1. Designing Organizations for Performance Excellence
Chapter 5
Designing Organizations for Performance Excellence

2. Factors Affecting Work Organization
Company and organizational guidelines
Management style
Customer influences
Company size
Diversity and complexity of product line
Stability of the product line
Financial stability
Availability of personnel

3. Functional Structure

4. Problems With the Functional Structure
Separates employees from customers
Inhibits process improvement
Functional organizations often have a separate function for quality

5. Redesigning Organizations for Performance Excellence
Focus on processes
Make quality everyone’s job
Recognize internal customers
Create a team-based organization
Reduce hierarchy
Use steering committees
Develop an agile organization
Redesign work systems

6. Types of Processes
Value-creation processes – those most important to “running the business”
Design processes – activities that develop functional product specifications
Production/delivery processes – those that create or deliver products
Support processes – those most important to an organization’s value creation processes, employees, and daily operations

7. Example of Process Focus: Gold Star Chili

8. Make Quality Everyone’s Job
Recognize that all jobs involve “managing quality”
Eliminate the quality department
Example: Texas Nameplate Company

9. Recognize Internal Customers
“Chains of customers” concept
Process mapping to identify internal customer-supplier relationships
Create links between internal customers and external suppliers

10. Create a Team-Based Organization

11. Six Sigma Project Teams
Champions – senior managers who promote Six Sigma
Master Black Belts – highly trained experts responsible for strategy, training, mentoring, deployment, and results.
Black Belts – Experts who perform technical analyses
Green Belts – functional employees trained in introductory Six Sigma tools
Team Members – Employees who support specific projects

12. Reduce Hierarchy Eliminate layers of middle management
Empower frontline workers
Benefits include improved communication
Risks include impact on morale and loss of valuable experience

13. Steering Committees

14. Develop Agile Organizations
Faster reaction to competitive challenges and changing customer demands
Simplification of work processes and rapid changeovers

15. Redesign Work Systems for High Performance
Job descriptions
Compensation and recognition
Flexibility
Innovation
Knowledge and skill sharing
Organizational alignment
Customer focus
Rapid response
Health and safety
Empowerment
Suggestion systems
Employee Involvement
Training and Education
Teamwork and Cooperation

16. Enhancing Work Design Job enlargement – expanding workers’ jobs
Job rotation – having workers learn several tasks and rotate among them
Job enrichment – granting more authority, responsibility, and autonomy

17. Case Studies Boeing Airlift and Tanker Programs VA Hospitals
Solar Turbines, Inc.
General Electric Bayamon
The San Diego Zoo

18. Comparisons to Organizational Theory
Structural Contingency Theory
Mechanistic vs. organic
Choice depends on organizational environment and technology
Institutional Theory
Structure legitimizes purpose, even if they may not provide value
ISO 9000 and Six Sigma