ch. 9: organizational agility: the responsive organization mechanistic organization a form of...
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Ch. 9: Organizational Agility: Ch. 9: Organizational Agility: The Responsive OrganizationThe Responsive Organization
Mechanistic Mechanistic organizationorganization A form of A form of
organization that organization that seeks to maximize seeks to maximize internal efficiency.internal efficiency.
Organic structureOrganic structure An organizational An organizational
form that form that emphasizes emphasizes flexibilityflexibility
Organic StructureOrganic Structure
1.1. Jobholders have broader responsibilities Jobholders have broader responsibilities that change as need arises.that change as need arises.
2.2. Communication occurs through advice & Communication occurs through advice & information rather than orders & information rather than orders & instructions.instructions.
3.3. Decision making and influence are Decision making and influence are decentralized and informal.decentralized and informal.
4.4. Expertise highly valued.Expertise highly valued.
Organic Structure (cont.)Organic Structure (cont.)
5.5. Jobholders rely more on judgment Jobholders rely more on judgment than rulesthan rules
6.6. Obedience to authority less important Obedience to authority less important than commitment to the org. goalsthan commitment to the org. goals
7.7. Employees more interdependent, Employees more interdependent, relate more informally & personallyrelate more informally & personally
Formal Organization ChartFormal Organization Chart
Figure 9.1(a)
Advice NetworkAdvice Network = =Knowledge FlowKnowledge Flow
Figure 9.1(b)
Organizing around Core Organizing around Core CompetenciesCompetencies
Identify existing core competenciesIdentify existing core competencies Acquire/build core competencies important Acquire/build core competencies important
for futurefor future Invest in competencies so company stays Invest in competencies so company stays
competitivecompetitive Extend competencies to find new Extend competencies to find new
applications and opportunities for futureapplications and opportunities for future
Strategic AlliancesStrategic Alliances
A formal A formal relationship created relationship created among independent among independent organizations with organizations with the purpose of joint the purpose of joint pursuit of mutual pursuit of mutual goals.goals.
Best AllianBest Alliancesces
Table 9.1
The Learning OrganizationThe Learning Organization
An organization skilled at creating, An organization skilled at creating, acquiring, transferring knowledge, and acquiring, transferring knowledge, and at modifying its behavior to reflect new at modifying its behavior to reflect new knowledge/insights.knowledge/insights.
Becoming a Learning Becoming a Learning OrganizationOrganization
Disciplined thinkingDisciplined thinking Attention to detailsAttention to details Decisions based on data and evidence rather Decisions based on data and evidence rather
than guesswork and assumptions than guesswork and assumptions Search for new knowledge and ways to apply it Search for new knowledge and ways to apply it Review successes and failures to find lessonsReview successes and failures to find lessons Benchmark--identify & adopt best practicesBenchmark--identify & adopt best practices Share ideas throughout organizationShare ideas throughout organization
The High-Involvement The High-Involvement OrganizationOrganization
A type of organization in which top A type of organization in which top management ensures that there is management ensures that there is consensus about the direction in consensus about the direction in which the business is headingwhich the business is heading
Organizational Size and AgilityOrganizational Size and Agility
Large organizations tend to be less Large organizations tend to be less organic and more bureaucratic organic and more bureaucratic
Jobs tend to become more specialized in Jobs tend to become more specialized in large organizationslarge organizations
With size comes greater complexity and a With size comes greater complexity and a need for increased controlneed for increased control
Organizations can still find ways to Organizations can still find ways to remain agile despite these challengesremain agile despite these challenges
The Case for BigThe Case for Big
Larger size helps Larger size helps create economies of create economies of scalescale
Larger size helps Larger size helps develop economies develop economies of scopeof scope Economies in which Economies in which
materials and materials and processes processes employed in one employed in one product can be product can be used to make other used to make other related productsrelated products
The Case for SmallThe Case for Small
Large organizations can Large organizations can have difficulty managing have difficulty managing relationships with relationships with customers and among customers and among its own unitsits own units
Large organizations are Large organizations are more difficult to more difficult to coordinate and controlcoordinate and control
Smaller organizations Smaller organizations can:can: Move fastMove fast Provide quality Provide quality
goods and services goods and services to targeted market to targeted market nichesniches
Inspire greater Inspire greater involvement from involvement from their peopletheir people
Being small can avoid Being small can avoid diseconomies of scalediseconomies of scale
Being Big and SmallBeing Big and Small
DownsizingDownsizing The planned The planned
elimination of elimination of positions or jobspositions or jobs
RightsizingRightsizing A successful effort A successful effort
to achieve an to achieve an appropriate size at appropriate size at which the which the company performs company performs most effectivelymost effectively
DownsizingDownsizing
Survivor’s Survivor’s syndromesyndrome Loss of Loss of
productivity and productivity and morale in morale in employees who employees who remain after a remain after a downsizing.downsizing.
Customers and the Responsive Customers and the Responsive OrganizationOrganization
The point of The point of structuring a structuring a responsive, agile responsive, agile organization lies in organization lies in enabling it to meet and enabling it to meet and exceed the exceed the expectations of its expectations of its customerscustomers
Managers must Managers must stay focused in stay focused in three key three key ingredients - the ingredients - the strategic trianglestrategic triangle The company itselfThe company itself CompetitionCompetition The customerThe customer
The Strategy TriangleThe Strategy Triangle
Figure 9.2
Customer Relationship Customer Relationship ManagementManagement
CRMCRM A multifaceted process focusing on A multifaceted process focusing on
creating two-way exchanges with creating two-way exchanges with customers to foster intimate knowledge of customers to foster intimate knowledge of their needs, wants, and buying patterns.their needs, wants, and buying patterns.
Customer Relationship Customer Relationship ManagementManagement
Value chainValue chain The sequence of activities that flow The sequence of activities that flow
from raw materials to the delivery of from raw materials to the delivery of a good or service, with additional a good or service, with additional value created at each step.value created at each step.
Generic Value ChainGeneric Value Chain
Figure 9.3
Total Quality ManagementTotal Quality Management
Total quality management (TQM)Total quality management (TQM) An integrative approach to management An integrative approach to management
that supports the attainment of customer that supports the attainment of customer satisfaction through a wide variety of tools satisfaction through a wide variety of tools and techniques that result in high-quality and techniques that result in high-quality goods and services.goods and services.
ISO 9001ISO 9001
A series of quality standards A series of quality standards Developed by committee under Developed by committee under
International Organization for International Organization for Standardization Standardization
To improve total quality in all To improve total quality in all businesses businesses
For the benefit of producers and For the benefit of producers and consumers.consumers.
ReengineeringReengineering
ReengineeringReengineering Revolutionizing key organizational Revolutionizing key organizational
systems and processes to answer the systems and processes to answer the question: “If you were the customer, how question: “If you were the customer, how would you like us to operate?”would you like us to operate?”
Processes are designed from scratch as if Processes are designed from scratch as if the organization was just starting outthe organization was just starting out
Types of Technology Types of Technology ConfigurationsConfigurations
Small batchSmall batch Technologies that produce goods and Technologies that produce goods and
services in low volume.services in low volume. Large batchLarge batch
Technologies that produce goods and Technologies that produce goods and services in high volume.services in high volume.
Continuous processContinuous process A process that is highly automated and A process that is highly automated and
has a continuous production flow.has a continuous production flow.
Organizing for Flexible Organizing for Flexible ManufacturingManufacturing
Mass customizationMass customization The production of The production of
varied, individually varied, individually customized products customized products at the low cost of at the low cost of standardized, mass-standardized, mass-produced products.produced products.
Key Features Key Features in Massin Mass
CustomizationCustomization
Table 9.2
Computer-Integrated Computer-Integrated ManufacturingManufacturing
CIMCIM Use of computer-aided design and Use of computer-aided design and
computer-aided manufacturing to computer-aided manufacturing to sequence and optimize a number of sequence and optimize a number of production processes.production processes.
Flexible FactoriesFlexible Factories
Manufacturing plantsManufacturing plants With short production runs, With short production runs, Organized around products, Organized around products, Use decentralized scheduling.Use decentralized scheduling.
Lean ManufacturingLean Manufacturing
An operation that strives to achieve An operation that strives to achieve highest possible productivity and total highest possible productivity and total quality, cost effectively, quality, cost effectively,
By eliminating unnecessary steps in By eliminating unnecessary steps in production process and continually production process and continually striving for improvement.striving for improvement.
Organizing for SpeedOrganizing for Speed
Time-based Time-based competition (TBC)competition (TBC) Strategies aimed at Strategies aimed at
reducing total time reducing total time needed to deliver a needed to deliver a good or service.good or service.
Time-Based CompetitionTime-Based Competition
LogisticsLogistics The movement of the The movement of the
right goods in the right goods in the right amount to the right amount to the right place at the right place at the right timeright time
Time-Based CompetitionTime-Based Competition
Just-in-time (JIT) Just-in-time (JIT) A system that calls for subassemblies A system that calls for subassemblies
and components to be manufactured in and components to be manufactured in very small lots and delivered to the next very small lots and delivered to the next stage of the production process just as stage of the production process just as they are needed.they are needed.
Just-in-time (JIT)Just-in-time (JIT)
Elimination of wasteElimination of waste Perfect quality.Perfect quality. Reduced cycle times.Reduced cycle times. Employee involvementEmployee involvement Value-added manufacturingValue-added manufacturing Discovery of problems and prevention Discovery of problems and prevention
of recurrenceof recurrence
Time-Based CompetitionTime-Based Competition
Simultaneous engineeringSimultaneous engineering Design approach Design approach All relevant functions cooperate jointly All relevant functions cooperate jointly
and continually in max effort and continually in max effort Aimed at producing high-quality Aimed at producing high-quality
products that meet customers’ needs.products that meet customers’ needs.