Organizing

What does it seem that managers over-delegate responsibility or pawn off their jobs to people below them?

Who do you handle complaints form employee that they might have about upper management and how they are treated by them?

How do you arrange people to do the things which they can do the best?

What is the average size of a group that managers manage?

L en S ym m esC on tro lle r

D ave S ch w abF ac to ry S u p er

R a lp h S im p sonE xec V P

D oc R eevesD ir. R esearch

F red R og ersD ep u ty D ir.

F ran k F orb u sE n g . S ervices

F ran k F orb u sD irec to r o f E n g in eerin g

R on P orte rV P S a les

B ill H u n tP res id en t

Previous slide was an organizational chart

Describes the arrangement of work positions within an organization (it reflect the formal or official organizational structure).

Different ways to organize.

Rondell--high tech company with rapidly changing Tech. Frank was recently hired. Predecessor lasted 10 months and one before him took to drinking. Problem in ES.

ES does pre-production lay out and design. Doc Reeves has many new ideas (over 900/year) and ES expected to modify pre-production changes quickly. Reeves underestimates time to implement.

Sales delivery dates get set further behind. Sales complains about resolving disputes between ES and production

Production complains about sloppy work in ES (Schwab). Forbus gets “a sack” for a Christmas present. Reason--costly delays that influenced customer satisfaction.

What would you do with Rondell. Are the problems Forbus or the structure? Assume you are on the management team and will make a recommendation.

L en S ym m esC on tro lle r

D ave S ch w abF ac to ry S u p er

R a lp h S im p sonE xec V P

D oc R eevesD ir. R esearch

F red R og ersD ep u ty D ir.

P erson XE n g . S ervices

W h o w an ts th is job ?D irec to r o f E n g in eerin g

R on P orte rV P S a les

B ill H u n tP res id en t

Organizing in a team

Pretty much deciding how to break up the work and who does what.

Importantly, how to communicate and set up the work flow (who does what first).

Time components.Allocating resources is not a

significant issue.

Big issue

Work collaboratively.Specialize.

Key Issues--Relevant to Rondell

Differentiation—the degree task are divided into subtasks and performed by specialized individuals

Task differentiation by what employees do

Cognitive differentiation by what employees think.

Need for differentiation

Specialization of tasksDevote resources towards critical

needs such as technology, customer segments, or stakeholders.

Tied to Mission/strategy/operational plans

How does Rondell do differentiation?

Integration

Various parts of the organization cooperate and interact with each other

Human resources and material resources

Efficient use of materials and people

HOW TO IMPROVESUBSYSTEM Integration

Rules and proceduresDirect contact among managers Liaison roles Task forces Teams Matrix organizations

Think about consequences if no integration.

How does Rondell do integration?

Management

Constantly addressing organizing in higher positions. Given goals how can we best allocate are material resources and human resources to meet those goals from efficiency perspective and from goal success perspective.

In project teams

Task force model/teams is integration. Direct communication

Functional structure

Groups together people with similar skills.

Rondell--research and engineering, production, and sales

Best when few product lines and competing demands for different products.

Advantages (Expertise and efficiency)

Task assignments consistent with technical training.

Technical Problem solving.Clear career paths.Efficient use of resources time and

cost within units.

Disadvantages

Poor communication across functionsToo many problems get resolved at

the top.Loss of responsibility for getting

product to market.Self-centered viewpoints.

Divisional structures

Groups people with diverse skills to work on the same product or with similar clients and customers.

Advantages over functional

Improved coordination (integration)Responsibility assigned for

product/service. Greater customer satisfaction with product or service.

Greater flexibility to adapt to environmental changes.

disadvantagesDivisions fight for resourcesLoss of efficiencies (capital and

human resources). (poor differentiation)

Lack of sharing of expertise across products.

New product development limited.

movie

Done individually.Does Chrysler have a divisional or

functional design. Why was this design effective. How did this influence employee behavior?

Overlay to create efficiencies

Larger Staff functions such as human resources or import/export

See page 10 Provide advice and support to line managers.

In reality it often does rules and constraints.

New Trends

Increased delegation--distributing and entrusting work to others (empowerment).

Increased responsibility and accountability.

See page 214 of text for delegation.Trust and accountability are key.

Current Trends (cont)

Flatter organizations--wider spans of control and shorter chains of command.

Wider spans of control associated with

Less controlling/ more empowermentdecentralized decision making push

the decision making authority down to the lowest level possible.

Example of company with new methods

Nucor See p. W 39

Steel bars, sheets, joists and girders, decking, grinding balls, fasteners, prefab buildings, and bearings. Started with just steel bars. Recycled steel in Mini meels

9 facilities in all7000 employees

Think small in spite of growth

Flat organization with Wide spans of control

DelegationIncentive systems

layers

Top executivesGeneral managers (by divisions)Department supervisorSupervisorhourly employeeExample no shift supervisors just

department supervisor

incentives

Weekly between 80-150% base payannual if outstanding performance of

company.

Revisting Rondell

What should we do to get them to work together. Nothing is perfect. What could be done to improve the situation?

Summary

Differentiation and integrationExamined different ways to

differentiate and integrate. Current trends toward employee

empowerment/accountability. Promoting integration