1. Organizational Designs
Mr. Spinelli BOH4M
Source: Business Leadership – Management Fundamentals. Wiley & Sons. Schermerhorn, Wright and Guest 2013.

2. Today’s Lesson Agenda: Learning Outcome: Organizational Designs
Mechanistic Designs
Organic Designs
Trends in Organizational Designs
Learning Outcome:
You will understand that there is an increasing trend of flatter organizations as businesses adapt to their changing environments

3. Organizational Designs
Is the process of choosing and implementing structures that best arrange resources to serve the organization’s mission and objectives
Because every organization faces its own set of unique problems and opportunities, the best design at any moment is the one that achieves a good match between structure and situational contingencies
Therefore, organizational design is a problem-solving activity – no one design applies in all circumstances

4. Mechanistic and Organic Designs
Mechanistic Designs
Recall earlier Max Weber theorized people should be managed through bureaucracy? – “hierarchy and clear divisions of labour”
organizations with mechanistic designs are highly bureaucratic
They are vertical structures that typically operate with centralized authority, many rules and procedures, a precise division of labour, narrow spans of control and formal coordination
Are described as “tight” structures of the traditional pyramid form

5. Mechanistic and Organic Designs
Mechanistic Designs
What organizations would this be good for?
Good for routine tasks in a stable environment. All franchises operate the same according to rules established by corporate management. Extensive training, rules and procedures accompanied by supervision. Any changes to the mechanistic system takes a long time to have cohesion throughout the organization.

6. Mechanistic and Organic Designs
The limits of mechanistic designs are especially apparent in organizations that operate in dynamic, often uncertain, environments
An organic design is decentralized, with fewer rules and procedures, open divisions of labour, wide spans of control, and more personal coordination
These are adaptive organizations with horizontal structures and cultures that encourage worker empowerment and teamwork

7. Mechanistic and Organic Designs
What organizations would this be good for?
click
These organizations are organic because their employees are encouraged to use creative problem solving skills and develop new products. Employee empowerment is encouraged and employees are more goal orientated than job orientated. ~ LEARNING ORGANIZATIONS

8. Mechanistic and Organic Designs
A continuum of organizational design alternatives: from bureaucratic to adaptive organizations.

9. Trends in Organizational Design
The complexity, uncertainty, and change characteristic of today’s environment have prompted more and more organizations to shift toward horizontal structures and organic designs
This has led to a number of trends in organizational design

10. Trends in Organizational Design
Fewer Levels of Management
The chain of command, or the line of authority, that vertically links positions in an organization is no longer always growing “taller” as organizations grow in size
Organizations are becoming increasingly “flatter” with wider spans of control and fewer levels of management allowing workers more empowerment and independence
the flat terminology isn’t about grouping or structure, it’s how the decisions flow inside the company, which is more peer-to-peer and less top-down

11. Trends in Organizational Design
More Delegation and Empowerment
Managers are delegating more by finding ways to empower people at all levels to make more decisions that affect themselves and their work
Delegation involves:
Assign responsibility
Grant authority for others to make decisions
Create accountability by having others report results

12. Trends in Organizational Design
Decentralization with Centralization
Delegation, empowerment, and horizontal structures are contributing to more decentralization in organizations
At the same time, advances in information technology are allowing for adequate centralized control

13. Trends in Organizational Design
Reduced Use of Staff
Organizations are reducing the size of staff
They are lowering costs and increasing efficiency by employing fewer staff personnel and using smaller units
There is no one best solution for all organizations – requires extensive information technology

14. Success Criteria I understand that :
Although many traditional hierarchal organizational designs exist, there has been a shift towards more flatter and organic organizational designs
This is made possible through IT, and it empowers employees by fostering creativity and problem solving