Senter for teknologi, innovasjon og kultur (TIK) - Universitetet i Oslo Organizational structure Torsdag 17. november 2005 Forelesning 5

Senter for teknologi, innovasjon og kultur (TIK) - Universitetet i Oslo Core question Which factors determine the structure of the organization?

Senter for teknologi, innovasjon og kultur (TIK) - Universitetet i Oslo Division and coordination “Every organized human activity – from the making of pots to the placing of a man on the moon – gives rise to two fundamental and opposing requirements: the division of labor into various tasks to be performed, and the coordination of these tasks to accomplish the activity. The structure of an organization can be defined simply as the sum total of the ways in which it divides its labor into distinct tasks and then achieves coordination among them.” Henry Mintzberg The Structure of Organizations (1979)

Senter for teknologi, innovasjon og kultur (TIK) - Universitetet i Oslo Division and coordination Two main structures of relevance: –The division of labor –Systems of coordination and control

Senter for teknologi, innovasjon og kultur (TIK) - Universitetet i Oslo Outline 1.Core technology and structure, rational perspectives 2.Natural views on structure 3.Professional organizations 4.Size and structure 5.Networks

Senter for teknologi, innovasjon og kultur (TIK) - Universitetet i Oslo 1. Core technology and structure The main argument: –The structuring of organizations (division of labor and control mechanisms) is determined by the nature of their core technology Rational system argument (contingency theory)

Senter for teknologi, innovasjon og kultur (TIK) - Universitetet i Oslo 1. Core technology and structure The technical core of an organization: –Define the primary outputs produced –Follow the process by which the organization produces these outputs from beginning to end –Include all components that are crucial for the functioning of the production process Technical components Organizational components Knowledge components

Senter for teknologi, innovasjon og kultur (TIK) - Universitetet i Oslo 1. Core technology and structure Exercise –Describe the technical core of your organization

Senter for teknologi, innovasjon og kultur (TIK) - Universitetet i Oslo 1. Core technology and structure Three dimensions of core technology –Complexity: number of items included in the process –Uncertainty: variability of items in the process –Interdependence: connectedness of items

Senter for teknologi, innovasjon og kultur (TIK) - Universitetet i Oslo 1. Core technology and structure Exercise: –Categorize the technical core of your organization on the three dimensions using three levels: high, medium, low Complexity: number of items included in the process Uncertainty: variability of items in the process Interdependence: connectedness of items

Senter for teknologi, innovasjon og kultur (TIK) - Universitetet i Oslo 1. Core technology and structure Organizations have different technical cores and their structures vary accordingly –Assumptions: High complexity  structural differentiation High uncertainty  less formalization High interdependence  coordination important

Senter for teknologi, innovasjon og kultur (TIK) - Universitetet i Oslo 1. Core technology and structure Find concrete examples of the following kinds of organizations: –Low complexity, uncertainty, interdependence –High complexity, uncertainty, interdependence

Senter for teknologi, innovasjon og kultur (TIK) - Universitetet i Oslo 1. Core technology and structure Basic coordination mechanisms –Rules and programs –Schedules –Departmentalization –Hierarchy –Delegation –Client coordination –Primarily capable of handling moderate levels of complexity, uncertainty and interdependence

Senter for teknologi, innovasjon og kultur (TIK) - Universitetet i Oslo 1. Core technology and structure Advanced coordination strategies: Reducing information (complexity, uncertainty, interdependence) –Process organization –Slack resources

Senter for teknologi, innovasjon og kultur (TIK) - Universitetet i Oslo 1. Core technology and structure Advanced coordination strategies: Increase information handling capacity –Add systems / resources in established hierarchy –Lateral connections Liaison roles Task forces Project teams Matrix structures

Senter for teknologi, innovasjon og kultur (TIK) - Universitetet i Oslo 2. Natural views on structure The social shaping of technology –The development and implementation of technologies a result of social processes –Attacks the idea that technology determines organizational structure –Social structures shape technology rather than technology shaping structures

Senter for teknologi, innovasjon og kultur (TIK) - Universitetet i Oslo 2. Natural views on structure Structures as choices –Organizations can choose a number of different alternative structures in a given situation –Choice will be the result of internal struggles for power

Senter for teknologi, innovasjon og kultur (TIK) - Universitetet i Oslo 2. Natural views on structure Informal structures –Challenges the idea that formal organization can solve coordination problems –Organizations need to take psychological and social aspects of the work place into account

Senter for teknologi, innovasjon og kultur (TIK) - Universitetet i Oslo 2. Natural views on structure Tacit knowledge –Challenges the idea that organizations can formalize the essential parts of their technical cores. –Knowledge is often tacit and well functioning routines may not be the result of formal procedures.

Senter for teknologi, innovasjon og kultur (TIK) - Universitetet i Oslo 3. Professional organizations The competent professional as a resource for handling increased complexity –“Professional organizations incorporate two layers of response to task complexity: complex performers enter into and are supported and constrained by complex organizational structures.”

Senter for teknologi, innovasjon og kultur (TIK) - Universitetet i Oslo 4. Size and structure Larger organizations tend to be more structurally complex Larger organizations are generally more formalized Formalization allows for increased decentralization of decision making authority

Senter for teknologi, innovasjon og kultur (TIK) - Universitetet i Oslo 5. Networks Neither market nor hierarchy –Complimentary strengths between organizations –Relations important –Conflicts handled by norms of reciprocity