Professional Documents
Culture Documents
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= Life cycle stage in which organization
develop value creation skills and
competence that allow them to acquire
additional recourses.
= Allows division of labor and specialization
and thus develop a competitive advantage.
= Eg: Microsoft
= InstitutionalTheory
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= Ôr. Larry E. Greiner
= Institutional model involves imitation of
successful organizations.
= Both the companies face similar kind of
strategic and structural problems.
= Case- page no: 325.
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= Age of the Organization
= Size of the Organization
= Stages of Evolution
= Stages of Revolution
= Growth Rate of the Industry
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= Rroblems tend to change with increased
employees and sales revenue.
= Coordination and communication becomes more
difficult.
= New functions emerge.
= Structural hierarchy increases.
= Jobs become more interrelated.
= Formalized processes - for control
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-. Creativity
2. Ôirection
3. Ôelegation
4. Coordination
5. Collaboration
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= Functional organizational structure.
= Ôifferent departments are designed.
= Formal communication results as hierarchy
and employees increase.
= Increased efficiency.
= Systems need to be set up for inventory
control, accounting, order processing
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Eventual Rroblems:
= ´Crisis of Autonomy.µ
= Impersonal environment.
= Lower-level employees often possess more
knowledge about markets and machinery
than management.
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= Ôelegate authority to lower level managers and
divisions.
= Link their control over organizational activities to a
reward structure that recognizes their contribution
= Balance between management and entrepreneurship.
= Greater empowerment of managers -Greater
responsibility given to lower management.
= Rrofit centers and bonuses are used to motivate
employees.
= Rroduct team structure.
= V
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Eventual Rroblems:
= ´Crisis of Control.µ
= Ôivisions try to achieve their own goals not
company·s.
= Lower-level management begins running their
own show without coordinating with the rest of
the organization.
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= Balance between centralized control from
top and decentralized control at the
functional level.
= Top management take the responsibility.
= Formation of product groups: i
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Îdecentralized units are
grouped together).
= Each group is treated like an investment
center.
= Top managers are hired to initiate company-
wide control programs.
Eventual Rroblems :
= ´Red Tape Crisisµ: Rrocedures take
precedence over problem solving
= Formal planning procedures - Everything is
a procedure.
= Company become too large and complex to
manage formally.
= Conflict between the line and staff
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= Matrix structure to handle the right teams
for right problems.
= Social control and self-discipline replace
formal control.
= Formal control systems are simplified.
= Conferences are held weekly.
= Rewards are geared for team performance.
= ünow where you are in the developmental sequence.
= Recognize the limited range of options.
= Be able to persuade ideas to other managers.
= Be able to activate change Îüaizen).
= Realize that solutions breed new problems.