ORGANIZATIONAL DESIGN A step by step approach
Richard M. Burton Geraldine DeSanctis Borge Obel Cambridge University Press 2006
What are our goals? What are our basic tasks? Who makes which decisions? What is the structure of communication? What is the incentive structure?Multidimensional context
Structural: Goals. Strategy (including environment). Structure (Configuration, complexity, geographic distribution and knowledge exchange). Human: Work processes (task design). People (leadership and climate). Coordination. Control (information systems, incentives).
Two complementary problems
How to partition a big task of the whole organization into smaller tasks of thesubunits. How to coordinate these smaller subunit tasks so that they fit together to efficiently realize the bigger task or organizational goals.
The work of an organization can be seen as information processing, observing, transmitting, analyzing, understanding, deciding, storing and taking action for implementation.
“The greater the uncertainity of the task, the greaterthe information that has to be precessed between decision makers.” John Kenneth Galbraith, econonist
Information procesing requirements
LOW: Exception based hierachical decision making. HIGH: Targets or goals.
“Organization is a conciously coordinated social entity, with a relatively identifiable boundary, which functions on a relatively contonous basis to achieve a common goal or set ofgoals.” S. P. Robbins
Fundamental goal orientations
Efficiency: primary focus on inputs, use of resources and costs. Effectiveness: focus on outputs, products or services and revenues.
= KAI = Change
= ZEN = To the best
= KAIZEN = Continous improvment
Do things well first time and better the second. Cost management, not costreduction. Easy techniques Everyone has to improve his or her job. Small steps. Process orientation. No investments. Examples: NISSAN, BMW vs. KAWASAKI
Big improvements. High investment level. Results oriented.
It is not possible to improve something that is made in a different way everytime. Standards mantenance is essencial point before Kaizen. Two possiblereasons for mistakes:
Rules not followed Discipline Rules and norms are not correct Change norms
Not Kaizen oriented company
Kaizen oriented organization
Plan: decide what to do (data) and fix targets (mesurable) for a definedperiod of time. Do: execute planification. Check: analyse gap between planification and results. Act: corrective actions to elimite gap.
STANDARD 3 STANDARD 2
4.- Improvement 3.- Mantenance 2.- Apply 1.- Stabilize
¡Beware of “DIABOLICAL DIAGONAL”!
E ncicie ff y
Low cost. KAIZEN. Stable environment.
Competitive complex and volatile environments . Product innovation and low cost.
ss ne tivi ec Eff
Focus on goals. High volatile environments. Cost is not important.
Where are them?
Corresponding quadrant in organizational design space
¿Where are them?
A. L. Estrella
“Structure followsstrategy.” Alfred Dupont Chandler, economist
Five forces (Porter)
Threat of new entrants
Bargaining power of suppliers
Bargaining power of customers
Threat of substitute products
Four Ps (Kottler / McCarthy)
Product. Price. Promotion. Place.
Refinement. Efficiency. Selection. Implementation.
Search. Variation. Risk...