Strategy org. desgn otd-ch-2

1. Ch No 2
OTD
By
By Kaleem A. Barlas
Strategy Organization Design n
Effectiveness

2. Learning Objectives
 The role of strategic Direction in Organization
Design
 Organizational purpose
a) Mission
b) Operative Goals
c) The importance of Goals
 A framework for selecting strategy n design
 Assessing organizational effectiveness
 Contingency effectiveness approaches
 Integrated Effectiveness Model

3. The role of strategic direction in
organization design
 Created to achieve some purpose
 Which is decided by the CEO
 He sets the directions
 Middle management do the same thing for their
departments
Direction setting process includes
a) SWOT
b) Resource availability
c) Internal strengths n weaknesses
d) The next step is to develop ;

4. Organizational Purpose
Mission
Often called overall goals
Reason for existence
Business scope
Business operations including, values, practices, processes,
Mission statement communicates what the org. stand for n trying to
achieve
It includes mission, vision and values
Our mission is to help people manage he risk of every day life,
recover from the unexpected and realize their dreams

5. Operative Goals
 Over all performance
 Resources
 Markets
 Employee development
 Innovation n change
 Productivity
Importance of goals

6. A frame work for selecting strategy n
design
 A strategy is a plan for interacting with the
competitive environment to organizational goals
 Some managers think of goals n strategies as
interchangeable but;
 Goals define where the org wants to go n
strategies define how it will get there
 A goal might be to achieve 15/ annual sales
growth
 Strategy to reach that goal might be aggressive
adverttisement

7. Porter’s competitive Strategies
Michael Porter introduced a framework describing
tthree competitive strategies
A) low-cost leadership
B) Differentiation
C) Focus, the org concentrate on specific market
or buyer group,
D) Is further divided into
1) Focused low cost
2) Focused differentiation

8. Miles n snow’s strategy typology
Prospector
Innovative
Risk Taking,
Seeking out new opportunities
Growth
Its suitable for dynamic environment
FedEx

9. Defender
Opposite of prospector
 Concerned with stability
 Retrenchment
 Hold on to current customers
 Neither innovates nor seeks to grow
 Believes in internal efficiency
 High quality
 Fit for declining industry

10. Analyzer
 Maintain a stable business
 Lies midway between the prospector and
defender
 Some products to keep current customers
 Other products will be used for attracting new
customers
 Attempts to balance efficient production n creative
development
Sony Corporation

11. Reactor
The reactor strategy is not really a strategy. Rather
reactors respond to environmental threats n
opportunities in an ad hoc manner
No long range plans
No explicit mission or goal

12. How strategies affect organization
design
 Choice of strategy affects internal organizational
characteristics
A co. wanting to grow and invent new products
looks and feels different from a co. that is focused
on maintaining market share for long established
products in a stable industry.
With a low cost leadership strategy managers take
efficiency approach to org design, other strategies
call for learning approach

13. Other factors affecting org design
 Assessing org effectiveness
 Contingency effectiveness approach
 Goal approach
 Resource based approach
 Internal process approach


14. An integrated effectiveness
model
The three approaches
Goal
Resource based
Internal process
All have some thing to offer. But each one tells only
part of the story. His model tries to balance
concern with various parts of the org rather than
focusing on one. It combines several indicators of
effectiveness into single framework.
The model is open for discussion

15. Quiz 1
List Mile’s n Snow’s Strategies typologies n discuss
any one of them briefly