Management Chapter 8

Factors managers must consider when taking a contingency approach:

1. Environment - mechanistic versus organic 2. Environment - differentiation versus integration 3. Life Cycle 4. Link between strategy and structure

Four Types of Organizational Culture:

Clan, Adhocracy, Market, Hierarchy

Virtual Organization

an organization whose members are geographically apart, using working with e-mail, collaborative computing, and other computer connections (while often appearing to customers and others to be a single, unified organization with a real physical location)

For-profit orgnanizations

are formed to make money, or profits, by offering products or services

Nonprofit organizations

are formed to offer services to some clients, not to make a profit (ex: hospitals, colleges)

Rites and Rituals

are the activities and ceremonies, planned and unplanned, that celebrate important occasions and accomplishments in the organization's life

Team-based structure

e.g. Google newgooglers are paired with higher ups to learn

Geographic divisions

group activities around defined regional locations

Centralized Authority

important decisions are made by higher-level managers

Organizational Design

is concerned with designing the optimal structures of accountability and responsibility that an organization uses to execute its strategies

The Birth Stage

is the nonbureaucratic stage, the stage in which the organization is created

Responsibility

is the obligation you have to perform the tasks assigned to you -Obligation to get job done right

Delegation

is the process of assigning managerial authority and responsibility to managers and employees lower in the hierarchy -letting others take responsibility -Give them framework and let them work then go over it and negotiate

Differentiation

is the tendency of the parts of an organization to disperse and fragment

Divisional Structure

people with diverse occupational specialties are put together in formal groups by similar products or services, customers or clients, or geographic regions -e.g. Legal services headquartered in Houston but other HUBs in other cities, geographical because different states have different laws, etc.

Functional Structure

people with similar occupational specialties are put together in formal groups

Coordinated Effort

the coordination of individual efforts into a group or organization effort

Espoused Values

the explicitly stated values and norms preferred by an organization

Common Purpose

unifies employees or members and gives everyone an understanding of the organization's reason for being

Division of Labor

(also known as work specialization) is the arrangement of having discrete parts of a task done by different people

Organizational Culture

(sometimes called corporate culture), is a system of shared beliefs and values that develops within an organization and guides the behavior of its members

Modular Structure Examples:

- LearJet - have different people make chunks of lanes and put them all together - Ships and helecopters

Level 2: Espoused Values

-Espoused Values -Enacted Values -"ice just beneath the water's surface" - can see as you get close to it

Market Culture

-has a strong external focus and values stability and control -driven by competition and a strong desire to deliver results

Adhocracy Culture

-has an external focus and values flexibility -attempts to create innovative products by being adaptable, creative, and quick to respond to changes in the marketplace -W.L. Gore & Associates --> all about innovation

Clan Culture

-has an internal focus and values flexibility rather than stability and control -encourages collaboration among employees -e.g. Pike's Place Fish Market - Seattle

Hierarchy Culture

-has an internal focus and values stability and control over flexibility -A formalized, structured work environment aimed at achieving effectiveness through a variety of control mechanisms

Level 1: Observable artifacts

-physical manifestations... dress, awards, myths, and stories about the company -visible behavior exhibited by managers and employees -"tip of the iceberg" -easy to see above the water

Hollow Structure

(often called the Network Structure) the organization has a central core of key functions and outsources other functions to vendors who can do them cheaper or faster. - Dell - farmed out different elements to places that are really good at it - Do it because its cost effective particularly

Hierarchy of authority

(or chain of command) is a control mechanism for making sure the right people do the right things at the right time

The Span of Control

(or span of management) refers to the number of people reporting directly to a given manager

Level 3: Basic Assumptions

-....

Three Levels of Organizational Culture:

Level 1 - Observable Artifacts - Physical Manifestations of Culture Level 2 - Espoused Values - Explicitly Stated Values & Norms Level 3 - Basic Assumptions - Core Values of the Organization

Modular Structure

a firm assembles product chunks, or modules, provided by outside contractors

Product divisions

group activities around similar products or services

Common Elements of Organizations: Four Proposed by Edgar Schein

1. Common Purpose 2. Coordinated Effort 3. Division of Labor 4. Hierarchy of Authority

Four Functions of Organizational Culture

1. It Gives Members an Organizational Identity 2. It Facilitates Collective Commitment 3. It Promotes Social-System Stability 4. It shapes Behavior by Helping Employees Make Sense of Their Surroundings

Virtual Structure

a company outside a company that is created "specifically to respond to an exceptional market opportunity that is often temporary."

Story

a narrative based on true events, which is repeated - and sometimes embellished upon - to emphasize a particular value

Hero

a person whose accomplishments embody the values of the organization

Symbol

an object, act, quality, or event that conveys meaning to others

Matrix Structure

an organization combines functional and divisional chains of command in a grid so that there are two command structures - vertical and horizontal -Only very sophisticated companies try this - Downside for two or more bosses - bosses want to differentiate themselves

Mutual-benefit organizations

are voluntary collectives whose purpose is to advance members' interests (ex: unions, trade associations)

Fit Perspective

assumes that an organization's culture must align, or fit, with its business or strategic context

Adaptive Perspective

assumes that the most effective cultures help organizations anticipate and adapt to environmental changes

Strength Perspective

assumes that the strength of a corporate culture is related to a firm's long-term financial performance

Mechanistic Organization

authority is centralized, tasks and rules are clearly specified, and employees are closely supervised

Organic Organization

authority is decentralized, there are fewer rules and procedures, and networks of employees are encouraged to cooperate and respond quickly to unexpected tasks

The four-stage organizational life cycle

has a natural sequence of stages: birth, youth, midlife, and maturity

Simple Structure

has authority centralized in a single person, a flat hierarchy, few rules, and low work specialization

Staff personnel

have authority functions; they provide advice, recommendations, and research to line managers (EX: specialists such as legal counsels and special advisers for mergers and acquisitions or strategic planning) -are green boxes (legal council, HR, etc.) -Do NOT generate revenue, they support the org. -e.g. United Way - Receptionist, Admin, Accounting

Line managers

have authority to make decisions and usually have people reporting to them (EX: The president, the vice presidents, the director of personnel, and the head of accounting) -Close to the action (e.g. President -> Professors)

Decentralized Authority

important decisions are made by middle-level and supervisory-level managers

Unity of command

in which an employee should report to no more than one manager

Organization Chart

is a box-and-lines illustration showing the formal lines of authority and the organization's official positions or work specializations

Boundary-less organization

is a fluid, highly adaptive organization whose members, linked by information technology, come together to collaborate on common tasks. The collaborators may include not only coworkers but also suppliers, customers, and even competitors.

Organizational structure

is a formal system of task and reporting relationships that coordinates and motivate an organization's members so that they can work together to achieve the organization's goals *Players association - AKA player union *For-profit, nonprofit, mutual-benefit *Nealson buys packets of data from facebook

Chester I. Barnard's definition of an Organization

is a system of consciously coordinated activities or forces of two or more people

Integration

is the tendency of the parts of an organization to draw together to achieve a common purpose

Accountibility

managers must report and justify work results to the managers above them -Employees are accountable

Authority

refers to the rights inherent in a managerial position to make decisions, give orders, and utilize resources -VP of company has authority

Enacted Values

represent the values and norms actually exhibited in the organization

Horizontal Design

teams or workgroups, either temporarily or permanent, are used to improve collaboration and work on shared tasks by breaking down internal boundaries

Customer divisions

tend to group activities around common customers or clients

The Midlife Stage

the organization becomes bureaucratic, a period of growth evolving into stability

The Maturity Stage

the organization becomes very bureaucratic, large, and mechanistic

The Youth Stage

the organization is in a prebureaucratic stage, a stage of growth and expansion

Contingency Design

the process of fitting the organization to its environment