Business Model Organizations And Organizations Theory

Organizations And Organizations Theory

Current Challenges

Globalization

Intense Competition

Ethics and Social Responsibility

Speed of Responsiveness

The digital Workplace

Diversity

Organization theory helps us explain what happened in the past, as well as what may happen in the future, so that we can manage organization more effectively.

what is Organization

• Social entities that are goal-directed
• Designed as deliberately structured and coordinated activity systems
• Linked to the external environment
• Includes large multinational corporations, family owned businesses as well as nonprofits.

Importance of Organization

• Organizations are a means to an end.
• The corporation has played a significant role in the last 100 years
• Produce goods and services efficiently
• Facilitate innovation
• Adapt to and influence a changing environment
• Create value for owners, customers, and employees
• Accommodate ongoing challenges of diversity, ethics, and the motivation and coordination of employees.

Dimension of Organization Design

Structural Dimensions	Contigency Factors
Formalization	Size
Specialization	Organizational technology
Hierarchy of Authority	Environment
Centralization	Goal and strategy
Professionalism	Culture
Personnel Ratios

Performance and Effectiveness Outcomes
Efficiency: amount of resources used to achieve the organization's goal
Effectiveness: the degree to which an organization achieves its goal
Stakeholder Approach: Balancing the needs of groups in and outside of the organization that has a stake in the organization's performance

Organic and Mechanistic Designs

Mechanistic Design	Contigency Factors
Centralized structure	Rigid Culture
Specialized Tasks	Manufacturing Technology
Many Rules Formalized	Efficiency Strategy
Vertical Communication	Stable Environment
Strict Hierarchy of Authority	Large Size

Organic Design	Contigency Factors
Decentralized Structure	Adaptive Culture
Empowered Roles	Service Technology
Few Rules, informal	Innovation Strategy
Horizontal Communication	Changing Environment
Collaborative Teamwork	Small Size

Devide and Coordinate

• Markets, hierarchies and conventions

  			Market
  Work division \(\rightarrow\)	Specialization\(\rightarrow\)	coordination\(\rightarrow\)	conventions
  			Hierarchy

Cordination

• Work division and coordination
• Thompson model
• Mintzberg model

Thompson coordination model
Born from workflow, Sharing of common resources

Typology of Interdipendences

Generic

Sequential

Mutual

Coordination mode

Standardisation

Planning

Mutual Adjustment

	Generic	Sequential	Mutual
Standardisation	√	ineffectiveness	NO(ineffectiveness)
Planning	inefficiency	√	ineffectiveness
Mutual Adjustment	NO(inefficiency)	inefficiency	√

Mintzberg

Five Components of the Organization

Top Management

Middle Management

Technical cores

Technical Support Staff

Administrative Support Staff

Five Coordination Mechanisms
Direct Supervision	The organizational units to be coordinated have the same hierarchically superior unit(and therefore they have a homogeneity of supervision) which is therefore able to coordinate the two units.
Process Standardization	Standardization of cycles and working methods through codification of activities,equipment, employee methods.
Output Standardization	Standardization and codification of the result envisaged by an organizational unit. these results can be objectives set by a plan or products / services standardized in terms of design and operation.
Input Standardization	Standadization of incoming resources(raw materials, personnel, etc) with a consequent homogeneity and simplification of subsequent transformations.
Mutual Adjustment	The coordination is carried out through a frequent and easy connection system(for carrying out activities) between the organizational units, it provides communications and feedback systems between organzational units. It is necessary in cases where early or planned management is difficult.

Five Organization Models

Simple Structure

Mechanical Bureaucracy

Divisional Organisation

Professional Bureaucracy

Adhocracy(as-needed)

Organization Structure

The Organization Variables

The Organization Variable	Organization Structure	Operating Systems	Leadership Style
1.	Work division	Coordination	Leadership
2.	Departmental Grouping Options	Control	Motivation
3.	Hierarchical levels	Decision Making Process	Authority Management
4.	Defination of tasks and roles	Communication/Information sharing
5.		Assessment

Departmental Grouping Options	Examples	Advantage	Disadvantage
Functional Grouping	Production,Design,Marketing,Logistics,Sales,Management	best for one or few products	1.Hierarchy overload 2.less innovation
Divisional Grouping	Product structure or strategic business units	By product, geographic area, customer	Divisional autonomy / self-sufficiency
Multifocused Grouping	1.meet dual demands from customer,2.flexible sharing of human resources across products,3.best in medium-sized with multiple products	dual authority,frequent meetings,required great effort to maintain power banance
Horizontal Grouping	1.promotes flexibility response to changes in customer needs, promotes a focus on teamwork and collaboration	Determining core processes is difficult and time consuming,requires training
Virtual Network Grouping

Organization Structures

1. Elementary Structure
2. Functional Structure
3. Division Structure
   • By product
   • By geographic area
   • By customer
4. Matrix Structure
   • ＃
5. Horizontal Structure
6. Virtual Structure