Kay 235: Introduction to Management

Lecture 7Subject: Organizing

Reading: Starling, Chapter 7

Announcements The date of the 2nd Midterm is:

December 17, Friday 13:30, D13-14 & DZ09

Chapters after the first midterm May include Maslow’s Hierarchy

“If I were a rich man”song example Planing, decision-making & organizing

And the “12 Angry Men” Movie

12 Angry Men” Movie

12 Angry Men” Movie Question Examples

What is the concept of “groupthink”?

Was the concept “groupthink” effective on Jury members: At the beginning of the movie? At the end of the movie?

Give examples to the advantages & disadvantages of group decision-making from the movie?

Questions of Organizing?

What are the main types of organizational design?

What are the types of authority? Which type of organization

responds best after emergencies?

Organizing

Definition: The grouping of activities necessary

to attain certain objectives Main question:

Finding the fit between the task at hand and organizational structure

ORGANIZATIONAL DESIGN “Design must follow purpose”,

Drucker Key activities

Design Criteria: Clarity, simplicity, adaptability and coherence Formal vs. Informal organizations

Delegation of authority Example: Shooting airplanes

Organizing

What kind of problem we are dealing with? Repetitive tasks, innovation, flexibility How urgent is the problem? How specific is the job? How much coordination is needed?

1. Leader-Follower Organizations

Sources of the leader’s authority (Max Weber) Traditional Charismatic Legal-Rational

The Nemesis of Creativity A leader rarely faces two consecutive

challlenges sucessfully Lack of Followership Studies

2. Networks Two or more organizations brought

together for a particular purpose Associations Consortia Partnerships Unions

They greatly vary according to their size, longevity & the amount of integration.

2. Networks

Institutions A program imposed by society on the

conduct of individuals A set of shared values and rituals;

beliefs, cultures Certain patterns of behaviors and

shared meanings Family institution, religious institution

Pros and Cons of Networks

Advantages Adaptive, creative, conducive to

innovation Pragmatic, goal-searching, and

problem-oriented Detect and correct errors easily Self-organizing, self-regulating

Pros and Cons of Networks

Problems Limited control

Political & persuasive skills, rather than orders become critical

Differences in cultures and sets of behavior

Free riders Using the benefits of the network, while

contributing as little as possible to it.

Pyramidal Organizations

Key features Division of labor Hierarchy

Chain of command Span of control

Efficient supervision Line and staff

The notion of functional authority

Pyramidal Organizations:Strengths and Problems

Strengths Efficiency gain from specialization Clear line of authority and responsibility

Pyramidal Organizations:Strengths and Problems

Problems Difficulty in coordination and communication

between different functions Rigidity (SOPs and Red Tape) Low capacity for innovation

It is a performance structure, not a problem solving structure

Span of control (one way, only downward rel.ship?)

Span of managerial relationships Growth of bureaucratic size

Adhocracies (Example: Matrix)

Experts drawn from different disciplines into ad-hoc (spontaneous) groups

Characteristics Organic: Highly flexible Little concern about the four defining

principles of pyramid organizations Emphasis on horizontal processes Deployed in project teams Mutual adjustment: members need to assume

responsibility

Matrix: Strengths and Problems

Strengths Work well for specific, narrowly

defined projects Ease in coordination Capability for problem-solving

Matrix: Strengths and Problems

Drawbacks Development of specialty Feeling isolated and rootless Little accumulated wisdom

Institutional memory or capacity

Team Approach The essence: Common assignment

Complementary skills, common purpose, hold themselves mutually accountable

Types of teams Cross-functional teams Temporary or permanent teams

Team Approach:Advantages and Disadvantages

Advantages Quicker decision-making Lowering administrative costs Increase in morale

Team Approach:Advantages and Disadvantages

Disadvantages Conflicts and dual loyalties Coordination costs Danger of over-decentralization

Question

When does an organization need to reorganize? Performance deficit Confidence/Trust deficit

REORGANIZATION

Rationale: Growth Greater efficiency Changes in public policy More political responsiveness Change in the business environment