9 -1 Task Interdependence: Thompson’s three types of technology Mediating Pooled interdependence Long-linked Sequential interdependence Intensive Reciprocal interdependence

Thompson’s Classification of Interdependence and Management Implications Form of Interdependence Demands on Horizontal Communications, Decision Making Type of Coordination Required Priority for Locating Units Close Together Pooled (bank) Low communication Standardization, rules, procedures Divisional Structure Low Sequential (assembly line)Medium communication Plans, schedules, feedback Task Forces Medium Reciprocal (hospital) High communication Mutual adjustment, cross-departmental meetings, teamwork Horizontal Structure High Client

9 -3 Routine and Nonroutine Tasks and Organizational Design Structural characteristic Nature of technology Routine tasksNonroutine tasks Standardization HighLow Mutual adjustment LowHigh Specialization IndividualJoint Formalization HighLow Hierarchy of authority TallFlat Decision-making authority CentralizedDecentralized Overall structure MechanisticOrganic

9 -4 Some kinds of technology are more complex and difficult to control than others because some are more difficult to program than others. Technology is said to be programmed when procedures can be specified in advance to make tasks standardized and predictable. Technical Complexity: Woodward’s Theory

9 -5 Technical Complexity and Organization Structure T echnical Complexity Structural Characteristics Levels in the hierarchy Span of control of CEO Span of control of first- line supervisor Ratio of managers to nonmanagers Approximate shape of organization Type of structure Cost of operation Small-Batch and Unit Technology Mass Production Technology Continuous-Process Technology LowHigh OrganicMechanisticOrganic HighMediumLow Relatively flat, with narrow span of control Relatively tall, with wide span of control V ery tall, with very narrow span of control to 231 to 161 to 8

Process Choice at a Bakery

10 -7 Advanced Manufacturing Technology Computer-aided design Computer-aided materials management Just-in-time inventory systems Computer-integrated manufacturing

NEW CHOICES TRADITIONAL CHOICES Mass Production Small batch Flexible Manufacturing Mass Customization Continuous Process Relationship of Computer-Integrated Manufacturing Technology to Traditional Technologies BATCH SIZE SmallUnlimited Customized Standardized PRODUCT FLEXIBILITY Source: Based on Jack Meredith, “The Strategic Advantages of New Manufacturing Technologies For Small Firms.” Strategic Management Journal 8 (1987): ; Paul Adler, “Managing Flexible Automation,” California Management Review (Spring 1988): 34-56; and Otis Port, “Custom-made Direct from the Plant.” Business Week/21 st Century Capitalism, 18 November 1994,

Differences Between Manufacturing and Service Technologies Manufacturing Technology 1.Tangible product 2.Products can be inventoried for later consumption 3.Capital asset intensive 4.Little direct customer interaction 5.Human element may be less important 6.Quality is directly measured 7.Longer response time is acceptable 8.Site of facility is moderately important Service Technology 1.Intangible product 2.Production and consumption take place simultaneously 3.Labor and knowledge intensive 4.Customer interaction generally high 5.Human element very important 6.Quality is perceived and difficult to measure 7.Rapid response time is usually necessary 8.Site of facility is extremely important Service: Airlines, Hotels,Consultants, Healthcare, Law firms Product and Service: Fast-food outlets, Cosmetics, Real estate, Stockbrokers, Retail stores Product: Soft drink companies, Steel companies, Auto manufacturers, Sources: Based on F. F. Reichheld and W. E. Sasser, Jr., “Zero Defections: Quality Comes to Services,” Harvard Business Review 68 (September-October 1990): ; and David E. Bowen, Caren Siehl, and Benjamin Schneider, “A Framework for Analyzing Customer Service Orientations in Manufacturing,” Academy of Management Review 14 (1989):