Organization theory and design

1. 2 โครงสร้างและการออกแบบองค์การ
organization @TC 2013

2. หัวข้อบรรยาย/กรณีศึกษา
1 แนวคิดทฤษฎีองค์การ
2 โครงสร้างและการออกแบบองค์การ
Focus on task performance and structure
Focus on motivation
Focus on adjustments to the external environment
3 หลักการการออกแบบองค์กรที่มีประสิทธิภาพ
4 Fundamentals of Organization Designพื้นฐานแนวคิดการออกแบบโครงสร้างองค์การ
C 1 : Harvard Business Case / NYPD New
5 Designing Around the Customer
C 2 : Harvard Business Case /Transformation at Ernst & Young United Kingdom
organization @TC 2013

3. WORK DESIGN DECISIONS
1.
WHAT ARE THE TASKS TO BE PERFORMED?
2.
HOW SHOULD THEY BE COMBINED INTO JOBS?
3.
HOW SHOULD THE JOBS BE PERFORMED?
ANALYSIS & DESIGN OF WORK METHODS
STANDARDS OF PERFORMANCE
4.
HOW SHOULD PEOPLE RESPOND TO THE JOB?
ATTITUDES
JOB SATISFACTION
MOTIVATION
5.
HOW TO STRUCTURE THE JOBS TO BE EFFICIENT & SATISFYING?
organization @TC 2013

4. TWO-FACTOR THEORY
HERZBERG (59)
ASSUMPTIONS
TWO DIFFERENT TYPES OF FACTORS INFLUENCE US…HYGIENES & MOTIVATORS
THE OPPOSITE OF SATISFACTION IS “NO SATISFACTION”
THE OPPOSITE OF DISSATISFACTION IS “NO DISSATISFACTION”
ONLY MOTIVATING FACTORS LEAD TO SATISFACTION
HYGIENES AT BEST LEAD TO NO DISSATISFACTION
HYGIENES
(EXTRINSIC)
WORKING CONDITIONS
COMPANY POLICIES
SUPERVISIOR
COWORKERS
SALARY & BENEFITS
STATUS SYMBOLS
MOTIVATORS
(INTRINSIC)
RESPONSIBILITY
CHALLENGE OF WORK
MEANINGFUL WORK
ACHIEVEMENT
ACCOMPLISHMENT
GROWTH OPPORTUNITIES
IMPLICATIONS
ABUNDANT HYGIENES DO NOT MOTIVATE WORKERS, THEY ONLY PREVENT DISSATISFACTION
ENRICH JOBS TO PROVIDE MOTIVATING, CHALLENGING WORK AND HIGH SATISFACTION
WEAKNESSES
RESEARCH METHODOLOGY IS FLAWED
DOESN’T RECOGNIZE INDIVIDUAL NEED DIFFERENCES…NOT EVERYONE WANTS ENRICHED JOBS
OVEREMPHASIZES JOB SATISFACTION
organization @TC 2013

5. HERZBERG’S VERTICAL LOADING FACTORS
(ACHIEVEMENT, GROWTH, RECOGNITION, RESPONSIBILITY)
ACCOUNTABILITY—Held responsible for performance
ACHIEVEMENT---Doing something worthwhile (Meaningful)
FEEDBACK---Gets direct performance information
WORK PACE---Able to set own work speed and rhythm
CONTROL OVER RESOURCES---Controls how and when to do the job
PERSONAL GROWTH & DEVELOPMENT---Opportunity to learn new skills
HACKMAN’S IMPLEMENTING CONCEPTS
(Create a sense of MEANINGFULNESS, RESPONSIBILITY, & KNOWLEDGE)
COMBINE TASKS
FORM NATURAL WORK UNITS
ESTABLISH CLIENT RELATIONSHIPS
VERTICAL LOADING
OPEN FEEDBACK CHANNELS
SKILL VARIETY
TASK IDENTITY
TASK SIGNIFICANCE
AUTONOMY
FEEDBACK
SUCCESS IS MODERATED BY THE INDIVIDUAL’S “GROWTH-NEED” STRENGTH
DOES THE INDIVIDUAL WANT AN “ENRICHED JOB?” ARE THEY HIGH “N-ACH?”

6. Job Design
organization @TC 2013

7. SPECIALIZATION (Division of Labor)
ADVANTAGES
FEWER SKILLS REQUIRED PER PERSON
EASIER TO STAFF POSITIONS & TRAIN WORKERS
JOBS CAN BE MASTERED IN LESS TIME
PRODUCTIVITY & WORK OUTCOMES CAN BE INCREASED
PRODUCTS & SERVICES ARE MORE UNIFORM
MANAGERS CAN SUPERVISE A LARGER NUMBER OF WORKERS
DISADVANTAGES
OVERSIMPLIFIED JOBS ARE REPETITIVE, BORING, STRESSFUL, FRUSTRATING
SKILL DEVELOPMENT IS NOT ENHANCED --- NO CHALLENGES
LEADS TO PRODUCTIVITY DECLINES, ABSENTEEISM, POOR QUALITY WORK
organization @TC 2013

8. ALTERNATIVES TO JOB SPECIALIZATION
• Job Rotation
– Systematically moving employees from one job to another. Most
frequent use today is as a training device for skills and flexibility.
• Job Enlargement
– An increase in the total number of tasks performed.
• Increases training costs, unions want workers paid more pay for doing more
tasks, and work may still be dull and routine.
• Job Enrichment
– Increasing both the number of tasks the worker does and the
control the worker has over the job.
organization @TC 2013

9. ALTERNATIVES TO SPECIALIZATION - 2
• Job Characteristics Approach
(HACKMAN & OLDHAM, 76)
– Core Dimensions
• Skill variety—the number of tasks a person does in a job.
• Task identity—the extent to which the worker does a complete or identifiable portion of the
total job.
• Task significance—the perceived importance of the task.
• Autonomy—the degree of control the worker has over how the work is performed.
• Feedback— the extent to which the worker knows how well the job is being performed.
– Growth-Need Strength
• The desire of some people to grow, develop, and expand their capabilities that is their
response to the core dimensions.
• Autonomous Work Teams
– An alternative to job specialization that allows the entire group to design the work system it will use.
organization @TC 2013

10. JOB DESIGN THEORY
HACKMAN & OLDHAM (76)
JOB CHARACTERISTICS MODEL
FIVE JOB DIMENSIONS
PSYCHOLOGICAL STATES
SKILL VARIETY
TASK IDENTITY
TASK SIGNIFICANCE
à
MEANINGFULNESS
(Leads to high internal work motivation)
AUTONOMY
à
FEEDBACK
PERSONAL RESPONSIBILITY
(Leads to high quality work & satisfaction)
à
KNOWLEDGE OF RESULTS
(Leads to high satisfaction & low turnover)
---------------------------------------------------------EFFECTIVENESS IS MODERATED BY EMPLOYEE GROWTH-NEED STRENGTH
CALCULATE THE MOTIVATING POTENTIAL SCORE TO DETERMINE IF THE JOB NEEDS TO BE REDESIGNED
ARE YOUR WORKERS MOTIVATED BY INTRINSIC WORK FACTORS AND A STRONG NEED FOR ACHIEVEMENT (AN
ENRICHED JOB)?
organization @TC 2013

11. CRITICISMS OF JOB ENRICHMENT
(JOB REDESIGN)
• HIGH COSTS
• TRAINING, DUPLICATE EQUIPMENT, PLANT REDESIGN
• SOME JOBS ARE ELIMINATED
• FEWER OPERATIVES, SUPERVISORS NEEDED
• ASSUMES WORKERS WANT RESPONSIBILITY, ETC.
• WHAT ABOUT WORKERS WITH LOW “N-ACH?”
• ENRICHMENT IS RELATIVE--EFFECTS MAY BE TEMPORARY
• DO WE NEED OCCASIONAL “BOOSTER SHOTS” TO KEEP GOING?
• SOME JOBS CAN’T BE ENRICHED
• WHAT DO WE DO TO AVOID JEALOUSY?
• USED AS A QUICK FIX FOR IMMEDIATE PROBLEMS
• HAVE WE REALLY CHANGED OUR PHILOSOPHY OF MGMT?
• IMPLEMENTED CHANGES ARE OFTEN WEAK & MODEST
• COMPROMISES FROM WHAT WAS PLANNED
• INNOVATIONS ARE ERODED & VANISH OVER TIME
organization @TC 2013

12. WHEN MIGHT REDESIGN WORK?
1.
WHEN NEW UNITS ARE FIRST ESTABLISHED
NO PAST HISTORY TO DEAL WITH
NEW FACILITIES AND WORKERS
2.
WHEN THE SYSTEM BECOMES UNSTABLE
(Seizing the opportunity!)
TECHNOLOGICAL CHANGE
CHANGE IN SENIOR MANAGEMENT
NEW PRODUCT OR SERVICE INTRODUCED
LEGISLATIVE OR REGULATORY CHANGES
FLUCTUATIONS IN THE ECONOMY OR ENVIRONMENT
3.
WHEN THE IMMEDIATE MANAGER WANTS IT
LOCAL CHANGES (JUST WITHIN THE DEPARTMENT)
MICRO REDESIGN
MANAGEMENT MUST BE COMMITTED TO A NEW PHILOSOPHY
organization @TC 2013

13. FLEXIBILITY & WORKER CONTROL
WORK SCHEDULE FLEXIBILITY
1. COMPRESSED WORK WEEK
WORKER FATIGUE
ISSUE OF OVERTIME
DIFFICULTIES IN WORK SCHEDULING
2. FLEXTIME
SUPERVISION & COORDINATION IS MORE DIFFICULT
ADEQUATE COVERATE OF WORK---HOW TO SCHEDULE?
JOBS THAT REQUIRE ALL TO BE PRESENT
3. JOB SHARING / PART-TIME WORK
COORDINATING WITH OTHER WORKERS
INCREASED COST OF BENEFITS
4. TELECOMMUTING
NO CONTACTS WITH OTHER WORKERS—NO COORDINATION
NO SUPERVISION—NOT EASY TO GET HELP WHEN NEEDED
HOW PRODUCTIVE ARE YOU WHEN WORKING AT HOME?
ISSUE OF LIABILITY WHEN WORK IS DONE AT HOME
organization @TC 2013

14. Organizational Structure
organization @TC 2013

15. ORGANIZATIONAL STRUCTURE
SIX DIMENSIONS
• WORK SPECIALIZATION (Division of Labor)
– To what degree are activities subdivided into separate jobs?
• DEPARTMENTALIZATION
– On what basis are jobs grouped together?
• CHAIN OF COMMAND (Hierarchy of Authority)
– To whom do individuals and groups report?
• SPAN OF CONTROL
– How many workers can a manager efficiently & effectively direct?
• CENTRALIZATION / DECENTRALIZATION
– Where does discretionary (exceptional) decision making authority lie?
• FORMALIZATION
– To what degree are written rules, regulations & procedures established?
organization @TC 2013

16. ORGANIZATIONAL STRUCTURE IS STRONGLY INFLUENCED BY:
ENVIRONMENTAL UNCERTAINTY
BURNS & STALKER (61)
THOMPSON (67)
DUNCAN (72)
ORGANIZATIONAL TECHNOLOGY
WOODWARD (65)
THOMPSON (67)
PERROW (67)
INTERNAL INFORMATION-PROCESSING NEEDS
LAWRENCE & LORSH (67)
GALBRAITH (73)
MANAGERIAL STRATEGY
CHANDLER (62)
ORGANIZATIONAL HISTORY & MATURITY
GREINER (72)
SCHWARTZ & DAVIS (81)
organization @TC 2013

17. ORGANIZATIONAL RATIONALITY
THOMPSON (67)
• Seal off (protect) the “core technology” from environmental influences
REDUCE UNCERTAINTY -- PROTECT THE “CORE”
• Buffer the core technology by surrounding it with specialized input and
output components
FORM DEPARTMENTS TO INTERFACE WITH THE ENVIRONMENT
(SO THE “CORE” DOESN’T HAVE TO DEAL WITH THE ENVIRONMENT)
• Smooth out the input and output transactions
THE MORE INDEPENDENT THESE BUFFERS BECOME, THE GREATER THE
NEED TO DEVELOP COORDINATING MECHANISMS ACROSS DEPARTMENTS
• Anticipate and adapt to environmental changes
THE ORGANIZATION MUST BE FLEXIBLE AND ADAPTABLE TO SURVIVE
organization @TC 2013

18. Organic vs. Mechanistic Organization
Low
UNCERTAINTY
Mechanistic Structure
§ Change Unlikely
§ High Formalization
§ Narrow Span of Control
§ Tall Structure
§ Centralized Authority in few top people
§ Rigid Rules
§ Many Specialists
High
Organic Structure
§ Change Likely
§ Low Formalization
§ Wide Span of Control
§ Flat Structure
§ Decentralized and Diffused Authority
throughout Organization
§ Considerable Flexibility
§ Many Generalists
organization @TC 2013

19. Basic Organization Principles
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23. Organizational Design
organization @TC 2013

24. Definitions
Organization Structure
The way work is divided up. How work and responsibilities are clustered . Lines
of reporting and accountability.
Organization Design
Planning and fitting together the people, activities and technologies and
other elements of the enterprise.
organization @TC 2013

25. Why Does Organization Design Matter?
• As business analysts, we often are:
– Improving or even re-engineering processes
– Introducing new technologies and associated systems into the
organization
– Introducing new jobs?
Other ??
organization @TC 2013

26. Design Parameter
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28. Parameters of Design :Structural Design
Job Specialization – number of tasks given a job and a worker’s control over them.
Behavior formalization – the standardization of work processes by the imposition of
operating instructions, job descriptions, rules, regulations, etc.
Training – the use of formal instructional programs to establish and standardize skills
and knowledge.
Indoctrination – programs and techniques by which norms are standardized.
Unit Grouping – choice of the basis by which positions are grouped together in units
(such as on an organizational chart).
Unit Size – number of positions (or units) contained in a single unit (i.e., span of
control).
Planning and Control Systems – standardizes outputs
Liaison Devices – mechanisms used to encourage adjustment between units.
Decentralization – diffusion of decision-making power.
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32. Mintzberg’s Six Parts of Organizations
organization @TC 2013

33. Mintzberg’s Six Parts of Organizations
Middle Line: Hierarchy of authority
between operating core and strategic apex.
Strategic Apex: Top Management
Support Staff: Provide
various internal services,
from a cafeteria or mailroom
to a public relations office.
Techno-structure: Analysts that plan
and control the work of others…labeled
as “staff.”
Operating Core: People
performing the basic work
through products or services.
Ideology: Traditions, beliefs,
culture.
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35. Information Processing Theory
organization @TC 2013

44. INFORMATION PROCESSING
GALBRAITH (73)
TRADITIONAL COORDINATING MECHANISMS
INFORMAL CONTACT
RULES & PROCEDURES (Standard Operating Procedures)
HIERARCHY (Exceptions)
GOALS & TARGETS (Specify outcomes, not behaviors)
AS INFORMATION PROCESSING NEEDS INCREASE, THE ORGANIZATION MUST WORK HARDER TO STAY IN
CONTACT WITH ITS VARIOUS UNITS.
STRATEGY 1 -- REDUCE THE AMOUNT OF INFORMATION PROCESSED
RELY ON SLACK
ESTABLISH SELF-CONTAINED UNITS
STRATEGY 2 -- INCREASE CAPACITY TO HANDLE MORE INFORMATION
INSTALL MORE VERTICAL INFORMATION SYSTEMS
STRUCTURE MORE LATERAL RELATIONSHIPS
SOME LATERAL COORDINATING MECHANISMS
LIAISON ROLES, TASK FORCES, STANDING COMMITTEES,
CROSS-FUNCTIONAL TEAMS, MATRIX STRUCTURES
organization @TC 2013