6.3.1 M AKING HUMAN RESOURCE DECISIONS : IMPROVING ORGANISATIONAL DESIGN AND MANAGING THE HUMAN RESOURCE FLOW AQA Business 6 D ECISION MAKING TO IMPROVE HUMAN RESOURCE PERFORMANCE What would be the features of your perfect job?

6.3.1 M AKING HUMAN RESOURCE DECISIONS : IMPROVING ORGANISATIONAL DESIGN AND MANAGING THE HUMAN RESOURCE FLOW  In this topic you will learn about  Influences on job design  Influences on organisational design  Influences on delegation, centralisation and decentralisation  The value of changing job and organisational design

J OB DESIGN  The way in which jobs are arranged in the workplace in order to reduce boredom and employee dissatisfaction  Job design includes the number and variety of tasks to be undertaken by an employee  Methods of improving job design include:  Job enrichment  Job enlargement  Job rotation  Changes in job design can lead to improvements in workforce performance

I MPROVING JOB DESIGN  Job enrichment is an increase in the level of responsibility that an employee has in order to increase motivation  Job enlargement is an increase in the number, as opposed to level, of responsibilities that an employee has in order to increase motivation  Job rotation is varying the tasks that an employee does to reduce boredom and increase the range of skills that the worker has Individually, choose one type of job. For each of the above give an example that applies to that job. These are non-financial methods of motivation.

H ACKMAN AND O LDHAM ’ S MODEL  Hackman and Oldham’s model is underpinned by the belief that the task undertaken by an employee i.e. the job design is the key to motivation  Unfulfilling jobs reduce motivation whilst challenging and interesting jobs will increase it What is meant by the term motivation? Would having 20% time to work on your own projects at work be a good ide in job design? Or is the reality that this is not really achievable?

H ACKMAN AND O LDHAM ’ S MODEL

 There are Five Job Characteristics:  Skill variety how many skills used in a job  Task identity the degree to which an individual is in charge of the entire task  Task significance the importance of the task to other people  Autonomy the freedom to complete a task independently  Feedback how effective the task has been through the eyes of others

H ACKMAN AND O LDHAM ’ S MODEL  Due to the presence of the Five Job Characteristics people will experience Three Critical Psychological States:  Experienced meaningfulness of work this is specifically affected by the skill variety, task variety and task significance  Experienced responsibility for work outcomes provided by the autonomy that the employee achieves when undertaking a task  Knowledge of the actual results provided by the feedback given by various people

H ACKMAN AND O LDHAM ’ S MODEL  In turn, the combination of the Five Job Characteristics and Three Critical Psychological States will influence Personal and Work Outcomes leading to:  High internal work motivation  High quality work performance  High satisfaction with the work  Low absenteeism and turnover  Finally, the Employee’s Growth Need Strength (GNS) acts as a moderator by looking at how the job can lead to potential motivation in the future

H ACKMAN AND O LDHAM ’ S MODEL An employee that uses a variety of skills and has ownership and freedom when undertaking an important task, getting positive feedback from a range of people will experience meaningful work, enjoying responsibility for task outcomes which will be enhanced by knowledge of the actual results leading to high motivation, high quality of work and a high degree of satisfaction with their job. This will lead to low absenteeism and low labour turnover. The potential of the job to motivate in the future acts as a moderator on motivation today.

A PPLYING H ACKMAN AND O LDHAM ’ S MODEL Select a career you may be interested in in the future Carry out some research into this career including information regarding the job design Prepare a short presentation to apply the model to your chosen career

O RGANISATIONAL DESIGN  Organisational design is the framework that provides a business with a structure to achieve its objectives  Organisational structure is the way in which the workforce within a firm is organised, including job roles and communication flows  Organisational charts provide a visual representation of the organisational structure Managing Director Finance Manager Accounts Supervisor Sales Supervisor Production Manager Production supervisor

O RGANISATIONAL DESIGN  Decisions relating to organisational design include:  Authority  Span  Hierarchy  Delegation  Centralisation and decentralisation

A UTHORITY  Authority is the power of an employee to instruct subordinates, make decisions and control the use of resources  Authority can be:  Centralised i.e. maintained by a few at the centre of the organisation  Decentralised i.e. spread across the organisation  Authority can act as a motivator Explain how the use of authority varies within the Tannenbaum Schmidt continuum.

S PAN AND HIERARCHY  The span of control shows the number of subordinates that a manager or supervisor directly responsible for  If a manager has many subordinates this is called a wide span of control  If they have few subordinates this is called a narrow span of control  The levels of hierarchy shows the number of levels of management and supervision within a business Why do you think there are so many ranks within the armed forces?

S PAN AND HIERARCHY  The levels of hierarchy within firms will differ:  tall and thin structures occur where each superior is responsible for a few subordinates this allows for closer supervision and communication between the two levels  wide and flat means that each superior is responsible for a large number of subordinates this requires greater delegation but fewer levels allowing for quicker communication through the firm

I N PAIRS  Using A3 paper produce an organisational chart for your school or college  On your chart show the various departments, year groups and staff  Try to work out:  the height of the hierarchy – is it tall or flat?  the span of control of the different members of staff  are there any areas of contradiction?  how efficient is this structure?

D ELEGATION  Delegation involves the passing of authority down the hierarchy  Authority occurs when an employee is given the right to do something by their superiors  Responsibility remains with the manager  This will:  free up time for management  motivate workers by providing them job enrichment  May mean that decisions are being made closer to the grass roots How easy is it to delegate? Are there any risks associated with delegation??

C ENTRALISATION AND DECENTRALISATION  Centralisation is when the responsibility for decision making is maintained, by a limited number of senior managers, at the top of the hierarchy  Few decision makers  Decisions are made by those at the top of the hierarchy  Speeds up decision making  Maintains tight control  Bureaucratic

C ENTRALISATION AND DECENTRALISATION  Decentralisation is when the responsibility for decision making is delegated to a number of middle managers throughout the hierarchy  Delegates decision making  Decisions made at many levels within the hierarchy  Frees up management time  Provides motivation  Reduces bureaucracy

I NFLUENCES ON DELEGATION, CENTRALISATION AND DECENTRALISATION  Attitudes and priorities of leaders and their preferred leadership styles  Organisational design  The skills and attitudes of the workforce  The nature of the decisions to be made  Legal form  Business and functional objectives  Response to changes in technology  Degree of confidence and stability in the economic environment In pairs discuss how each of these will influence delegation, centralisation and decentralisation.

I NFLUENCES ON DELEGATION, CENTRALISATION AND DECENTRALISATION  Can you explain the relationship between delegation, centralisation and decentralisation and the Blake Mouton grid?

T HE VALUE OF CHANGING JOB AND ORGANISATIONAL DESIGN  Increase labour productivity  E.g. motivating the workforce through job design and delegation  Lower unit costs  E.g. take out a level of the hierarchy or introduce greater job enrichment  Increase retention/lower labour turnover  E.g. a more motivated workforce as a result of decentralised decision making are happier to stay with the business

6.3.1 M AKING HUMAN RESOURCE DECISIONS : IMPROVING ORGANISATIONAL DESIGN AND MANAGING THE HUMAN RESOURCE FLOW  In this topic you have learnt about  Influences on job design  Influences on organisational design  Influences on delegation, centralisation and decentralisation  The value of changing job and organisational design