Organizing

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Organizing
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• What does it seem that managers overdelegate
  responsibility or pawn off their jobs to people
  below them.
• Who do you handle complaints form employee that
  they might have about upper management and how
  they are treated by them.

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• How do you arrange people to do the things which
  they can do the best
• What is the average size of a group that managers
  manage

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Previous slide was an organizational chart

• Describes the arrangement of work positions
  within an organization (it reflect the formal or
  official organizational structure).
• Different ways to organize.

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Rondell--high tech company with rapidly changing
Tech. Frank was recently hired. Predecessor
lasted 10 months and one before him took to
drinking. Problem in ES.
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ES does pre-production lay out and design. Doc
Reeves has many new ideas (over 900/year) and ES
expected to modify pre-production changes
quickly. Reeves underestimates time to
implement.
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Sales delivery dates get set further behind.
Sales complains about resolving disputes between
ES and production
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Production complains about sloppy work in ES
(Schwab). Forbus gets a sack for a Christmas
present. Reason--costly delays that influenced
customer satisfaction.
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What would you do with Rondell. Are the problems
Forbus or the structure? Assume you are on the
management team and will make a recommendation.
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Key definitions (p. 219)

• Organizing arranges people and resources to work
  towards a goal.
• Organizational structure is the system of tasks,
  reporting relationships and communication
  linkages.

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Organizing in a team

• Pretty much deciding how to break up the work and
  who does what.
• Importantly, how to communicate and set up the
  work flow (who does what first).
• Time components.

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Big issue

• Work collaboratively.
• Specialize.

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As a mid to upper level manager

• Organizing is what you focus. How do you get
  departments to work with each other.
• Rather than focusing on people in a group, you
  focus on the departments.

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Why important

• Priorities of important areas. Those that report
  directly to the President are most important for
  strategic purposes. Not all are equally
  important.
• Working relationships (task flow) and
  communications effectiveness internally.
• Managing external relationships with key
  stakeholders (customer).

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Key Issues--Relevant to Rondell

• Differentiation--degree of difference between
  subsystems in an organization
• Time orientation
• Objectives
• Interpersonal orientation
• Formal structure

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Need for differentiation

• Specialization of tasks
• Devote resources towards critical needs such as
  technology, customer segments, or stakeholders.
• Tied to Mission/strategy/operational plans

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How does Rondell do differentiation?
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Integration

• The level of coordination achieved among
  subsystems
• Human resources and material resources
• Efficient use of materials and people
• Avoid displacement of operational plans over
  strategic plans.
• Be certain to read p. 293 on How to improve
  integration.

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HOW TO IMPROVE SUBSYSTEM Integration Rules and
procedures Direct contact among managers Liaison
roles Task forces Teams Matrix organizations
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Think about consequences if no integration.
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How does Rondell do integration?
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Management

• Constantly addressing organizing in higher
  positions. Given goals how can we best allocate
  are material resources and human resources to
  meet those goals from efficiency perspective and
  from goal success perspective.

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Functional structure

• Groups together people with similar skills.
• Rondell--research and engineering, production,
  and sales
• Best when few product lines and competing demands
  for different products.

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Advantages (Expertise and efficiency)

• Task assignments consistent with technical
  training.
• Technical Problem solving.
• Clear career paths.
• Efficient use of resources time and cost within
  units.

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Disadvantages

• Poor communication across functions
• Too many problems get resolved at the top.
• Loss of responsibility for getting product to
  market.
• Self-centered viewpoints.

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Divisional structures

• Groups people with diverse skills to work on the
  same product or with similar clients and
  customers.

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Advantages over functional

• Improved coordination (integration)
• Responsibility assigned for product/service.
  Greater customer satisfaction with product or
  service.
• Greater flexibility to adapt to environmental
  changes.

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disadvantages

• Divisions fight for resources
• Loss of efficiencies (capital and human
  resources). (poor differentiation)
• Lack of sharing of expertise across products.
• New product development limited.

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movie

• Done individually.
• Does Chrysler have a divisional or functional
  design. Why was this design effective. How did
  this influence employee behavior?

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Overlay to create efficiencies

• Larger Staff functions such as human resources or
  import/export
• See page 10 Provide advice and support to line
  managers.
• In reality it often does rules and constraints.

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New Trends

• Increased delegation--distributing and entrusting
  work to others (empowerment).
• Increased responsibility and accountability.
• See page 214 of text for delegation.
• Trust and accountability are key.

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Current Trends

• Increased Team--cross functional teams brings
  together members from different functional
  departments.

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Problem

• Violates Unity in chain of command

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Current Trends (cont)

• Flatter organizations--wider spans of control and
  shorter chains of command.

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Wider spans of control associated with

• Less controlling/ more empowerment
• decentralized decision making (Stew Leonard).

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Example of company with new methods

• Nucor See p. W 39

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• Steel bars, sheets, joists and girders, decking,
  grinding balls, fasteners, prefab buildings, and
  bearings. Started with just steel bars.
  Recycled steel in Mini meels
• 9 facilities in all
• 7000 employees

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Think small in spite of growth

• Flat organization with Wide spans of control
• Delegation
• Incentive systems

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layers

• Top executives
• General managers (by divisions)
• Department supervisor
• Supervisor
• hourly employee
• Example no shift supervisors just department
  supervisor

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incentives

• Weekly between 80-150 base pay
• annual if outstanding performance of company.

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Revisting Rondell

• What should we do to get them to work together.
  Nothing is perfect. What could be done to
  improve the situation?

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Summary

• Differentiation and integration
• Examined different ways to differentiate and
  integrate.
• Current trends toward employee empowerment/account
  ability. Promoting integration