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Chapter TitleChapter Title
Organizing for
Success
(Based on Chapter 8 ofExploring Corporate Strategy by Johnson, Scholes & Whittington)
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Organizational Configuration
Structure
Processes
Relationships
Configuration
Structure
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Three Key Challenges
Three key challenges for organizations in the 21st
century:
1. Speed of change and increased level of uncertainty in
the business environment2. Importance of knowledge creation & knowledge
sharing
3. Rise of globalization
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Seven Basic Structural Types
1. Functional
2. Multi-divisional
3. Holding
4. Matrix5. Transnational
6. Team
7.
Project
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Functional or U-Form Structure
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Multidivisional orM-Form Structure
Williamsons Structures: U-Form, M-Form and H-Form
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Conglomerate or H-Form Structure
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Matrix Design
By Davis & Lawrence
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Transnational Structure
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Team Based Structure
Attempts to combine both horizontal and vertical
coordination through structuring people into cross-
functional teams
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Project Based Structure
Teams are created, undertake the work and are then
dissolved
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Comparison of Structures
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Goold & Campbell Design Tests
Based on organizations objectives and constraints:
Market Advantage Test
Parenting Advantage Test
PeopleT
est Feasibility Test
Based on good general design principles:
Specialized Cultures Test
Difficult Links Test Redundant Hierarchy Test
Accountability Test
Flexibility Test
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Types of Control Processes
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Types of Control Processes
Direct Supervision Direct control of strategic decisions
by one or a few individuals
Planning Processes Plan and control allocation of
resources and monitor their utilization
Self-Control By direct interaction and coordination
among individuals without supervision
Cultural Processes Concerned with organizational norm
and standardization of norms
Performance Targeting Focus on output such as
product quality, revenues or profits (Balanced Scorecard)
Market Processes Formalized system of contracting for
resources
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Relationships
Relating Internally and Externally
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Relating Over Strategy - 1
Strategic Planning Style
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Relating Over Strategy - 2
Financial Control
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Relating Over Strategy - 3
Strategic Control
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Relating Externally
Outsourcing
Strategic Alliances
Networks
Virtual Organization
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Configurations
Stereotypical Configurations
Reinforcing Cycles & Implications for Change
Managing Dilemmas in Configurations
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Stereotypical Configurations
Mintzbergs Structures
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Mintzbergs Five Configurations
1. Simple Structure: Entrepreneurial setting - relies on direct supervisionfrom the strategic apex, the CEO.
2.Machine Bureaucracy: Large organizations - relies on standardization
of work processes by the techno-structure.
3. Professional Bureaucracy: The professional services firm - relies on
the professionals' standardization of skills and knowledge in the
operating core.
4. Divisionalized Form: Multi-divisional organization - relies on
standardization of outputs; middle-line managers run independentdivisions.
5. Adhocracy: Project organizations - highly organic structure with little
formalization; relies on mutual adjustment as the key coordinating
mechanism within and between these project teams.
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Reinforcing Cycles Example 1
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Reinforcing Cycles Example 2
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Configuration Dilemmas
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Organizational Structures ofthe Future: Overall Themes
Revolutionary changes in how workis organized
have been triggered by
New strategic priorities
Rapidly shifting competitive conditions
Tools oforganizational design include
Empowered managers and workers
Reengineered work processes
Self-directed work teams
Rapid incorporation ofInternet
technology
Networking with outsiders
The future
structure
will be . . .
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Characteristics ofOrganizations of the Future
Extensive use ofInternet technology
and e-commerce business practices
Fewer barriers between
Different vertical ranks Functions and disciplines
Units in different geographic locations
Company and its suppliers, distributors,
strategic allies, and customers
Capacityforchange and rapid learning
Collaborative efforts among people in different
functions and geographic locations
Change &Learning