Organizational Structure and Management Style

Organization & Administration

Organizational Management

Basics of Organizations Organizational structure Organizational culture Bureaucracies and the search for

alternatives Leadership & Management

Organizations

Two or more people working together to achieve something (that often cannot be accomplished alone)

Shared vision? mission? values?

Organizational structure System of relations, governing

activities of employees, reliant upon one another to meet common goals

Embedded in position descriptions Pictured in position relationships

shown on organizational charts Revealed in distribution of authority

and communication channels

Organizational structure

Since it is based upon relationships, it changes, even when it looks fixed

Varies from the simple to complex Can be formal or informal May be centralized or decentralized Marked by specialization and

coordination

Organizational Culture

“…the system of norms, beliefs and assumptions, and values that determine how people in the organization act—even when that action may be at odds with written policies and formal reporting relationships.”

Edgar H. Schein

Organizational Culture Not a model for management but a theory

that explains workplace behavior Often operates unconsciously but guides

action and affects ability to change Exists alongside formal organizational

structure, can be at odds with it Learned responses of an organization in

adapting to an external environment and integrating internally its experiences

Elements of Organizational Culture

Symbols: décor, signs, clothing Language: use of terminology Standards of behavior: meetings Slogans: sayings Heroes: those who embody the culture Mythology: stories that are repeated Ceremonies: special events,

celebrations

Levels of Organizational Culture

Underlying assumptions Unspoken and unconscious but guide

action Espoused values

Stated in mission, ethical codes, etc. Artifacts

Visible evidence of assumptions in behavior, rituals, myths, etc.

Bureaucracies

Distinguished by: Governing rules –often rigid Division of labor Chain of command Specializations

Bureaucratic Structure Pyramidal

Top Level Management Middle Level Management Floor Supervisors Floor Workers

Research indicates that restructuring usually results in the elimination of middle management positions

Horizontal and vertical components

Vertical Structure

Hierarchy Provides the conduit for authority to flow,

traditionally from top down (scalar principle)

Delegation entails assignment of authority from super-ordinate to subordinate

Units may be centralized or decentralized Unity of command means each employee

has a supervisor

Vertical Structure

Span of control refers to number of staff under one manager

Positions: Line relationship: Position of authority over

otherssuper-ordinate

lsubordinate)

Staff relationship: Advisory or supportlateral -> position

Power and/or Authority

Authority: right of supervisor to direct subordinates; flows from chain of command; vested in position, not person

Power: ability to influence the behavior of others; may derive from: management, ability to reward, expertise, and/or respect

Horizontal Structure Departments with specialized

Functions Territory Product Processes Customers

Structure: Coordination Mechanisms

Hierarchy’s elements: order, positions, etc.

Communication Supervision Standardization of work, products, skills Policies & procedures Committees Planning

Tools for Management

Structure Organizational design

Viewed today as means for competitive edge if the design is well matched to needs

All the elements of structure For example, position descriptions,

distribution of authority Use of specialization and coordination, etc.

Bureaucracy’s shortcomings

What are they???

Bureaucracy’s shortcomings Fails to take environment into account Is less effective during change or

turbulence, requiring flexibility and action

Ignores interpersonal relationships and their effects upon the workplace

Has undesirable, unintended consequences in control mechanisms

Structure as an Organic System

Concept of Burns and Stalker Based upon biological model Traits

Emphasizes horizontal communication Relies upon knowledge-based authority Encourages broader system view Has broader, flexible position definitions Refers to external, professional

standards

Structure as an Organic System

Other aspects: Promotes greater employee

commitment Blurs formal and informal elements of

an organization Mostly works for small groups

Looking for Perspectives on Organization, or Sense Making

Bureaucracy: The Model that Stands Organizational Design Approaches:

Classical or Scientific, parallel and support the bureaucratic model

Human Relations, modifies it to better respond to people in the workplace

Systems Theory, modifies it to respond to the role of the environment (organizations function interdependently like organisms)

Participatory Management or shared leadership

Looking for Perspectives on Organization, or Sense Making

New models: Ideas come and go but each may contribute to the development of theory

From the models, new ideas have been incorporated into the bureaucratic model and it continues to evolve

Currently Accepted or Popular Methods to Modify Bureaucracy

Committees Taskforces Retreats Use of consultants Outsourcing

Matrix Structure Self-managing

work teams Quality circles Re-structuring

Questions:

Will bureaucracy endure as a form?

Should bureaucracies persist? Will they evolve? Will they be replaced by

revolutionary new organizational forms or design?

Leadership and Management styles

Think of a manager you worked for and how s/he treated subordinates:

Did s/he build team spirit? Did s/he monitor work closely? Did s/he punish mistakes? Did s/he permit you to share in goal

setting and decision-making?

Leadership & Management

Think of some differences between…LeadershipManagement

Leadership and power Power is based on the subordinate’s perceptions of the

leader/manager (Mullins, 1996) Reward power: ability and resources to obtain rewards for

those who comply, e.g. pay, promotion, recognition, privileges

Coercive power: ability to punish or to bring about undesirable outcomes, e.g. withholding pay rises & promotion, withdrawing friendship, formal reprimands

Legitimate power: the right to exercise power because of leader’s position in the organisation

Referent power: subordinate’s identification with the leader because of attractiveness, reputation, or charisma

Expert power: competence, special knowledge or expertise in a given area. Expert power is normally limited to narrow, well-defined areas or specialties

More a leadership trait

More a management trait

What makes a leader? The qualities or traits approach (“Great person”)

assumes that leaders are born, not made we select leaders, not nurture or train them

common in popular thinking, but no evidence has been found to support this

each person’s list of leadership traits is different

Functional approach Kretch et al (1962) identified 14 leadership functions Both the official leader and the group member who happens

to come up with the right function at the right time are leaders for that moment

The official leader is just a safety net, someone who is expected to fill in the leadership functions when needed

What makes a leader? Styles of leadership approach

Many possibilities Tannenbaum & Schmidt (1973) have a continuum some similarity with Theories X and Z discussed later

Tells: leader identifies problem, chooses a decision, announces to subordinates, no participation

Sells: leader chooses a decision but attempts to persuade subordinates to accept it

Consults: leader identifies problem, listens to advice of subordinates, chooses a decision

Joins: leader defines problem and limits of decisions, group take decision with leader as just a member

Which approach is best depends on forces in the leader, the subordinates and the situation

Country clubmanagement

Teammanagement

Impoverishedmanagement

Authoritycompliance

What makes a leader? Employee-centred vs. production-centred

approach Blake and Mouton (1964), and Likert (1961),

use a two dimensional grid

Concernfor

people

Concern for production

Hi

Lo

Lo Hi

Management: Theory X and Theory Y Management styles: Douglas McGregor

(1960) polarised (caricatured?) managers’ attitudes

Theory X: Average person has an inherent dislike of

work People must be coerced, controlled,

directed, threatened with punishment Average person prefers to be directed,

and wishes to avoid responsibility

"When one treats people with benevolence, justice and righteousness, and reposes confidence in them, the army will be united in mind and all will be happy to serve their leaders.” Sun Tzu (circa 400 BC)

Theory X and Theory Y McGregor suggested: Theory Y

Physical and mental effort is as natural as play or rest

Man will exercise self-direction for objectives to which he is committed

Commitment to objectives is a function of reward Average person learns to accept and seek

responsibility Imagination and creativity is widely distributed People’s potentials are only partially utilised

Theory XAutocratic

Theory YObjective setting(Laissez Faire)

Theory ZDemocratic

Your style mightbe anywhere inthis continuum

Theory Z Theory Z: WS Ouchi, 1980s

Well managed companies in US and Japan had lifetime employment, collective decision making, promotion from within, non-specialised career paths

Characterised as a “democratic” management style

Final Thoughts... Do you believe leadership can pass around a

group depending on the function required? What if there is an official leader?

Think about a manager you have worked for. Was he Theory X, Y or Z? How did that make you feel?

What factors affect whether you adopt a Theory X, Y or Z style of management?