Introduction of Management : Review

CHAPTER 9 : ORGANIZATIONAL AGILITY

THE RESPONSIVE ORGANIZATION

The formal structure is put in place to control people, decisions, and actions. But in today’s fast-changing business environment, responsiveness-quickness, agility , the ability to adapt to changing demands-is more vital than ever to a firm’s survival. Mechanistic organization is a form of organization that seeks to maximize internal efficiently. Organic structure is an organizational form that emphasize flexibility.

STRATEGY AND ORGANIZATIONAL  AGILITY

Organizing around Core Capabilities

                A core competence gives value to customers, makes the company’s  products different from-and better than –those of competitors, and can be used in creating new products.

Strategic Alliances

                A strategic alliance is a formal relationship created with the purpose of joint pursuit of mutual goals.

The Learning Organization

                A learning organization is an organization skilled at creating, acquiring, and transferring knowledge, and at modifying its behavior to reflect new knowledge and insights.

The High-Involvement Organization

                In high-involvement organization, top management ensure that there is a consensus about the direction in which the business heading.

ORGANIZATIONAL SIZE AND AGILITY

The Case for Big

                Size creates scale economics,-that is,lower costs per unit of production. And size can offer specific advantages such as lower  operating costs, greater  purchasing power,and easier access to capital.

The Case for Small

                Small size may improve speed. A salesperson learns about a customer’s new challenge.

Being Big and Small

                Small is beautiful for unleashing energy and speed. But in buying and selling, size offers market power. The challenge, then,is to be both big and small to capitalize on the advantages of each.

CUSTOMERS AND THE RESPONSIVE ORGANIZATION

Customer Relationship Management

                Customer Relationship Management is a multifaceted process, typically mediated by a set information technologies, that focuses on creating two-way exchanges with customers so that firms have an intimate knowledge of their needs, wants, and buying patterns.

Total Quality and Six Sigma

                Total quality management is a way of managing in which everyone is committed to continuous improvement of his or her part of the operation. In business, success depends of having high-quality products. Six sigma quality is a method of systematically analyzing work processes to identify and eliminate virtually all causes defects, standardizing the processes to reach the lowest practicable level of any cause ofcustomer dissatisfaction.

ISO 9001

                ISO 9001 is a series of quality standards developed by a committee working under the International for Stadarization to improvefe total quality in all business for the benefit of the producers  and consumers.

Reengineering

                Organizations also have embrace the notion of reengineering,the principal idea of reengineering is to revolutionize key organizational systems and processes to answer this question,”if you were the customer, how would you like us to operate ?” the answer to this question forms a vision for how the organization should run, and then decisions are made and actions are taken to make the organization operate like the vision.

TECHNOLOGY AND ORGANIZATIONAL AGILITY

                Technology systematic application of scientific knowledge to a new product, process, or service.

Types of Technology Configuratios

                These three classifications are equally useful for describing either service or manufacturing technologies.

1.       Small Batch Technlogies

2.       Large Batch Technologies

3.       Continuous Process Technologies

Organizing for Flexible Manufacturing

                Mass costomization, the production the production of varied. Individually customized products at the low cost of standardized. Mass produced products.

o   Computer Integrated Manufacturing

The use of computer aided design and computer aided manufacturing a number of production processes.

o   Flexible Factories

Manufacturing plants that have shorts production runs, are organized around products, and use decentralized scheduling.

o   Lean manufacturing

An operation that strives to achieve the highest possible productivity and total quality, cost effectively, by eliminating unnecessary steps in the production process and continually striving for improvement.

Organizing for Speed : Time Based Competition

                Time Based Competition refers to strategies aimed at reducing the total time needed to deliver the good or service.

o   Logistics

The movement of the right goods in the right amount to the right place at the right time.

o   Just In Time Operation

Just In Time Operation calls for subassemblies and components to be manufactured in very small lots and delivered to the next stage in the process precisely at the time needed, or “just in time”.

o   Concurrent Engineering

A design approach in which all relevant functions cooperate jointly and continually in a maximum effort aimed at producing high quality products that meet costumer’s needs.

Introduction of Management : Review

CHAPTER 8 : ORGANIZATION STRUCTURE

 

Fundamentals of Organizing

        We often begin to describe a firm’s structure by looking at its organization chart . The organization chart depicts the positions in the firm and the way they are arranged or the reporting structure and division of labor in an organization. Although the organization chart presents some important structural features,other design issues related to structure-while not so obvious-are no less significant. Two fundamental concepts around which organizations structured are differentiation and integration. Differentiation means that the organization is composed of many different units that work on different kinds of tasks, using different skills and work methods. Integration means that these differentiated units are put back together so that work is coordinated into all overall product.

The Vertical Structure

§  Authority in Organizations

Authority is the legitimate right to make decision and to tell other people what to do.

§  Hierarchical Levels

           Hierarchy is the authority levels of the organizational pyramid. Corporate governance is the role of a corporation’s executive staff and board of directors in ensuring that the firm’s activities meet the goals of the firm’s stakeholders.

§  Span of Control

          The number of subordinates who report directly to an executive or supervisor is called the Span of Control.

§  Delegation

          Delegation is the assignment of authority and responsibility to a subordinate at lower level.

§  Decentralization

          Decentralized organization is an organization in which lower-level managers make important decision.

The Horizontal Structure

       Line departments isunis that deal directly with the organization’s primary goods and services. Staff departments is units that support line departments. Departmentalization is subdiving an organization into smaller subunits.

§  The Functional Organization

            In a functional organization,jobs are specialized and grouped according to business function and the skills they require : production, marketing, human resources, research and development, finance, accounting, and so forth.

§  The Division Organization

     The discussion of a functional structure’s weakness leads us to the divisional organization. Divisional organization is departmentalization that groups units around products, customers,or geographic regions.

§  The Matrix Organization

     A matrix organization is a hybrid form of organization in which functional and divisional forms overlap. Managers and staff personnel report two bosses-a functional manager and a divisional manager.

§  The Network Organization

     The network organization is a collection of independent, mostly single-function firms that collaborate to produce a good or service. A very flexible version of the network organization is the dinamic network-also called the modular or virtual corporation. It is composed of temporary arrangements among members that can be assembled and reassembled to meet a changing competitive environment.

Organizational Integration

     A variety of approaches are available to managers to help them make certain that interdependent units and individuals will work together to achieve a common purpose.

§  Coordination by Standarization

Standarization contrains actions and intergrates various units by regulating what people to do. To improve coordination, organizations may also rely on formalization-the presence of rules and regulations governing how people in the organization interact .

§  Coordination by Plan

Coordination by plan does not require the same high degree of stability and routinization required for coordination for standarization. Interdependent units are free to modify and adapt their actions as long as they meet the deadlines and targets required for working with others.

§  Coordination by Mutual Adjustment

Coordination by mutual adjustment involves feedback and discussion to joinly figure out how to approach problems and devise solutions that are agreeable to everyone.

§  Coordination and Communication

    To cope with high uncertainty and heavy information demands, managers can use two general strategie:

Option 1 : Reducing the Need for Information

    Managers can use the need information in two ways (a) creating slack resources and (b) creating self-contained tasks.

Option 2 : Increasing Information-Processing Capability

    Instead of reducing the need for information, an organization may take approach of increasing its information-processing capability.