Formalization  The degree to which an organization has rules, procedures, and written documents  Structure & Information Requirements

  Centralized Decision Making  Problems and decisions are funneled to top levels of the hierarchy for resolution  Global Product Structure  Product divisions take responsibility for global operations in their specific product area  Most commonly used structure through which managers attempt to achieve global goals  Provides a straightforward way to effectively manage a variety of business and products around the world.  Each division manager is responsible for planning, organizing and controlling all functions for the product and distribution of the product.  Provides economies of scale and standardization of production, marketing and advertising.  Global Geographic Division Structure  Divides the world into geographic regions, with each geographic division reporting to the CEO  Usually used by companies with mature product lines and stable technologies  Problems encountered result from the autonomy of each regional division hard to do global planning.  Tracking and maintaining control of costs can be a problem  Computer Integrated Manufacturing  Also known as flexible manufacturing systems (FMS)  Using computers to link together manufacturing components such as robots, machines, product design, and engineering analysis to enable fast switching from one product to another  Result of 3 subcomponents:    Computer-aided design (CAD) Computer-aided manufacturing (CAM) Integrated information network

 Sociotechnical Systems Approach  Combines the needs of people with the organizations needs for technical efficiency  Socio refers to the people and groups that work in organizations and how work is organized and coordinated  Technical refers to the materials, tools, machines and processes used to transform organizational inputs into outputs  3 components:  Social system (individual/team behaviors, organizational culture, management practices, leadership style, degree of communication openness, individual needs and desires)

 

Technical system (type of production technology, level of interdependence, physical work setting, complexity of production process, nature of raw materials, time pressure Joint optimization organization functions best when the social and the technical systems are desined to fit the needs of one another

 Six Sigma  Highly ambitious quality standard that soecifies a goal of no more than 3.4 defects per million parts; also, a set of control procedures that emphasizes the relentless pursuit of quality  Based on a methodology referred to as DMAIC (define, measure, analyze, improve, control) which provides a structured way for organizations to approach and solve problems  Management & Executive Information Systems  MIS a computer based system that provides information and support for managerial decisions  Supported by the organizations transaction processing systems and by organizational and external databases  EIS a higher-level application that facilitates decision making at the highest levels of management, these systems are typically based on software that can convert large amounts of complex data into pertinent information and provide that information to top managers in a timely fashion  Organizational Life Cycle  Entrepreneurial stage             Stage in which an organization is born and its emphasis is on creating a product and surviving in the marketplace creativity Crisis need for leadership

 Collectivity stage Stage in which an organization has strong leadership and begins to develop clear goals and direction Provision of clear direction Crisis need for delegation with control

 Formalization stage Stage that involves the installation and use of rules, procedures and control systems Addition of internal systems Crisis need to deal with too much red tape

 Elaboration stage Mature stage in which a red tape crisis is resolved through the development of a new sense of teamwork and collaboration Development of teamwork Crisis need for revitalization

 Ethics  Code of moral principles and values that governs the behaviors of a person or group with respect to what is right or wrong  Sets standards as to what is good or bad in conduct and decision making  Personal and unique to each individual.  In any given group, organization or society there are many areas of consensus about what constitutes ethical behavior  History -> leads to the development of societal morality -> Society -> shapes the local environment -> Local Environment -> shapes individual behavior  Organization  Social entities that are goal directed, designed as deliberately structured and coordinated activity systems and are linked to the external environment  Key element is people and their relationships with one another  Exist when people interact with one another to perform essential functions that help attain goals.  Exist to do the following:        Bring together resources to achieve desired goals and outcomes Produce goods and services efficiently Facilitate innovation Use modern manufacturing and information technologies Adapt to and influence a changing environment Create value for owners, customers and employees Accommodate ongoing challenges of diversity, ethics, and motivation and coordination of employees  Organization as a System  Contingency  One thing depends on other things; for organizations to be effective, there must be a goodness of fit between their structure and the conditions in their external environment  What works in one seeting may not work in another no one best way  Contingency theory means it depends  Benchmarking  The process of continually measuring products, services, and practices against tough competitors or other organizations recognized as industry leaders.  Identifying whos best at something in the industry and then duplicating the technique for excellence, perhaps even improving it in the process.  Flexible Manufacturing System (FMS)  See CIM above

 Decline Stages of Organizations  Organizational decline is a condition in which a substantial, absolute decrease in an organizations resource base occurs over time.  3 factors are considered to cause         Organizational atrophy Vulnerability Environmental decline or competition

 Stages: Blinded internal and external change that threatens long-term survival and may reqire the organization to tighten up. Leaders often miss the signals at this point. Inaction denial occurs despite the signs leaders may try and persuaded employees that all is well. Faulty action organization is facing serious prolems and indicators cnnot be ignored. Leaders are forced to consider major change. Crisis has not dealt with decline effectively and is facing panic. CHAOS only solution is major reorganzation Dissolution irreversible stage only solution is to close shop

 Effectiveness  The degree to which an organization achieves its goals.  Approaches:     Goal approach concerned with an organizations outputs and how well the organization has met its output goals Resource-based approach asses effectivenss by observing how successfully the organization obtains, integrates and manages valued resources Internal process approach looks at internal activities and assesses effectiveness by indicators of internal health and efficiency Balanced scorecard approach comprehensive management control system that balances traditional financial measures with operation measures relating to a companys critical success factors  Organizational Behavior  Micro approach to organizations because it focuses on the individuals within the organizations as the relevant units of analysis.  Examines concepts such as motivation, leadership style, and personalty and is concerned with cognitive and emotional differences among people within organizations

 General Environment  Those sectors that might not have direct impact on the daily operations of a firm but will indirectly influence it.  Includes:      Government Sociocultural Economic conditions Technology Financial resources sector

 Boundary-spanning  Activities that link and coordinate an organization with key elements in the external environment  Concerned with the exchange of information to:   Detect and bring into the organization information about changes in the environment Send information into the environment that presents the organization in a favorable light

 Organic  An organization system marked by free-flowing, adaptive processes, an unclear hierarchy of authority, and decentralized decision making  As environmental uncertainty increases, organizations tend to become more organic  Decentralized authority and responsibility to lower levels  Encorgae employees to take care of problems by working together  Encourage team work  Informal approach to assigning tasks and responsibilities  Organic forms:      Employees contribute to the common task of the department Tasks are adjusted and redefined through teamwork Less hierarchy of authority and control and fewer rules Knowledge and control of tasks are located anywhere in the organization Communication is horizontal

 Lean Manufacturing  A process that uses highly trained employees at every stage of the production process, who take a painstaking approach to details and problem solving to cut waste and improve quality  Requires changes in organizational systems, such as decision making and management processes, as well as an organizational culture that supports active employee participation, a quality perspective and focus on the customer.  Employees are trained to attack waste and strive for continuous improvement in all areas.  Lean manufacturing is a super-efficient form of manufacturing that produces products of top quality

 Knowledge Management  The ability to systematically find, organize, and make available a companys intellectual capital and to foster a culture of continuous learning and knowledge sharing so that the organizational activities build on what is already known.  Companies need ways to transfer both explicit (formal) knowledge and implicit, or tacit (personal experience) knowledge across the organization.  Centralization  Refers to the level of hierarchy with authority to make decisions  Decisions tend to be made at the top.  Most smaller companies tend to have this type of structure  Rite of Passage  Facilitates the transition of employees into new social roles  Rite of Integration  Creates common bonds and good feelings among employees and increases commitment to the organization.  Managerial Ethics  Principles that guide the decisions and behaviors of managers with regard to whether they are right or wrong  Why do Organizations Exist?  Exist to do the following:        Bring together resources to achieve desired goals and outcomes Produce goods and services efficiently Facilitate innovation Use modern manufacturing and information technologies Adapt to and influence a changing environment Create value for owners, customers and employees Accommodate ongoing challenges of diversity, ethics, and motivation and coordination of employees  Acquisition  Involves the purchase of one organization by another so the buyer assumes control.  Technology & Job Design  The relationship between a new technology and the organization seems to follow a pattern, beginning with immediate effects on the content of the jobs followed by impact on design of the organization.  Job design assignment of goals and tasks to be accomplished by employees.  Besides replacing workers technology may have several different effects on human jobs: y Mass production technologies produce job simplification

j Variety and difficulty are reduced y Job rotation j Moving employees from task to task to prevent boredom y Job enrichment j Casued by advanced technology j Provides greater responsibility y Job enlargement j Expansion of number and type of tasks performed by employee  Workers have to keep learning new skills.  Weber and Bureaucracy  Max Weber sociologist studied government organizations in Europe and developed a framework of administravtive characteristics that would make large organizations rational and efficient.  Perceived bureaucracy as a threat to personal liberties he also recognized it as the most effiecint possible system of organizing  Predicted the triumph of bureaucracy because of its ability to ensure more efficient functioning of organizations in both business and government setting  Identified a set of characteristics that could be found in successful bureaucratic organizations:       Rules and procedures Specialization and division of labor Hierarchy of authority Technically qualified personell Separate position from position holder Written communications and records

 Cultural Symbols  Something that represents another thing  Stories, ceremonies and rites are all symbols because they symbolize deeper values  Another symbol is a physical artifact of the organization   Powerful because they focus attention on a specific item Examples: y Advertising firm with no private offices symbolizes and reinforces the firms cultural value of open communication

 Corporate Code of Ethics  A formal statement of the companys values concerning ethics and social responsibility; it clarifies t employees what the company stands for and its expectations for employee conduct.  May cover a broad range of issues, including statements of the companies guiding values; guidelines related to issues such as workplace safety, security of information, employee privacy; and commitments to environmental responsibility, product safety, and other matters of concern to stakeholders.  Important that managers support and reinforce codes through their actions otherwise it is nothing more than a piece of paper.  Power and Authority  Power the ability of one person or department in an organization to influence other people to bring about desired outcomes.    Exists only in a relationship of two or more people and can be either vertical or horizontal Power often comes from dependency and the side with the resources has greater power 5 sources of personal power y y y y y  Legitimate based on position Reward based on ability to reward Coercive based on ability to punush Expert based on knowledge Referent based on personality

Vertical sources of power y y y y y Formal position Resources Control of decision premises and information Network centrality People

Horizontal sources of power y y Strategic contingencies Power sources j Dependency j Financial resources j Centrality j Nonsubstitutability j Coping with uncertainty

 Authority a force for achiving outcomes but only as prescribed by the formal hierarchy and reporting relationships  3 properties identify y y y  Centrality  Reflects a departments role in the primary activity of an organization.  One measure is the extent to which the work of the department affects the final output of the organization.  Example: production department is more central and usually has more power than staffing.  Is associated with power because it reflects the contribution made to the organization.  Service Technologies vs. Manufacturing Technologies  Service technology                     Intangible output Production and consumption take place at same time Labor and knowledge intensive High customer interaction Human element very mportant Quality is erceived and difficult to emasuer Rapid response time is usually necessary Site of facility is extremely important Vested in organizational position Accepted by subordinates Flows down the vertical hierarchy

 Service examples: Airlines Hotels consultants Health care Law firms

 Manufacturing technology Tangible product Products can be inventoried for later consumption Capital-asset intensive Little direct customer interaction Human element may be less important Quality is directly measured Longer response time is acceptable Site of facility is moderately important

 Manufacturing examples

    

Soft drink comapines Steel companies Car manufacturers Mining Food processing plants

 Job Enrichment  Caused by advanced technology  Job provides greater responsibility, recognition, and opportunities for growth and development.  Learning Organization  An organization that promotes communication and collaboration so that everyone is engaged in identifying and solving problems, enabling the organization to continuosly experiment, improve, and increase its capability.  Five elements of organizational design for learning organizations:      Horizontal structure (structure) Adaptive culture (culture) Collaborative strategy (strategy) Shared information (systems) Empowerment roles (tasks)

 Sources of Ethical Values  There are varied sources of ethical values  Each persons ethical stance is a blending of their historical, cultural, societal and family background and influences.  History -> leads to the development of societal morality -> Society -> shapes the local environment -> Local Environment -> shapes individual behavior