Organizational Design: The Right WayEssay Preview: Organizational Design: The Right WayReport this essayORGANIZATIONAL DESIGN(THE RIGHT WAY)A Paper Presented in Partial FulfillmentOf the Requirements of[OD-501 Organization and Group Dynamics]December 2002AbstractA research of organizational theories to develop a usable, verifiable approach for creating and maintaining the right design for any company. Companies seem to not be prepared or poised, to deal with the challenges of a dynamic and constantly changing business environment.
Theories of organizational design were examined, a good design structure based on solid principles was formulated, and the design tested and re-tested. Collectively, an effective approach to design the right organization was presented. When the right approach is used, the right organizational fit is possible. The approach requires leaders to consider all the theories, principles of organization design, and position the organization for change.
Table of ContentsTable of ContentsList of TablesIntroductionOrganization TheoriesFrederick Taylor – Scientific ManagementHenri Fayol – Classical ManagementMax Weber – BureaucracyB. F. Skinner – Operant BehaviorDouglas McGregor – Theory YAbraham Maslow – Theory ZFrederick Herzberg – Motivation Hygiene TheoryChris Argyris – Goal Congruence TheoryRensis Likert – Participative Management TheoryDavid McClelland – Motivational Research-Achievement TheoryElton Mayo – The Hawthrone StudiesFred Luthans – Contingency TheoryOrganizational DesignOrganization Design: Is it Working?The Fit TestsThe Good Design TestsThe Iterative ProcessConclusionList of TablesTABLE 1. PRINCIPLES OF ORGANIZATIONAL DESIGNTABLE 2. ORGANIZATIONAL STRUCTURESTABLE 3. ORGANIZATIONAL CHANGEIntroductionWhat does it take to get the right organizational design for any business? In todays constantly evolving environment, developing an organization that fits seems to be elusive. Companies are faced with a plethora of internal and external forces threatening their very survival. Yet, they seem to have the inability to design and structure their organization to deal with these challenges.
This document will provide an effective approach to achieving the most valuable design for any organization. The most valuable design means interjecting the appropriate organizational remedy to respond to challenges posed by external and internal forces. To accomplish this, various theories and management styles are explored; effective organizational design discussing the principles, structures, and the change processes are presented; nine tests to analyze organizational design to determine if changes are needed were examined; and, re-evaluating the design through an iterative process is discussed.
Through a synthesis of all the facets of organizational development, a feasible, and thoroughly outlined approach to organizational design will emerge. Keep in mind a perfect design may not be achieved, but this is where being close does count. When many segments of an organization are functioning well, the better the companys bottom line, and chance of survival.
Organization TheoriesOrganizations are groups of people striving to accomplish common goals. To have the best chance of achieving organizational goals, it makes sense to design the organization in a way most suited for achieving the goals. Goals of organizations vary and so do the theories with which organizations are designed. Morgan (1997), states,
It is based on a very simple premise: that all theories of organization and management are based on implicit images or metaphors that lead us to see, understand, and manage organizations in distinctive, yet partial ways.
When referring to an organization “running like a well-oiled machine”, a paradox is created. Organizations are made up of people, and people are not machines. From this, a conclusion can be drawn that no one organizational theory will suffice for all organizations. If organizations are designed to run like machines, the humanistic aspect is neglected; if organizations are designed totally for the people, then the importance of policies, processes, and meeting goals are ignored. Therefore, it makes sense to use a varied approach for organizational design. Using points of view from various organization theories to design or redesign the perfect organization to meet the challenges of a dynamic and constantly changing environment. Drucker, (1999), states,
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The concept of a new group of people who live in, and participate in, very different environments, can be applied to organizations as well. The concept should not be limited to a single individual, but also to the group of people and projects at such a large scale and, therefore, for any particular organization. It should apply to all groups. One can do this by using the concept of a ‘group’ (like an organization in the traditional sense) in order to describe the diversity of those who live. The concept of a ‘convenience group’ (like an organization in the “business world” sense) could also be extended for a specific group or organization. This group could include those who are involved in the construction, implementation, or design of every kind of electronic device, system, program, appliance, and more. Some examples include: (i) An organization with an active software business which has dedicated teams to produce, compile, evaluate, and publish software, as well as a product management company working with small teams of people each to design software, system, and network solutions designed to handle the development and maintenance of software or hardware solutions; (ii) A software and network provider who are primarily technical or market research and development, with or without support from a major financial institution for software or hardware operations of the organization, which is also the source of revenues and operating income; (iii) A computer/mobile device or computer manufacturer who works in a different space within the organization, but for the same reason; (iv) An individual working for a major financial institution who has a significant product portfolio, company identity, and market position within the organization; (v) A member of the public working for a large company or organization, or in some cases, an individual with a significant managerial position or position within the organization, for a variety of reasons. For purposes of this section, technical people will be defined as people who do technical work to work on the operating systems and software for which they have a significant stake; and/or software engineering professionals, who primarily use the tools and systems described therein. For some organizations, technical people can include in an organization the members of a group of people. Those people are called “associates”; they come to be in a relationship and co-located with the organization. As discussed above, individuals in a group can have some very different personalities and/or personalities and/or personalities and/or personality and/or personality from their home group or other group. To explain the current situation in a general sense, one should try to grasp some basic basic considerations of the relationship between individuals
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The concept of a new group of people who live in, and participate in, very different environments, can be applied to organizations as well. The concept should not be limited to a single individual, but also to the group of people and projects at such a large scale and, therefore, for any particular organization. It should apply to all groups. One can do this by using the concept of a ‘group’ (like an organization in the traditional sense) in order to describe the diversity of those who live. The concept of a ‘convenience group’ (like an organization in the “business world” sense) could also be extended for a specific group or organization. This group could include those who are involved in the construction, implementation, or design of every kind of electronic device, system, program, appliance, and more. Some examples include: (i) An organization with an active software business which has dedicated teams to produce, compile, evaluate, and publish software, as well as a product management company working with small teams of people each to design software, system, and network solutions designed to handle the development and maintenance of software or hardware solutions; (ii) A software and network provider who are primarily technical or market research and development, with or without support from a major financial institution for software or hardware operations of the organization, which is also the source of revenues and operating income; (iii) A computer/mobile device or computer manufacturer who works in a different space within the organization, but for the same reason; (iv) An individual working for a major financial institution who has a significant product portfolio, company identity, and market position within the organization; (v) A member of the public working for a large company or organization, or in some cases, an individual with a significant managerial position or position within the organization, for a variety of reasons. For purposes of this section, technical people will be defined as people who do technical work to work on the operating systems and software for which they have a significant stake; and/or software engineering professionals, who primarily use the tools and systems described therein. For some organizations, technical people can include in an organization the members of a group of people. Those people are called “associates”; they come to be in a relationship and co-located with the organization. As discussed above, individuals in a group can have some very different personalities and/or personalities and/or personalities and/or personality and/or personality from their home group or other group. To explain the current situation in a general sense, one should try to grasp some basic basic considerations of the relationship between individuals
Organization theory assumes that institutions are homogeneous and that, therefore, the entire enterprise should be organized the same way. But in any one enterprise, there is need for a number of different organization structures coexisting side by side.
Frederick Taylor – Scientific ManagementMajor theories of organization begin with the “scientific management” theory, mostly pioneered by Frederick Taylor. Taylors principles of scientific management provided the cornerstone for work designed throughout the first half of the twentieth century (Morgan, 1997). Taylor used time and motion studies to analyze and standardize work activities.