Chapter 11 Adaptive Organizational Design

Contemporary Organizational Designs

Team Structure

-a structure in which the entire organization is made up of work groups or teams

Advantages: Employees are more involved and empowered

Reduced barriers among functional areas

Disadvantages: No clear chain of command

Pressure on teams to perform

Matrix-Project Structure

-Matrix-a structure that assigns specialists from different functional areas to work on projects who then
return to their areas when the project is completed

-Project-a structure in which employees continuously work on projects. As one project is complete,
employees move on to the next project

Advantages: Fluid and flexible design that can respond to environmental changes

Disadvantages: Complexity of assigning people to projects

Task and personality conflicts

Boundaryless Structure

-a structure that is not defined by or limited to artificial horizontal, vertical or external boundaries;
includes virtual and network types of organizations

Advantages: Highly flexible and responsive

Utilizes talent wherever its found

Disadvantages: Lack of Control

Communication difficulties

Learning Structure

-a structure in which employees continually acquire and share new knowledge and apply that
knowledge

Advantages: Sharing of knowledge throughout organization. Sustainable source of competitive

advantage

Disadvantages: Reluctance on part of employees to share knowledge for fear of losing their power

Large numbers of experienced employees on the verge of retiring

*Organizations need to be lean, flexible, and innovative; that is, they need to be more organic

Team Structures

-an organizational structure in which the entire organization is made up of work teams

-complements what is typically a functional or divisional structure and allows the organization to have
the efficiency of a bureaucracy and the flexibility the teams provide

*In this structure, employee empowerment is crucial because no line of managerial authority flows from
top to bottom. Rather, employee teams design and do work in the way they think is best, but the teams
are also held responsible for all work performance results in their respective areas

Matrix and Project Structures

-creates a dual chain of command

-the project manager has authority over the functional members who are part of his or her project team
in areas related to the projects goals

-violates the unity of command principle (which says that each person should report to only one boss)

-employees join project teams because they bring needed skills and abilities to that project. Once a
project is completed, however, they move on to the next one

Matrix structure-an organizational structure that assigns specialists from different functional
departments to work on one or more projects

Project Structure-an organizational structure in which employees continuously work on projects

The Boundaryless Organization

-an organization whose design is not defined by or limited to, the horizontal, vertical or external
boundaries imposed by a predefined structure

2 types:

1. Internal-the horizontal ones imposed by work specialization and departmentalization and the
vertical ones that separate employees into organizational levels and hierarchies
2. External-the boundaries that separate the organization from its customers and other
stakeholders

Virtual Organization

-researching, sales, marketing and social-media development---tasks that can be done anywhere with
a computer and online access

-an organization that consists of a small core of full-time employees and outside specialists temporarily
hired as needed to work on projects

Network Organization
-an organization that uses its own employees to do some work activities and networks of outside
suppliers to provide other needed product components of work processes

Learning Organization

-an organization that has developed the capacity to continuously learn, adapt, and change

-this approach promotes consistency in operations as well as being a way to share innovations

-employees throughout the entire organization---across different functional specialities and even at
different organizational levels---must share information and collaborate on work activities

-such an environment requires minimal structural and physical barriers, which allows employees to work
together in doing the organizations work the best way they can and, in the process, learn from each
other

-empowered work teams

Organizing for Collaboration

-managers recognize how such collaborative efforts fit with the organizations structure and the
challenges of making all the pieces work together successfully

Benefits

Increased communication and coordination

Greater innovative output
Enhanced ability to address complex problems
Sharing of information and best practices

Drawbacks

Potential interpersonal conflict

Different views and competing goals
Logistics of coordinating

Internal Collaboration

1. Cross-functional teams
-a work team composed of individuals from various functional specialties
2. Task forces/ad hoc committee
-the temporary nature of a task force is what differentiates it from a cross-functional team
-when the issue or problem is solved, the task force is no longer needed and members return to
their regular assignments
-a temporary committee or team formed to tackle a specific short-term problem affecting
several departments
3. Communities of practice
-groups of people who share a concern, a set of problems, or a passion about a topic, and who
deepen their knowledge and expertise in that area by interacting on an ongoing basis
 -can create value by contributing to increased effectiveness in employees job performance
through greater access that they provide to the ideas, knowledge, and best practices shared
among community members

Making Communities of Practice Work

Have top management support and set clear expectations
Create an environment that will attract people and make them want to return for
advise, conversation and knowledge sharing
Encourage regular meetings of the community, whether in person or online
Establish regular communication among community members
Focus on real problems and issues important to the organization
Have clear accountability and managerial oversight

External Collaboration

1. Open innovation
-opening up the search for new ideas beyond the organizations boundaries and allowing
innovations to easily transfer inward and outward
-as you can see, many of todays successful companies are collaborating directly with customers
in the product development process. Others are partnering with suppliers, other outsiders and
even competitors
Benefits
Gives customers what they want---a voice
Allows organizations to respond to complex problems
Nurtures internal and external relationships
Brings focus back to marketplace
Provides way to cope with rising costs and uncertainties of product development
Drawbacks
High demands of managing the process
Extensive support needed
Cultural challenges
Greater need for flexibility
Crucial changes required in how
Crucial changes required in how knowledge is controlled and shared
2. Strategic partnerships
-collaborative relationships between 2 or more organizations in which they combine their
resources and capabilities for some business purpose
-here are some reasons why such partnership make sense: flexibility and informality of
arrangements promote efficiencies, provide access to new markets and technologies, and entail
less paperwork when creating and disbanding projects; risks and expenses are shared by
multiple parties; independent brand identification is kept and can be exploited; working with
partners possessing multiple skills can create major synergies; rivals can often work together
harmoniously; partnerships can take on varied forms from simple to complex; dozens of
participants can be accommodated in partnership arrangements; and antitrust laws can protect
R&D activities
Flexible Work Arrangements

*some different types of flexible work arrangements including telecommuting and compressed
workweeks, flextime and job sharing

1. Telecommuting-a work arrangement in which employees work at home and are linked to the
workplace by computer

2. Compressed Workweeks, Flextime, Job Sharing

Compressed Workweeks

-four 10-hour days (a 4-40 program)

-a workweek where employees work longer hours per day but fewer days per week

Flextime

-typically designates certain common core hours when all employees are required to be on the
job, but allows starting, ending and lunch-hour times to be flexible

-scheduling system in which employees are required to work a specific number of hours a week
but are free to vary those hours within certain limits

Job Sharing

-the practice of having 2 or more people split a full-time job

Contingent Workforce

Contingent workers

-temporary freelance, or contract workers whose employment is contingent upon demand for their
services

*There people are essentially free agents who move from project to project applying their skills----
directing, talent casting, costuming, makeup, set design and so forth---as needed. They assemble for a
movie, then disband once its finished and move on to the next project

*The legal definition of a contract worker depends on how much control a company has over the
person; that is, does the company control what the worker does and how the worker does his or her
job? The more control the company has, the more likely the individual will be considered an employee
rather than an independent contractor

Todays Organizational Design Challenge

1. Keeping Employees Connected

2. Managing Global Structural Issues
*What does this distinction between strategy and culture mean for designing effective and
efficient structures? When designing or changing structure, managers may need to think about
the cultural implications of certain design elements
*For instance, one study showed that formalization---rules and bureaucratic mechanisms---may
be more important in less economically developed countries and less important in more
economically developed countries where employees may have higher levels of professional
education and skills
*organizations with people from high power-distance countries find that their employees are
much more accepting of mechanistic structures than are employees from low power-distance
countries
*Other structural design elements may be affected by cultural differences as well.