Organizational Management theory and application

Fumiaki Yasukawa (HIGO visiting professor)

HIGO

The Principles of Social and Cultural Sciences (2015.05.15.)

Contents of the lecture of

Organizational Management

1.Concept of organization (and its management)

2.Some features of organization

3.Behavior and managerial strategy of organization

4.Some examples of organizational management

1.Concept of organization

What is organization? -

identification of organization

What is an organization?

Why we need to identify an organization?

The theory of the firm

Firm=the most popular and general form of organization

1. As a form for long-relationship among social agents

2.As a form of incomplete contract

*It does not be limited in the form of commercial, but all forms of having general (=societal) mission at goal !

Firm(organization),market(society) and institution

firm

firm

firm

society

institution

Some attributes of “organization”

1.Independency as a discrete agent in society

2.A community having same goal

3.A constituent of an institute in society

2.Some features of organization

1.The architecture of organization 1) full description of organization

2) typology of organization

2.Economics requirement for managing organization 1) efficiency

2) coordination & motivation

3) value maximization

Organizational architecture - full description

②Flow of information and resources

③The authority and control relationship with

distribution of power

④The allocations of responsibilities and rights of

decision making

①The effective boundaries among legally contracting

bodies

⑥The means by which new idea is generated and diffused throughout the organization

⑦The means in order to unify the goals and behavior of the members of the organization

These architectural features perform the

elements of organization

⑤The methods for attracting members of organization

Typology of organization

1) Hierarchical organization

2) Functional organization

① vertical line organization

② line and staff organization

① divisional organization

② matrix organization

③ team organization

Hierarchical organization

vertical line organization

line and staff organization

upper

middle

bottom(specialties)

Functional organization

leader

members

Indicate typical organization like this.

The Sony Group is primarily focused on the Electronics

(such as AV/IT products & components), Game (such as

PlayStation), Entertainment (such as motion pictures

and music), and Financial Services (such as insurance

and banking) sectors.

Not only do we represent a wide range of businesses,

but we remain globally unique. Our aim is to fully

leverage this uniqueness in aggressively carrying out our

convergence strategy so that we can continue to

emotionally touch and excite our customers.

from About Sony Group

http://www.sony.co.jp/SonyInfo/CorporateInfo/Data/organization.html

Hospital organization in Japan

http://www.kosei.jp/enzan/outline/corporateprofile...

Hospital organization in US

CEO

CFO CMO COO CNE

Advantage and disadvantage

advantage disadvantage

hierarchical

organization

1.feasible strong integration of

organization

2.advancement of specialization

3.fostering specialties

1.alienated relationship among

upper, middle and bottom

2.encouraging "sectionalism"

functional

organization

1.encouraging flexible behaviors

among team members

2.easiness of coordination

among members

1. adoptable only for small

size organization

2. no room of advancement of

specialization

3.Behavior and managerial strategy of

organization

The goal of (economic) organization is to satisfy

the wants and needs of individual human being

in society arr.from Milgrom & Roberts (1992)

What are required for achieving this goal

Efficiency

Coordination and Motivation

Value Maximization

Standard definition of efficiency

There is no available alternative that is universally

preferred in terms of the goals and preferences of

the people involved …… Milgrom & Roberts(1991) pp.22

It is inefficient if there is an alternative

possible choice that would help one person

without harming any other!

Exercise 1

You are cutting one birthday cake for 4 persons who are

cerebrating your birthday. After you done for all, one

person (i.e. your younger sister) asked you “please give

me a little bit more piece because I like this cake very

much!”. If no one feel discomfort after re-divided, is

cutting cake you have done first efficient ?

Imagine that you are a physician facing an alternative in

which prescribing a specific AIDS drug for whether the

patient who are low income or high. While decision that

prescribing for lower income patients may be expected for

us in charitable manner, the CEO of pharmaceutical firm

refuse to sell the drug because no profit may be earned by

doing so. He states that “ it is inefficient if we sell this

drug to you because the other patients who are suffering

by other illnesses may be harmed due to the cutting in

production of other drugs by the shortage of our profits.”

…..

So, you may agree that the latter alternative may be more

efficient to you. If so, can you explain “why”?

Exercise 2