1. Unit Lesson MBA 6001: Unit VII
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2. Unit VII:
organizational design and strategy within the global operations environment
Please be sure to turn up your volume or plug in your headphones. The next several slides contain important audio.
(OpenClipartVectors, 2013)

3. Strategy Degree of rivalry Threat of substitutes
Buyers’ bargaining power
Suppliers’ bargaining power
Barriers to entry and threat of new entrants
Business Trends
Economic Growth
Political Activities
Societal Developments
Organizations are constantly changing. Business trends, economic growth, political activities, and societal developments cause constant organizational transitions. Therefore, changing organizational structures are needed to accommodate transformation, reorganization, and realignment.
Strategy is the direction and scope of an organization over time. It aligns resources to its changing environment, its markets, and customers to meet shareholder’s expectations (Feurer & Chaharbaghi, 1997).
It has been discussed that there are five forces that shape strategy (Porter, 1980). These forces are 1) degree of rivalry, 2) threat of substitutes, 3) buyers’ bargaining power, 4) suppliers’ bargaining power, and 5) barriers to entry and threat of new entrants. A strategy that embraces the organization’s mission and vision may include globalization.

4. Globalization Global financial markets
Internet and supply chain management
Economies of scale
Competitive advantage
Strategy implementation
Transformations
Innovative ideas
Different perspective in management
Cultural changes
Globalization has changed the way organizations operate in terms of global financial markets, internet and supply chain management, economies of scale, and competitive advantage. A process of strategy implementation and transformation comes with globalization. Globalization is also about innovative ideas, a different perspective in management, and cultural changes (Mikl-Horke, 2004).
Globalization is an important factor for organizations that compete at an international level to benefit customers, performance quality, and a low-cost strategy (Friedman, 2007). Human resource management (HRM) must adapt to international and cultural trends to successfully manage these organizational transitions.
(Marco, 2010)

5. Organizational Design Differences
Cultural Factors
Change Processes
Privatization laws
Market economic policies
Changes in consumer behaviors and employee behaviors
Profound social and cultural changes
Organizational Design Differences
Management styles
Shareholder values
Communication styles
Cultural Differences
Uncertainty
Avoidance
Transfer of best practices
Centralized power distance when making decisions
Confrontation when achieving consensus
HRM
Recruit globally
Provide training
Select leaders consistent with the culture
Meet employees’ information and career advancement needs
Promote women (some cultures)
Increased sensitivity
Cultural and diversity awareness
To cope with globalization, many change processes must be considered for successful operations such as privatization laws, market economic policies, changes in consumer behaviors and employee behaviors, and profound social and cultural changes. Organizational design in global economies will include differences in management styles, shareholder values, and communication styles. Cultural factors and performance differences may force changes in the organizational structure. Strategic implementation involves changing value conceptions and attitudes while connecting to institutional structures, behavioral patterns, and customs of the culture (Mikl-Horke, 2004). Cultural differences may include uncertainty, avoidance, transfer of best practices, centralized power distance when making decisions, or confrontation when achieving consensus. Therefore, human resource management have to recruit globally, provide training, select leaders consistent with the culture, and meet employee’s information and career advancement needs. In some cultures, it may be difficult to promote women. As organizations globalize, there are differences in cultures, languages, speed, and content expertise. Globalization also calls for increased sensitivity and cultural and diversity awareness (Friedman, 2007).

6. Structures Three-dimensional matrix structure Boundaryless Structures
Worldwide product manager
Functional manager
International issues
Overseas managers
Financials
Local issues
Product and functional duties
Branding
Boundaryless Structures
Common with globalization
Some organizations use a three-dimensional matrix structure for international operations. This structure may include a worldwide product manager, a functional manager for international issues, and overseas managers to focus on financials, local issues, product and functional duties, and branding. In international settings, to eliminate communication resistance and power issues, more networking and collaborations are needed rather than hierarchal relationships. Boundaryless structures are common with globalization. Departmental, team, and dual-reporting structures also work well in international settings.
(Altmann, 2015)

7. Technology Collaboration Global Risk Globalization
Inflation
Intracompany accounts
Performance management
Globalization
Free trade zones
Reduced labor and production cost
Products that are similar across cultures
Success happens when companies successfully integrate local market differences with economies of scale and transfer of knowledge and technology.
(Linforth, 2015)
Technology is the key to successful global implementation. U.S. companies and foreign countries constantly collaborate to stay current not only with technology but also with financial resources. Global risk should be considered and managed considering inflation, intracompany accounts, and performance management. In addition to free trade zones, globalization includes reduced labor and production cost and products that are similar across cultures. Success happens when companies successfully integrate local market differences with economies of scale and transfer of knowledge and technology.

8. Boundaryless structures are NOT common with globalization.
Self Check
True or False
(Altmann, 2014)
Boundaryless structures are NOT common with globalization.
The next few slides consist of self check questions for you to test your knowledge regarding the content covered in this unit. The correct answer will be indicated on the next slide.
True or False: Boundaryless structures are NOT common with globalization

9. FALSE Boundaryless structures are common with globalization.
Departmental, team, and dual-reporting structures also work well in international settings.
The answer is False!
Boundaryless structures are common with globalization. Departmental, team, and dual-reporting structures also work well in international settings.
(ClkerFreeVectorImages, 2012)

10. True or False
(Altmann, 2014)
Business trends, economic growth, political activities, and societal developments cause constant organizational transitions.
True or False: Business trends, economic growth, political activities, and societal developments cause constant organizational transitions.

11. TRUE
Business trends, economic growth, political activities, and societal developments cause constant organizational transitions.
Therefore, changing organizational structures are needed to accommodate transformation, reorganization, and realignment.
True! Business trends, economic growth, political activities, and societal developments cause constant organizational transitions. Therefore, changing organizational structures are needed to accommodate transformation, reorganization, and realignment.
(ClkerFreeVectorImages, 2014)

12. References
Altmann, G. (2014). Test [Image]. Retrieved from
Altmann, G. (2015). Organizational chart [Image]. Retrieved from
ClkerFreeVectorImages. (2012). X [Image]. Retrieved from
ClkerFreeVectorImages. (2014). Checkmark [Image]. Retrieved from
Feurer, R., & Chaharbaghi, K. (1997). Strategy development: Past, present and future. Training for Quality, 5(2),
Friedman, B. A. (2007). Globalization implications for human resource management roles. Employee Responsibilities and Rights Journal, 19(3), 157. doi:
Linforth, P. (2015). Internet [Image]. Retrieved from
Marco Lachmann-Anke, P. (2010). Globe [image]. Retrieved from
Mikl-Horke, G. (2004). Globalization, transformation and the diffusion of management innovations. Journal for East European Management Studies, 9(2),
OpenClipartVectors. (2013). Headset [Image]. Retrieved from
Porter, M.E. (1980). Competitive strategy: Techniques for analyzing industries and competitors. New York, NY: Free Press.