MGT 363 Organization Theory

1
MGT 363 - Organization Theory Design

• Prof. Dan Ondrack
• Rotman School of Management
• January - April 2004
• www.mgmt.utoronto.ca/ondrack
• TA Ranjita Singh singh_at_rotman.utoronto.ca

2
Introduction

• Focus topics of the course
• Text readings
• Daft, R. Organization Theory Design 8th Ed
• Assignments grading
• Field project report 50
• Mid term (20) final exams (30)
• Chapter 1 - Introduction

3
Course Objectives/topics

• Business models for survival/growth
• Organization design - structure - processes
• Diverse perspectives/theories on orgs
• Skills in analysis diagnosis of orgs
• Solutions to organizational problems
• Assessment of risk/investment values
• Emerging theories/perspectives on orgs

4
Assignments Grading

• Group field project teams 3-5 people
• Proposal - 1 page before mid term
• Project report due week of Feb 12 (50)
• Exams individual only
• Mid term - short essay Feb 12 (20)
• Final exam all cases Apr 21-May 9 (30)

5
Field Project - objectives

• Compare course concepts to real orgs
• Gain practical experience in data gathering,
  analysis diagnosis of organizations
• Gain practical experience in evaluating
  organizations for consulting/investing
• Gain experience in preparing management reports
  or business plans
• Gain experience in team project mgt

6
Field project focus options

• Academic analyze an organization and compare to
  theory
• Consulting analyze, identify problems
• Investment analyze, estimate value, recommend
  buy or sell
• Business plan propose a venture, develop
  operational and financial model

7
Field Project analysis topics

• The business story history, markets, products,
  strategy, environment, competition
• The value-proposition how does the firm create
  value, market role, justify investment?
• Structure major features/comparison to theory
• Operations major processes for value-added
• Challenges comparison to lecture/text theory,
  identify problems, if any
• Conclusions or Recommendations appropriate
  suggestions from your analysis

8
Summary

• Decide on teams/topics ASAP
• Decide on organization(s) ASAP
• Do your team project planning key activities,
  time lines, key results
• Get started on data gathering contacts,
  interests, archives, observations, tests of
  systems, interviews inside/outside.

9
Introduction to Org Theory

• Some basic concepts
• The value-proposition for any business
• Industry-product/market life-cycles
• Firms as innovators-adapters-losers
• Organization Culture advantage or drag
• Paradigm shifts in industries/markets
• Need for organization learning and periodic
  restructuring for survival
• Rationalization of industry winners/losers

10
Some key concepts/terms

• Transaction costs in organizations cost of
  frictions, errors, controls, repetition
• Value-added processes.functions, etc produces
  more value than cost of process
• Hierarchy-vs-markets make it or buy it?
• Market-test market determines value, people
  make value-price trade-offs.
• Burn-rate of capital spending rate of
  start-up is greater than earnings from business
• Entropy everything deteriorates over time

11
Organizations as open systems

• ENVIRONMENT - MARKETS
• Inputs processes outputs
• Capital -gt transform -gt products
• Resources -gt add-value -gt prices
• Challenges -gt adaptation -gt survive
• Retained -gt invest/improve-gt grow
• Closed system immune from environment
• Open system dependent on environment

12
Organization systems
capital
MKT
Org systems ???
outputs
resources
Valued outputs
MKT price
change
13
Organization configurations

• Top management decide on strategy, goals,
  resources, environment -gt obtain capital, control
  operations -gt strategy
• Technical core major value-added
• Technical support to technical core
• Administrative support to tech core
• Mid-management communication up down,
  coordination of operations

14
5 Major Org components
Top Mgt founders
Tech support
Admin support
mid mgt
Mkt value
Tech/operations core
15
History/develop of Org Theory

• Military/royalty/church command models
• Scientific engineering efficiency models
• Administrative/bureaucracy routine models
• Hawthorne studies social models
• National major markets growth/culture
• Contingency theories environment models
• Learning/information organizations - organic
• Network organizations virtual models

16
Current challenges for Orgs

• From national to global competition
• Stable/insular to turbulent operations
• Traditional culture to diversity mkts
• Integrated/internal to divested ops
• Paper/physical ops to e-commerce digital
  operations.
• Stakeholder pressures ethics/earnings, legal
  social responsibility

17
McDonalds video

• Global strategy for brand identity with local
  adaptation
• Global structure for operations
• Global/Local sourcing and promotion
• Global coordination of supplies for product
  standards and cost-control
• Global marketing for brand/image
• Result most well-known world brand

18
Org analysis dimensions and context, p 17-22

• Dimensions Context
• Formalization size
• Specialization technology
• Hierarchy goals/strategy
• Centralization environment
• Professionalism org culture
• Staff/assets ratios paradigms