COMMUNICATION IN COMMUNICATION IN ORGANIZATIONSORGANIZATIONS

ENVIRONMENT AND THE ENVIRONMENT AND THE TYPE TWO ORGANIZATIONTYPE TWO ORGANIZATION

Lecture 5cLecture 5c

THE ISSUE OF OVERLOAD LEADS TO THE ISSUE OF OVERLOAD LEADS TO TYPE TWO STRUCTURETYPE TWO STRUCTURE

• TOO MUCH INFORMATION AND DECISIONS TOO MUCH INFORMATION AND DECISIONS AS ORG. GROWSAS ORG. GROWS

• UNLESS BOSS BEGINS TOUNLESS BOSS BEGINS TO

• SEPARATE FUNCTIONSSEPARATE FUNCTIONS- NEW STRUCTURE - DIFFERENTIATED BY FUNCTION NEW STRUCTURE - DIFFERENTIATED BY FUNCTION - -

SPECIALIZATION IS EFFICIENTSPECIALIZATION IS EFFICIENT

• AND AS SIZE INCREASESAND AS SIZE INCREASES• DELEGATE SOME AUTHORITY TO DELEGATE SOME AUTHORITY TO

ASSISTANTS TO MANAGE EACH FUNCTION ASSISTANTS TO MANAGE EACH FUNCTION - VERTICAL DECENTRALIZATIONVERTICAL DECENTRALIZATION

• THE ORG. BEGINS TO FAILTHE ORG. BEGINS TO FAIL

The B.A.R. and Grille

THE ISSUE OF OVERLOAD LEADS TO THE ISSUE OF OVERLOAD LEADS TO TYPE TWO STRUCTURETYPE TWO STRUCTURE

• VERTICAL DECENTRALIZATION - OR DELEGATION - VERTICAL DECENTRALIZATION - OR DELEGATION - OF AUTHORITY- LIMITED TO A PARTICULAR OF AUTHORITY- LIMITED TO A PARTICULAR FUNCTIONFUNCTION

• NO LONGER AN ASSISTANT BUT A MANAGERNO LONGER AN ASSISTANT BUT A MANAGER• CAN CONTROL AND COORDINATE CAN CONTROL AND COORDINATE WITHIN WITHIN FUNCTIONFUNCTION

TYPE TWO ORGANIZATION TYPE TWO ORGANIZATION STRUCTURE IS EFFICIENTSTRUCTURE IS EFFICIENT

• BOTH CONTRIBUTE TO ORGANIZATIONAL GROWTH BOTH CONTRIBUTE TO ORGANIZATIONAL GROWTH • ORG. BEGINS TO DO FEWER THINGS BETTER - ORG. BEGINS TO DO FEWER THINGS BETTER -

MORE GROWTH MEANS ENVIRONMENT CONTROLMORE GROWTH MEANS ENVIRONMENT CONTROL

• CHANGES ENVIRONMENTAL PERCEPTION FROM CHANGES ENVIRONMENTAL PERCEPTION FROM MODERATELY HIGH UNCERTAINY TO LOW MODERATELY HIGH UNCERTAINY TO LOW UNCERTAINTYUNCERTAINTY

• DIFFERENTIATION BY FUNCTION: DIFFERENTIATION BY FUNCTION: SPECIALIZATION IS SPECIALIZATION IS EFFICIENTEFFICIENT

• VERTICAL DECENTRALIZATION - OR DELEGATION - OF VERTICAL DECENTRALIZATION - OR DELEGATION - OF AUTHORITY AUTHORITY (MANAGER CAN CONTROL AND (MANAGER CAN CONTROL AND COORDINATE COORDINATE WITHIN WITHIN FUNCTION) FUNCTION) IS ALSO EFFICIENTIS ALSO EFFICIENT

BECOMING A MACHINE BECOMING A MACHINE ORGANIZATION ORGANIZATION

FROM A SIMPLE STRUCTUREFROM A SIMPLE STRUCTURE

PRESPRES..

ASSTASST ASSTASST ASSTASST

DIRECT SUPERVISION - MUTUTAL ADJUSTMENTDIRECT SUPERVISION - MUTUTAL ADJUSTMENTNO FUNCTIONAL DIFFERENTIATIONNO FUNCTIONAL DIFFERENTIATIONLOW SPECIALIZATION OF WORKLOW SPECIALIZATION OF WORK

BECOMING A MACHINE BECOMING A MACHINE ORGANIZATION ORGANIZATION

AUTHORITY-COMMUNICATION FLOWAUTHORITY-COMMUNICATION FLOW

PRESPRES..

AsstAsst AsstAsst

Mgr. Mfg.Mgr. Mfg. Mgr. SalesMgr. Sales Mgr. Fin.Mgr. Fin.

AsstAsst AsstAsst AsstAsst AsstAsst

* - - - - - = FUNCTIONAL D.O.L* - - - - - = FUNCTIONAL D.O.L* VERTICAL DELEGATION OF AUTHORITY * VERTICAL DELEGATION OF AUTHORITY FROM STRATEGIC APEX FROM STRATEGIC APEX * MUTUAL ADJUST. WITHIN FUNCTIONS* MUTUAL ADJUST. WITHIN FUNCTIONS

THE MACHINE ORGANIZATION THE MACHINE ORGANIZATION AUTHORITY-COMMUNICATION FLOWAUTHORITY-COMMUNICATION FLOW

Mgr. Sales

PRESPRES..

Mgr. Mfg.Mgr. Mfg. Mgr. Fin.Mgr. Fin.

AsstAsst.. AsstAsst.. AsstAsst.. AsstAsst.. AsstAsst.. AsstAsst.. AsstAsst.. AsstAsst.. AsstAsst

ADD MORE PEOPLE AND BEGIN JOB ADD MORE PEOPLE AND BEGIN JOB SPECIALIZATION WITHIN FUNCTIONSSPECIALIZATION WITHIN FUNCTIONS

THE MACHINE ORGANIZATION THE MACHINE ORGANIZATION AUTHORITY-COMMUNICATION FLOWAUTHORITY-COMMUNICATION FLOW

Mgr. Sales

PRESPRES..

Mgr. Mfg.Mgr. Mfg. Mgr. Fin.Mgr. Fin.

AsstAsst.. AsstAsst.. AsstAsst.. AsstAsst.. AsstAsst.. AsstAsst.. AsstAsst.. AsstAsst.. AsstAsst

MFG. MIGHT INCLUDEMFG. MIGHT INCLUDE

1. RECEIVING PARTS1. RECEIVING PARTS2. ASSEMBLY2. ASSEMBLY3. SHIPPING3. SHIPPING

THE MACHINE ORGANIZATION THE MACHINE ORGANIZATION AUTHORITY-COMMUNICATION FLOWAUTHORITY-COMMUNICATION FLOW

Mgr. Sales

PRESPRES..

Mgr. Mfg.Mgr. Mfg. Mgr. Fin.Mgr. Fin.

AsstAsst.. AsstAsst.. AsstAsst.. AsstAsst.. AsstAsst.. AsstAsst.. AsstAsst.. AsstAsst.. AsstAsst

MFG. INCLUDEMFG. INCLUDE

1. RECEIVING PARTS1. RECEIVING PARTS2. ASSEMBLY2. ASSEMBLY3. SHIPPING3. SHIPPING

IF MORE WORK MEANS MORE PEOPLE -IF MORE WORK MEANS MORE PEOPLE -ALSO MEANS LESS CERTAINTY - SO ALSO MEANS LESS CERTAINTY - SO BEGIN WRITTEN JOB DESCRIPTIONS ANDBEGIN WRITTEN JOB DESCRIPTIONS ANDADD MORE DIRECT SUPERVISIONADD MORE DIRECT SUPERVISION

THE MACHINE ORGANIZATION THE MACHINE ORGANIZATION AUTHORITY-COMMUNICATION FLOWAUTHORITY-COMMUNICATION FLOW

Vp. SalesVp. Mfg.Vp. Mfg. Vp. Fin.Vp. Fin.

MgrMgr.. Mgr.Mgr.MgrMgr..

SS SS SS - - - - - = FUNCTIONAL D.O.L. - - - - - = FUNCTIONAL D.O.L. SPECIALIZ’ TION FORMAL JOB DESCRIPS.SPECIALIZ’ TION FORMAL JOB DESCRIPS.ADDING LAYERS FORMAL COMMUNIC.ADDING LAYERS FORMAL COMMUNIC.

PRESPRES..

SUMMARY: FUNCTIONS AND SUMMARY: FUNCTIONS AND ORGANIZATION SIZE AND AGEORGANIZATION SIZE AND AGE

• IN IN SMALLER, YOUNGERSMALLER, YOUNGER ORGS. - BOSS DOES ORGS. - BOSS DOES MANAGERIAL FUNCTION PLUS ALL OTHERS. MANAGERIAL FUNCTION PLUS ALL OTHERS. INDIVIDUAL STAFF CAN DO SOME AS LONG AS INDIVIDUAL STAFF CAN DO SOME AS LONG AS BOSS AGREES.BOSS AGREES.

• IN IN GROWING, MATURING ORGSGROWING, MATURING ORGS. FUNCTIONS . FUNCTIONS ARE SEPARATED INTO HIGHLY SPECIALIZED ARE SEPARATED INTO HIGHLY SPECIALIZED DEPARTMENTS OR UNITSDEPARTMENTS OR UNITS

• (DIFFERENT PEOPLE GROUPED TOGETHER BY FUNCTION(DIFFERENT PEOPLE GROUPED TOGETHER BY FUNCTION) )

• DELEGATION OF AUTHORITY COMES WITH NEW DELEGATION OF AUTHORITY COMES WITH NEW STRUCTURE.STRUCTURE.