Learning Objectives

7.1 Describe the organizing process and how formal and informal organizations differ.

7.2 Identify some common types of organizational structures and discuss the span of control represented by each one.

7.3 Explain how an organization’s culture is affected by workplace diversity.

7.4 Discuss the pros and cons of using teams and when it is most beneficial to use them.

7.5 Describe the stages of team development and how productive teams can be rewarded.

What does

Organizing mean?

Organizing is the process of analyzing and arranging the pattern of work tasks and relationship to achieve goals efficiently and effectively.

What is an

Organizational Structure?

Organizational Structure the structure derived from systematically grouping the tasks to be performed and from prescribing formal relationships that strengthen the ability of people to work more effectively together in pursuing common goals.

Formal and Informal Organizational Structures

• Organization in the workplace can be both formal and informal.

• Formal Organizational Structures – provides the framework or chain of command for determining accountability

• An organizational chart is a published document that graphically represents the formal organizational structure.

• Informal Organizational Structures – is unpublished, and forms out of the everyday relationships that exist between employees.

• An informal leader emerges based on an individual’s influence, and norms are adopted that direct the behavior of employees.

Organizing Process Steps

• The organizing process is a systematic division of division of labor or division of work to achieve or accomplish a plan. The process follows these steps:

• Make a list of all the tasks that must be performed to accomplish a goal.

• Divide tasks into activities that can be performed by one person.

• Group together related jobs or sequence jobs in a logical order.

• Allocate authority and establish relationships between the various jobs and groupings.

Types of Organizational Structures

• Almost all organizational structures are built on the concept of departmentalization, which is the grouping of jobs into related work units. Common types of organizational structures include:

• Functional Organization • Product Organization • Geographic Organization• Customer Organization • Hybrid Organization • Line Structure • Line and Staff Structure • Matrix Structure • Horizontal Structure • Virtual Structure • Flat and Tall Structure

Functional Organization

• Functional Organization – The categorization of organizational units in terms of the nature of the work. Most organizations have four basic functions: production, marketing, finance, and human resources.

• Advantages of functional organizations include:

Allows for specialization within functions.

Provides efficient use of equipment and resources, potential economies of scale, and ease of coordination within the function itself.

• Disadvantages of functional organizations include:

• Members of functional group develop more loyalty to the functional groups goals than the organization’s goals

• Conflict can develop among different departments striving for different goals.

Product Organization

• Product Organization – The placement of all activities necessary to produce and market a product or service under one manager.

• Advantages of product organizations include:

Allows employees to identify with a particular product.

Provides opportunities for training executive personnel by letting them experience a broad range of functional activities.

• Disadvantages of product organizations include:

• Departments can become overly competitive to the detriment of the overall organization.

• Possible duplication of facilities and equipment.

Geographic Organization

• Geographic Organization – The categorization of organizational units by geography.

• Advantages of geographic organizations include:

Allows for the use of local employees or salespeople.

Can create customer goodwill and an awareness to local needs.

• Disadvantages of product organizations include:

• Having multiple locations can be costly.

Customer Organization

• Customer Organization – The categorization of organizational units by customers served.

• Advantages of customer organizations include:

Allows employees to identify with a particular customer type.

Provides opportunities for training executive personnel by letting them experience a broad range of functional activities.

• Disadvantages of customer organizations include:

• Departments can become overly competitive to the detriment of the overall organization.

• Possible duplication of facilities and equipment.

Hybrid Organization

• Hybrid Organization – An organizational structure that uses multiple types of departmentalization within the organization.

• A small organization may have no organization at first. As it grows, it may organize first on one basis, then another, and then another.

• Hybrid organizations share the same advantages and disadvantages as the organization types being used within it.

Line Structure

• Line Structure – An organizational structure in which authority originates at the top and moves downward in a line and in which all organizational units are directly involved in producing and marketing the organization’s goods or services.

• It is the simplest organizational structure.

• Advantages of a line structure include:

• It is a clear authority structure that promotes rapid decision making.

• Disadvantages of a line structure include:

• May force managers to perform too broad a range of duties.

• May cause the organization to become too dependent on key employees who are capable of performing multiple duties.

Line and Staff Structure

• Line and Staff Structure – An organizational structure that results when staff specialist are added to a line organization.

• Staff people are normally specialist in one field, and their authority is normally limited to making recommendations to line people.

• Advantages of a line and staff structure include:

• Allows more specialization and flexibility then a simple line structure.

• Disadvantages of a line structure include:

• Some staff specialist may resent the fact that they act as only advisors over line personnel and have no real authority.

• Line managers who have responsibility for the product can be reluctant at times to listen to staff advice.

Matrix Structure

• Matrix Structure – A hybrid organizational structure in which individuals from different functional areas are assigned to work on a specific project or task.

• Advantages of a matrix structure include:

• Allows for resources and people to be changed as project needs change.

• Employees are challenged constantly, interdepartmental cooperation develops along with expanded managerial talent.

• Disadvantages of a matrix structure include:

• A role conflict can develop if the authority of the project manager is not clearly delineated form that of a functional managers.

• They defy tradition and put undue stress on communication networks.

Horizontal Structure

• Horizontal Structure – An organizational structure consisting of two groups: the first composed of senior management responsible for strategic decisions and policies, and the second composed of empowered employees working together in different process teams.

• Characteristics of a horizontal structure include:

• The organization is build around three to five core processes. Each process has an owner or champion.

• The hierarchy is flattened to reduce supervision.

• Teams manage everything, including themselves.

• Customers, not stock appreciation or profitability, drive performance.

• Team performance, not just the individual, is rewarded.

• Customer contact is maximized with employees.

• Emphasis is on informing and training all employees.

Virtual Organization

• Virtual Organization – A network of independent companies– suppliers, customers, and even rivals– linked by information technology to share skills, costs, and access to one another’s markets.

• Three types of virtual organizations exist:

• A group of skilled individuals from a company that communicate via computer, phone, fax, or videoconference.

• A group of companies, each of which specializes in a certain function, partner together.

• A large company that outsources or subcontracts many of its operations using modern technology to transmit information.

• Technology plays a central role in allowing virtual organizations to form.

Benefits and Challenges of a Virtual Organization

Benefits

•Increases productivity. •Decreases the cost of doing business. •Provides the ability to hire the best talent regardless of location. •Allows rapid problem solving by forming dynamic teams.

•Improves the work environment.

•Provides competitive advantage. •Provides better balance for professional and personal lives.

Challenges

•Leaders must move from a control model to a trust method. •New forms of communication and collaboration are required. •Management must enable a learning culture and be willing to change.

•Staff reduction may be required. •It can be difficult to monitor employee behavior.

Flat & Tall Structures

• Flat Structure – An organization with few levels and relatively large spans of management control at each level.

• Tall Structure – An organization with many levels and relatively small spans of management control.

• A study suggests that organizations with fewer levels and wider spans of management control offered the potential for greater job satisfaction.

• Another study suggested that groups operating in a tall structure had better performance than those operating in a flat structure.

• Japanese organizations tend to have fewer middle managers and flatter structures than American organizations.

What is

Span of Control?

Span of control is the number of employees a manager supervises.

It is influenced by a number of factors including specialization and complexity of the business, geographical dispersion of employees, and centralized vs. decentralized organization.

Centralized and Decentralized Organizations

• Centralized Organization – An organization where decision making authority is at the top of the organization and employees have little freedom to make their own decisions.

• Decentralized Organization – An organization where decision making is pushed down to lower levels and employees have greater freedom to make decisions.

• Span of control is smaller when employees are geographically dispersed, decision-making is centralized, and activities are specialized and complex.

• Span of control is wide when employees perform similar activities in the same work area.

• In order for a manager to be responsible for a span of control, they must have authority or power to carry out the responsibility.

• Authority is established by title or rank, or it can be handed down or delegated from a higher level of management.

What is

Organizational Culture?

Organizational culture is the underlying set of assumptions, beliefs, attitudes, values, and expectations shared by employees of an organization.

As a general rule, most corporate cultures have the following attributes:

•Implicit and fuzzy, not explicit or clearly defined.

•Relatively stable, although they do evolve over time.

•A product of tope management beliefs and visions.

•Of varying strength.

Managers Role in Organizational Culture

•Managers play a critical role in the development, maintenance, and communication of an organization’s culture.

•Culture influences the way managers perform their primary functions– planning, organizing, staffing, leading, and controlling.

•It is a managers job to help employees understand their organization’s culture and learn the norms governing expected behaviors.

•By designing and implementing experiences that emphasize the organization’s culture, managers can shape employee attitudes and behaviors.

Managing a

Diverse Workplace

Diversity is the differences or individual attributes which distinguish one person from another.

Diversity can include age, gender, religion, ethnicity, disability, education, creativity, influence, personality, political affiliation, and more.

It is estimated that US organizations spend over $8 billion annually on diversity training and other diversity initiatives.

Diversity is an asset to organizations because it contributes towards:

– More varied beliefs and cross-cultural experiences.

– Enhanced creativity and innovation.

– Expanded global reach to new markets.

– Diverse alliances with customers and suppliers.

Managers Role in Valuing and Managing Diversity

•Managers play a dual role in valuing (passive) and managing (active) diversity.

•They manager diversity to create an environment that enables employees to achieve their full potential.

•Managers need to be aware of unique needs of individual employees and to provide “accommodations” that support those needs.

•Poorly managed diversity can have a negative impact on performance and create conflict.

•Organizational culture, strategy, and HR practices, determine whether diversity will boost performance or drag it down.

•Diversity is best managed with an “open” organizational culture.

Diversity

Policies & Programs

Equal Employment Opportunity (EEO) is a system of organizational justice, stipulated by law, that applies to all aspects of employment and is intended to provide equal opportunity for all members of the labor force.

Affirmative Action is an in-company program designed to remedy current and future inequities in employment of minorities.

Effective Management of Diversity

•The following strategies can facilitate the effective management of diversity:

• Communicate diversity goals and expectations clearly to employees. Incorporate diversity goals in the organization’s mission, vision, value statements and other written communications.

• Ensure diversity is supports at the top with visible evidence so that employees will view it as real and credible.

• Give immediate attention to correcting abusive behaviors and rectifying violations of EEO laws.

• Respect differences and avoid trying to make all employees the same.

• Develop a management plan for assessing diversity and setting objectives.

When do Teams Make Sense?

•Teams are better when no individual “expert” exists because teams tend to make better judgments than the average individual acting alone.

•Teams are often superior in stimulating innovation and creativity.

•Teams are better when risk is desirable, because of their tendency to make more extreme decisions.

•Teams can help create a context where people feel connected and valued.

•Teams can serve to create a sense of community and support.

•Unnecessary teams slow decisions, detract from individual effort, and take up organizational resources.

Building

Effective Teams

The Team Concept is a commonly used form of organization to accomplish complex tasks that can benefit from a diverse set of skills or that require input from multiple departments or units.

When effective, teams can make better decisions, be more productive, innovative and creative than individuals.

Teams can create more satisfying work environments and increase retention rates.

Teamwork Myths

•Teams are always the answer. Teams are often not the best way to accomplish a task. If the proper conditions for teamwork are not present, a manager is better off making individual assignments.

•The key to team performance is cohesiveness. High cohesion is not a sufficient, or even the most critical, element for great performance. It sometimes causes teams to make bad decisions and flounder.

•The team leader is the primary determinant of team performance. Teams with leaders who control all the details, manage all the key relationships, and present all the ideas are usually underproductive.

•The more the merrier. The larger a team gets, the harder it becomes to keep working on the same page, informed of what is happening, and personally invested in the teams performance.

•The best individual performers will create the highest-performing teams. The highest performing teams have complementary members, willing and capable of playing different roles.

Different

Types of Teams

Most teams can be classified in one of three ways:

• Teams that recommend things • Teams that make or do things • Teams that run things

Teams that Recommend Things

•These teams include task forces and project groups formed to study and solve particular problems.

•These teams often have predetermined completion dates.

•Teams that recommend things must have a clear objective and include members with the skills necessary to complete organizational tasks.

•These teams are often cross-functional, comprised of members from various departments or units.

•These teams derive their strength from diversity.

Teams that Make or do Things

•These teams include people on or near the frontlines who are responsible for manufacturing, development, operations, marketing, sales, service, and other value-adding activities.

•These teams usually have no completion date since their projects or activities are ongoing.

•They are most effective when they deal with “critical delivery points.”

•For these teams to be effective a relentless focus on performance is required.

•Teams that make or do things often take the form of self-managed teams.

• Self-managed teams develop over a long period of time and work without the ongoing direction of a manager or supervisor.

Teams that Run Things

•These teams over see some business, ongoing programs or significant functional activities.

•These types of team would often times be more effective as working groups, or individuals.

Traits of

High-Performing Teams

Five disciplines consistently emerge as essential to high performing teams:

• Small size• Capable and complementary members • Shared purpose and performance objectives• Productive norms and working approach • Mutual accountability

Small Size

•People working in smaller groups work harder, engage in a wider variety of tasks, assume more responsibility for the team’s performance, and feel more involved with the team.

•With large teams it is hard to meet in person or virtually.

•With large teams it is difficult to gain shared understanding and commitment, and share leadership roles.

•High performing teams rarely consist of more than 10 people and ideally are between 5 and 8 members.

Capable and Complementary Members

•Successful teams needs members with a mix of skills and talents in order to deliver its performance objectives.

•It is complementary team members , capable of playing diverse roles, who contribute most to a teams success.

Shared Purpose and Performance Objectives

•High-performing teams have both a clear understanding of the purpose of the team and a belief that the goal is worth pursuing.

•The best teams are able to translate purpose into a clear understanding of the goals to be achieved.

•High-performing teams know what they are expected to accomplish and how they will be measured and evaluated as a team.

Productive Norms

•Norms are generally unwritten rules or standards of behavior that apply to team members.

•Norms allow members to predict what others will do.

•The most critical norms when working in teams relate to effort, meetings, and trust.

•Strong norms create a team culture where members can challenge each other without taking offense.

Mutual Accountability

•High-performing team members pull their own weight, are rewarded for contributing, and challenged for slacking.

•Effective teams are characterized by high level of trust among members.

•Effective teams find a way to reward those who contribute. Two types of reward structures include:

• Cooperative Team Rewards – Rewards that are distributed equally among team members.

• Competitive Team Rewards – Rewards that are distributed to individuals for their unique contribution to the team.

The Stages of

Team Development

There are five stages of team development, which include:

• Forming – The stage where the team is formed as team members are identified or selected.

• Storming – The stage where conflict and infighting can occur due to outside demands, as well as the process of selecting a leader.

• Norming – The stage at which the team starts to come together as a group.

• Performing – The stage in which the team is mature, organized, and well-functioning.

• Adjourning – The stage where the team completes the task required and then splits up.

How can

Meetings Facilitate High Performing

Teams

Meetings are an effective form of intervention to stimulate team performance and avoid dysfunction.

Meetings are used to keep team members informed, coordinate efforts to stay on task, make group decisions, and empower the team.

Meetings can encourage group participation and enhance motivation.

How Can Meetings be Nonproductive?

•The top three reasons for failed meetings are:

• Meetings get off subject.

• Meetings lack an agenda or goal.

• Meetings last too long.

• Meetings lack planning or preparation.

When is a Meeting Necessary?

•A meeting is necessary if it meets its objective or purpose and the information cannot be communicated or obtained easily in another way.

•If basic information is all that needs to be shared with a team, then it is best to use an alternative means of communication rather then a meeting.

•Meeting on a regular schedule, without a defined objective or purpose is not a good idea.

•Meetings have a cost and should be used wisely.

The Meeting Facilitator

•Meetings can be led by managers, staff, team members, facilitators and others.

•Facilitator – an individual that assumes responsibility for leading a meeting without bias to any individual(s) in order to achieve the meeting’s objective or purpose.

•A facilitator may be used when independence is necessary, such as for strategic planning, problem solving, brainstorming, or innovating.

Roles of a Meeting Leader

Responsibilities of a meeting leader include:

• Starting, staying, and ending on time.

• Following the agenda as closely as possible.

• Designating an individual to record minutes and action items.

• Maintaining a “parking lot” for later review of off-topic subjects.

• Encouraging all attendees to participate.

• Bringing the team to consensus.

• Mediating conflict respectfully according to rules for debate.

• Summarizing accomplishments at the close of the meeting.

• Distributing written minutes and assignments after the meeting.

What are the

Attributes of a good

Meeting Agenda?

Meeting Agenda – clarifies the meeting objective and lists the points of discussion and their priority.

A meeting agenda spells out the tasks, estimated time for each task, decisions to be made, and expected outcomes or deliverables.

Meeting agendas can be split into four stages:

1. Initial Stage

2. Kickoff Stage

3. Summary Stage

4. Evaluation Stage