Scribd
Upload
18 views50 pages

Org Theory Lecture Four

This document discusses organizational design and structure. It covers key topics such as differentiation, integration, centralization vs decentralization, formalization, and the relationship between organizational structure and the external environment. The reading discusses how managers must balance differentiating roles and tasks while also integrating divisions to coordinate work. It also addresses how centralizing or decentralizing decision-making and using formal rules or social norms can impact an organization.

Uploaded by

Sharif Ibrahim
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
18 views50 pages

Org Theory Lecture Four

This document discusses organizational design and structure. It covers key topics such as differentiation, integration, centralization vs decentralization, formalization, and the relationship between organizational structure and the external environment. The reading discusses how managers must balance differentiating roles and tasks while also integrating divisions to coordinate work. It also addresses how centralizing or decentralizing decision-making and using formal rules or social norms can impact an organization.

Uploaded by

Sharif Ibrahim
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 50

Organisation Theory

Organisational Design: basics

23 November 2022

© HÖGSKOLAN DALARNA | 2017-03-02


• Part One: Organizing design

• Legstretch!

• Part Two: Designed organization


• Differentiation
• Integration

David Ricardo: theory of


comparative advantage
Gareth Jones:
• Differentiation: The process by
which an organization allocates
people and resources to
organizational tasks

• Division of labor: The process of


establishing and controlling the
degree of specialization in the
organization
Design: ”how to control
– that is, coordinate
organizational tasks and
motivate people who
perform them – to
maximize an
organization’s ability to
create value”
4-21
NGL-centrum
4-6
4-7
4-8
4-9
4-10
4-14
Gareth Jones:
• Organizational roles: Set of task-
related behaviors required of a person
by his or her position in an
organization

• Integration: The process of


coordinating various tasks, functions,
and divisions so that they work
together and not at cross-purposes
Taylor and scientific Management as skilled
management labor
• Taylorism (Fredrik Taylor) ● Henri Fayol:
sought to establish a form of ● Adminstrative management:
work management as a science managers are experts at
of the workplace managing:

• Mary Parker Follet


• the art of getting things done
through people
Organizational structure is • As the division of labor
based on a system of increases, managers
interlocking roles specialize in some roles
and hire people to
Authority: The power to specialize in others
hold people accountable for • Specialization allows
their actions and to make people to develop their
decisions concerning the use individual abilities and
of organizational resources knowledge within their
Control: The ability to specific role
coordinate and motivate • The relationship of one
people to work in the role to another is defined
organization’s interests by task-related behaviors

4-11
Hierarchy: A classification of people according to
their relative authority and rank
• Vertical differentiation: The way an organization
designs its hierarchy of authority and creates
reporting relationships to link organizational roles
and subunits
• Horizontal differentiation: The way an
organization groups organizational tasks into roles
and roles into subunits (functions and divisions)

4-18
4-20
• Hierarchy of authority - Dictates “who reports to
whom”
• Direct contact - Managers meet face to face (over
Zoom??) to coordinate activities
• Problematic that a manager in one function has no
authority over a manager in another
• Liaison roles: A specific manager is given
responsibility for coordinating with managers from
other subunits on behalf of their subunits

4-24
4-28
• Task force: A temporary committee set up to
handle a specific problem
• Task force members responsible for taking coordinating
solutions back to their respective functions for further
input and approval
• Teams - A (permanent) task force used to deal
with ongoing strategic or administrative issues

4-25
4-29
• Integrating role: A full-time position established
specifically to improve communication between
divisions. Focused on company-wide integration

• Integrating department - A new department


intended to coordinate the activities of functions or
divisions Created when many employees enact
integrating roles

4-26
4-30
• Managers facing the challenge of deciding how
and how much to differentiate and integrate
must:
• Carefully guide the process of differentiation
• Carefully integrate the organization by choosing
appropriate integrating mechanisms

4-31
• 15 minute break.
• Business Models

• Power
Gareth Jones:
• Centralized organization
Organizational setup in which the
authority to make important decisions is
retained by managers at the top of the
hierarchy

• Decentralized organization:
An organizational setup in which the
authority to make important decisions
about organizational resources and to
initiate new projects is delegated to
managers at all levels in the hierarchy
• Centralized organization: Organizational setup in
which the authority to make important decisions is
retained by managers at the top of the hierarchy
• Decentralized organization: An organizational
setup in which the authority to make important
decisions about organizational resources and to
initiate new projects is delegated to managers at all
levels in the hierarchy

4-33
Should the education side of
universities have a centralized or a
decentralized organization?
Gareth Jones:
• Standardization: Conformity to
specific models or examples that are
considered proper in a given situation

• Mutual adjustment: The


compromise that emerges when
decision making and coordination are
evolutionary processes and people use
their judgment rather than
standardized rules to address a
problem
Formalization: The use of written rules and
procedures to standardize operations
• Rules: Formal, written statement that specify the
appropriate means for reaching desired goals
• Norms: Standards or styles of behavior that are
considered acceptable or typical for a group of people
• Socialization: Organizational members learn the norms
of an organization and internalize these unwritten rules of
conduct

4-36
Challenge facing managers is:
• To find a way of using rules and norms to standardize
behavior
• To allow for mutual adjustment to give managers
opportunity to discover new and better ways to achieve
goals

4-37
Leadership style
Acme:
• Organization chart
•”one-man band”
Omega
• few barriers between specialists
•”making sure everyone understands what
we’re doing and listening to suggestions”
Different focus in use of resources
Communication
• Top-down / Group interaction
Knowledge
• Top-down / Operative level initiatives
Cost reduction
• Top-down/ Shared development
Which organization can
deal with
Low transaction costs: High transaction costs:
• Exchange of nonspecific • Exchange or more specific
goods and services goods and services
• Low uncertainty • Increasing uncertainty
• Increasing number of • Falling number of exchange
exchange partners partners
4-21
Lawrence & Lorsch, Organization and Environment 1967

4-43
4-38
Structure / environment fit

(Burns & Stalker, The


Management of
Innovation 1961 )

4-46

You might also like