CHAPTER EIGHT

1
CHAPTER EIGHT

• Designing Adaptive Organizations

1
2
Yahoo HeadquartersSunnyvale, CA
What Would You Do?

• Where do you start to fix a company that has a
  100 million loss, falling ad sales, plummeting
  stock prices, and an unmanageable organizational
  structure?
• Yahoo has done a poor job in establishing
  relationships with customers

What structure should Yahoo adopt? What should
you do about the informal culture? How can better
decisions be made for the company?
2
3
Organizational Structure
Organizational Structure The vertical and
horizontal configuration of departments,
authority, and jobs within a company.
Organizational Process The collection of
activities that transform inputs into outputs
that customers value.
3
4
Organizational Structure
Process View of Microsofts Organization
4
Adapted from Exhibit 8.1
5
Designing Organizational Structures

• After reading the next three sections,
• you should be able to
• describe the departmentalization approach to
  organizational structure
• explain organizational authority
• discuss the different methods for job design

5
6
Departmentalization
1
6
7
Functional Departmentalization
1.1
7
8
Functional Departmentalization
1.1
8
9
Product Departmentalization
1.2
9
10
Product Departmentalization
1.2
10
11
Customer Departmentalization
1.3
11
Adapted from Exhibit 8.5
12
Customer Departmentalization
1.3
12
13
Geographic Departmentalization
Coca-Cola EnterprisesTerritories of Operation
1.4
13
Exhibit 8.6
14
Geographic Departmentalization
1.4
14
15
Matrix Departmentalization
1.5
15
Adapted from Exhibit 8.7
16
Matrix Departmentalization
1.5
16
17
Organizational Authority
2
17
18
Chain of Command

• The vertical line of authority in an organization
• Clarifies who reports to whom
• Unity of command
• workers report to only one boss
• matrix organizations violate this principle

2.1
18
19
LINE VERSUS STAFF AUTHORITY
Line Authority the right to command immediate
subordinates in the chain of command Staff
Authority the right to advise but not command
others
versus
2.2
19
20
Delegation of Authority
Delegation of Authority The assignment of direct
authority and responsibility to a subordinate to
complete tasks for which the manager is normally
responsible.
2.3
20
21
Delegation of Authority
2.3
21
Adapted from Exhibit 8.8
22
How to Be a More Effective Delegator

• Trust your staff to do a good job
• Avoid seeking perfection
• Give effective job instructions
• Know your true interests
• Follow up on progress.
• Praise the efforts of your staff.
• Dont wait to the last minute to delegate.
• Ask questions, expect answers, assist employees.
• Provide the resources you would provide if doing
  the assignment yourself.
• Delegate to the lowest possible level.

2.3
22
Adapted from Exhibit 8.9
23
Degree of Centralization

• Centralization of authority
• primary authority is held by upper management
• Decentralization
• significant authority is found in lower levels of
  the organization
• Standardization
• solving problems by applying rules, procedures,
  and processes

2.4
23
24
JOB DESIGN
3
24
25

• A job that is a small part of a larger task or
  process
• Jobs are simple, easy to learn, and economical
• Can lead to low satisfaction, high absenteeism,
  
• employee turnover

Job Specialization
3.1
25
26
Job Rotation, Enlargement, and Enrichment

• Job Rotation
• periodically moving workers from
• one specialized job to another
• Job Enlargement
• increasing the number of tasks performed by a
  worker
• Job Enrichment
• adding more tasks and authority to an employees
  job

3.2
26
27
Job Characteristics Model

• A job redesign approach that seeks to increase
  employee motivation
• Emphasizes internal motivation
• experience work as meaningful
• experience responsibility for work outcomes
• knowledge of results

3.3
27
28
Job Characteristics Model
3.3
28
Adapted from Exhibit 8.10
29
What Really Works
The Job Characteristics Model
3.3
29
30
What Really Works
The Job Characteristics Model
Job Satisfaction
Autonomy
10 20 30 40 50 60 70 80 90 100

probability of success 73
Provide Feedback
10 20 30 40 50 60 70 80 90 100

probability of success 70
3.3
30
31
What Really Works
The Job Characteristics Model
Job Satisfaction
High Growth Need Strength/Job Satisfaction
10 20 30 40 50 60 70 80 90 100

probability of success 84
Low Growth Need Strength/Job Satisfaction
10 20 30 40 50 60 70 80 90 100

probability of success 69
3.3
31
32
What Really Works
The Job Characteristics Model
3.3
32
33
What Really Works
The Job Characteristics Model
Workplace Absenteeism
Autonomy
10 20 30 40 50 60 70 80 90 100

probability of success 74
Provide Feedback
10 20 30 40 50 60 70 80 90 100

probability of success 72
3.3
33
34
JOB REDESIGN TECHNIQUES
3.3
34
35
Designing Organizational Processes

• After reading the next two sections,
• you should be able to
• explain the methods that companies are using to
  redesign international organizational processes
  (i.e., intraorganizational processes)
• describe the methods that companies are using to
  redesign external organizational processes (i.e.,
  interorganizational processes)

35
36
Intraorganizational Processes
4
36
37
Reengineering

• The fundamental rethinking and radical redesign
  of business processes
• Intended to achieve dramatic improvements in
  performance
• Change the orientation from vertical to
  horizontal
• Changes task interdependence

4.1
37
38
Reengineering and Task Interdependence
4.1
38
Adapted from Exhibit 8.11
39
Empowerment

• A feeling of intrinsic motivation
• Workers perceive meaning in their work
• Employees are capable of self-determination

4.2
39
40
Behavioral Informality
4.3
40
41
Behavioral Informality
Popular ways to increase behavioral
informality Casual Dress and Open
Offices
41
42
Doing the Right Thing

• Dont Scavenge That Office If
• Somebody Is Still in It
• Its roadkill in the animal kingdom coworkers
• scavenge for office leftoversoften before an
• employee leaves
• Do the right thing by maintaining the dignity of
  departing coworkers Wait until the office is
  empty

4.3
42
43
Interorganizational Processes
5
43
44
Modular Organizations
5.1
Adapted from Exhibit 8.12
44
45
Modular Organizations
5.1
45
46
Virtual Organizations
5.2
46
Adapted from Exhibit 8.13
47
Virtual Organizations
5.2
47