Summary Organization Theory, -chapter 7 + 8
Organizational Structure (EBP670C05)
Rijksuniversiteit Groningen
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ORGANIZATIONAL
STRUCTURE
Technology & Environment (chapter 7 & 8)
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Authors Summary
Danique Visser S Sem Oosterhoff S Josef Richarz S Anne Fleur Schnepper S
Course: Organisational Structure Group: 5.
Table of contents
- Summary of Chapter 7; Technology
- Food for thoughts
- Summary of chapter 8; environment
- Food for thoughts
- Sources
- Long linked technology: a fixed sequence of connected steps: sequentially interdependent tasks
- Mediating technology: the process of linking together different clients in need of each other’s services
- Intensive technology: the utilisation of wide range of customised responses, depending on the nature and variety of the problems.
Galbraith’s contribution
Galbraith defined uncertainty as: the difference between the amount of information required to perform a task and the amount of information already possessed by the organization. Galbraith sad that how an organisation is structured depended on in which it had to process information
Galbraith identified seven organisational design strategies associated with different capacities to process information:
- Rules and programs
- Hierarchical referral
- Goal setting
- Creation of slack resources
- Creation of self- contained tasks
- Investment in vertical information systems
- Creation of lateral relations
Technological imperative
Job-level research support technological imperative the best. However, it does not apply to all organisations. Technological imperative only fits to
- small companies
- Organisations which provides arrangements at the operating core
Routines is a important part of technological. It has been proven that routine technology is positively connected with high formalisation, low complexity and centralisation. However, only when there is a low formalisation.
Service industries
Technology may also be categorized with manufacturing and service industries. The production and consumption of a service industry are simultaneously. The products are intangible and there is no possibility to inventor the product. Therefore, the organisation requires a lot of employees to interact with customers.
Information technology and structure
There have been researches about the influence of information technology on structure. However, the evidence is not very convincing. Informational technology does not have a direct impact. It looks like it mitigate between different variables. Information technology alleviate:
centralisation and decentralisation
increase and decrease in middle managers
increase and decrease in size
concentration and dispersion of operations
Informational technology may be popular among routine data processing and design work. However, Informational technology is not frequently used during conceptual work. Nevertheless, communication technology may bring different participants in an identical field effortless in close contact.
Summary of chapter 8 Environment
In order to define an organization's environment, the book differs between its general environment, its specific environment and its domain.
General environment encompasses conditions that potentially have an impact on the organization, but there relevance is not completely clear.
Specific Environment is that part of the environment that is directly relevant to the organization in achieving its goals.
Domain identifies the organization's niche in which it chose to operate with respect to the range of products and market served.
In addition to that, managers decide with regard to their perceived environment not to the objective or actual environment.
However, not all the environments are the same. They differ in their environmental uncertainties, which means that some forces in a company's environment are changing. The process through which the actual and the perceived environments interact in relation to environmental uncertainty is called the enacted environment. This means that the more information a manager has gathered, the more he assumes more uncertainty.
Burns and Stalker
The first research on the influence of environments and organizations determines how the organizational structure and managerial practice might differ depending on different environmental conditions. It says that an organization should choose between one of those two strategies:
Mechanistic structure is characterized by a high complexity, formalization and centralization.
The Organic structure is flexible and adaptive, with emphasis on lateral communication, non- authority- based influence and loosely defined responsibilities.
Lawrence and Lorsch
This research concentrates on the relationship between environmental differences and effective organization structures. They looked at two dimensions of what constituted an organization's internal environment. Moreover, they perceived the organization and the environment as having subparts: parts of the organization deal with parts of the environment.
Differentiation is the task segmentation and attitudinal differences held by individuals in various departments
Integration is the quality of collaboration that exists among interdependent units.
They concluded, that environments have different sub environments with a different uncertainty. Therefore, the organization's subunits have to deal with the demands of the sub environment. An organizational structure should be chosen, depending on the environment.
Duncan
Duncan classified environments along two divisions. The rate of change of environments (how fast does it change) and the environmental complexity (how complex is it). The interaction of these two, result in 4 possibilities of how an environment may look like:
Simple+ High Uncertainty Complex+ High uncertainty
Few elements, but unpredictable Many elements+ unpredictable
- Decentralized, organic structure - Decentralized, teamwork
- Many different departments departments - Constant environmental monitoring
- Extensive integration - High coordination
- Extensive planning - Mechanistic production facilities
Simple+ Low uncertainty Complex + Low uncertainty
Large number of dissimilar external Many elements, which change slowly elements which change only slowly. - Centralized, formalized, mechanic structure
- Centralized, formalized - Differentiated into many departments
- High differentiation - Many boundary spanners
- Large number of boundary spanners - Programmed coordinator
- Programmed coordination
Boundary spanners have different roles in an environment:
- Understand their environmental segment
- Make the information useful for the organization
- Represent the organization in front of the customers
There are three key dimensions to any organization’s environment:
Capacity refers to the degree to which an environment can support growth Stability states the extend to which there is little change in the environment. Environmental complexity refers to the degree to which the environment is
concentrated on just a few elements.
Sources
Food for thoughts, technology
ft/cms/s/0/4ecdb67c-beb9-11e1-b24b-00144feabdc0.html#axzz
Food for thoughts, environment
John Kotter, The Real Reason Behind the Kodak Downfall
He wrote for forbes
Summary, technology & environment
Organisation Theory, concepts and cases written by: Stephen P. Robbins and Neil Barnwell
Summary Organization Theory, -chapter 7 + 8
Vak: Organizational Structure (EBP670C05)
Universiteit: Rijksuniversiteit Groningen
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