MS-10

Management Programme

ASSIGNMENT
FIRST SEMESTER
2011

MS-10: ORGANIZATIONAL DESIGN,

DEVELOPMENT AND CHANGE

School of Management Studies

INDIRA GANDHI NATIONAL OPEN UNIVERSITY
MAIDAN GARHI, NEW DELHI – 110 068
 ASSIGNMENT
Course Code : MS - 10
Course Title : Organizational Design, Development and Change
Assignment Code : MS-10/SEM - I /2011
Coverage : All Blocks

Note: Answer all the questions and send them to the Coordinator of the Study Centre you are
attached with.

1) Briefly describe different approaches to organizations and explain the 7Ss Model and it’s
relevance.
Solution: The basic elements of organisations have remained the same over the years.
Organisations have purposes (be they explicit or implicit), attract people, acquire and use
resources to achieve the objectives, use some form of structure to divide (division of labour)
and coordinate activities, and rely on certain positions/people to lead or manage others. While
the elements of organizations are the same as ever before, the purposes o\f organisation,
structures, ways of doing things, methods of coordination and control have always varied
widely over the years and even at the same time amongst different organisations. For
example, public sector organisation in India with there multiple objectives in early years were
not roused by the profit motive but are now required to make surpluses. At a given point in
the time of history. Ford Motors relied more on centralization and General Motors on
decentralization. The crucial aspect that accounts for the differences is how an organisation
adapts itself to the environment. Organisation being part of the society affects and is affected
by the changes in society. The changes could be social, economic, technical, legal or
political; they could be in input (labour, capital, materials etc.) or output markets.

It is essential to develop a perspective understanding about organisations because human

behaviour and organisational behaviour are influenced by the people in organisations and the
specific characteristics in the basic elements in the organisations and the way they adapt
themselves to the environment. There is considerable body of knowledge and literature,
called organisation theories, developed over the years reflecting what goes on in
organisations. Organisation theories are sets of propositions which seek to explain or predict
how individuals and groups behave indifferent organisational structures
and circumstances.
Basically we have the three types of approaches to organisation
1. Classical
2. neo-classical
3. modern approach
Now we will describe

Classical Viewpoint:
these concepts have come to be popularly known as classical concepts or classical theories of
organisation. The structure of an organisation received emphasis under this school of thought.
According to the classical view, “An organisation is the structure of the relationships, power,
objectives, roles, activities, communications and other factors that exist when persons work
together.

The streams of concepts in the “classical” mould are based on the same assumptions, but are
developed rather independently. Bureaucracy as a concept, first developed by Max Weber,
presents a descriptive, detached, scholarly point of view. Administrative theories not only
described macro aspects of organisations but also focused on principles and practice for better
performance. Scientific management thought focused mainly in micro aspects like individual
worker, foreman, work process, etc. The classical theorists on the whole, with scientific
management stream being a minor exception, viewed organisations as mechanistic structures.
Let us consider the three streams of classical theories briefly : i.e Bureaucracy,
Administrative theory and Scientific Management.

Bureaucracy
Bureaucracy is the dominant feature of ancient civilizations as well as modern organisations
in contemporary world. Max Weber describes an “ideal type” approach to outline the
characterstics of a fully developed bureaucratic form of organisation. The features that the
described as being characterstic of a bureaucracy are common to all social institutions, be
they political, religious, industry, business, military, educational or government
organisations. Size and complexity produce bureaucracy. As such, the rigid structures, fixed
jurisdictions, impersonal rules and mundane routine, concomitant with bureaucracies often
result in delays, produce inertia, encourage buck-passing, lead to wastage of resources and
cause frustration. As such, in general parlance the word ‘bureaucracy’ has come to have a
negative connotation and many tended to wish it away. But the features that characterize
bureaucracy have become inevitable and ubiquitous with the growing size and complexity in
organisations. There is need, therefore, to understand and improve bureaucracies than indulge
in dysfunctional debates over their relevance.
Administrative Theory
Administrative theory is another stream of thought in the classical mould.
Among the several proponents of the Administrative theory, the earliest and significant
contribution came from Henri F Fayol, a French industrialist, in 1916. The 14 principles that
capture the essence of the administrative theory could be summarized as follows:
Division of work. Division of work or specialization gives higher productivity because one
can work at activities in which one is comparatively highly skilled.
Authority and responsibility. Authority is the right to give orders. An organisational member
has responsibility to accomplish the organisational objectives of his position. Appropriate
sanctions are required to encourage good and to discourage poor performance.
Discipline. There must be respect for and obedience to the rules and objectives of the
organisation.
Unity of command. To reduce confusion and conflicts each member should receive orders
from and be responsible to only one superior.
Unity of direction. An organistion is effective when members work together toward the same
objectives.
Subordination of individual interest to general interest. The interests of one employee or
group of employees should not prevail over that of the organisation.
Remuneration of personnel. Pay should be fair and should reward good performance,
decentralization.
Centralisation. A good balance should be found between centralisation and decentralization.
Scalar chain. There is scalar chain or hierarchy dictated by the principle of unity of command
linking all members of the organisation from the top to the bottom.
Order. There is a place for everything and everyone which ought to be so occupied.
Equity. Justice, largely based on predetermined conventions, should prevail in the
organisation.
Stability of tenure of personnel. Time is required for an employee to get used to new work
and succeed in doing it well.
Initiative. The freedom to think out and execute plans at all levels.
Espirit de corps. “Union is strength”.
Scientific Management
The third stream of classic school of thought is the scientific management. Whereas
bureaucracy and administrative theory focused on macro aspects of the structure and
processes of human organisations, scientific management concerned itself with micro aspects
such as physical activities of work through time-and-motion study
and examination of men-machine relationships. Unlike in the other two, the scientific
management and based its inductive reasoning on detailed study and empirical evidence. In
juxtaposition the principles of bureaucracy and administrative theory were formed by
synthesising experience and observation with abstract reasoning.

Neoclassical Viewpoint
The neoclassical theory, also referred to as the human relations school of thought reflects a
modification to and improvement over the classical theories. While classical theories focused
more on structure and physical aspects of work the neoclassical theory recognizes the primary
of psychological and social aspects of the worker as an individual and his relations within and
among groups and the organisation. Though neoclassical philosophy could be traced to
ancient times, it gained currency only after the world War I, particulary in the wake of the
“Hawthrone experiments” at Western Electric Company by Elton Mayo during 1924 to 1932.
The neoclassical viewpoint thus gave birth to human relations movement and provided the
thrust toward democratisation of organisational power structures and participative
management. The emerging changes in social, economic, political and technical environment
of organisations also seems to have provided the rationale for such shift in emphasis.
The neoclassical viewpoint does not replace classical concepts. The need for order,
rationality, structure, etc. have been modified to highlight the importance of relaxing the rigid
and impersonal structures and consider each person as an individual with feelings and social
influences that effect performance on the job.
Modern (Systems) Viewpoint
Modern theories of organisation and management have been developed largely since the
1930s. The perspective here is to provide a systems viewpoint. Among the several persons
who contributed to the modern theory, it was perhaps Chester I. Bernard, who in 1983,
provided a comprehensive explanation of the modern view of management and organisation.
He considered the individual, organisation, suppliers and consumers as part of the
environment. Ten years later, Weiner;s pioneering work on cybernetics developed concepts
of systems control by information feedback. He described an adaptive system (including an
orgainsation) as mainly dependent upon measurement and correction through feedback. An
organisation is viewed as a system consisting of five parts: inputs, process, output, feedback
and environment as shown in Figure .
Input Process Outputs
The GST approach suggests the following nine levels of systems complexity:
1. The most basic level is the static structure. It could be termed the level of frameworks. An
example would be the anatomy of the universe.
2. The second level is the simple dynamic system. It incorporates necessary Predetermined
motions. This could be termed the level of clockworks.
3. The next level is a cybernetic system characterized by automatic feedback Control
mechanisms. This could be thought of as the level of clockworks.
4. The fourth level is called the “open-systems” level. It is a self-maintaining Structure and is
the level where life begins to differentiate from nonlife. This is the level of the cell.
5. The fifth level can be termed the “genetic-societal” level. It is typified by the plant and
occupies the empirical world of the botanist.
6. The next is the animal level, which is characterized by increased mobility, Teleological
behaviour, and self-awareness.
7. The seventh level is the human level. The major difference between the human level and
the animal level is the human’s possession of self-consciousness.
8. The next level is that of social organisations. The important unit in a social organisation is
not the human per se but rather the organisatonal role that the person assumes.
9. The ninth and last level is reserved for transcendental systems. This allows for ultimates,
absolute and the inescapable unknowables.
Each level is more complex than the one that precedes it. However, no stage is as yet fully
developed and knowledge about different levels is for varying degrees. Beyond the second
level none of the theories are comprehensive or fully meaningful. Over the last here decades
further developments in research into organisations may have added to the existing
knowledge, but human organisations continue to be extremely complex.
The systems approach points to the interdependent nature of everything that forms part of or
concerns an organisation. A system is composed of elements which are related to and
dependent upon one another and which, when in interaction, from a unitary whole.
Systems framework covers both general and specialized systems and closed and open
analysis. A general systems approach to the management processes deals with formal
organisation and concepts relating to different disciplines such as technical, social,
psychological and philosophical. Specific management systems deal with aspects relating to
organisation structure, job design, specific functions of management, etc.
A closed system operates in a closed loop, devoid of external inputs. An open system, in
contrast, is a dynamic input-output system “in continual interaction with environment to
achieve a steady state of dynamic equilibrium while still retaining the capacity for work or
energy transformation”.
While the classical theorists recognised only a closed system viewpoint, the modern theorists
believe in organisations as open systems. The work of D.Katz and R L Kahn provided the
intellectual basis to merge classical, neoclassical and modern viewpoints.
Here below we are describing the different approaches to organisation in relevence of 7s
model.
The 7-S-Model is better known as McKinsey 7-S. This is because the two persons who
developed this model, Tom Peters and Robert Waterman, have been consultants at McKinsey
& Co at that time. Thy published their 7-S-Model in their article “Structure Is Not
Organization” (1980) and in their books “The Art of Japanese Management” (1981) and “In
Search of Excellence” (1982).
The model starts on the premise that an organization is not just Structure, but consists of
seven elements:
Those seven elements are distinguished in so called hard S’s and soft S’s. The hard elements
(green circles) are feasible and easy to identify. They can be found in strategy statements,
corporate plans, organizational charts and other documentations.
The four soft S’s however, are hardly feasible. They are difficult to describe since
capabilities, values and elements of corporate culture are continuously developing and
changing. They are highly determined by the people at work in the organization. Therefore it
is much more difficult to plan or to influence the characteristics of the soft elements.
Although the soft factors are below the surface, they can have a great impact of the hard
Structures, Strategies and Systems of the organization.
Description
The Hard S’s
Strategy Actions a company plans in response to or anticipation of changes in its external
environment.
Structure Basis for specialization and co-ordination influenced primarily by strategy and by
organization size and diversity.
Systems Formal and informal procedures that support the strategy and structure. (Systems are
more powerful than they are given credit)
The Soft S’s
Style / Culture The culture of the organization, consisting of two components:
• Organizational Culture: the dominant values and beliefs, and norms, which develop over
time and become relatively enduring features of organizational life.
• Management Style: more a matter of what managers do than what they say; How do a
company’s managers spend their time? What are they focusing attention on? Symbolism –
the creation and maintenance (or sometimes deconstruction) of meaning is a fundamental
responsibility of managers.
Staff The people/human resource management – processes used to develop managers,
socialization processes, ways of shaping basic values of management cadre, ways of
introducing young recruits to the company, ways of helping to manage the careers of
employees
Skills The distinctive competences – what the company does best, ways of expanding or
shifting competences
Shared Values / Superordinate Goals Guiding concepts, fundamental ideas around which a
business is built – must be simple, usually stated at abstract level, have great meaning inside
the organization even though outsiders may not see or understand them.
Effective organizations achieve a fit between these seven elements. This criterion is the origin
of the other name of the model: Diagnostic Model for Organizational Effectiveness.
If one element changes then this will affect all the others. For example, a change in HR-
systems like internal career plans and management training will have an impact on
organizational culture (management style) and thus will affect structures, processes, and
finally characteristic competences of the organization.
In change processes, many organizations focus their efforts on the hard S’s, Strategy,
Structure and Systems. They care less for the soft S’s, Skills, Staff, Style and Shared Values.
Peters and Waterman in “In Search of Excellence” commented however, that most successful
companies work hard at these soft S’s. The soft factors can make or break a successful
change process, since new structures and strategies are difficult to build upon inappropriate
cultures and values. These problems often come up in the dissatisfying results of spectacular
mega-mergers. The lack of success and synergies in such mergers is often based in a clash of
completely different cultures, values, and styles, which make it difficult to establish effective
common systems and structures.
 The 7-S Model is a valuable tool to initiate change processes and to give them direction. A
helpful application is to determine the current state of each element and to compare this with
the ideal state. Based in this it is possible to develop action plans to achieve the intended
state.
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2) Discuss any four organizational structures and how they contribute to fulfill the demands of
new environment. Give examples.

3) Describe various approaches to job design and their advantages and limitations. Briefly
explain how relevant they are in today’s environment.

4) What is organizational diagnosis? Briefly explain why diagnosis is useful for an

organization? Discuss the role of work-shop and task force in diagnosis and their merits and
demerits. Give examples.
Organizational diagnosis is a process based upon behavioral science theory for publicly
entering a human system, collecting valid data about human experiences with that system,
and feeding that information back to the system to promote increased understanding of the
system by its members (Alderfer, 1981). Purpose of organizational diagnosis is to establish a
widely shared understanding of a system and based upon that understanding to determine
whether change is desirable.
Concept of system
System can be viewed as a linkage of input flows (energy, materials, information, human
resources, economic resources) from sources in the external environment, a transforming
mechanism (a machine or a technical-human organization), and flows of outputs or outcomes
provided to users. System may include one or more feedback mechanisms for self-regulation.
Focus of attention
Diagnostic activities should focus its attention to two areas � (a) subsystem areas (top
management, department, group, individual unit) (b) organization processes or organizational
health (decision-making process, communication patterns and styles, relationships between
interfacing groups, the management of conflict, the setting of goals and planning methods).
Who will diagnose?
People cannot be diagnosticians in systems in which they are full-fledged members due to
overt or covert vested interests. Diagnosticians must maintain role of researcher (systematic,
objective and result-oriented investigation) and must establish some type of liaison system
between the researcher and the elements of the systems. The liaison may be an individual or a
group.
Internal researchers can work in parts of a larger system in which they have not been or
currently are not members. But they cannot study their own groups and they generally have a
great deal of difficulty with parts of the system in which they have recently been members.
Phases of organizational diagnosis
Entry
Primary objectives of entry are to determine which units of the system (individual, group and
organization) will participate in the diagnosis and to determine whether the researcher and
respondent can reach agreement about their respective roles during data collection and
feedback. Researchers may experience anxiety related to potential acceptance or rejection by
the respondent system. The more self-awareness and experience the researchers have, the less
these feelings will interfere with their effectiveness during entry.
Data collection
The primary objectives of data collection are to gather valid information about the nature of
the system systematically and to prepare an analysis of that data for delivery to respondents
during feedback. Collection of data proceeds from less (unstructured observation) to more
structured methods (qustionnaires) to produce more valid data.
In unstructured observation, researchers will be concerned with the relevant documents
offered by the respondent, newsletters, chairman reports, roaming around relevant selected
places, interviewing individuals or group. He must decide how much emphasis to give to
theoretical concepts for understanding the observational data. Researcher besides observation
and theoretical concepts should pay attention to respondent�s own explanation of the data.
Repeated unstructured observation, explanation of respondents and use of theory lead the
researcher to develop hypothesis about the causal relationship of the specific events,
relationships among the independent, dependent and moderating variables.
It is better to take a case history of the organization before observational data collection. The
case history should cover the followings:
Identification data: It includes organization name, location, type of organization, organization
affiliation, size (financial condition, stockholders, employees).
Historical data: Cheap complaints, duration and possible determinants, short-range and long-
range problems, major crisis of the organization (natural catastrophy, loss of key personnel,
labour problems, financial emergencies, technological changes), product service history
 (change and development of organizational goals, sequence of development in product or
service), organizational folklore.
Structural data: Organizational chart, formal job description, ecology of the organization
(spatial distribution of individuals, activities), financial structure, personnel (size, various
educational levels, average tenure, range or skills, absentee rate, turnover rate, accident rate),
structure for handling personnel (recruitment, orientation, training, growth of the job,
promotion, compensation, performance analysis), rules and regulations (medical, safety,
retirement, recreation, other fringe benefits).
Organizational functioning: Organizational perceptions (alertness, accuracy and vividness),
organizational knowledge (acquisition, use and dissemination of knowledge), organizational
language, emotional atmosphere of the organization and organizational action.
Attitudes and relationship: Attitudes towards the task agents, relations to things and ideas,
attitudes about self, inter-organizational relationships.
Analysis and conclusions: Appraisal of the effect of the environment on the organization,
appraisal of the effect of the organization on the environment, reactions, appraisal of the
organization, impairments and level of integration.
Feedback
Primary objective of feedback is to promote increased understanding of the client system by
its members. Effective feedback design relates the content of the feedback to the process by
which the analysis is delivered to the system. The process of feedback is the composition of
feedback meetings (i.e., who is present with whom), the ordering of the meetings (i.e., which
groups receive information first, which is second, etc.), the behavior of the system during
feedback and the behavior of the researchers within and between feedback meetings.
feedback is probably the period of maximum anxiety during the entire diagnosis. If the
system could tolerate the anxiety, system could learn its self.
In sum, the methodology of organizational diagnosis calls for the researcher to be competent
in the conventional use of social science tools ( observation, interviews, questionnaires and
archives) ant to possess a sophisticated theory and the related behavioural skills to enter,
collect and feedback information to complex multigroup systems.

5) What is Organizational Development? Describe different stages of organizational

development. Discuss any two interventions and their contribution to organizational
development. Give examples.