LECTURE NOTE 7

PM
Table of Content
1. Cases’ Application
2. Reviewing Notes for you

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 CASE 1: organisation
flexibility, organisation
design
Since 2020, Covid pandemic has affected all companies’ activities worldwide. Company M, one of the
leading furniture company in New York also has experienced negative consequences from Covid. The
company had to persuade employees to work from home in the first period to protect employees’
health as well as continue hoping to sustain the business. After 7 months, the company had to transfer
1/3 of employees to work part-time instead of full- time mode to save company’s budget. Alain, HR
manager of Company M promised that the company will increase the salary to 5% when the company’s
finance increases. In Spring 2022, Company M has started to gain back profit; as a result, Ben, Director
decided to increase the salaries to 7% instead to motivate everyone to come back to the office to work.
However, just 40% employees agreed with that option. The other 60% still wants to stay at home. They
said they started getting used to work and spend time with family during Covid pandemic; therefore,
they still want to maintain that habit.
Q1: If you were Ben, what would you do in this situation?
Q2: Explain the pros and cons of all alternatives for this situation (pros & cons, stakeholders who will be
affected?)
Q3: If you were Alain, what would you do to make sure the Company works effectively and the internal
& external stakeholders will not be demotivated?
2. Reviewing Notes
Chapter 11 (Book)
 2.1
ORGANIZATIONAL
DESIGN
 ORGANIZATIONAL DESIGN’S
ELEMENTS
Work
specializatio
n

Departmentalizatio
Formalization
n

Centralization/ Chain of
decentralization command

Span of
control
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 PURPOSES OF
ORGANIZING

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 1ST ELEMENT- WORK
SPECIALIZATION
DIVISION OF
LABOR
▪ Dividing work activities
into separate job tasks/
division of labor
 increase productivity & ▰ Human diseconomies
efficiently use the
diversity of employees’
capabilities
SPECIALIZATION OVER-SPECIALIZATION
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 Economies and Diseconomies of Work
Specialization

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2nd ELEMENT-
DEPARTMENTALIZATION
▪ How jobs are grouped together

Functional Product Process Geographical Customer

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DEPARTMENTALIZATION
TRENDS

CUSTOMERS TEAMS

• Emphasizes • Cross-functional
monitoring and team
responding to • Individuals from
changes in various functional
customers’ needs specialties

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 3rd ELEMENT- CHAIN OF
COMMAND

▪ Continuous line of authority

that extends from upper levels
of an organization to the
lowest levels of the
organization
▪ Who reports to whom? Or Who
do I go to if I have a problem?” 15
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 • the rights inherent in a
managerial position to tell people
Authority
what to do and to expect them to
do it
Acceptan
• authority comes from the
ce theory
willingness of subordinates to
of Y/ N?
accept it
authority
Chester Barnard

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 Chain of Command and Line
Authority

Line authority  direct the work of employees and

to make certain decisions without consulting anyone

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 STAFF AUTHORITY  support, assist,
advise, and generally reduce some of their
informational burdens

Responsibility

Unity of Command Rule

= 1 person: 1 manager

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 Line Authority vs Staff Authority
Line authority is the type of authority that Staff authority refers to the right to advice
reflects superior-subordinate relationships on improving the effectiveness for line
characterized by the power of decision employees in performing their duties.
making.

Main Responsibility
Line managers are responsible for Main responsibility of line staff is to
directing, motivating and supervising provide expert advice and support to line
employees towards achieving staff to allow smooth flow of operations.
organizational goals.

Specialization
Level of specialization is low in line High specialization is seen in staff
authority. authority.
Adaptation to Environment
Line authority is mostly suitable for small Staff authority can bring wider benefits for
and medium scale organizations. large-scale organizations.
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4th ELEMENT: SPAN OF CONTROL
= How many employees can a manager efficiently and
effectively manage
(traditional view: not >5 or 6)
The wider the span, the more efficient the
organization

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 5TH ELEMENT:
(Employee Empowerment)

Not completely
centralized OR
decentralized?

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 6th ELEMENT: FORMALIZATION
▪ Jobs within the organization are standardized and the extent
to which employee behavior is guided by rules and
procedures

High Low
fewer constraints on
little discretion over
how employees do
what is to be done
their work

explicit job
descriptions, numerous
organizational rules,
> Freedom, creativity
and clearly defined
procedures covering 22
work processes
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 2.2
CONTINGENCY
FACTORS
AFFECTING
STRUCTURAL
CHOICE
 4 FACTORS  STRUCTURAL CHOICE

Environme
Technology ntal
Strategy Size Uncertaint
y

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Mix & Match
Game
1 2

STRATEGY: Unique Innovation Stable and simple environment

TECH: Mass production

SIZE: Small
Dynamic and complex environment

TECH: Process production SIZE: Larger

STRATEGY: Tightly control cost 25
TECH: Unit production
 STRATEGY: Tightly control cost STRATEGY: Unique Innovation

SIZE: Larger SIZE: Small

TECH: Mass production TECH: Unit, process production

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Stable and simple environment Dynamic and complex environment
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 2.3
ORGANIZING FOR
COLLABORATION?
 PROS AND CONS?

Internal External
Collaboration Collaboration Open Innovation:
opening up the search for
new ideas beyond the
Cross-functional teams organization’s boundaries
and allowing innovations
to easily transfer inward
and outward

BENEFITS AND LIMITATIONS OF

INTERNAL COLLABORATION?
[Strengths & Weakness] Task forces (+) Greater Strategic partnership
(ad-hoc committee) input
(-) more
conflicts

(+) more specialised, easily to share

Communities of practice: ideas  >> bonding
HOW TO MAKE IT WORK? share same concern,
problems, passion, (-) not allow us to see diverse aspect of
expertise ideas/ problems
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 COLLABORATIVE WORK

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 30
OPEN INNOVATION Copyright © Pearson Education, Ltd.
 MAKE COMMUNITIES OF PRACTIVE WORK?

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 2.4
FLEXIBLE WORK
ARRANGEMENT
 TELECOMMUNICATING FLEXIBLE HOURS

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COMPRESSED WORKWEEK a 4–40 program JOB SHARING
 2.5
ORGANIZATIONAL
DESIGN’S
CHALLENGES
 BUILD CONNECTION,
NETWORK WITH
TRUST

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 GLOBAL STRUCTURAL ISSUES
Cultural background and designing organizational structure??

▪ DEVELOPING ▪ DEVELOPED
COUNTRIES COUNTRIES
 > formalization—rules  < formalization -
and bureaucratic employees may have
mechanisms higher levels of
“an organization’s structureprofessional
is simply a education
means to an
end”and skills
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2. Reviewing Notes
(CONT)
Chapter 12 (Book)
GROUP &

1
ITS
DEVELOPMENT
Let’s start with what is
group
+2
Interdependent individuals

Interacting

Mutual goals
together
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 TYPES OF GROUP

Group

Your
Examples?

Formal Informal
Group Group

Work
Organization Independentl Social
assignment
’s structure y formed needs
s

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 Command Groups Task Groups
 Hierarchy/ Organizational Chart  Job Task + Temporary

FORMAL
GROUPS
Cross-Functional Teams Self-managed Teams
 Knowledge & Skill + Various  Independent + Own tasks + Traditional
groups + Training managerial responsibilities

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 DEVELOPMENT OF
GROUPS

Group identity,
norms,
expectations 42
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2
GROUP  EFFECTIVE
TEAMS
 GROUP TEAM

Task(s) o Share information o GROUPS

o Make decision o Work intensely with effort

Purposes Members perform jobs Specific mutual goals

effectively and efficiently With positive synergy, individual
and mutual
accountability, and
complementary skills

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 Problem-
solving

Virtual 4 Self-
managed
team
TYPES work

Cross-
functional
team
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CREATING AN EFFECTIVE TEAM
Mutual Trust Feedback
Clear Goals (without discrimination) Good Communication Leadership
1 3 5
7

Internal &
External Support

2 4 6

Relevant Skills Unified Commitment Negotiation Skill

(technical + interpersonal (environment to work (e.g: Customers)
skills) comfortably
 willing to put more effort
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3
CHALLENGES IN
MANAGING TEAM
3 CHALLENGES

s
ce
ur
so
Re

e
r

ur

s
be

es
ct
em

oc
ru
St

Pr
M
up

up
up
ro

ro
ro
G

G
G

1 2 3

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MEMBER RESOURCES IN GLOBAL TEAM

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▪ Asian cultures Perceptions ▪ >>Diverse
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GROUP STRUCTURE

Social loafing
Status
Conformity

Cohesiveness
The level of conformity in those nations in high collectivism easier for employees to align
with the social norms

Social loafing: employees work individually >> in group

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 GROUP PROCESS

Hello!
Hola!
Bonjour!
你好

こんにちは
 Unique cultural characteristics of GROUP & GROUP 52
MEMBERS Copyright © Pearson Education, Ltd.
Global Teams

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Thanks!

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