Org DesignProcess of coordinating the structure elementsRange of theories

Classical org theory – assume one best way to design/structure org (early 1900s)

Tall hierarchy best w/ formal authority

Neoclassical theory – human relations focus w/goal of ee satisfaction

Flatter structures w/decentralization

Org DesignContingency Approaches – Lawrence& Lorsch (1969); now most accepted org design

Design depends on org’s environment Including economy, competitors, geography, suppliers, workforce

Studies comparing orgs in stable v unstable environments resulted in models of ‘mechanistic’ v ‘organic’ orgs

Org DesignMechanistic Orgs – stable environments with little change in product, market, or technology

Allows specialization of tasks given that people have time to develop their expertise

Organic Orgs – unstable environmentsLittle specialization; need broad knowledge to deal w/changing conditionsLittle authority; rely on participative decisions

Effectiveness results when form matches environment

Mintzberg’s Theory

Orgs composed of 5 basic elements; which one is dominant determines most effective design for that situation

Operating Core: ees who do the basic work related to product/serviceStrategic Apex: top-level execs who run itMiddle Line: mid-managers who go-between operating core & strategic apex

Mintzberg (cont.)Technostructure: specialists who standardize org systemsSupport Staff: indirect support services

Mintzberg specifies 5 designs based on which of the 5 groups dominates…

1) Simple structure: small, informal,w/one person in charge2) Machine bureaucracy: specialized, power at top; can be routine/boring

Mintzberg (cont.)

3) Professional Bureaucracy: power in operating core (univ.) but still some rules coming from strategic apex4) Divisional Structure: autonomous units organized by central headquarters; middle line has most power5) Adhocracy: informal, often team-based; support staff has power

Org Change and Org Development

Ch 16

Org Change and ODOrg Change – in structure, technology or people

1st order – minor, incremental changes2nd order – major changes, all levels

Org Development – methods used to implement org changeChange required due to demographics, regulations, competition, technology…

Group DiscussionSituation A: a new e-mail system is introduced at a large university that will replace the practice of transmitting memos on paper.Situation B: A very popular employee who has been w/the org for many years is retiring. He’ll be replaced by someone new from outside.

(cont.)Discuss major impediments to change for each situationIdentify ways to overcome these impedimentsDoes the nature of the situation seem to call for different ways of overcoming the impediments?

Lewin’s Force Field Analysis Model

Unfreeze Desired State Refreeze

•To unfreeze, produce imbalance betw driving and restraining forces.•To refreeze, new structure must support and reinforce new system to avoid slipping back to old ways.

developed 50 yrs ago, still prevalent today

Driving & Restraining Forces

To increase driving forces:Create urgency for change (crisis)

Ees need to know about competitive threats, org’s financial problems

Customer-driven change (complaints)

To reduce restraining forces:Communicate (increase procedural justice)Train ees so they can use new skillsAll else fails, coercion (Continental Airlines – firing majority of senior execs).

Best when need quick change

Employee Resistance to Change

Main reasons for creating resistance:Direct costs (need to see change as positive, not loss of power/status)Saving face – in political situations want to prove decision or person was wrongFear of unknown – make change explicitIncongruent org systems – rewards don’t encourage new behaviors

RefreezingThrough org structure changesThrough org reward systems consistent with new changesLewin’s model effectively describes change process, but overlooks:

Change agentsDiffusing change

(cont…)Change agents – person who forms & communicates change, then builds commitment (facilitator)

Some orgs rely on external consultants, but typically internal people

Transformational leaders

Diffusion of change – often works best if start w/pilot project, then spread.

Evaluating ChangeUsing Kirkpatrick’s training evaluation model:

Reactions – did ees like the change?Learning – what was acquired from the change? (new skills learned?)Behavior – what changes in job behavior occurred? (individual-level)Outcomes – what changes in productivity occurred? (org-level)Reactions measure restraining forces, learning reflects change itself, behavior measures refreezing success.

OD InterventionsOD implements org change w/emphasis on org effectiveness

Tries to improve org capability to solve problems & cope with change

Client-consultant relationship (process consultation)

Facilitator observes group, then works w/them (conflict mgmt)

OD InterventionsTotal Quality Movement (TQM)

Developed by Deming (U.S.) in 50’s, exported to Japan, then back to U.S. in 80sFocus on managing process of work and challenge ees to constantly improve qualityTeach stats to measure variance in qualityEmphasis on immediate feedback re:quality Continuous improvement (kaizen) is key

OD Interventions (cont.)Management by Objectives (MBO) – develop specific org goals

Goals mutually set w/ ee involvementIncludes evaluation component

Quality of Work Life (QWL) – encourage ee participation to improve sat

Could include job enrichmentUse of ‘quality circles’ to fix specific problems

OD Interventions (cont.)Survey feedback – employee opinion surveys with unit/dept follow-up meetings to solve problems

The process raises ee expectations that change will occur, so mgmt must commit

OD AssessmentDoes it work?

Work best if use combination of interventions w/mgmt supportDifficult to evaluate given multiple causes of any change (need quasi-experiments)

Ethical concernsEthics of behavior interventions from ee perspective? (coercion)

Culture & ODValues/goals of OD fit U.S. culture (democratic)

Other cultures expect leaders to make decisions w/o ee inputCultural diffs in resistance to change affect OD success (England, China value tradition; U.S. values change)

Trice & Beyer (1993)Describe change along 4 dimensions

Pervasiveness – % of org activities that will be affected by changeMagnitude – distance betw old and newInnovativeness – degree to which new ideas are unprecedentedDuration – how long it will take and how permanent it will be

Trice & BeyerInstitutionalization of change –

takes years, may continue to see residue of old culture Includes removal of prominent people who represent old culture

Symbolic messageRemoves resistance