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7-1 Chapter 7 and 8 Organizational Structure and Managing Change.

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Presentation on theme: "7-1 Chapter 7 and 8 Organizational Structure and Managing Change."— Presentation transcript:

1 7-1 Chapter 7 and 8 Organizational Structure and Managing Change

2 7-2 Designing Organizational Structure  Organizing  The process by which managers establish the structure of working relationships among employees to achieve goals  Organizational Structure  Formal system of task and reporting relationships that coordinates and motivates organizational members so that they work together to achieve organizational goals

3 7-3 Factors Affecting Organizational Structure Figure 7.1

4 7-4 Job Design  Job Design  The process by which managers decide how to divide tasks into specific jobs  Job Enlargement  Increasing the number of different tasks in a given job by changing the division of labor  Job Enrichment  Increasing the degree of responsibility a worker has over a job

5 7-5 Departmentalization- by Function  Functional Structure  An organizational structure composed of all the departments that an organization requires to produce its goods or services  Advantages  Encourages learning from others doing similar jobs  Easy for managers to monitor and evaluate workers  Disadvantages  Difficult for departments to communicate with others  Preoccupation with own department and losing sight of organizational goals

6 7-6 Departmentalization: by Divisions  Divisional Structure  An organizational structure composed of separate business units within which are the functions that work together to produce a specific product for a specific customer

7 7-7 Departmentalization: by Product Structure  Product Structure  Each product line or business is handled by a self- contained division Advantages  Allows functional managers to specialize in one product area  Division managers become experts in their area  Removes need for direct supervision of division by corporate managers  Divisional management improves the use of resources

8 7-8 Figure 7.4 Product, Market, and Geographic Structures

9 7-9 Departmentalization: by Geographic  Geographic Structure  Each region of a country or area of the world is served by a self-contained division  Global geographic structure  Managers locate different divisions in each of the world regions where the organization operates  Generally, occurs when managers are pursuing a multi-domestic strategy

10 7-10 Departmentalization  Global Product Structure  Each product division, not the country or regional managers, takes responsibility for deciding where to manufacture its products and how to market them in foreign countries

11 7-11 Global Geographic and Global Product Structures Figure 7.5

12 7-12 Departmentalization: By market  Market Structure  Each kind of customer is served by a self- contained division  Also called customer structure  Matrix Structure  An organizational structure that simultaneously groups people and resources by function and product

13 7-13 Matrix Structure Figure 7.6

14 7-14 Product Team Structure  Product Team Structure  Employees are permanently assigned to a cross- functional team and report only to the product team manager or to one of his direct subordinates  Cross-functional team  group of managers brought together from different departments to perform organizational tasks

15 7-15 Coordinating Functions and Divisions  Authority  The power to hold people accountable for their actions and to make decisions concerning the use of organizational resources  Hierarchy of Authority  An organization’s chain of command, specifying the relative authority of each manager

16 7-16 Allocating Authority  Span of Control  The number of subordinates that report directly to a manager  Line Manager  someone in the direct line or chain of command who has formal authority over people and resources  Staff Manager  Someone responsible for managing a specialist function, such as finance or marketing.

17 7-17 Tall & Flat Organizations Figure 7.9

18 7-18 Tall & Flat Organizations Figure 7.9

19 7-19 Tall and Flat Organizations  Decentralizing authority  giving lower-level managers and nonmanagerial employees the right to make important decisions about how to use organizational resources.

20 7-20 Organization Change  Organization Change  Movement of an organization away from its present state and toward some desired future state to increase its efficiency and effectiveness  Top-down change  A fast, revolutionary approach to change in which top managers identify what needs to be changed, decide what to do, and then move quickly to implement changes throughout the organization  Bottom-up change  A gradual approach to change in which managers at all levels work together to develop a plan for change

21 7-21 Four Steps in the Organizational Change Process

22 7-22 Description on Organizational Change Process 1. Recognize the need for change: The change agent can use a variety of techniques to diagnose problems in need of changes to solve them. 2.Identify possible resistance to the change and plan how to overcome it: Follow the guidelines in step 1. 3.Plan the change interventions: Based on the diagnosis of the problem, the appropriate intervention must be selected. 4.Implement the change interventions: The change agent, or someone selected, conducts the intervention to bring about the desired change. 5.Control the change: Follow up to ensure that the change is implemented and maintained. Make sure the objective is met. If not, take corrective action.

23 7-23 Resistance to Change and Ways to Overcome Resistance Why employees resist change? Uncertainty--- Fear of the unknown outcome of change Uncertainty--- Fear of the unknown outcome of change Learning anxiety--- Nervousness or fear of change that requires learning new ways of working Learning anxiety--- Nervousness or fear of change that requires learning new ways of working Self-interest--- People resist change that threatens their own self interest Self-interest--- People resist change that threatens their own self interest Loss --- Lost job or change in salary/benefits Loss --- Lost job or change in salary/benefits Control --- Change can also result in an actual or perceived loss of power, status, security and control, feeling that someone else is controlling their destiny Control --- Change can also result in an actual or perceived loss of power, status, security and control, feeling that someone else is controlling their destiny

24 7-24 Overcome Resistance to Change Ways to overcome resistance to change: Develop a positive trust climate for change --- Develop and maintain good human relations Plan --- Take good planning. Identify the possible resistance to change and plan how to overcome it. Communication ---Clearly state why the change is needed and how it will affect company or employees Create a win-win situation --- Company should guarantee that employees will not lose jobs, pay or other loses, at least within a short period of time Involve employees --- Employees who have participated in developing changes are more committed to them than those who have not Provide support --- Give advance notice and providing training before the change take place.


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