Exam 1: Chapter 7- Organizational Design Flashcards Preview

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Flashcards in Exam 1: Chapter 7- Organizational Design Deck (25):
1

Organizational Design

The formal systems, levers, and decisions an organization adopts or employs in pursuit of its strategy

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Division of Labor

the manner in which work in a firm is divided among employees

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Organizers

Those who believe that more control is warranted in organizational design to ensure that jobs are performed satisfactorily and efficiently

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Bureaucratic Approach

an extreme form of organizational control in which systems are highly formalized and are characterized by extensive rules, procedures, policies, and instructions

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Extreme control is seen within the....

Bureaucratic approach

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Behaviorists

those who support a more open organizational structure where roles and responsibilities are loosely defined

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Clan Approach

a type of organizational control that includes self-supervising teams that are responsible for a set of tasks

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Organizational Structure

the pattern of organizational roles, relationships, and procedures that enable coordinated action among employees

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Functional Structure

A structure that organizes a firm in terms of the main activities that need to be performed, such as production, marketing, sales, and accounting

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Division Sturcutre

a structure that groups diverse functions into separate divisions

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Matrix Structure

a structure where both divisional and functional managers have equal authority in the organization
combines both aspects

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The Organizational Structure's three primary functions

1) Allows a firm to perform a variety of activities by diving the firm's labor force according to tasks and functions
2) Allows the members of a firm to coordinate their activities through mechanisms such as supervision, formal rules and procedures, plans and budgets, training and socialization
3) defines the borders of a firm and its relationships with both the business environment and other firms

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The functional structure works very well for....

small businesses with a limited number of products or services

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Functional organizational structures are best suited for....

competitive situations where the most important aspect of competition is efficiency of production or functional expertise

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One main weakness of functional organizational structure is...

its inability to deal with changes in the business environment

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Network Structure

a structure where "knowledge workers" are organized to work as individual contributors or to be a part of a work cluster that provides a certain expertise for the organization

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Decision rights

Rights that include initiating, approving, implementing, and controlling various types of strategic or tactical decisions

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Delegation

the process by which managers transfer decision rights to individual employees

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Centralized organization

an organizational structure characterized by formal structures that control employee behavior by concentrating decisions in a top-down, hierarchical fashion

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Decentralized Organization

an organizational structure where key decisions are made at all levels of the firm, not mandated form the top

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Centralized organizations tend to be...

larger and older, exist in more mature industries, often imposes a rigid structure that constrains employees' activity

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Mutual Adaptation

the process by which firms impact the nature of their overarching industrial environment and adapt their organization in response to evolving contextual factors

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Four stages in a business' "life cycle"

Start-up, growth, maturity, and decline

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Recently, firms' have been more customer focused with four specific activities into their organizational design

Coordination, cooperation, capability development, connection (with external partners)

25

Silos

a functional or divisional unit that operates by its own rules and guidelines and does not openly share information with other units