strategies. For instance, the flexibility and free-flowing information of the organic structure works well when an organization is pursuing meaningful and unique innovations. In contrast, the mechanistic organization, with its efficiency, stability, and tight controls, works best for companies that want to tightly control costs.

boundaryless organization

Another contemporary organizational design is the boundaryless organization, which is an organization with a design that is not imposed by a predefined structure. Former GE chairman Jack Welch coined the term "boundaryless" because he wanted to eliminate vertical and horizontal boundaries within GE and break down external barriers between the company and its customers and suppliers. In fact, many of today's most successful organizations find that they operate most effectively by remaining flexible and unstructured.

geographic departmentalization

Another way to departmentalize is on the basis of geography or territory, which is called geographic departmentalization. The sales function might have western, southern, midwestern, and eastern regions.

organizational change

Any alteration of an organization's people, structure, or technology

current organizational design challeges

As managers seek organizational designs that best support and facilitate employees to work efficiently and effectively, they face such challenges as: Keeping employees connected Managing global structural issues Building a learning organization, and Designing flexible work arrangements.

line and staff authority

As organizations get larger and more complex, line managers find that they do not have the time, expertise, or resources to get their jobs done effectively. In response, they create staff authority functions to support, assist, advise, and generally reduce some of their informational burdens. For example, if a hospital administrator cannot effectively purchase all the supplies the hospital needs, the administrator creates a purchasing department, which is a staff department. Exhibit 6-4, seen here, illustrates how line and staff authority relate.

authority and power

Authority is a right and its legitimacy is based on an authority figure's position in the organization. Power, on the other hand, refers to an individual's capacity to influence decisions.

causes of stress

Categories of organizational stressors: Task demands Role demands Interpersonal demands Organization structure Organizational leadership

Organization structure

can increase stress. Excessive rules and an employee's lack of opportunity to participate in decisions that affect him or her are examples of structural variables that might be potential sources of stress.

creativity

Creativity refers to the ability to combine ideas in a unique way or to make unusual associations between ideas. A creative organization develops unique ways of working or novel solutions to problems. For instance, at Mattel, company officials introduced "Project Platypus," a special group that includes people from a variety of disciplines such as engineering, marketing, design, and sales, and tries to get them to "think outside the box" to understand the sociology and psychology behind children's play patterns. To fuel this kind of thinking, team members embarked on imagination exercises, group crying, and juggling with a stuffed-bunny to learn to "let go."

Reducing Resistance to Change

Education and communication Participation Facilitation and support Negotiation Manipulation and co-optation Coercion

organization development

Efforts that assist members with a planned change by focusing on their attitudes and values

customer departmentalization

Employees can also be grouped by the type of customer an organization seeks to reach. For example, the sales activities in an office supply firm can be divided into three departments that serve retail, wholesale, and government customers, respectively. The assumption underlying customer departmentalization is that customers in each department have a common set of problems and needs that can best be met by specialists.

Education and communication

can reduce resistance to change by helping employees see the logic of the change effort. Of course, this technique, assumes that much of the resistance lies in misinformation or poor communication.

structure explicitly supports creativity

employees' creative performance can be enhanced. Beneficial kinds of support include encouragement, open communication, readiness to listen, and useful feedback.

HR and Innovation

HR aids innovation by: Promoting training and development Offering high job security Encouraging individuals to become idea champions Supporting new ideas Overcoming resistance Implementing innovations

culture and innovation

Innovative organizations: Encourage experimentation Reward both successes and failures Celebrate mistakes It accepts ambiguity. Too much emphasis on objectivity and specificity constrains creativity. It tolerates the impractical. Individuals who offer impractical, even foolish, answers to "what-if" questions are not stifled. What at first seems impractical might lead to innovative solutions. It keeps external controls minimal. Rules, regulations, policies, and similar organizational controls are kept to a minimum. It tolerates risk. Employees are encouraged to experiment without fear of consequences should they fail. Mistakes are treated as learning opportunities. It tolerates conflict. Diversity of opinions is encouraged. Harmony and agreement among individuals or units are not assumed to be evidence of high performance. It focuses on ends rather than means. Goals are made clear, and individuals are encouraged to consider alternative routes to reach these goals. Focusing on ends suggests that there might be several right answers to any given problem. It uses an open-system focus. Managers closely monitor the environment and respond to changes as they occur, and It provides positive feedback. Managers provide positive feedback, encouragement, and support so employees feel that their creative ideas receive attention.

virtual organization

consists of a small core of full-time employees and outside specialists temporarily hired as needed. By relying on freelancers, an organization enjoys a network of talent without unnecessary overhead and structural complexity.

reducing stress

Match employee skills to job requirements Redesign jobs Offer employee assistance programs

Organizing

Organizing is the management function that creates the organization's structure. When managers develop or change the organization's structure, they're engaging in organization design, which is the process of making decisions about how specialized jobs should be, the rules to guide employees' behaviors, and the level at which decisions will be made. Organizing and organizational structure have undergone much change in the 80 years since the basic concepts of organization design were formulated by management writers such as Henri Fayol and Max Weber. Let's now look a the six basic elements of organizational structure: Work specialization Departmentalization Authority and responsibility Span of control Centralization versus decentralization, and Formalization.

change agents.

People who act as catalysts and assume the responsibility for managing the change process are called change agents. A change agent can be a manager, internal staff specialist, or outside consultant with expertise in change implementation. Consultants who come from the outside offer an objective perspective that insiders usually lack, but they may not understand the organization's history, culture, operating procedures, and personnel. They're also prone to initiating more drastic changes than insiders—which can be either a benefit or a disadvantage—because they don't have to live with the repercussions after the change is implemented. In contrast, internal managers who act as change agents may be more thoughtful—and possibly more cautious—because they must live with the consequences of their actions.

perception

Perception involves the way you see things; being creative means seeing things from a unique perspective. While employees sit on their ideas to incubate, they should collect massive amounts of data that can be stored, retrieved, studied, reshaped, and finally molded into something new.

simple structure

Since most companies start as entrepreneurial ventures, they use a simple structure, which is an organizational design with low departmentalization, wide spans of control, authority centralized in a single person, and little formalization. The simple structure is most widely used in smaller businesses and it's fast, flexible, inexpensive to maintain, and has clear accountability. However, as an organization grows, there are few policies to guide operations, which creates information overload at the top and slows decision making.

Organizational development tactics

Survey feedback Process consultation Team-building Intergroup development

span of control

The number of employees a manager can efficiently and effectively supervise Examples of contingency variables: Employee training and experience Similarity of tasks and task complexity Location of employees Use of standardized procedures Sophistication of management information system

the environment and structure

The organization's environment has a major effect on its structure: Mechanistic organizations are most effective in stable environments and organic organizations are best matched with dynamic and uncertain environments. That's why so many managers have restructured their organizations to be lean, fast, and flexible in response to such dynamic environmental forces as global competition, accelerated product innovation by competitors, knowledge management, and increased demands from customers for higher quality and faster deliveries.

unity of command

Traditionally, the unity of command structure, in which each employee reports to only one manager, was the norm. In instances when the unity of command had to be overridden, a clear separation of activities and a supervisor responsible for each was always explicitly designated. Today, advances in technology allow employees access to company information and communication company-wide without going through the formal chain of command.

team structure

employee empowerment is crucial because there is no line of managerial authority from top to bottom. Instead, employee teams design and work in the way they think is best, but are held responsible for all work performance results in their respective areas. In large organizations, the team structure complements what is typically a functional or divisional structure to allow the organization to have the efficiency of a bureaucracy with the flexibility of teams.

types of authority relationships

When organizing work, managers need to clarify who reports to whom, which is know as the chain of command—that is, the line of authority extending from upper to lower organizational levels. Authority refers to the rights inherent in a managerial position to give orders and expect the orders to be obeyed. Authority is a major concept discussed by the early management writers, who viewed it as the glue that held an organization together. Each management position had specific inherent rights associated with the position's rank or title. When managers delegate authority, they must allocate commensurate responsibility. That is, when employees are given rights they also assume a corresponding obligation to perform and be held accountable for their performance. Early management writers distinguished between two forms of authority: line authority and staff authority. Line authority entitles a manager to direct the work of an employee according to the chain of command, which is shown here in Exhibit 6-3. In the chain of command, every manager is subject to the direction of his or her superior. Sometimes the term "line" is used to differentiate line managers from staff managers. In this context, line refers to managers whose organizational function contributes directly to the achievement of organizational objectives. Whether a manager's function is classified as line or staff depends on the organization's objectives.

human resource variables

Yes—innovative organizations actively promote the training and development of their members so the members' knowledge remains current. They offer their employees high job security to reduce the fear of getting fired for making mistakes, and they encourage individuals to become idea champions by actively and enthusiastically supporting new ideas, building support, overcoming resistance, and ensuring that innovations are implemented.

External boundaries

are those that separate the organization from its customers, suppliers, and other stakeholders. To minimize or eliminate these boundaries, managers might use virtual or network structural designs.

Formal groups

are work groups that are defined by the organization's structure and have designated work assignments and specific tasks directed at accomplishing organizational goals. Here in Exhibit 10-1 we can see several examples of such formal work groups, including command groups, task groups, cross-functional teams, and self-managed teams.

Command groups

are determined by the organization chart and composed of individuals who report directly to a given manager.

Self-managed teams

are essentially independent. In addition to their own tasks, they take on traditional managerial responsibilities such as hiring, planning and scheduling, and evaluating performance.

task demands

are factors related to an employee's job. They include the design of a job (which includes autonomy, task variety, and degree of automation); working conditions; and the physical work layout. Work quotas can put pressure on employees when "outcomes" are perceived as too large to meet. Additionally, the more interdependence there is between an employee's tasks and the tasks of others, the more potential stress that employee feels. Jobs in which uncomfortable temperatures, noise, or dangerous or undesirable working conditions exist can increase anxiety.

Task groups

are often temporary and are composed of individuals brought together to complete a specific job task.

Boundaryless structures

are organizations with designs that are not defined by, or limited to, the horizontal, vertical, or external boundaries imposed by a predefined structure.

Interpersonal demands

are pressures created by other employees. Lack of social support from colleagues and poor interpersonal relationships can cause considerable stress, especially among employees with a high social need.

Role demands

are pressures placed on an employee as a function of the particular role he or she plays in the organization. Role conflicts create expectations that may be hard to reconcile or satisfy. An employee experiences role overload when he or she is expected to do more than time permits. An employee experiences role ambiguity when role expectations are not clearly understood and the employee is not sure what he or she is supposed to do.

Matrix and project structures

assign specialists from different functional departments to work on projects led by a project manager, and

Frequent communication

between organizational units helps break down barriers to innovation. Cross-functional teams, task forces, and other such organizational designs facilitate interaction across departmental lines and are widely used in innovative organizations

Internal boundaries

boundaries are the horizontal ones imposed by work specialization and departmentalization, and the vertical ones that separate employees into organizational levels and hierarchies.

Cross-functional teams

bring together the knowledge and skills of individuals from various work areas, or are groups whose members have been trained to do each other's jobs

personal factor

can also create stress. These include family issues, personal economic problems, and inherent personality characteristics. Because employees bring their personal problems to work, a manager must understand and address these personal factors. Evidence also indicates that employees' personalities have an effect on how susceptible they are to stress. The most commonly used labels for these personality traits are Type A and Type B. The Type A personality is characterized by a chronic feeling of time urgency, an excessive competitive drive, and difficulty accepting and enjoying leisure time. In contrast, Type B personalities never suffer from time urgency or impatience. Recent research shows that both Type As and Type Bs are susceptible to the same anxiety-producing elements, and studies show that the hostility and anger associated with Type A behavior are actually associated with the negative effects of stress. Therefore, it's important for managers to recognize that Type A employees are more likely to show symptoms of stress, even if organizational and personal stressors are low.

internal forces

can also create the need for organizational change. These internal forces can originate from the internal operations of the organization or from the impact of external changes, both of which are a normal part of the organizational life cycle. Redefining or modifying an organization's strategy often introduces a host of changes. For example, bringing in new equipment is an internal force for change that can result in employees facing job redesign, undergoing training to operate the new equipment, or establishing new interaction patterns within their work groups. Another internal force for change is a shift in the composition of an organization's workforce in terms of age, education, gender, nationality, and so forth. A stable organization in which managers have been in their positions for years might need to restructure jobs to retain more ambitious employees and to rework the compensation and benefits systems to reflect the needs of a diverse workforce and to respond to market forces in which certain skills are in short supply. Employee attitudes, such as increased job dissatisfaction, may lead to increased absenteeism, resignations, and even strikes. Such events will likely lead to changes in organizational policies and practices.

Job redesign

can also reduce stress by increasing challenge, including employees in decision making, or reducing the workload.

Survey feedback

efforts are designed to assess employee attitudes about, and perceptions of, the change they are encountering. Employees generally respond to a set of specific questions regarding how they view such organizational aspects as decision making, leadership, communication effectiveness, and satisfaction with their jobs, coworkers, and management. This data is used to clarify problems that employees may be facing and to initiate action to remedy the problems.

"calm waters" metaphor

envisions the organization as a large ship crossing a calm sea. Change appears as the occasional storm, a brief distraction in an otherwise calm and predictable trip.

Intergroup development

focuses on helping different work groups to become more cohesive. It attempts to change attitudes, stereotypes, and perceptions that one group may have toward another in order to improve coordination of efforts among the various groups.

external forces

forces that create the need for organizational change come from various sources, including: The marketplace reflects intense competition in recent years. Government laws and regulations are another impetus for change. For example, when the Americans with Disabilities Act was signed into law, thousands of businesses were required to widen doorways, reconfigure restrooms, and add ramps. Technology also creates the need for organizational change. The Internet has changed how we get information, how products are sold, and how we get our work done. Technological advancements have created significant economies of scale for many organizations. Fluctuations in labor markets can force managers to initiate changes. For example, the shortage of registered nurses in the United States has led hospital administrators to redesign nursing jobs, alter their rewards and benefits packages for nurses, and join forces with local universities to address the shortage of nurses. Economic changes affect almost all organizations. For example, prior to the mortgage market meltdown, significant growth in the housing market meant more jobs, more new hires, and increased sales in other businesses that supported the building industry. But as the economy soured, the housing industry and other related industries shrunk as credit markets dried up and businesses couldn't get the capital needed to operate.

Process departmentalization

groups activities on the basis of work or customer flow. Examples of process departmentalizaiton can be found in many states' motor vehicle offices and in health care clinics. Units are organized around common skills needed to complete a certain process

Product departmentalization

groups employees according based on a corporation's major product areas. Each product is under the authority of a senior manager who is a specialist in, and is responsible for, everything related to his or her product line. The advantage of product grouping is that it increases accountability for product performance because all activities related to a specific product are under the direction of a single manager

Team-building is generally an activity that helps work

groups set goals, develop positive interpersonal relationships, and clarify the roles and responsibilities of each team member. The primary focus of team-building is to increase members' trust of and openness toward one another.

idea champions

have certain personality characteristics in common: extremely high self-confidence, persistence, energy, and a tendency toward risk taking. They also display characteristics associated with dynamic leadership: They inspire and energize others with their vision of the potential of an innovation and through their strong personal conviction in their mission. They're also good at gaining the commitment of others to support their mission. Idea champions also have jobs that provide considerable decision-making discretion. This autonomy helps them introduce and implement innovations in organizations.

Global Differences

in organizational structures. Researchers have concluded that the structures and strategies of organizations worldwide are similar, although the behavior within them maintains a cultural uniqueness.

organic-type structure

positively influences innovation. Because this structure is low in formalization, centralization, and work specialization, it facilitates the flexibility and sharing of ideas that are critical to innovation.

availability of plentiful resources

is a key building block for innovation. With an abundance of resources, managers can afford to purchase innovations, can afford the cost of instituting innovations, and can absorb failures.

Telecommuting

is a work arrangement in which employees work at home and are linked to the workplace by computer. This arrangement saves the organization overhead and allows employees to save on commuting expenses and time. In this arrangement, managers might be concerned about supervising the productivity of remote employees, keeping employees connected socially, and the security of business information.

organizational culture

is an important aspect of a learning organization, where everyone agrees on a shared vision and recognizes the inherent relationships among the organization's processes, activities, functions, and external environment. Organizational culture also fosters a strong sense of community, caring, and trust.

functional structure

is an organizational design that groups similar or related occupational specialties. For example, Revlon, Inc. is organized around the functions of operations, finance, human resources, and product research and development. The strength of the functional structure is the advantages of economies of scale, minimal duplication of personnel and equipment, and more satisfied employees who speak the same language as their peers.

divisional structure

is an organizational structure made up of separate business units or divisions. Each division has limited autonomy and has a division manager who has authority over his or her unit and is responsible for performance. In divisional structures, the parent corporation typically acts as an external overseer to coordinate and control the various divisions, and often provides such support services as financial and legal. The chief advantage of the divisional structure is that it focuses on results. Division managers have full responsibility for a product or service. The divisional structure also frees the headquarters staff from day-to-day operating details so that they can focus on long-term and strategic planning.

What is a group?

is composed of two or more interacting and interdependent individuals who come together to achieve specific goals.

organic organization

is highly adaptive, loose, and flexible, which allows it to change rapidly as required. Although it has division of labor, the jobs are not standardized because the employees tend to be technically proficient professionals who are trained to handle diverse problems and whose behavior is guided by professional standards. The organic organization is low in centralization so that the professional can respond quickly to problems.

stress

is the adverse reaction people have to excessive pressure placed on them from extraordinary demands, constraints, or opportunities. A dynamic and uncertain environment characterized by restructurings, downsizings, empowerment, and personal-life matters has caused large numbers of employees to feel overworked and "stressed out."

Centralization

is the degree to which decision making takes place at upper levels of the organization

Decentralization

is the degree to which lower-level managers provide input or actually make decisions.

sources of power

legitimate, reward, coercive, expert, referent

mechanistic organization

naturally results from combining the six elements of structure bulleted in Exhibit 6.7. The chain-of-command principle ensures a formal hierarchy of authority, with each person controlled and supervised by one superior. Keeping the span of control small at increasingly higher levels in the organization creates tall, impersonal structures. Because top managers can't control lower-level activities, they substitute rules and regulations. A high degree of work specialization creates jobs that are simple, routine, and standardized. Further specialization through departmentalization increases the need for multiple layers of management to coordinate the specialized departments.

minimize extreme time pressures

on creative activities despite the demands of white-water rapids-type environments. Although time pressures may spur people to work harder and may make them feel more creative, studies show that it actually causes them to be less creative.

process consultation

outside consultants help managers to perceive, understand, and act on organizational processes they face, such as workflow, informal relationships among unit members, and formal communication channels. Consultants give managers insight into what is going on and help managers diagnose the interpersonal processes that need improvement.

Leadership

plays an important role as an organization moves toward becoming a learning organization. Leaders should facilitate the creation of a shared vision for the organization's future and keep organizational members working toward that vision. They should also support and encourage the collaborative environment that's critical to learning.

Traditional Organizational Designs

simple structure, functional structure, divisional structure

Innovation

takes inspiration and turns it into a useful product, service, or way of doing things.

contingent workers

temporary, freelance, or contract workers whose employment is contingent upon demand for their services. In today's economy, many organizations have responded by converting full-time permanent jobs into contingent jobs. It's predicted that by the end of the next decade the number of contingent employees will grow from 30 percent to about 40 percent of the workforce.

Large organizations

tend to have more specialization, departmentalization, centralization, and regulations than small organizations.

Inspiration

that is the moment when all your efforts successfully come together in the creative process, is similar

white-water rapids" metaphor,

the organization is seen as a small raft navigating a raging river with uninterrupted white-water rapids. Aboard the raft are half a dozen people who have never worked together before, who are totally unfamiliar with the river, and who are unsure of their eventual destination. In this metaphor, change is the status quo and managing change is a continual process.

innovation

the process of taking a creative idea and turning it into a useful product, service, or method of operation. The innovative organization is characterized by its ability to channel creativity into useful outcomes. When managers talk about changing an organization to make it more creative, they usually mean they want to stimulate and nurture innovation.

network organization (or modular organization)

uses its own employees to do some work activities and networks of outside suppliers to provide other needed product components or work processes.

cross-functional teams

which are teams comprised of individuals from various departments who tackle complex tasks in which diverse skills are needed.

coercion

which involves the use of direct threats or force against the resisters, can also be used to deal with resistance to change.

learning organization

which is an organizational mindset or philosophy that has significant design implications. In a learning organization, employees continually acquire and share new knowledge and apply that knowledge when making decisions or performing their work. Some theorists say this may be the only sustainable source of competitive advantage.