17 Management: Principles and Practices Griffin © 2010 South-Western, Cengage Learning, Inc. All rights reserved.
The Nature of Organization Design The structural elements and the relationships among the elements used to manage the organization. A means to implement strategies and plans to achieve organizational goals. Organization Design Concepts Organizations are not designed and then left intact. Organizations are in a continuous state of change. Designs for larger organizations are extremely complex and have many nuances and variations. © 2010 South-Western, Cengage Learning, Inc. All rights reserved.
Bureaucratic Model Advantages Disadvantages Efficiency in function Organizational inflexibility and rigidity Prevention of favoritism Neglect of social and human processes Recognition of and requirement for expertise Belief in “one best way” to design organizations © 2010 South-Western, Cengage Learning, Inc. All rights reserved.
Behavioral Model: Likert System Renesis Likert Organizations that pay attention to work groups and interpersonal processes are more effective than bureaucratic organizations. System 1 Exploitative Authoritative Job-centered leader behavior System 2 Benevolent Authoritative System 3 Consultative System 4 Participative Employee-centered leader behavior © 2010 South-Western, Cengage Learning, Inc. All rights reserved.
Situational Influences on Organization Design Environment Technology Organizational Life Cycle Organization Design Size © 2010 South-Western, Cengage Learning, Inc. All rights reserved.
Core Technology and Organization Design Woodward’s Basic Forms of Technology Unit or small-batch technology Large batch/mass production Continuous process © 2010 South-Western, Cengage Learning, Inc. All rights reserved.
Strategy and Organization Design Corporate-Level Strategies Single-product strategy Related or unrelated diversification Portfolio approach to managing strategic business units Organizational Functions Major functions of the organization can influence an organization’s design. © 2010 South-Western, Cengage Learning, Inc. All rights reserved.
Organizational Strategies Business-Level Strategies Generic Competitive Strategies Defender Differentiation Prospecting Cost Leadership Analyzer Focus © 2010 South-Western, Cengage Learning, Inc. All rights reserved.
Basic Organization Designs Functional or U-form (Unitary) Design Conglomerate or H-form (Holding) Design Divisional or M-form (Multidivisional) Design Matrix Design Hybrid Designs © 2010 South-Western, Cengage Learning, Inc. All rights reserved.
The Future of Organization Design Emerging Organization Design Issues Team-based organizations Virtual organizations Learning organizations International/global organizations © 2010 South-Western, Cengage Learning, Inc. All rights reserved.
International Organization Design Issues Establish an international operating group? Make international operations an autonomous subunit? Create an international division? Competing Effectively in Global Markets © 2010 South-Western, Cengage Learning, Inc. All rights reserved.
Key Terms organization design bureaucracy behavioral model System 1 design System 4 design situational view of organization design technology mechanistic organization organic organization differentiation integration organization size organizational life cycle functional design conglomerate design divisional design matrix design hybrid design team organization virtual organization learning organization © 2010 South-Western, Cengage Learning, Inc. All rights reserved.