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BUSINESS ORGANIZATIONDR DOUGLAS NISBET
PGDBA101 Strategic Leadership and Management Skills
Learning Themes
There are 3 themes in this Topic:
1. Organisational Structure2. Information Systems and e-Business3. Managing Change and Innovation
Learning Objectives – Theme 1
After studying this topic you should understand the following:
• Structure and performance of organizationss• Elements in structure: the design options• Dividing work into functions and divisions• Coordinating work: alternative ways• Mechanistic and organic structures• Learning organizations
Structure and performance
Figure 10.1 Alternative structures and performance
Structure of a unit in a large business
Figure 10.2 The structure within a BAE aircraft factory (www.baesystems.com)
Developing structure in a small business
Figure 10.3 The organisation structure at Multi-show Events
Grouping work into functions and divisions
Figure 10.5 Five types of structure
Coordinating workIf divide work, then need to coordinate it by:• Direct supervision• Hierarchy• Standard inputs or outputs• Rules and procedures• Information systems (see Siemens)• Direct personal contactWhat method of coordination works best?
Mechanistic and organic structures
Table 10.4 Characteristics of mechanistic and organic systemsSource: Based on Burns and Stalker (1961)
Strategies and structures
Figure 10.8 Relationship between strategies and structural types
Contingencies – technologyWhat structure best supports technologies used to transform inputs, in manufacturing or services? • For example, production line or custom-made?• For example, information systems enable different ways of delivering services, and prompt a search for new structures to support relevant behaviour?• Chapter 18 (Managing Operations and Quality) shows other ways of designing transformation processes using different technologies
organisation structure 2
PROPERTIESAllow user to leave interaction: AnytimeShow ‘Next Slide’ Button: Show alwaysCompletion Button Label: Next Slide
Contingencies – size and life cycle
What structure best supports an organisation as it grows (number of staff)?
• Birth – informal, little division of labour, organic• Youth – decisions shared more widely, specialists
employed• Mid-life – extensive division of responsibility, with
rules for coordination• Maturity – mechanistic, perhaps divisions,
selling some units that no longer fitProblem of managing the transitions
Learning organizations
Figure 10.10 Clusters of learning organisation featuresSource: Pedler et at. (1997)
Learning Objectives – Theme 2
After study of this theme you should understand:• The importance of Information Systems (IS) and e-business • How convergence transforms how people add value• How value depends on technology and organisation• About operating and management systems and applications –
enterprise resource planning, customer relations, knowledge and e-business
Management depends on information
Figure 12.1 The role of Information systems in organizations Source: Boddy et al. (2005)
Stages in using the Internet
Figure 12.3 Stages in using the Internet
Co-creation (or Wikinomics)
Figure 12.2 Traditional delivery and customer participation
Computer-based IS
Figure 12.4 The elements of a computer-based ISSource: Boddy et al. (2009a)
Operating and management systems
Figure 12.5 Types of information system
How the Internet changes the links
Figure 12.6 Reinventing the supply chain
Customer Relationship Management (CRM)
Figure 12.7 Communications methods and message
Enterprise Resource Planning (ERP) systems
Figure 12.8 Anatomy of an enterprise system
Knowledge Management (KM) systems
• Potential benefits– Improve way an organisation creates, captures and uses
knowledge– Relates to inputs, transformation and outputs– Examples of BP and Buckman Labs
• Difficulties include– Most valuable knowledge is tacit (shared understanding,
often unwritten): IS best suitedto explicit, codified knowledge
– Do rewards structures encourage people to share knowledge?
IS, strategy and organisation
Figure 12.9 How information systems can change competitive forces: Porter’s modelSource: Adapted and reprinted by permission of Harvard Business Review. Exhibit adapted from Strategy and the Internet, Harvard Business Review, vol. 79, no. 3, pp. 63–78 by M. E. Porter, Copyright © 2001 by Harvard Business School Publishing Corporation; all rights reserved
Conclusion to Theme 2
• Developing technologies have moved IS from the background to the foreground of managing
• Focusing on the technical aspects of computer-based systems will usually add less value than attending to the strategic, human and organisational aspects
• Models presented enable you to question whether the assumptions behind a proposal are right for the context, to explore alternatives and to recognise limitations
Learning Objectives - Theme 3
Managing Change and Innovation is an important part of Organising Business and after studying this theme you should understand about:
• Initiating change – interaction with context• Four models of change• Driving and restraining forces• Forms and sources of resistance• Innovation
An overview of the themes
Figure 13.1 A model of the change process
The life cycle illustrated
Figure 13.4 A project life cycleSource: Lock (2007) p. 8
Models of change – emergent
• Change takes place in an uncertain context,and unrealistic to expect outcomes to be closeto plan
• Success depends on– Learning during the project– Adapting to changing conditions– Managing interest groups
• Plan, but be ready to change
Models of change – participative
• Change relies on those affected being willingto cooperate with the change
• Success depends on– Developing ownership and commitment– Consulting widely for ideas– Seeking consensus
• A democratic process– Suited to which conditions?
Models of change – political
• Change often threatens established interests, who will oppose it
• Success depends on – Building power sources– Creating alliances and coalitions– Manipulating information to support position
• A political process– Suited to which conditions?
Kurt Lewin – driving and restraining forces
Figure 13.5 Driving and restraining forces
Innovation
Figure 13.7 Sources of innovation
The Process of innovation
Figure 13.8 A model of the innovation processSource: Based on Tidd and Bessant (2009)
Organisational support factors
• Strategy – innovation is explicitly called for in the corporate strategy
• Structure – roles and jobs are defined to aid in innovative behaviour
• Style – management empowers the workforce to behave innovatively
• Support – IT systems are available to support innovative behaviour
Conclusion on Theme 3
• External and internal forces driving change• Managing it depends on having a model of the
process – such as the interaction model• Four perspectives offer complementary models
– which is best for the situation• Innovation can be used as a tool to enhance what
the company offers to the market