Posted at 12.29.2018
Warren Bennis(2003), notices that good observation of the situations is the primary competency of leadership which is a important tool in growing successful organizations. Bolman and Package (2007) shows four major areas of organizational theory namely structure, people, political dynamics and culture. Each framework has its logic, focus, assumptions and path to success of firm.
Structural frame views an organization as a stock or machine and provides more importance to goals, formal interactions and specific jobs. It also emphasizes on policies, procedures, creating guidelines to merge the focus of diverse group towards reaching the business goal.
The people body perceives a business as a unit with every individual having their own ideas, energy, needs, skill, limitations and thoughts. Individuals in an organization should get the liberty to operate independently to show their skill but at the same attention should be taken to get their job done.
As per the view of Thomas (2006), the politics frame perceives a business as an industry with competition, vitality, conflict and procedures as center where values, skills, values, issues and interests among the staff are obvious organizational realities.
Finally, the social frame views organizational life as a event where individuals become a member of together to create culture, framework and interpretation as they engage themselves in their specific assignments and bring creativeness and inspiration to their work.
Each frame takes on an important role in an firm, but any body alone is lacking. Gallos(2008), views modern organizations as "sophisticated beast" and the fast growing technology and competitive world only offers more with their complication.
The structural body as mentioned before is concerned with rules and goals of the organization. So, "the structure concentrates on the goal directions, structural clarity, and task achievement in an firm. "(Harris & Nelson, 2008). The main values of the frame are:
The best strategy is rational methodology ;
Dividing labor predicated on their specialization contributes to increased performance and individual expertise;
synchronization and control are best achieved through the authority and impersonal rules; and
Based by using an organizations nature set ups can be systematically designed and applied.
These principles suggest that problems in organization usually are signs or symptoms of structural issues and it can be fixed by streamlining and restructuring. But these are one among the many problems that an organization is facing.
Rationality is another important principle that an corporation deals with. According to the view of Brunsson (2009), organizations are intentional, in other words group works towards an absolute reason. In many companies, this can be a hypothesis that conducts are governed by decisions under a norm of rationality. Usually this norm is difficult to fulfill the truth is.
Like two edges of coin, the idea of differentiation and integration will be the reason behind it being seen as a rational methodology. Differentiation in when tasks are done among individuals and integration is the link between the tasks that make the interdependence. These functions and interdependencies are synchronized vertically by power and laterally by teams, meeting etc. You will find six main assumptions in structural shape:
Existence of organization is to realize established purpose and goals.
Efficiency of firm is increased and performance is increased through clear section of employees and specialty area.
Proper co-ordination and control ensures that diverse effort of people and units participate.
For a business to just work at its best rationality should prevail over personal choice and exterior pressure.
The structure of a business should be designed so that it matches to the scenario of the business.
Structural deficiencies lead to performance gap and in this situation and can be fixed through proper analysis and restructuring.
Two design issues are how to allocate work and how to coordinate tasks between them or product. Employment prescription is in form of job description, methods where it is clear doc on what an employee should do and what he should not to accomplish an activity. Once work is assigned to individuals the managers/leaders face next important decision as that they should group people into working models. There are many basic functions (Mintzberg, 1979):
Groups are partitioned based on expertise and knowledge. For instance - Java team, Visual Basic team etc.
Groups based on working time, as by switch.
Units shaped on basis of product. Telecommunication software, accounting software and so on.
Groups around consumer or customer.
Groups around place or geography. Say for example team in Australia, team in India
Groups by process. For example - development, evaluation and support.
In an IT company like this, it's important to form groupings and it can be best formed when they are grouped based on expertise, time, geography and process. The true problem here's issue of co-ordination. Units make an effort to concentrate on their own goal rather than organizations. For a business to be successful it has to employ a powerful method of coordinating between the units to work towards the organizational goal. This is achieved by either vertical coordination or lateral coordination.
Vertical Coordination: In vertical coordination higher management gets the authority. They make a decision as what should happen through expert, policies, guidelines and control system.
Authority means designating a manager. He integrates your time and effort of individuals and models. They take control by resolving conflicts, making decisions, solving problems and distributing rewards. Guidelines and insurance policies ensure informality on the list of employees. This can help to lessen "particularism" (Perrow, 1986) - reacting to a particular situation on personal bias or political forces somewhat than towards the purpose of organization. To be able to make sure that a quality level is maintained, benchmarks are placed. So a measurement against standard helps to find the performance and can help you fix a challenge. Standard operating steps (SOPs) reduce difference in performance for jobs that requires high level of predictability rather than allowing more margins for mistake. Standard operating procedures can are unsuccessful how ever more often only in case of situations that's not foreseen. Mintzberg (1979) distinguishes performance control and action planning. Performance control imposes result objectives. For example increase the team's output by 5%. That is great way when the goals are clear however, not successful when goals are hard to assess. Action planning specifies action as well as time frame. It works well when it is easier to gain access to the way the job is performed.
Lateral Coordination: Sometimes vertical coordination can't be effective. Behavior of folks is usually untouched by rules and command word. Lateral techniques such as conferences (both formal and informal), network company, matrix structure, coordinating roles and task force helps in filling up the void. Inside our organization to be able to fill the void there will be continuous meeting. You will see wide selection of meetings like task management meeting to make sure that task can be provided on time as promised with high quality. In a higher technology company that is under consideration, we will have process causes also. High-technology companies have high degree of reliance on job teams or process makes to synchronize development of new service or product. Being a high technology company it is important to have systems as knowledge will be propagate all cross the organization and it can not be at a specific place. Ghoshal and Barlett (1990) argued that many organizations have improved into inter firm network. Initiatives arise from many places as it is a multi centric composition.
Organizations architecture depends upon pursuing factors: size and get older, key process, environment, strategy and goals, it and dynamics of the labor force. Let us see how these factors are likely involved in shaping a business.
Size and time: An organizations size and age plays an integral role in architecture. Small businesses can have informal structural agreements. Whereas the same business, as it grows up, it'll be difficult to obtain a hold of the process if things are not formalized. Being a startup IT company it could be casual but since it is high technology organization it is very much essential to formalize process say for example documenting everything as the work done is not recurring and knowledge needs to be shared.
Core Process: The center product is taxation software for duty agencies. Henderson and Clark (1990) said that it is difficult to cope with the change in a technology for an established company than a startup firm. Being a startup organization there is an edge, within an aspect to find yourself in the business with latest technology. Also service should be taken and framework should be in such as way that organization should be adaptable enough to adjust to latest technology without a lot of hassle and complexity. If the start up organization neglect to build a adaptable structure then it will show up in the same pit as other founded company and the newbies will take on the lead.
Environment: Environment takes on a significant role. In a high technology industry there is always high degree of uncertainty. This wants sophisticated architecture. New roles and specialties tend to be required to be able to cope up with the growing problems. High level of adaptability and flexibility are required in an uncertain industry like high technology industry.
Strategy and goals: Proper decisions tend towards long-term goal and are worried with the future (Chandler, 1962). Goals that are mentioned will be the ones that an organization follows almost all of the time. We have to look beyond formal statement of purpose to comprehend the link that is accessible between strategy, goals and structure.
Information Technology: New solutions and computers continue steadily to revolutionize the amount of information available and the swiftness at which it can be distributed. Information is central structural determinant. Galbraith (1973) identifies uncertainty as difference between what information is at hand and what information is necessary. As the gap increases, the complexity of making a choice also enhances. In this example group has two alternatives: Firstly, reduced the need for information. Secondly, improve the capacity to process it. In a higher technology organization it is best to find the second option as high technology firm need up to information possible to stay in the race. It takes on an important role in high technology firms. Innovations in information technology make flatter structure unavoidable. Drucker (1989) remarked that information-based organizations need fewer management levels when compared to other industries. Similarly, this pertains to high technology firm and will follow more of even structure than vertical structure.
Nature of labor force: In a high technology industry, even a lower level workforce have to have high knowledge. Sometimes lower level workforce has more complex knowledge than their supervisors. There is certainly increasing need to specialization of areas. Drucker (1989), makes an observation that work will be changed to put where people are alternatively than moving people where work is. Likewise there may be need to create the structure in a way that there are different centers predicated on availability of work force. This again raises dependency on network as work should be coordinated between different geographic locations.
Boundary less group: Prahalad and Lawrence (1995) insisted about the value of boundary less business. In a very boundary less organization ideas flow through different levels easily and hence the productivity will be high. The business as a whole functions far better. Within the startup high technology organization the amount of levels between top and lower part is less so that there surely is free move of ideas. Care should be taken on diluting the number of tiers as too much autonomy brings about chaos.
The following factors should be considered when making a structure. They may be gap versus overlap, underuse versus overload, lack of clarity versus insufficient creativity, increased autonomy versus abnormal interdependence, too loose versus too tight, goalless versus goal destined, irresponsible versus unresponsive. Inside our organization care should be taken such that there is no inclination towards any of the character mentioned above. Right balance should be preserved.
Structural design starting from scratch will not happen the majority of the days. Usually supervisors duplicate an existing composition from their experience or some existing popular theory. Why don't we take a look at Mintzberg's fives and observe how it is applicable in our company. Mintzberg model has five components. First element is operating central. Core contains employees who make the product to the client or clients. Level above this is administrative. They can be managers who provide and control source for the operation. Above this is strategic apex. It consists of top level management, who are accountable for proper decisions. Usually they may be board of directors and comparative. Two more components in the sides are techno composition which comprises of specialists who assess and check the outcome of the process. Last part is support personnel whose work is to help other staff and ensure clean jogging of office.
Mintzberg derived five structural configurations from this blueprint.
Simple composition: This framework has only two level, proper apex and functioning core. Usually it includes direct guidance. It is effective in family business. The positives of simple structure are adaptability and overall flexibility. In addition, it has negative area as manager too near to day today procedure lose emphasis and gets distracted easily and they don't look at the long range proper issues.
Machine bureaucracy: In machine bureaucracy, proper apex makes all proper decision, professionals supervises all day today procedure. And types of procedures are standardized. Machine bureaucracy has tons of support personnel and few technostructures. Key issue is how to keep employees motivated as it is tedious work.
Professional bureaucracy: On this structure, majority of men and women are from operating core and very less number of managers. Technostructre is relatively very less. Professional bureaucracy stumbles when they make an effort to get a greater control over functioning core.
Divisionalized form: Work is done by means of quasi-autonomous items. Each division functions different market. For instance a MNC may have financial service, IT, manufacturing etc. It generates ample source and responsiveness without much risk. Nonetheless it has other tensions like cat and mouse game between the head office and the division. The other potential problem is the difference that widens between mind quarters and the divisions.
Adhocracy: Adhocracy is loose, versatile structure mostly tied along by lateral means. This kind of structure is more regularly within condition of turbulence and immediate change such as advertising industry.
After looking at these five constructions its professional bureaucracy and divisionalized form that suits our organization. In high technology industry, there may be need for more folks with technological skill than managerial skill. Hence professional bureaucracy works well in high technology organization.
Every organization has to restructure sooner or later with time. Restructuring is time consuming and moreover it generally does not even ensure success. Restructuring happens due to various pressures such as environment shifts, technology change, organizational expansion and control changes. Miller and Friesen(1984) discovered that companies in big trouble usually show up in the next three categories.
Impulsive organization: It is a fast growing firm with immediate changes usually lead by one or very few managers. This may lead organization to run uncontrollable. Many onetime successful owners fail to recover from this stage and they stumble.
Stagnant bureaucracy: These are organizations that follow old tradition. They often times become too stagnant. They don't make up to market velocity and lower level professionals often feel left out.
Headless giants: These are loosely combined organizations where in fact the administration is vulnerable. Most of the decisions are created by the section and does not have any real strategy at the top. Decision making is not proactive whereas it is reactive.
Organizations are hesitant to make changes in structure since it creates doubt and bafflement.
Corporate Public Responsibility is the most accepted and credible form to avoid societies from interpersonal unrest and save the planet and environment from destruction through corporate behaviour. The partnership between corporation and the world is interdependent. Any company is largely reliant on social balance and economic condition. In case of international organisation like the high technology business, it is important to operate in a responsible manner specifically in local community to avoid conflicts and prevent boycotts. However Multi National Companies face problem when esteem for local community clash with primary value. For instance whenever a company has its core value as similar opportunity for all, this will collide with job for locals. Implementation of Corporate and business Friendly Responsibility strategies makes good business sense. Profit maximization is not the mantra of set up hight technology company as it could equally harm. Only a long-term rather than short-term, balanced view on revenue maximization will be acceptable, and dependable. This makes it evident that Corporate and business Social Responsibility can provide an opportunity for organisation to improve their long term profit and at exactly the same time benefit large range of folks apart from managers and owners. This ensures sustainability.
Corporate Community Responsibility is a major source of competitive benefit. One reason for doing good is to make a good opinion about the business among the culture. This creates an intangible asset that is impossible for a competitor to reproduce. Thus we can say Corporate Social Responsibility is a significant player in value creation. Another way to obtain competitive gain is by lowering operating cost. In high technology business, the expenses associated with dumping of hardware can be prevented by presenting it to the charity. Researchers have discovered that certain individuals are interested in buying product that gives value to the society. Also there are couple of investors who like investing in companies that has high communal responsibility. The High technology set up firm can tap this market by maintaining higher level of Corporate Public Responsibility. 75% of consumers declare that they would not buy a product it doesn't have good ethical value or goods produced under bad circumstances. So that it is very important to the firm to act ethically as major customers consider honest value. Research has found that certain consumers are even prepared to pay reduced for sustainable products.
We have observed the benefits associated with Corporate Public Responsibility but the real problem is the implementation period and the sensible feasibility with such procedures. Major decisions must be taken not only on what the corporation should engage in but also should measure whether the Commercial Social Responsibility initiative will are unsuccessful or do well. A prerequisite for corporate responsibility is availability of resource. This might explain why study among 1000 companies have shown that 94% believe Commercial Community Responsibility will lead to income but only 11% could actually apply it. So in the high technology firm that is discussed, care should be studied that we are not falling short of reference as this is a significant road stop in implementation phase. For a new firm it could be difficult use CSR because there won't be more developed formal structure. Further more they'll be in a phase of survival. Corporate and business climate says how things are and commercial culture instructs as why things are as they are. Both environment and culture are fundamental factors for corporate and business sociable responsibility.
Corporate Sociable Responsibility brings sustainability in business. This works well in long haul. Also Corporate Community Responsibility provides competitive benefits over the competition. For a start up high technology company, structure plays an important role. Without composition, energy and time of resources tend to be misdirected. Often we fail to find the true cause if the issue. For instance sometimes we spend more time and money on training but the real problem is with social architecture somewhat than peoples frame of mind and skill. There is absolutely no perfect composition. It depends upon circumstances and factors like technology, goal, strategy and environment. A structural design might be apt for a specific time and circumstance but generally there will be need to improve the structure depending on the changes in goal, strategy and environment. Restructuring is important but at exactly the same time it is high risk. In short term it generates more bafflement and panic. In long haul it depends upon how well it gels with the organisation goal, environment and strategy.