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Organization Studies
ORGS 2010
Eleanor Westney

WEEK 1-5 NOTES (READINGS + SLIDES) WEEK 1 - INTRO  The organization has set of features shared by modern large scale organizations called bureaucracy (Max Weber – note, very strategic design-y) o Features include: o 1. Clearly delineated positions and jobs – with required qualifications o 2. Formal hierarchy of positions – line of authority setting out power/limitations (“chain of command”) o 3. Formal rules and standard operating procedures o 4. Training, career paths, reward systems (aka advancement)  Macro/Micro analysis o Macro – organization and external organizational environment o Micro – groups & teams and interpersonal relations o Organizations are complex systems and what happens on one level affects another  Unanticipated consequences of changes!  3 lenses o Strategic design  View of the organization: input-throughput-output system  Key concepts: activities, interdependence, resources (esp. information)  Key processes: grouping, linking, and aligning  View of the environment: resource base (source of inputs), competitive market  Role of the leader: “organizational architect”, strategist  Stimuli for change: lack of internal alignment, lack of “fit” between organization & environment  Obstacles to change: inadequate information (“they don’t get it”), inadequate analysis (“the case isn’t convincing”) o Political system  View of the organization: an arena for conflict  Key concepts: power & influence, interests  Key processes: conflict, negotiation, coalition building, networking  View of the environment: external stakeholders  Role of the leader: forging coalitions, identifying and leveraging interests, negotiating  Stimuli for change: shifts in dominant coalition, in power of stakeholders  Obstacles to change: entrenched interests (“they won’t buy in because they stand to lose”) o Cultural perspective  View of the organization: a social construct – what we think it is  Key concepts: identity, symbols, values, basic assumptions  Key processes: meaning and interpretation, legitimating  View of environment: social and cultural network  Role of the leader: articulating vision, symbolizing the culture, understanding and leveraging the culture  Stimuli for change: challenges to basic assumptions, contending interpretations  Impediments to change: dominant culture, established mindsets (“they can’t see it”)  Levels of analysis o Individual o Group o Organization  Applications o Teams o Gender and Diversity o Incentives and Motivation o Change and CSR WEEK 2 – STRATEGIC DESIGN  Strategic design – systems deliberately constructed to achieve certain strategic goals o Efficiency (accomplishing strategic goals with least resources)+ effectiveness (goals accomplished to standards) emphasized o Assumption: organization has a strategy for creating value (value proposition/distinctive competitive advantage) – establishes what activities will lead to success o Key strategic question: which activities should be inside the boundaries of the organization and which outside?  Key elements o Information processing and enhancing system o Task – basic element – smallest unit of activities needed to be done to achieve overall strategic goals  Vary in complexity, routinization and interdependence o Task interdependence  Sequential interdependence – one task completed and then handed off to next stage  Harder to manage than pooled, easier than reciprocal  Pooled interdependence – tasks undertaken at same time and final result put together  Easiest to manage  Reciprocal interdependence - tasks conducted in repeated interaction with each other  Hardest to manage o Organizational design choices begin with strategic grouping – differentiation of clusters of activities, positions, and individuals into work units o Then they must go through linking – ensure that resources and information flows efficiently and effectively between activities/groups o Lastly must use alignment mechanisms (incentive systems, information systems, etc.) to ensure people have the resources AND incentives to carry out tasks assigned to them  Strategic grouping – gathering tasks, functions, disciplines and separating from others o Assumption: coordination and communication are easier within unit than across units o Basic criteria  Activity (function)  Product/technology (business division/unit)  Market/customer (geography/customer segment) o Grouping by expertise/function – bringing together individuals who share similar functions, disciplines, skills, and work processes   Three strengths  1. Development of deep functional expertise and a high degree of specialization  2. Economies of Scope – easy to transfer resources across activities within functions  3. Allows for creations of separate alignment systems each tailored to every function’s needs/strengths  Four weaknesses  1. Backward flows of information can be difficult due to sequential interdependence between functions (e.g. from marketing to eng) -> therefore not responsive to changes in consumers  2. As specialization increases, individuals develop narrower perspectives  3. Difficult to assess costs  4. Tendency to expand levels of management over time – this can inhibit efficient and effective info flows  Frequently adopted by new businesses – maintained over time by organizations that have a single major business or share similar technologies across similar markets o Grouping by Output/Product – organizes on basis of service/product provided   Two strengths  1. Transparency of performance – costs/profits are clear of each function (business)  2. Clear strategic focus – each business division head is responsible for profitability/growth of a complete “value chain”  Four weaknesses  1. Difficulty of sharing resources – lead to duplication of activities across business units  2. New business creation difficult – business units focus on expanding their own business instead of finding new opportunities OR competing across units  3. Functional specialists are spread – can lose touch with innovation in own fields  4. Distributing activities across different units can lead to missed learning opportunities in core functions  Structure associated with strategies that emphasize efficiency, where info on cost/profitability is crucial o Grouping by Market – gathers together people who perform different activities/tasks and produce different outputs but serve same customers/market   Two strengths  1. Capacity for deep customer knowledge and close relationships  2. Tailor products/services to different needs  Three weaknesses  1. Duplication of activities/resources  2. Erosion of deep technical expertise  3. Missed opportunities for synergies and learning  For strategies that are customer-focused (customers with different needs and tastes). Often in service industries o Matrix organization – picks two strategic grouping dimensions and gives them equal weight in org structure – each manager of each operating unit reports to two bosses – one for each dimension   Strength: balancing two equally important grouping dimensions  Four weaknesses from complexity  1. Confusion  2. Higher costs  3. Delays in decision making  3. Heightened potential for conflict o Front/back structure – divided into two parts. “Front end” faces customer and organized by market – developing and producing products. “Back end” is organized by product – business units that include technology dev, production, logistics   Two Strengths  1. Close integration of tech development and production (back end)  2. Building deep customer knowledge and close relationships (front end)  Three weaknesses  1. Fragmentation of technical expertise (back end)  2. Poor integration between market needs and tech development  3. Ensuring adequate integration/synergy between the front and back ends can be difficult o Modular/Network structures – self organizing network. The subunits come together and cooperate to deliver a specific product or service. New development. Not much info in reading o Line – activities in the direct “value chain” providing products/services to customer o Staff – support activities (so finance, legal, HR, PR, IT)  Linking – designing structures and processes to connect and coordinate organizational units and subunits whose tasks are interdependent but have been separated by strategic grouping decisions o Intensity of linking mechanisms is influenced by level of interdependence (pooled, sequential, reciprocal – the task interdependence earlier) o Dotted line relationships – lower ranking person is formally responsible for supplying all relevant information to higher ranked person but that they have no formal authority over them beyond the information flow (“easy fix” for lack of horizontal information flow) o Liaison roles – assigning responsibility for coordination across groups to individuals  These people are conduits for info and expertise  Primarily information-focused role  Not a full-time responsibility but combined with other activities o Integrator roles – coordinate activities and decision processes  More of a general management role  Have “carrots and sticks” to help their role o Permanent cross-unit groups – formal mandate for representatives of different task/work groups to pool expertise and coordinate efforts to a certain product/client/market/problem. Often combined with other activities (not full-time assignment) o Temporary cross-unit groups – like permanent groups, but project is the grouping dimension. Disband after the project. Heads of project teams play an integrator role o IT Systems – enhance support for linking and coordinating mechanisms – and even can be seen as own linking mechanisms o Co-location – putting people and subunits that need to exchange information in the same location o Challenge in designing linking mechanisms – determining which add value and which do not  Alignment – ensuring the units and individuals assigned certain tasks and activities by grouping and linking have the resources and motivation to carry them out o A common failure of organizational redesign efforts is a lack of organizational congruence – misaligned supporting systems and processes o Performance measurement systems – system to indicate whether or not a design is effective based on its performance. Need to be designed so that they do not pull groups in incompatible directions that undercut linking o Rewards and incentives – useful tool for changing behaviour.  Criteria for general principles:  Incentives should link performance to pay and directly link performance to specific standards and objectives  Rewards should relate directly to the nature of performance required at each level of the organization.  Rewards should be directly linked to objectives that are within the group’s or individual’s power to control  Incentive plans should match measurement periods for rewards to relevant performance plans  One view – individuals oriented to material rewards  Prone to “free ride” off others – can be unproductive without negative sanctions  Other view – most individuals want to do a good job  Main challenge is to design reward system that doesn’t misalign rewards with requirements of org’s strategic intent – “perverse incentives” o Resource allocation – assessing adequacy of resource to carry out assigned tasks – very difficult to implement o HR Development –Allocating resources of people as well as developing (training) and “creating” them (hiring)  Strategic organizational design process o Disruption of flow of business – redesign efforts take up time and attention of managers and tie up organizational resources  Information is not processed adequately – employees do not recognize the value of different kinds of info, how to interpret it, how to add value, or how to pass it on o Risk to LT relationships with customers/suppliers – they do not know who to talk to in the organization because of changing positions o Stress – loss of continuity, departure of key people = damages core competencies of company. People worry about job loss o Good design process (Nadler/Tushman)  1. Those that emerge from consideration of widest possible range  2. Design process involves people who understand the organization  3. Developed with implementation in mind  4. Making people responsible for making the change work feel as if were part of shaping the change o Stimulus for change  Response to growth – more products, broader range of customers, etc.  Internal problems – lack of coordination, excessive conflict, unclear roles, poor work flows, etc.  Environmental changes (most frequent) from external business environment  Organization seen as “throughout-put” – takes inputs from environment, adds value through internal processes, and distributes to users outside the organization  Input-set – environment  Output-set – market  Shifts in the environment can change the design – organization must fit the environmental pressures  Understanding an organization o 1. Know its strategy – what is the organization trying to accomplish? How does it differentiate itself? What does it do better than others? o 2. Map its design  What is the grouping structure?  How are the units created by the structure linked?  Are the basic systems aligned with each other? Do they positively reinforce each other?  Does the organization design fit the demands of its environment and of its strategy?  Strategic organizational design process o 1. Generate design criteria o 2. Generate grouping alternatives o 3. Evaluate grouping alternatives o 4. Identify coordination requirements o 5. Generate structural linking mechanisms o 6. Evaluate structural linking mechanisms o 7. Conduct impact analysis o 8. Refine and eliminate designs o 9. Identify issues for operational design and alignment o 10. Identify issues for implementation WEEK 3 – POLITICAL SYSTEM  Political system – sees organization as a social system constructed as an arena for competition and conflict among individuals, groups, and other organizations whose interests and goals differ o Roots of conflict lie in different interests, disagreements requiring action, including negotiation, coalition building, exercise of power and influence o Asks “Who’s defining the problem? What gives them the power to define it? Who’s advocating my solution and why? How can I get an outcome that serves the interests of me and my group? o Decisions must be political – have to have buy in of those with power to implement/block them  Interests – what people want and what’s at stake for them o Assumption: people act rationally to serve their own interests (economic man) o Collective interests – those shared by others belonging to same group o Groups:  Formal structure  Demographic groups  Division of labour  Location  Professional/occupational category o Stakeholder perspective – identifies groups that have a share stake (i.e. set of collective interests) o 1. Analyzing what interests are and what priority they have for individuals and collective actors  Multiple interests at same time – LT/ST, competing, autonomy/cooperation  Collectives also have multiple interests  Therefore, the way decisions are made, they depend mostly on how key decision makers see and assign weight to their interests  These interests are also dynamic – they change  Can be latent – do not realize they exist until an event happens  To carry out an action, one must understand what interests will be affected by it  Power – ability to affect behaviour of other people o 1. Influence – someone does not have formal authority but has ability to persuade others. Legitimate o 2. Authority – legitimate and decreed upon by organizational hierarchy/formal positions o 3. Coercion – domination – not considered very legitimate. Breeds resentment. Basically punishing someone o Sources of power:  Personal characteristics – charisma – gift of grace. Emotional connection between leader and followers. Unstable, requires constant proofs, difficult to transfer  Energy  Focus  Sensitivity to others and ability to understand how they see interests  Flexibility  Ability to tolerate conflict  Submerging one’s ego and getting along  Willingness to engage in conflict to further one’s actions is a source of power  Scarce or valued expertise  Past performance/track record  People believe can cultivate future relationships with “high fliers”  Formal position  Provides guide to resource allocation, info flows, evaluation of employee performance, task assignments, conflict resolution  Proximity of subunit to head of organization – greater the power  Informal network position  Size of network and position in network is crucial  Centrality – how many links you are between powerful individuals within a network  Network clusters are better and more efficient than redundant interconnected, tightly knit networks  Network position is a great source of influence for 2 reasons o 1. Info advantage in can confer o 2. Potential for coalitions  Holes in an organizational network where there is no direct link between subunits that could benefit from being linked – structural holes o Someone who bridges these wholes has power because he has disproportionate say since he has contact with both  Many social networks: task-related networks, friendship networks, advice networks o How to identify where power resides in an organization:  Reputation – ask people who has power in the org  Representational indicators – which groups’ interests are over repped  Observation of consequences – which groups benefit most from resource allocation  Symbols of power o Sources of power: Personal characteristics, scare & valued expertise, track record/contribution to org. performance, formal position in org. hierarchy, informal network position  Using political lens to take action: o 1. Map interests and power  1. Supporters – whose cooperation do you need  2. Blockers – whose opposition could hold you up  3. Potential stakeholders – who will be affected  4. Existing coalitions – who are the friends/allies of potential supports/blockers and what are their collective interests  This provides guidance on a) how to convince key stakeholders that your initiative serves them, and b) how to tailor your initiative so that incorporates key stakeholders o 2. Getting buy-in – getting people to commit to action  Escalation of commitment – people are more likely to commit to something that they have already invested resources into  Publically made – less likely to back in  More resources = more commitment  Giving stakeholders chance to provide feedback – illusion of influence – feeling that they have some effect on the group  Risk: having potential supporter back out o 3. Finding allies & building coalition  Set of allies who act together to support certain policies/activities  Long-term can be a general coalition to provide reciprocal support for each other’s interests  Dominant coalition – upper management acting together in their interests  Idea of reciprocity mostly o 4. Building a network  Built on reciprocity (I do for you, you do for me), and trust. Have values, i.e. currencies:  Rewards-related  Task-related  Relationship-related  Status-related  Key to establish trust to overcome initial barrier and begin with reciprocity  Maintaining relationships are a crucial time sink – may take up to 80% of managers’ time  Choose type of network to maintain o 5. Building negotiation skills WEEK 4 – CULTURAL PERSPECTIVE  Cultural perspective focuses on social and personal identities carried by people. Cultural understandings are collectively shaped and rooted in the past o Limitations of managers, structural authority, influence, and rationality best describe human behaviour o Emphasis that people must learn these things to be fully functioning members of org  Schien’s model of culture: o Pyramid going from top to bottom: o 1. Artifacts/behaviours (symbols) – what you observe o 2. Espoused values – what you are told (normative) o 3. Basic assumptions – what participants take for granted (cognitive)  Centrality of symbolism – meanings guide behaviour. Key is that symbols influence people to act in certain ways o Vehicle for meaning – notions of personal identification o Denotative meaning – direct and instrumental use of symbol o Connotative meaning - expressive and general uses of symbol o 4 domains of symbols to examine for interpretation:  1. Symbols are cultural objects whose artifacts can be categorized  2. Produced and use by people and groups within orgs for certain purposes – the intentions of symbols creators and users must be understood  3. Have a historical period and social context that shapes it  4. Mean different things to different people so effect of them on different people must be examined  This is at heart of cultural perspective of orgs  Part of all aspect of the organization  Leadership itself can be seen as symbolic action  Symbolism is the elementary process to make org behaviour possible and meaningful  Culture broken down into cultural products and cultural processes o Cultural products: tangible social constructions that are explicitly produced o Cultural processes: more general, implicit features of social life that underlie and prefigure cultural products o Distinguish between structure and culture  Structure represents institutional conditions that characterize a given society  Culture represents the values, beliefs, norms, etc. to societal culture  As culture shifts so does structure. Reverse is true as well. With without the other is incomplete and fails o Taking a cultural perspective involves considering the historically grounded pattern of meanings that guide a group  Organizational culture – business orgs and social systems where people must do things together o Orgs are within and across cultures and even generate their own culture o Culture and control  Coercive theories say that to get people to do things, management must hold a whip above them  Exchange theories say that most people work for tangible rewa
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