isep msc corporate organisation_session2 20121207

7/28/2019 ISEP MSc Corporate Organisation_session2 20121207

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CORPORATE ORGANISATION : AN

OVERVIEWOFTHECORPORATEORGANISATION

MSc ISEP

Session 2

7/12/2012


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ORGANISATIONALTHEORY

What do you remember?

the seeds : Who? What?

The classical era : Who? What?

Human behavioural theories : Who? What?

Mintzberg : Contingency factors? Organizational structure?

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WHATISORGANISATIONALSTRUCTURE?

An organisational structure defines how job tasks areformally divided, grouped and coordinates

Mintzberg defined organisational structure as "the sum total of the ways in which it divides itslabour into distinct tasks and then achieves coordination among them".

One of the main task of management

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DESIGNINGTHEORGANIZATIONALSTRUCTURE

Some definitions

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the degree to which tasks in the organisation are

subdivided into separate jobs.

the basis by which jobs are grouped together.

the unbroken line of authority that extends from

the top of the organisation to the lowest echelon

and clarifies who reports to whom.

the number of subordinates a manager can

efficiently and effectively direct

the degree to which decision making is

concentrated at a single point in the organisation

the degree to which jobs within the organisation

are standardized

Work specialisation

Departmentalisation

Chain of command

Span of control

Centralisation and

decentralisation

Formalization


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6 questions to ask, and answers provided by...

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1. To what degree are tasks subdivided into

separate jobs?

2. On what basis will jobs be grouped together?

3. To whom do individuals and groups report?

4. How many individuals can a manager

efficiently and effectively direct?

5. Where does decision-making authority lie?

6. To what degree will there be rules and

regulations to direct employees and managers?

1. Work specialisation

2. Departmentalisation

3. Chain of command

4. Span of control

5. Centralisation anddecentralisation

6. Formalization


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Work specialization : horizontal or vertical?

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Prod 1 Prod 2 Prod 3 Prod 4

CEO

Mkt Mfg Finance R&D Logistics

CEO

Horizontal differentiation : degree

to which tasks are divided intodistinct homogeneous groups

function-wise

geographic-wise

product-wise

production stage-wise

=> Departmentalization


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Work specialization : horizontal or vertical?

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Vertical differentiation : number of

levels within the organization

Sr. VP

VP

Asst. VP Asst. VP

Asst. Branch Mgr

Branch Mgr. Branch Mgr.

Asst. VP

VP VP

Sr. VP

EVP EVP EVP

CEO


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Span of control : tall or flat?

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Centralization

The degree to which decision making isconcentrated at a single point in the organization.

Formalization

The degree to which jobs withinthe organization are standardized.

Decentralization

The degree to which decision making isspread throughout the organization.


Source: S. Robbins Prentice Hall


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MAIN ORGANIZATIONALSTRUCTURESN1

Functional

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Functional

Division of work based on functional specialisations (production, sales,

administration, personnel, purchasing, research and development,

etc...)

Aim to reach efficiency goals and permits exploiting scale economies

Suitable for high environmental and technical stability

Main characteristics:

o Everyone has a precise function and job

o Procedures and formalisation are more important that direct contactso Communication follows the chain of command

o Functional structure follows centralized decision making model (decisions

occurs at the top)

o Control (process & norms) have a key role

o Disadvantage: siloing, poor communication/conflicts between departments4



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Divisional

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Divisional

Division of work based on product type; market type; geographical area;

type of technology; etc...

Aim to be adapted to strategic segmentation, and decrease the

complexity of decision making

Suitable for high heterogeneity (products, market, technology) and high

environmental instability (need for reactivity and decentralisation)


o

Headquarter manage the whole, with global objectives (profit, margin,..), andusually measure results and distribute financial means

o Divisions have large autonomy / elbow room

o Better ability to respond to customers issues; more accountability

o Disadvantage : redundant effort and resources

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Matrix

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Employee

MATRIX STRUCTURE (COLLEGEOF BUSINESS ADMINISTRATION)

Source: S. Robbins Prentice Hall


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Matrix

Division of work based on the combination of two criteria (functional and

divisional)

Combination of needs for internal reactivity and the need to assure

sophisticated specialized performance Suitable high environmental instability, high heterogeneity but with high

interdependence


o Everyone is belonging to a department, and depending on the time, is

assigned to one of the other project or activity

o Dual reporting lines and functional

o Extremely efficient, particularly when resources are scarce.

o Main disadvantage : whos the boss? confusion with chain of command;

conflicts between project and department managers concerning deadlines

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17Source 2005 Prentice Hall Inc. All rights reserved.15

NEW DESIGN OPTIONS

Characteristics:

Breaks down departmental barriers.

Decentralizes decision making to the team level.

Requires employees to be generalists as well as specialists. Creates a flexible bureaucracy.

Team StructureThe use of teams as the central device to coordinatework activities.


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NEW DESIGN OPTIONS (CONTD)

T-form Concepts:

Eliminate vertical (hierarchical) and horizontal (departmental)

internal boundaries.

Breakdown external barriers to customers and suppliers.

Boundaryless OrganizationAn organization that seeks to eliminate the chain ofcommand, have limitless spans of control, and replacedepartments with empowered teams.

Source 2005 Prentice Hall Inc. All rights reserved.


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NEW DESIGN OPTIONS (CONTD)

Concepts:

Advantage: Provides maximum flexibility while concentrating onwhat the organization does best.

Disadvantage: Reduced control over key parts of the business.

Virtual Organization

A small, core organization that outsources its majorbusiness functions.

Highly centralized with little or no departmentalization.



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2015

A VIRTUAL ORGANIZATION



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VIRTUAL ORGANIZATION

A Virtual company resembles a normal traditional

company in its inputs and its outputs. It differs in the

way in which it adds value during the journey in

between.

Virtual Organization : read The Economist article


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22Source: S. Adams, Dogberts Big Book of Business, DILBERT


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LEADERSHIPANDMANAGEMENT

Management is about coping with complexity

Good managers brings about order and consistency by drawing up formal

plans, designing rigid organizations structures, monitoring results against

plans

Management consists of implementing the vision and strategy provided byleaders, coordinating and staffing organisation, and handling day-to-day

problems

Leadership is about coping with change

Leaders establish direction by developing a vision of the future; they align

people by communication this vision and inspiring them to overcome

obstacles

(John Kotter Harvard Business School / Rober House University of Pennsylvania)

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MANAGEMENT

Ten Management Roles (Mintzberg)

Informational (3 roles) :

(1) MONITOR: gathers internal and external

information relevant to the organisation;

(2) DISSEMINATOR: transmits factual and value

based information to subordinates;

(3) SPOKESPERSON: communicates to theoutside world on performance and policies.

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MANAGEMENT


Interpersonal (3 roles) :

(4) FIGUREHEAD: the manager performs ceremonial

and symbolic duties as head of the organisation;

(5) LEADER: fosters a proper work atmosphere and

motivates and develops subordinates;

(6) LIAISON: develops and maintains a network of

external contacts to gather information;

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MANAGEMENT


Decisional (4 roles) :

(7) ENTREPRENEUR: designs and initiates change in

the organisation; (8) DISTURBANCE HANDLER: deals with unexpected

events and operational breakdowns;

(9) RESOURCE ALLOCATOR: controls and authorises

the use of organisational resources; (10) NEGOTIATOR: participates in negotiation activities

with other organisations and individuals.

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LEADERSHIP

The ability to influence a group toward the

achievement of goals

If you want to build a boat, do not drum up people tocollect wood or assign them tasks or work, but rather

teach them to long for the endless immensity of the seaAntoine de Saint-Exupery

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LEADERSHIP : THEORIES (1)

Traits of Leadership?

Commonalities : ambition, energy, desire to lead, honesty and integrity, self-

confidence, intelligence, job-relevant knowledge

However too many limitations: no universal trait for all situations, trait predict

behaviour in weak situations rather than strong, evidence not clear betweencause from effect, trait better predict the appearance of leadership rather than

the effectiveness

Behavioural theories

Theories proposing that specific behaviours differentiate leaders from

nonleaders

Based on behavioural theory => people can be trained to be leaders

However is missing the consideration of situational factors

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LEADERSHIP : THEORIES (2)

Contingency theories

Relationship between leadership styles and effectiveness depends on different

factors key variables isolated by some models

Neocharismatic theories

Stress symbolic and emotionally appealing leader behaviours

Attempt to explain how certain leaders are able to achieve extraordinary levels

of follower commitment

Deemphasise theoretical complexity 3 approaches : charismatic leadership, transformational leadership, visionary

leadership

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LEADERSHIP

What does a leader look like? I've met leaders allover the world, on several continents, and in everyprofession. I've met young leaders and old ones,

leaders with big tribes and tiny ones. I can tell you

this : Leaders have nothing in common. They don'tshare gender or income level or geography. There isno gene, no schooling, no parentage, no profession.

In other words, leaders aren't born. I'm sure of it.Actually, they do have one thing in common. Every

leader I've ever met share's one thing: the decisionto lead.

Seth Godin - Tribes: We Need You To Lead Us


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LEADERSHIP : CONTEMPORARYISSUES

Emotional intelligence and leadership Primal leadership refers to the emotional dimension of leadership. We

argue that a leaders primal task is an emotional oneto articulate amessage that resonates with their followers emotional reality, with theirsense of purposeand so to move people in a positive direction.Leadership, after all, is the art of getting work done through other people.Daniel Goleman Primal leadership

Team leadership if we are together, nothing is impossible. If we are divided, all will fail Winston

Churchill

Moral leadership One of the things I noticed, as so many of us in business do, is that some of

the hardest leadership decisions are the ones that have moral or ethicalstakes Sandra J. Sucher, teaching the Moral Leadership at Harvard BusinessSchool

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LEADERSHIP EXPECTATIONS

Charismatic

Team

Participative

Humane

Autonomous

Self

protective

ChineInde

US/UK

ALL.

Turquie

Inde US/UK

Chine

ALL.

US/UK

SudeALL.

Brsil

Sude

Afrique

Russie Chine

Inde

France

France

France

France

France

France

Source: House, R. H. (2004). Culture, Leadership, and Organizations: the

GLOBE study of 62 societies. London: Sage.


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LEADERSHIP FRENCH EXPECTATIONS

Cross-cultural leadership : French position Key words for Leadership for a French manager :

Charisma

Vision

Management

4Source : Edhec Business School


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TOBECONTINUED...

Next course :

Quiz

Main stakeholders in a company

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isep msc corporate organisation_session2 20121207

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