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Organizational

Environment
Session 6

What is Organizational
Environment?
The following factors influences
and present numerous and
diverse opportunities and
threats that must be exploited
by organization:
customers, competitors, suppliers,
distributors, as well as
technological, economic,
demographic, political and legal.

The Impact of Globalization on


Organizations and Managers
The world economic, political, legal
and technological changes, as well
as newly formed international
relationship have had a significant
effect on managers within
organizations:

European Union (EU): Which includes


most Western European nations, such as
France, Greece, the United Kingdom,
Denmark, the Netherlands, Belgium,
Ireland, Italy and Luxembourg.

North American Free Trade


Agreement (NAFTA): Jan, 1994
Reduced tariffs and barriers to trade and
has linked customers and economies
between the United States, Canada and
Mexico.

Asia-Pacific Economic Cooperation


Forum (APEC)
Joint economic development of the AsiaPacific base countries.

Caribbean Community (CARICOM):


Pursuing free trade within Latin
American countries.

World Trade Organization (WTO):

Monitor the reduction of import duties


that will be phased in over the next
several years.

Mercosur: this free trade agreement


has a primary objective to eliminate of
80 per cent of goods traded between
Argentina, Brazil, Uruguay and
paraguay.
Other areas: ASEAN Free Trade Area
(Brunei, Indonesia, Malyasia, the
philppines, Singapore, thailand and
vietnam), the Economic Community of
Centra African States and the Gulf
Cooperation Council.
SAARC: South Asian Association for
Regional Cooperation.

Assignment # 1
What is the mission of this
organization/agreements.
Scope of this
organization/agreement?
Member countries
Organization structure if any
Achievements
Your comments

Global attributes
Following global attributes are
sought after by many organizations:

Adapts well to different business


environments.
Respects different beliefs, values and
practices.
Solves problem quickly
Communicates well with people among
different cultures
Speaks more than one language
Understands different government and
political systems.
Conveys respect and enthusiasm when
dealing with others.
Possesses high technical expertise for
the job.

Technology and
organizational design
The infrastructure of organizations
has been redesign in a way:

That has radically changed the people


communicate with each other
Cross functional nature of work
Team work

The classification of technology


provided by Charles Perrow, James
Thmpson, and Joan Woodward apply
to organizations.

Charles Perrow Routineness


The various technologies are
differentiated primarily by the
routineness of the transformation
task that is managed by the
department or organization with two
components:
Expectation: standardized input, output
few expectations. Varity of input,
output many expectations. As
expectation increased technology
become less routinized
Problems: Where problems are more
complex and difficult to analyzed the
technology became less routine.

Outputs from inputs


The term technological routineness
to describe the extent to which
exceptions and problems affect the
task of converting inputs into
outputs.
Craft Technologies: these refer to
standard inputs and outputs
Routine Technologies: these
technologies require standardized
input and outputs, when an
expectation is made, the
adjustments are clearly articulated.

Non-routine Technologies: expectations


are common, and decision-making
regarding process can be complex. An
addiction centre might treat alcoholism,
but also needs to consider a wider
variety of mental disorders.
Engineering Technologies: many
exception are characteristics of these
technologies, however, the solution or
application is standardized.
E.g: you may have a number of clients, all of
whom require consulting for fund-raising
event. While their needs are distinct, you
have an application for each of them that is
based on their own objectives and available
resources.

Problems

Expectations
Few

Many

Difficult
Analysis

Craft Technology

Nonroutine Technology

Cabinet Making

Research Unit

Public School

Psychiatric Hospital

Easy

Routine Technology

Engineering Technology

Assembly Line

Heavy Machinery
Construction Health

Analysis

Vocational Training

Spa

Perrow s Technology Matrix

James Thompson Interdependence


James Thompson pursued an
understanding of sequential work
activities and identify the ways in
which these units or activities were
dependent on each other for
resources such as raw materials or
information.

Intensive Technology: complex


environments where interdependence in
reciprocal. In this technology, member of
organization work interactively and use
multiple techniques in order to solve
problems.

E.g: Hospitals a combination of


efforts and coordinators from
doctors, nurses, pharmaceuticals,
social services, religious services,
and others is needed in order to
facilitate.

Mediating Technology
This is a function of pooled
interdependence. The level of
interdependence is not as high as in
intensive technology. E.g: Banks,
which link creditors and depositors,
and are sources of information that
facilitate exchanges.

Long-linked Technology
This technology implies a
sequential interdependence,
where each unit is dependent on
the unit that preceded it in
sequence. E.g: automobiles
assembly line.

Joan Woodward Batch


Technology

She distinguished among three kinds


of technology based on relative
contribution made by people or
machine.
Unit or small batch technology: entails
custom-tailored units using
unsophisticated machinery and
equipment. Quantities are small and
production is carried out by small
groups of skilled participants. E.g:
custom built cars
As such, organic structures that lend
themselves to decentralized decision
making models are most appropriate in
unit production.

Mass Production Technology:

Makes use of automated machines that


perform the same activities over and over
again. Tasks tend to be repetitive and there
are typically stringent controls in place that
manage the production process.

Continuous process technology:

Is highly mechanized and input are


transformed as on ongoing process. This is
done using automated machines that
typically are centrally controlled with
computers. E.g: automated oil refineries
and chemical plants.
A flexible organization structure is
required.

Advance IT in Org. Today


IT is a combination of machines,
artifacts, procedures and used to
generate, aggregate, store, analyze,
and disseminate information that is
translated into knowledge.
Advance manufacturing technology
has led to more organic, flatter
structures that facilitate flexibility.
With respect to job design,
sophisticated skills and diverse
responsibilities are required. Self
manage teams are often responsible
for operating and servicing the
system.

Technology has enabled


employees to work from home,
manager can supervise and
coordinate work across
geographically dispersed
employees, meeting can be
conducted videoconferencing.
Organizations have enjoyed
significant labour saving by
making use of IT.