Uvod

organizacioni dizajn

dimenzije org dizajn (specijalizacija, department, span of control,..

organizaciona stuktura sta je

motivacija teorije

performanse zapo

uticaj struct na perfo

istraziv

zakljucak

Uvod

The early generation of managers of the classical schooi invented the centralised structure and the
line and staff structure · as a response to increasing oomp-,.lèxi ty of task and size. The period
featured people like Max Weher who presented what he thought was an ideal organisation structure
called a bure~racy •. This was then seen as one of the keys to employee performance and
organisational effectiveness. However, today emerging emperical evidences on organisational
structure tend to be saying that there is no one best way to structure an organisation for
effectivenesso

file:///G:/Master%20rad/m_oyedeji_ganiyu_a-2.pdf

WHY I HAVE CHOSEN THE TOPIC "THE IMPACT OF ORGANISA- ••• - • * TIONAL STRUCTURE ON
EMPLOYEE PERFORMANCE" The problem of.deteriorating employee performance and frequent cases
of business failures has among other reason, being attributed to inappropriate structure of the
organisation concerned. Each generation of managers have tried to find· out how best they could
structure their organisation to achieve desired quantity and quality of output. This is why,new forms
of organisation structure are being'designed, altered, or changed in reep~n.èl!·to problems being
encountered. Organisational structure of a business enterprise is the framework within which
executive decision making CODESRIA - LIBRARY 3 behaviour takes place. It is the organisational' tool
which impose constraints on individual behaviour and r~lationship with other people in the
organisation. Therefore, it is important we study the impact of this important organisational tool on
the performance of an equally important organisational resources - employee. Hence, the topic: "The
Impact of Organisational Structure on Employee Performance".

“People are definitely a company’s greatest asset. It doesn’t make any difference
whether the product is cars or cosmetics. A company is only as good as the
people it keeps.” – Mary Kay Ash
There is no doubt about the fact that the human asset is the key intangible asset for any
organization. In today’s dynamic and continuously changing business world, it is the human assets
and not the fixed or tangible assets that differentiate an organization from its competitors. Today’s
knowledge economy distinguishes one organization from another with the single most important and
powerful factor that is the Human Resources (HR) or Human Assets. Bill Gates pointed out: “What
would Microsoft be worth if it was sold without its collaborators; one dollar? The success or failure of
an organization is largely dependent on the caliber of the people working therein. Without positive
and creative contributions from people, organizations cannot progress and prosper.

Employees leaving an organisation might be replaced physically; however, their skill-sets and
knowledge cannot be exactly replaced by the person replacing them, as each individual possesses a
different skill-set and experience

With one-employer careers most likely gone forever, organizations striving to compete and thrive in
a highly competitive, global economy need all the members of their crew in the boat feeling valued
and rowing in the same direction

During my parent’s generation, people worked for a company for the long haul. Employees were like
an extended part of a family and worked hard to meet employers’ needs. Job security and a regular
paycheck sustained American families for decades.

It’s time for organizations to recognize that valuing employees must come full circle. Their people are
their most valuable asset in securing the future.

WHAT I.S ORGANISATIONAL STRUCTURE? . ' According to Brasa (1981) Organisation is a network of
interrelated task positions which are assigned to

workers to perfèrm. It is formed whenever the pursui t.iiof an objective requires the realisation of a
task that calls for the joint·efforts of two er more indivïduals ( Hax and Magluf, 1984). Rice and
Mitchell (1973) defined structure as a set of elements and their interrelations. Organisati0nal
structure specifies relationships between individuals whioh affect the ways in which organis~ tional
resolll'ees are allocated (Moch• 1976). Mintzberg (1979) held that the structure of·an organisation
canbe defined simply as the sum total of the ways in whieh it divides its labour into distinct tasks and
then aohieves coordination ameng them., Jackson and Margan (1978) even wt!Bt some steps further
when they defined organisational u structure as the relatively enduring allocation of work l"Oles and
administrative mechanisms that creates a pattern of interrelated work activities, and allows the
organisation to conduct, coordinate, and control 1 ts work acti vi tie, Lutha.ns (1985) seems to agree
with Jackson and Morgan (1978) since he also sees Organisation structure as being more than boxes
on a chart. According to him, Organisation structure is a pattern of interactions and coordination that
links the technology, tasks, and human components o:f the organisation to ensure that the
organisation accomplishes its purpose. Koontz et al (1980) however, suggested that an organisation
structure.should be designed to clarify the environment so that everyone knows who is CODESRIA -
LIBRARY - 15 - to do what and who is responsible for what results; to remove obstacles to
performance caused by confusion and uncertainty of assignment; and to furnish a decision .making
communications network reflecting and supporting enterprise objectives. An organisation structure
is effective if it facilitates the contribution of individuals in the attainment of enterprise objectives, It
is said to be efficient if it facilitates accomplishment of objectives by people with the minimum
unsought consequences or costs (Koontz et al, 1980). According to Henri Fayol (1949) the more an
organisation~structure reflecta"the tasks or activities necessary to attain goals and assista in the.ir
co0rdination, and the more roles are designed to fit the capabili~ ties and motivations of people
available to fill them, the more effective and efficient an organisation structure will be.

18 THE CONCEPTUAL MODEL OF ORGANISATIONAL STRUCTURE AND EMPLOYEE PERFORMANCE For

the purpose of this study, a conceptual model of organisational structure and employee performance
is presented in figure 2.1. Employee performance= f (Organisational Structure) See figure 2.1.
CODESRIA - LIBRARY - 43 - Organisational Structure Employee Performance HOD having relevant
Qualification Quality of 1 Formalisation 1 work - 1 Lack of Autonomy l Quality of output 1 Delegation
1 1 Initiative Participation in ... ,, decisions Functional Specifici ty Work with the 1 V~rtical Span 1
Group Happy with Super1 Span of Control 1 vision 1 Authority equals responsibili- Appearance ·. ties
FIGURE 2.1: The Conceptual Madel of Organisational Structure an~ Employee performance.

WHY CENTRALISE OR DECENTRALISE A STRUCTURE? The two reasons variously given in the literature
for cèntralising structures include the lust for power and the need for coordination. CODESRIA -
LIBRARY - 30 - According to Mintzberg (1979) an organisation decentralise simply because all the
decisions cannot be understood atone center, in one brain. Another related reason for
decentralisation is that it allows the organisation to respond quickly to local conditions. And one last
reason for decentralisation is that it is a stimulus for motivation. :.... . •l'i .> • .. • .. - - .. - . . . .. - .. - ..
CHARACTERISTIES OF DECENTRALISED STRUCTURES Dµncan (197·9) stated the following as the
characteristics of decentralised structures. Strenghts 1. Suited to fast change and dynamic growth. 2.
High product, project, or program.visibility and awareness, 3. Fùll-time, objectice task orientation 4.
Task responsibility pinpointed and clearly communicated to customers or clients. 5. Multiple tasks
processed in parallel, easy-to-cross :functional lines 9 CODESRIA - LIBRARY - 31 - WEAKNESSES l.
Tendency for innovation and growth to be restricted 1. to existing project or functional areaso 2.
Difficul ty in aà.locating pooland resourceso 3. Difficulty in coordinating and integrating shared
functions (for example, purchasing). 4. Deterioration of in-depth competence and expertise -
difficulty in attracting technical specialists. 5. Possible internal task conflicts and jurisdictional and
priority conflicts. 6. Possible neglect of high level of coordinational integration required in effective
organisation. ADVANTAGES OF DECENTRALISATION Cole (1990) identified the following as the
advantages of decentralisation. a. It prevents top management overload by freeing them from many
operational decisions and enabling them to concentrate on their strategic responsibilities. b. It
speeds up operational decisions by enabling line units to take local actions without reference back all
the time. CODESRIA - LIBRARY - 32 - c. It enables local management to be flexible in their approach to
decisions in the light of local conditions; and thus be more adaptable in situations of rapid changeo d.
It focuses attention on to important cost and profitcentres within the total organisation, which
sharpens management awareness of cost-effectiveness as welL1as revenue targets. e. It can
contribute to staff motivation by enabling middle and· _junior management to get a taste of
responsibili ty, and by generally en~ouraging the use of initiative by all employees. f. Decentralisation
contributes strongly to morale because employees work in an atmosphere of relative freedom from
oppressive supervision and have a sense of individual importance and personal responsibility which
other types of arrangem~nts often deny them. (Worthy, 1950)~ Rage and Aiken (1967) have also
found that participation in decision making is a better predictor of other structural properties than
hieracrchy of authority. This participation has been defined by Connor (1992) as means by which an
individual who is affected by decisions influences the making of those decisionso CODESRIA - LIBRARY
- 33 - DISADVANTAGES OF DECENTRALISATION The main disadvantages of decentralisation as stated
by Cole (1990) include: ao It requires an adequate control and communication system if major errors
of judgement are to be avoided on the part of operational management. b. It requires treater
coordination by senior management to ensure that individual units in the organisation are not
working against the interests of the whole. c. It can lead to unconsistency of treatment of customers,
clients or public, especially in service industries. d. It may encourage parochial attitudes in subsidiary
units, who maJ be inclined to look more to their own needs than to those of colleagues in the
organisation. e. It does require a plentiful supply of capable and well motivated managers, able to
respond to the increased responsibility which decentralisation brings abouto CODESRIA - LIBRARY -
34 - 2.10 EVOLUTION OF THE ORGANISATIONAL STRUCTURE The pioneer research in this area is due
to Alfred D.Chandler, Jr., a professer of history, who published in 1962 his book strategy and
structure. Chandler (1962) proposed a thesis that structure follows managerial strategy. He obtained
data from four major companies to test this thesis. He observes that the change in structure has
followed the strategic change. The firm's structure has to match the strategy chosen. He believes
that the.implementation of a new strategy in the framework of the old struc~ure produces increasing
wiefficiencies and organisational tensions that eventually lead to the adoption of a new structure.
Chandler concluded that decentralised structure was as a result of management strategy. Each
company eventually evolved int~ a decentralised structure, but for àifferent reasons. 2.11
DEPARTMENTATION According to Koontz et al (1980) the word department designates a distinct
area, division, or branch of an enterprise over which a manager has authority for the performance of
specified activities. Departmentation is concerned with horizontal organisation on any one level of
the hierarchy, and it is closely related to the classical bureacratic principle of spe$ialisation CODESRIA
- LIBRARY .- 35 - (Luthans 1985), There are several types of departmentation: Time, Number,
Function, Geographic, Product, Customers, Market, Process, and services were the recognised bases
for departmentation. All these are refer to as single methods of structuring or departmentation. In
modern organisation, one fiinds the combination of two or more structure due to size and
complexity of the organisation. This mixed structure can come in the form of General Mixed
Structure or Matrix Structure. General Mixed Structure combines any two or more of single structure
while Matrix Structure is a f orm of .,gro_uping used by highly technical and di versifi ed
organisation., It is the combinat:î.on of product and functional grouping. There is no one best way of
departmentizing applicable to all organisations and all situations. Managers must determine what is
'best' by the situation they face~ the jobs to be done and the way they should be done, the people
involved and their personalities, the technology employed in the department, the users being served,
and other internal and external environment factors in the situation (Koontz et al k980). CODESRIA -
LIBRARY - 36 - 2.12 $TEPS IN THE DESIGN OF THE ORGANISATIONAL STRUCTURE Hax and Ma:j:luf
(1984) suggested some steps to be followed in the designing of the organisational struc~ ture. The
first step is the definition of a basic organisational structure. A second step is the definition of a
detailed organisational structure. The design of an organisational structure is completed with the
specification of a balance between the organisational structure chosen and the managerial processes
that go with it: planning, management control, communication and information, and evaluation and
reward. 2.13 FLAT VERSUS TALL STRUCTURES Worthy's study (1950) of Sears Roebuck and Company
was one of the first extensive and a widely accepted empirimal study on the. effect of flat and tall
organisation structure. Worthy maintained, that small organisations had better employee morale and
productivity than large organisations. Internally motivated empl0yees reward themselves for
successful performance (Moch, 1980). According to Worthy, the advantages of small organisations
could be wicorporated into large organisations by using fewer level of administration: that is, a flat
organisational structure with a wide span. of supervision rather than a tall or multilevel organisation
with a very CODESRIA - LIBRARY - 37 - narrow span of supervision. The bread, flat type of
organisational structure,. according to Worthy, made i t possible to do a better job and allowed
individuals to develop and grow in ways that were not possible under the traditional tall
organisational structure. There has been empiri~al evidence that raises reasonable doubts about the
validity of Worthy conclusions. Meltzer and Salter (1962) categorised their questionnaire
respondents by size of company and by number of levels of administr.ation within the organisation.
The result of this study contradicts the negative r:elationship found by Worthy between the number
of organisational levels and productivity. Porter and Lawler §1964) also discovered that a tall
structure was better in producing sec~rity and satisfaction of social needs, while a flat structure was
better for self actualisation. These two studies concluded that there is no simple relationship
between structure and performance and that a flat organisation structure was not equivocally
superior,. to a tall organisation structure. In the laboratory e~periment by Carzo,Jr. and Yanouzas
(1969), it was found that it.all organisation structures were superior on two other measures of
performance: _profits and rate of return on revenues. Apparently, the greater number of levels in
the tall structure pro.- vided :for more frequent evaluation of decisions and better CODESRIA -
LIBRARY - 38 - performance on these two variableso According to Koontz et al (1980), it is difficult to
generalise on wide or narrow spans of management since there are so many underlying variables to
be considered. There are advantages to one and advantages to the other. Users must seek balance,
or compromise, to obtain the.best total results in the light of the realities of a given situation. 2.14
DELEGATION Delegation is the process by which an individual manager or superviser transfers part of
his legitimate authority to a subordinate but without passing on the ul timate responsi bili ty which
has been entrua.ted to him by his own superior (Cole, 1990). Cole (1990) stated the following
practical reasons for delegation: a. Senior managers can be relieved of less important or less
immediate résponsibilities in order to concentrate on more strategic duties. b. Delegation enables
decisions to be taken nearer to the point of impact and without delays caused by reference upwards.
c. Delegation gives managers the opportunity to experi ence decision-making and to live wi th the _,
-.. , CODESRIA - LIBRARY ·. ,·,.·' . - 39 - consequences of it. d. Delegation enables organisations to meet
changing conditions more flexibly at the boundaries of their system. 2.15 SPAN OF CONTROL Span of
control refers to the number of employees reporting directly to one pers9n. According to Fayel
(1949), Hamilton (1921)·and Urwick (1956), man's available energy knowledge, time and abilities are
confined to narrow limits, he is unable to supervise the work of more than a few subordinates
successfully. Various writers have attempted to define an ideal span of control on the basis of
observation and authoritative judgement (Hamilton, 1921; Urwick, 1956) mathematical analysis of
group relations (Graicunas, 1947) and psychological limits of attention (Miller, 1956). These writers
suggested between three and eight subordinates as the ideal span at the executi ve level of an
organisationo Among the cri tics of these writers are Simon, 1957; and Suojanen, 1955 who argued
that the span suggested was based on insufficient evidence. Worthy 1950 also held that the
suggested span was much too CODESRIA - LIBRARY ', J, - 40 - narrow. He explained that such span of
control will result in tall organisation structure with all its likely problems. Udell (1967) found
considerable support for the hypothesis that certain underlying variables influence the span of
control. The span of control or the number of employees reporting directly to one persan can vary
considerably between one organisation or unit and another. The most significant factors that affect
the span include: the policy of top management towards the relative shape of the organisation (flat
or tall?), the degree of complexity of the work, and the capabilities of the management concerned.
Other factors relate to issues such as cost, hazard and geographical location (Cole, 1990).

INTRODUCTION
An organization is a goal directed social entity with deliberate process and systems. In other 
words, an organization is a collection of people working together to accomplish a common 
goal. Top management determines what that  goals and sets the strategic direction for the 
organization by defining its purpose, establishing  goals to meet that purpose, and 
formulating strategies to achieve the goals. The definition of its purpose gives the 
organization reason to exist, in effect, it answers what business are they in. This topic will 
explore the structure of organizations.  OBJECTIVES
Upon completion of this topic you will be able to:  1. Describe different organizational structures.  2.
Explain the characteristic of a formal structure.  ORGANIZATION STRUCTURE
An organizational structure defines the form and function of the organization’s activities.  It 
parallels the workflow to produce the products or deliver the services.  It also defines how 
the different parts of an organization fit together as it is evident from an organizational 
chart.  The organizational structure also reflects the formal framework by which job tasks 
are divided, grouped, and co‐ordinated.  
A formal organizational structure helps define the management structure and coordinate 
the actions of employees to achieve organizational goals.  It is the framework by which 
people can accomplish more by working together than they do separately. The work must 
be coordinated if the potential gains of collective effort are to be realized. 
As illustrated below most organizations have six common characteristics. 
Characteristics of an Organization  Now let’s explore each characteristic.  Page | 92 
Insert Course Title   Formalization 
Formalization refers to the degree to which jobs within the organization are standardized 
and the extent to which employee behaviour is guided by rules and procedures. If a job is 
highly formalized, then the person doing that job has a minimum amount of discretion over 
what is to be done, when it's to be done, and how he or she could do it. Employees can be 
expected to handle the same input in exactly the same way, resulting in consistent and 
uniform output. In organizations with high formalization, there are explicit job descriptions, 
numerous organizational rules, and clearly defined procedures covering work processes. 
Where formalization is low, job behaviours are relatively unstructured and employees have 
a great deal of freedom in how they do their work. Because an individual's discretion on the 
job is inversely related to the amount of behaviour in that job that is preprogrammed by 
the organization, the greater the standardization, the less input the employee has into how 
work is done. Standardization not only eliminates the possibility that employees will engage 
in alternative behaviours, it even removes the need for employees to consider alternatives. 
The degree of formalization can vary widely between organizations and even within 
organizations. For instance, at a newspaper publisher, news reporters often have a great 
deal of discretion in their jobs. 
They may pick their news topic, find their own stories, research them the way they want, 
and write them up, usually within minimal guidelines. On the other hand, the compositors 
and typesetters who lay out the newspaper pages don't have that type of freedom. They 
have constraints—both time and space—that standardize how they do their work.  Span of Control 
How many employees can a manager efficiently and effectively manage? This question of 
span of control is important because, to a large degree, it determines the number of levels 
and managers an organization has. All things being equal, the wider the span of control the 
more efficient the organization. An example can show why. 
Assume that we have two organizations, both of which have approximately 4,100 
employees. If the average manager made $42,000 a year, the organization with the wider 
span would save over $33 million a year in management salaries alone!  Obviously, wider 
spans are more efficient in terms of cost. 
However, at some point, wider spans of control reduce effectiveness.  That is, when the 
span becomes too large, employee performance suffers because managers no longer have 
the time to provide the necessary leadership and support. The contemporary view of span 
of control recognizes that many factors influence the appropriate number of employees 
that a manager can efficiently and effectively manage. These factors encompass the skills 
and abilities of the manager and the employees and characteristics of the work being done. 
For instance, the more training and experience employees have, the less direct supervision 
Organizational Behaviour   Page | 93 they'll need. Therefore, managers with well‐
trained and experienced employees can  function quite well with a wider span 
Span of control or span of management is a dimension of organizational design measured 
by the number of subordinates that report directly to a given manager. This concept affects 
organization design in a variety of ways, including speed of communication flow, employee 
motivation, reporting relationships, and administrative overhead. Span of management has 
been part of the historical discussion regarding the most appropriate design and structure 
of organizations. 
A small, or narrow, span of control results in each manager supervising a small number of 
employees, while a wide span of management occurs when more subordinates report 
directly to a given manager. A small span of management would make it necessary to have 
more managers and more layers of management to oversee the same number of operative 
employees than would be necessary for an organization using a wider span of 
management. The narrower span of management would result in more layers of 
management and slower communications between lower level employees and top level 
managers of the firm. Recent moves to downsize organizations and to eliminate 
unnecessary positions has resulted in many organizations moving to wider spans of 
management and the elimination of layers of middle‐level managers. 
Centralization and Decentralization 
Centralization is the concentration of authority and responsibility for decision making into 
few senior managers at the top of an organization’s hierarchy (the degree to which decision 
making is concentrated at a single point in the organization) 
Decentralization is the distribution of authority and responsibility for decision making to 
managers at all levels of an organization’s hierarchy (decision discretion is pushed down to  lower ‐
level employees).  Both forms of control have advantages and disadvantages.  CENTRALIZATION 
DECENTRALIZATION  Environment is stable  Environment is complex and uncertain 
Lower level managers are not as capable or     experienced at making decisions as upper 
level managers.  Lower level managers are capable and  experienced at making decisions. 
Lower level managers do not want to have  a say in making decisions. 
Lower level managers want a say in  decision making.  Decisions are significant.                                    
Decisions are relatively minor.  Company is large.  Company is geographically dispersed. 
Effective implementation of strategies  depends on managers retaining say over  what happens. 
Effective implementation of strategies  depends on managers having involvement 
and flexibility to make decisions.  Page | 94  Insert Course Title   Chain of Command 
A chain of command, sometimes called the scalar chain, is the formal line of authority, 
communication, and responsibility within an organization. The chain of command is usually 
depicted on an organizational chart, which  identifies the superior and subordinate 
relationships in the organizational structure.  According to classical organization theory the 
organizational chart allows one to visualize the  lines of authority and communication within an 
organizational structure and ensures clear  assignment of duties and responsibilities. By 
utilizing the chain of command, and its visible  authority relationships, the principle of unity of 
command is maintained.  Unity of command  means that each subordinate reports to one 
and only one superior.  ORGANIZATIONAL STRUCTURES
Organizations can be divided into two types:  Mechanistic and Organic.  The table below 
describes the characteristics of each type.  Table – Basis of an Organizational Structure  Mechanistic
Structures Organic Structures  Division of Labour  Horizontal/Vertical Differentiation  Clear Chain
of Command  Narrow Span of Control  Relatively Centralized  Direct Supervision  Cross-
Functional Teams  Personal/Spatial Differentiation  Multiple Chains of Command  Wide Spans of
Control  Relatively Decentralized  Self-Managed
Every effective organization has an identifiable structure based on the characteristics 
described above.  Other factors that impact an organizational structure includes:  
Size of the company.   The type and variety of products and/or services provided by the company.  
The need for specialization to build the products or provide the services.  
The geographic dispersion of the organization.    The management style within the company.  
The need for communications.  TYPES OF ORGANIZATIONAL STRUCTURES Organizational Behaviour  
Page | 95 There are a number of different ways to structure new or existing organizations.  The four 
most common methods include: Functional, Divisional, Matrix, Virtual or some combination 
of the four.  Let’s examine how a potential distance education business may structure its  company.   
Functional Structure – organizes the departments based on the work that they actually 
perform.  Each department manager has specific responsibilities to perform that represent 
a small part of the business.  Each manager must collaborate with other departments to 
produce the products or services manufactured by the company.  In functional 
organizations management is hierarchical and most of the key decisions are made by the 
senior managers.  Budgets are centrally controlled and work is usually allocated to each 
department based on an annual work plan or sales projection. 
Divisional Structure – ensures that each work unit has all of the necessary resources, 
budget and personnel required to produce the product or provide the services they are 
mandated to create.   They  often work as independent  units that do not need the 
support of others within the  company.  In a divisional set‐ up the managers of each 
division often have their own  budget, their own marketing  targets and their own work 
processes.  They are  measured based on the  success of achieving their  annual business goals.  Each 
division services a specific  market sector or  concentrates on the provision  of a line of products or 
services.    Page | 96  Insert Course Title  
Matrix Structure – is a mix of a functional organization and project teams or business teams 
that are formed at different times of the year to complete specific tasks.  Department 
managers are responsible for hiring, training, professional development and work 
assignments of their department employees.  When assigned to a matrix team, the project 
manager oversees the day to day work of each team member supporting his or her project.  
Once the work has been completed by the team member the employee returns to his or 
her department for additional tasks or assignments.
Virtual Structure – With the universal availability of the Internet and the globalization of 
work more and more organizations are structuring themselves as a virtual entity.  This may 
require the creation of one of the more traditional business structures described above, but 
the work is completed by employees or contractors who are not physically working in the 
same location.  This type of structure requires effective online project management, work 
flow, communications and a well‐defined reporting infrastructure.  In addition teleworkers 
require online tools and an online collaborative work environment to produce the products 
or deliver the services to the clients.  This approach is being used more and more by 
distance education companies who use a variety of telecommuniting techniques and 
employ a mix of full‐time employees and part‐time contractors.    But even in a virtual 
structure there may be a need for some form of physical location in which the 
administrative and support services are provided to the virtual employees/contractors and 
their clients.  Organizational Behaviour   Page | 97
One or more of these structuring options can be used to establish a distance education 
business.  As the business grows there may be a need to modify the structure and embrace 
a different organizational model that reflects the size and growth of the company.  For 
example a DE consulting company may start out as a virtual matrix company with different 
expertise provided by different consultants geographically dispersed.  But as the consulting 
grows they may find that the need to concentrate on specific industry sectors such as 
higher education, the military and K to 12.  Since each of these industry sectors have unique 
needs the board of directors may decide to re‐engineer the company into separate 
divisions with their own budgets and their consulting pool  SUMMARY
An organizational structure must be tailored in a way that ensures the business goals can be 
met.  As an organization matures it may be necessary to modify the organizational 
structure.  It may even require the senior management team to embrace multiple 
organizational methods.  For example a company that grows from a single corporate site to 
an organization with multiple work locations across the country may want to embrace both 
a matrix structure and a virtual structure.  Success of your business requires that you 
structure be flexible so that you can meet the needs of your current and future customers 
and supports higher productivity and product quality.      Page | 98  Insert Course Title   TOPIC 4.2 –
WORKPLACE AND JOB DESIGN INTRODUCTION
Job design is the process by which managers plan and specify job tasks and the work 
arrangements through which they are accompl

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CONCLUSION The following constitutes the findings of this study. There was a finding that when the
head of department has qualification relating to their subordinate'...s job, the employees will be
conscious of quality in their_ job,even when they operate in an organisation with different
structures. Ic was found that employee working in an .organisation with flat structure will not stop
using his initiative on the job even where any decision he makes is subject to superior officer's
approval. Found also was that this will not be the case for employee in an organisation with
tall~structure. The study has also confirmed that when -~ .·::." employees are clearly informed of
their duties in written they will put in more effort to inccease output, differences in structure
notwithstanding. The study revealed that ernployee working in an organisation wi th., tall structure
will perform better when working in group if allowed to participate in decisions affecting CODESRIA -
LIBRARY - 141 - their department. Uml.:.erstaf.fing was found to have effect on the quantity of
output of employees in an organisation with either tall or flat structure. Also found was the positive
relationship between participation in decisions and job satisfaction of employee, different structure
notwithstanding. Employees in any forrn of structural set up will use their initiative on the job when
given :~ the authortty that equals the assigned responsibilities. Having opportunity to interact with
co-workèr~ in Wt~ an organisationAflat structure was found to result in increase in output. The study
revealed that when ernployees are clearly informed of duties in written, they will be commited to
their job,even when they work in an organisation wi.th different structure. The study also found that
ernployees will be quali ty conscious when ,··-the· struè.,.;--_ ture of the organisation gives
opportunity for the use of initiative on the job. However, assignment bf tasks to subordinate was
found to be negatively related to the use of initiative by the employees, in both companies. The
study further revealed that when every member of stalff.f has a specific job schedule, they will be
conscious of quality in their job, different structure of organisations notwithstanding. It was also
found that age of employee is positively related to the level of his job satisfaction in an organisation
with flat structure. Years spent in the company by the ernployee was found not to guarantee
employees participation, in decisions affecting the department in bath companies. The study also
revealed that CODESRIA - LIBRARY - 142 - no rnatter what the age of ernployee, superior officer's
approval is essential for any decision ma:4e by employee in bath companies. In the extract of open-
ended questions, the problems identified were grouped into ~nine. These are Weak structure,
Inadequate Service Condition, Management problem, Workers Negligence, Poor interpersonal
relationship, economic·problems, the Nigerian factor, communication gap and shortage of resources.
The respondents however proffered some solutions which i nclude, the call for the· .. dvèduction in
the nutYtber of subordinates attached to each superior in an organisation with wi~e span, proper
definition of responsibiliti2s, cte..o.r eut structural arrangement and location of the administrative
office in the front of the factory. Other solutions suggested are efficient and effective management,
sense of total commitment by workers, cordial interpersonal relationship, stable government
regulations, equal treatrnent to all, effective communication, and adequate resources. Of particular
importance was the finding that the need for adequate service condition for employees eut across all
structural arrangements. 5. 3 Ill'IrLICATION :B'OR '.l1HE MANAGEMENT OF COMPANY A AND
COM1''ANY B! The findings in this research study have implications for manag~rnent in both
cornpanies. Management in both corn- ··, CODESRIA - LIBRARY - 143 - panies should pro~id~
their~ètaff with a specific job schedule. This will make ti1e employees to be conscious of guality in
their job. The management can also assist the employees to be commited to their job by getting
theN'\· informed of th~"'ir dtïl;ies in writfn.:9. IJ.'hat is to r~a;y, each employee should be ade9uatel;y
in.f-orrned of what is expected of him. Quality consciousness can also be built . ,. into the ernployees
by providing them, the opportunity to use initiative on their job, ManaGement in an organisa~ion
with a flat structur~can increase the level of output of their employees by creating an environment
that allows the emplo;yees to interact. Job satisfacti.on of ernplo;yee,, is r;uarantee

Rachmayanthy, (2017) there is a positive and significant effect between organizational structure and
employee performance. And the indirect effect between organizational structure on performance
through job satisfaction. Based on these findings, it can be concluded that any changes or variations
that occur in performance are directly affected by job satisfaction, and indirectly have a significant
effect on organizational structure. Eynali, Golshahi, Yazdi, & Rahimi, (2014).

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Conceptualization of organizational structure is a manifestation of the systematic thinking of

organizations that consists of several elements in which there is a relationship between the elements
in an organization so that it composes a unit (Ali et al., 2016). Structure is a high combination of
relationships between organizational elements that form the philosophy of existence of
organizational activities, the systematic view of the organization towards structure shows that the
organizational structure consists of several people with their duties and responsibilities (Ali et al.,
2016). The literature review looks at structural relationships from various aspects, organizational
structure is the method by which organizational activities are shared, regulated and coordinated (Ali
et al., 2016). The organizational structure has a strong influence on company performance and
employee performance where the factors or dimensions of the organizational structure (Job
Complexity, Job Formality, and Job Centralization) have a positive and significant effect on employee
effectiveness and indirectly influence on company performance, (Wahudi, 2017

Organization structure displays the system of task and authority relationship that control how
employees use resources to achieve the organizational goals. The evidence generally indicates that
work specialization contributes to higher employee productivity but at the price of reduced job
satisfaction (Robinson, 2000). Some organization structure is necessary to make possible the
effective performance of key activities and to support the efforts of staff (Griffin, 1996). The structure
of an organization affects not only the productivity and the efficiency of the economy but also the
morale and job satisfaction of the work force. Therefore the Structure should be designed in such a
way to encourage the willing participation of members of the organization and effective
organizational performance (Mullins, 1999). According to Drucker (1989) a good organization
structure does not by itself produce good performance. But a poor organization structure makes
good performance impossible, no matter how good the individual manager may be. Improved
organization structure will therefore always improve performance. Argyris C. (1964) claims that the
formal bureaucratic organization restricts individual growth, self-fulfillment and, the psychological
health of a person, causes a feeling of failure, frustration, and conflict. Argyris argues that the
organization should provide a more “authentic” relationship for its members. Ford demonstrated
that work can be performed more efficiently if employees are allowed to specialize (Robinsion,
2000). According to Stephen Robinson (1989), it may be claimed that the extent to which an
organization structure reduces ambiguity for an employee and clarifies problems such as “What am I
supposed to do”?, “How am I supposed to do it”, “Whom do I report to”, “Whom I go to if I have a
problem?”, shapes their attitudes and facilitates and motivates employees to higher levels of
performance. It is difficult to assert categorically the positive effect of organization structure on
performance. This is so because there are conflicting findings about the relationship between
structural variables like span of control, subunit size, specialization, centralization vs. decentralization
and employee performance. Some studies have found positive effects and some have found negative
effects (K. Aswathappa, 2000). (Stephen P. Robbins, 2000) has indicted that strategy, size,
technology, and environment determine the type of structure an organization will have. Here, the
structure is designed around one of the two models: mechanistic or organic. The specific effects of
structure designs on performance and satisfaction are moderated by employees’ individual
preferences and culture norms. Based on these arguments, the second hypothesis for the study is as
follows;

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Every organization has some goals to achieve and these goals can be achieved only by combined
efforts of various resources, this includes division of work and grouping of numerous activities
performed in an organization, according to the required need and specialization. To attain these
goals it is important for an organization to have a proper organizational structure. In order to achieve
maximum performance organizational structure has to be appropriate and matched with the rate of
change in the environment (Burns and Stalker, 1961). Organizational structure is defined as “the
establishment of authority relationships with provision for coordination between them, both
vertically and horizontally in the enterprise structure” (Koontz, 1994). Modern organization design
draws on ideas from many fields to make functioning more effective and dynamic to blend individual
and organizational solutions together into a cohesive whole. New designs focus on adaptability. They
rely highly on employee involvement, distribute authority based on skill and have fewer rules and
boundaries, resulting in a more organic structure

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HYPOTHESIS & MODEL DEVELOPMENT Prior research has demonstrated the positive effect of task
characteristics on employee affective outcomes such as job motivation, job satisfaction (Hackman
and Lawler, 1971; Hackman, Oldham, & Pearce, 1976), and job performance (Folami, 1999). The
findings of these studies have been criticized because they ignore surrounding job context variables
and their possible impact on the dependent variables. These criticisms may be legitimate given that
there are several factors other than task characteristics that affect job performance. In Figure 1
below, we propose an integrated job context model which includes several of these omitted
variables. Figure 1: Integrated Job Context Model As shown in Figure 1 above, factors other than task
characteristics that may impact performance include individual, economic, and organizational
context variables. Individual factors that may affect performance include ambition, education, ability,
professional experience, and occupational level. Employees that are ambitious and are highly
motivated are more likely to do better on the job. Employee growth need strength (GNS) has been
used to proxy for ambition and individual differences between employees. Prior research provides
support for GNS as Individual Factors 1. Ambition (GNS) 2. Education 3. Abilities 4. Job Experience 5.
Job Level (Mgt vs. Non-mgt) Economic Factors 1. Compensation Package 2. Opportunity Cost 3. Risk –
Reward Factor Task Characteristics 1. Task Variety 2. Task Identity 3. Task Significance 4. Task
Autonomy 5. Task Feedback Job Performance 1. Planning 2. Managing and Supervising 3. Efficiency 4.
Effectiveness 5. Meeting Deadlines 6. Quality of Decision-Making Employee Affective Outcomes 1.
Job Motivation 2. Job Satisfaction 3. Organizational Commitment 4. Organizational Citizenship
Behavior Organizational Context 1. Organizational Structure 2. Organizational Inflexibility 3. Office /
Job Environment 4. Job Uncertainty 5. Environmental Uncertainty Journal of Business & Economics
Research – July 2005 Volume 3, Number 7 28 mediating the relationship between job characteristics
and affective outcomes (Hackman & Lawler, 1971; Hackman & Oldham, 1976; Hackman, Oldham,
and Pearce, 1976). Individual differences are used in the task characteristic model to capture how
employee motivation can be enhanced through the design of jobs. According to theory, workers who
desire higher order need satisfactions are more likely to obtain satisfaction when they work on jobs
that are meaningful and that provide feedback on the adequacy of their personal work activities
(Hackman & Lawler, 1971). In this study, GNS is used to proxy and control for ambition and individual
differences between employees. Employees with advance degrees or Certified Public Accountant
certificates (CPA) in a public accounting firm may be expected to do a better job than their counter
parts that do not have an advance degree or a CPA. Professionals in public accounting do a variety of
different tasks in a variety of industries. As such, the ability for learning can play a critical role in their
job performance. Job tenure is another factor that may impact performance. Professionals who have
been with a firm longer or those that have more tenure with the accounting profession may be more
likely to do a better job than their counterparts with lesser experience. Economic factors that may
impact performance include compensation and opportunity cost. Employees that perceive
themselves as being well compensated are more likely to strive to do better on their jobs.
Compensation could be a combination of salary, benefits, and opportunities for future advancement.
Employees working in public accounting build an intellectual capital base that may translate to better
prospects for future employment. Available opportunities for this intellectual capital may affect the
motivation of employees on their job. If the opportunity cost for future employment is high,
employees will be motivated to do better on the job. Organizational context factors that affect job
performance include organization structure variables (centralization, formalization, complexity, and
organizational inflexibility), job environment, job uncertainty, and environmental uncertainty. Folami
(1999) documents differences in the organizational structure of the former big five accounting firms.
Other research has examined the relationship between perceived environmental uncertainty and
organizational structure (Gordon and Narayanan 1984), compensation contract design (Kren and Kerr
1993), employee motivation, performance, and job satisfaction (Gul and Chia 1994; Anderson and
Kida 1985; Ferris 1977, 1982). Given the differences in the organizational structure of accounting
firms (Folami 1999; Kinney 1986), and the importance of perceived environmental uncertainty to
research, the limitation of the job design literature in ignoring job context is a serious one. An
important research question is whether the effect and magnitude of task characteristics on employee
affective outcomes persist in the presence of organizational context variables. The present study
extends prior research by examining the joint impact of task characteristics and organizational
context variables on job performance. Data limitation does not allow us to test the theoretical
integrated job context model presented in Figure 1. Thus, in the model presented in Figure 2 below,
we test a subset of the integrated job context model introduced in Figure 1. Figure 2: Task
Characteristics Model With Organizational Context Variables Task Characteristics Growth Needs
Strength Organizational Inflexibility Job Performance Perceived Environmental Uncertainty P4 P3 P2
P1 Journal of Business & Economics Research – July 2005 Volume 3, Number 7 29 Individual factor is
proxy for with growth needs strength. The study used two variables to proxy for organizational
context. Internal organizational context is proxy for with organizational inflexibility, external context
is proxy for with perceived environmental uncertainty, and task characteristics are proxy with task
autonomy, task significance, and task feedback. The research question relates to whether there is a
joint effect of task characteristics and contextual variables on job performance. Thus, the null
hypothesis is: Ho: There is no joint effect of task characteristics with either organizational inflexibility
or perceived environmental uncertainty on job performance. If the results support the null
hypothesis, it would provide justification for prior research that ignores the effect of organization
context in the study of job design. However, if the null hypothesis is rejected, future research and
human resource professionals should consider the effect of organizational context variables in their
design and interpretations of studies on task characteristics.
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The organizational structure is one of the key factors that affect job performance. This can influence
the job performance by its ability in managing people who are in the organization. Organizational
structure organizes the division arrangements of employees and also the patterns of coordination,
communication, work flow, and formal power that directs organizational activities. Good
organizational structure will be able to improve job performance. Based on that idea, it is expected
that organizational structure influences job performance. Hypothesis 2: There is a direct effect of the
organizational structure on the job performance

Indirect Effect of Organizational Structure on Performance through Trust The organizational structure
also play a role in improving job performance. With the effective organizational structure, it is
expected to increase the trust of organization’s members for performing well. Organizational
structure which is appropriate to the needs of the organization and in accordance with the
capabilities and expertise of members of the organization will increase the trust of the organization’s
members to the organization itself. Trust can be improving the job performance of organization’s
members during the working process. Good organizational structure indirectly improves the job
performance of organization’s members to work through the increase of their trust during
conducting the working process. Based on that thought, this is expected that organizational structure
indirectly effects the job performance through the trust. Hypothesis 6: There is an indirect effect of
the organizational structure on the job performance through the trust

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TALL AND FLAT ORGANIZATIONAL STRUCTURE The structure of business organizations can be
described as either tall or flat, which refers to the levels of management in the organization's
hierarchy and the corresponding distance between front-line or entry-level employees and top
management. Whether a business has a tall or a flat structure can have important impacts on a
variety of elements within the organizational culture. The difference between tall and flat
organizational structures is the layers of management. In a flat organizational structure, there may be
just one top manager who is an owner or CEO of the company, overseeing a handful of other
employees, all with equal levels of authority. In a tall organizational structure, by contrast, there are
multiple layers of authority between the CEO and lowlevel employees. For example, an entry-level
employee may report to a supervisor, who reports to a manager, who reports to a director, who
reports to a vice president, who, finally, reports to top management. FLAT ORGANISATIONS Flat
organisations relatively have few layers or just one layer of management. This means that the “Chain
of Command” from top to bottom is short and the “span of control is wide”. Span of control refers to
the number of employees that each manager is responsible for. If a manager has lots of employees
reporting to them, their span of control is said to be wide. A manager with a small number of direct
reports has a narrow span of control. Due to the small number of management layers, flat
organisations are often small organisations and have following characteristics: • Decentralized
Management Approach • Few levels of Management • Horizontal career path that cross functions •
Broadly defined jobs • General job descriptions • Flexible boundaries between jobs and units •
Emphasis on teams • Strong focus on the customer SIGNIFICANCE OF FLATTER ORGANIZATIONAL
STRUCTURE In large organizations, traditional organizational structure is basically used but due to
many levels of management between top-level and baseline staff, decision making have to go
through these process, leaving front-line staffs to answer the delay to customers which decrease
productivity. While the flat organizational structure has less middle management, allows the whole
organization work with ease and less resistance. This increase the productivity of organization as well
as using a flat structure can decrease the budget by cutting the middles men cost and decrease the
communication barriers (Borkar, 2010). Organization that analyzes function of middle managers can
allocate necessary tasks to other members by giving lower level staffs more responsibility or
assigning some duties to upper management. Beside these there are lots of activities which are
actually a burden on organization can be eliminated by eliminating middle managers (Strinfellow,
2010). MAJOR ADVANTAGEOUS FEATURES OF FLAT ORGANIZATIONS Organizational structure is a
formal outline of the managerial reporting relationships inside a company. Tall European Journal of
Business and Management www.iiste.org ISSN 2222-1905 (Paper) ISSN 2222-2839 (Online) Vol.6,
No.36, 2014 59 organizational structures feature numerous layers of management, cascading from
the executive level all the way down to front-line management. Flat organizational structures feature
less layers of management. In flat organizational structures, employees are empowered and
expected to take responsibility for a range of traditionally managerial decisions in their daily routines.
The management structure of an organization affects how individuals within a company make
decisions and how quickly the company reacts to various challenges and opportunities. A flat
organizational structure, in which the number of managers at various levels is few from top to
bottom, is regularly seen in smaller companies. Larger companies with larger employee populations
face additional challenges not faced by small businesses. As they grow, small companies face the
question of whether to retain a flat management structure or add levels of management as they add
employees. In flat organizational structure, vertical boundaries are removed to flatten the hierarchy,
and horizontal boundaries are removed in order both to replace functional departments with cross-
functional teams and to organize activities around processes. When fully operational, boundary-less
organizations remove the barrier of geographic distance from external constituencies. Such
organizations are thus characterized by: Employee Motivation Employee motivation is a key factor in
any organizational structure. While employees in a flat organization may feel as though they have
more direct influence on the company, they may also feel as though they have no room for
advancement. On the other hand, employees at a tall organization have many layers through which
to advance their careers, but may become frustrated at their relative lack of influence at lower levels
within the company. Organizational Complexity Generally, the more complex an organization
becomes, the taller the organization must be. An employee in a small organization may be able to
handle all the company's marketing duties; however, as the organization grows, that employee may
need subordinates to whom he can delegate certain tasks. Additionally, top managers can generally
be much more effective if they have a handful of upper-level managers reporting to them, as
opposed to dozens or more of lower-level employees. Organizational Flexibility Organizations with
fewer levels between managers and employees can more easily implement strategic management
plans, take action steps for short-term goals and take action on policy and procedural changes. By
acting on a level closer to front-line employees, managers can monitor progress toward goals and
objectives as well as receive more immediate feedback regarding the feasibility of a specific action
plan. One advantage a flat organizational structure has over a tall one is the level of flexibility.
Decisions can often be made and carried out more quickly in flat structures because there are few
layers of communication between the employees doing the work and those making the decisions.
Therefore, directives and feedback can be communicated more quickly to allow for necessary
changes. Influence over Power By far one of the key difference between two styles of running
organization is how not to dictate decisions but influence decisions in the right directions with
involvement from everyone, adjusting direction for better based on the views from all stakeholders.
In most flat organizations, you will find roles and people as influencers as oppose to powerhouses
and corner offices. Discussions before decisions Decisions are usually not taken in some corner office.
There are lots of discussions happening all around on various topics before reaching to decisions.
Approachability over Unreachability Leaders are usually very approachable in flat organizations. If
physical presence is not feasible all the time, there are leaders available over emails, chats, town hall
meetings and other such mechanisms to ensure approachability. Collective Ownership over
Autocracy Not making decisions is not a choice but usually, decisions are made collectively where
everyone gets a chance to express their views and opinions. Collective ownership does not mean
democracy. Accountability towards a Team than an Individual or a Role Even though reporting
structure might be fuzzy at best, ownership driven teams find themselves accountable to entire team
and not to an individual or to a particular role. Better Communication Smaller companies with flat
organizational structures can more easily communicate with employees at all levels. By sheer
volume, larger companies face challenges in communicating consistent and accurate information.
Flat organizational structures remove barriers between top-level managers and front-line employees.
Communications flow across the organization instead of from the top down. Another aspect of this
management structure is that Informal communications and honest critiques occur between peers
more easily than from managers to subordinates. Growing organizations that maintain or adopt a flat
organizational structure can better European Journal of Business and Management www.iiste.org
ISSN 2222-1905 (Paper) ISSN 2222-2839 (Online) Vol.6, No.36, 2014 60 maintain formal as well as
informal communications and receive more immediate feedback. Organizational Response Large
organizations with many management levels may not cede responsibility to lower-level managers to
make strategic decisions or even decisions directly affecting customer service at lower levels. Flat
management structures allow lower-level managers more latitude to make strategic decisions,
implement action plans and communicate these changes to front-line employees. This
empowerment can decrease the time it takes to react to new opportunities or business threats.
Shared Organizational Goals Large organizations may be able to effectively communicate
organizational goals, but due to lack of communication between top level management and lower
level employees, the shared benefit of reaching those goals may not be understood. Flat
organizational structures include lower-level managers in the goal-setting process and empower
them to help the company reach those goals. This shared process can foster community and create
shared organizational goals (Tim Burris). Adaptability Employees and work groups in flat
organizations tend to be more adaptable in changing or unique circumstances, due to their smaller
hierarchies and lack of bureaucracy. When front-line employees are empowered to handle customer
complaints without management approval, for example, complaint resolution can progress more
efficiently, boosting customer satisfaction. Work groups assigned to unique projects, for example,
can often craft their own unique operational processes in flat organizations, without seeking the
approval of upper management. Collaboration Open communication and collaboration are
encouraged in companies with flat organizational structures. Since more employees are on a level
playing field, more responsibility is placed upon each individual, creating a situation where
innovative, collaborative self-starters excel and passive followers lag behind. As an added bonus,
organizations with a flat structure can attract the type of employees who are encouraged by a work
structure that requires self-motivation and teamwork. Innovation and Creativity Ideas come from a
wider range of sources in a flat organizational structure than in companies with many layers of
management. By giving everyone in a company an equal voice in submitting new ideas and feedback
on operational processes, products, services, business models and company policies, companies can
discover new ideas that may lead to competitive success. Communication Since the chain of
command in a flat organization is small or even only one layer, communication is often faster and
more effective. Direct input and control of business operations means that staff is less likely to
disagree and fight in secret; they can debate their points of view in public. However, workers may
end up with more than one boss and their functions can become confused with those of another
worker or department. Decision Making and Authority Fewer levels of management mean less
gerontocracy and more flexibility in decision making. However, it also means that more underlings
are reporting to a single manager, which leads to confusion about the chain of command. When the
staff can make decisions quickly, they keep customers happy instead of forcing them to wait while
they hunt down a manager. When all the subordinates are reporting to a single (or few) chief
executives, it's hard for the execs to be team leaders and keep their employees organized and
productive. Finally, most of the subordinates suspect that peers are pulling strings behind the scenes
and have more of the chief executive's attention than they do. Growth Flat organization is most
effective in small organizations or when used for small sections of larger organizations. For small
businesses, giving staff the authority to make quick decisions leads to better customer interaction
and increased flexibility. Those same qualities become counterproductive in large organizations
because the offices are too different and have trouble meshing. The "Business Plan" explains, “There
have been instances where customers were given a discount on an item in one store, but not in the
same store in a different location. This does not promote good customer relations.” Morale Flat
organizations rely on highly trained employees who have a voice in decisions. The idea is that when
employees feel that they have power and are responsible for company operations and progress, they
work harder since they have a personal interest in seeing the firm succeed. CONSTRAINTS OF
TRADITIONAL ORGANIZATIONAL STRUCTURES Hierarchical organizational structure is common in
private and public sector organizations, both large and small. Department heads and business unit
managers report to vice presidents and general managers, who report to the European Journal of
Business and Management www.iiste.org ISSN 2222-1905 (Paper) ISSN 2222-2839 (Online) Vol.6,
No.36, 2014 61 president. Small businesses usually have fewer management layers than large
organizations. Although a hierarchical structure can coordinate the actions of thousands of
employees, it has certain weaknesses. Inflexibility Hierarchical structures are often inflexible. In a
May 2011 "Harvard Business Review" article, Harvard Business School professor John Kotter suggests
that hierarchical organizations inhibit timely transformations, which are essential if a business is to
survive in a rapidly changing environment. He suggests that hierarchies work for standardized
processes but they are not useful in dynamic environments. They are slow to react to new
opportunities, which often require transformative change. Slow Decision-making Decision-making is
usually slower in hierarchical structures because responsibility and authority are concentrated in a
few people at the top. In a September 2000 interview with Harvard Business School Working
Knowledge, retired Harley-Davidson CEO Rich Teerlink said that the structure of an organization has a
significant influence on employee behavior. The hierarchical system places limits on the
responsibility and authority of individual employees, which reduces an organization's ability to adapt
to dynamic business conditions. Teerlink wanted to give people more responsibility and authority,
which meant that he had to reduce the hierarchy. He suggests that although a command-and-control
hierarchical system might work well in a crisis, it is of limited help after the crisis is over. Resistance
to Creativity Hierarchical systems can stifle creativity and innovation. The top-down decision-making
structure means that business units are unable to respond rapidly to competitive threats. PROCESS
OF CONVERSION OF VERTICAL ORGANISATIONAL STRUCTURE INTO FLAT ORGANISATIONAL
STRUCTURE Conversion of vertical organisational structure into a flat structure presents various
challenges to managers and business owners which can be overcome by proper planning and
guidance. Following steps can be taken for effective implementation of flat organizational structure:
Preparing Employees Gaining buy-in from employees at all levels of your organization is crucial to
success in a transition as overarching as a change in organizational structure. Seek input from
employees through formal feedback systems and informal conversations before beginning the
planning process. Take employees' ideas seriously, and invite innovative idea-generators to
participate in planning meetings. Clearly explain the need for the change in structure to all
employees. Explain the need in terms that relate to each employee’s individual roles, as well as how
the change will benefit the organization as a whole. Also explain how the change will positively affect
each employee and enhance their positions in the company. Send regular updates on the planning
process to all employees via email, company newsletters, company meetings and informal
conversations. Always be open to feedback when sending updates. Planning and Implementation
Take the time to create thorough, formal plans to implement the transition from your old
organizational structure to your new structure. Map out how physical workspaces and work groups
will be moved or reorganized. Create plans to transition managerial information and duties among
employees, and to ensure that all departmentrelevant information is preserved and reorganized
according to the new structure. Implement the transition one step at a time rather than throwing the
entire package into the works all at once. As an example, consider that you wish to transition from a
tall organizational structure to a flatter structure where front-line employees are empowered to
make managerial decisions. It would be a good idea to make the transition in one department at a
time, first putting employees through training sessions to give them the information and skills
required in their new roles, then formally moving line managers into other positions in the company.
Monitoring Keep feedback mechanisms in place after implementing the transition. Rather than
viewing the transition as a finished project, consider it a work in progress; use feedback from
employees to fine-tune or alter specific aspects of the new structure. Allowing employees a voice
after the transition can add uniqueness to the structure, bringing it closer to a structure that is best
suited to maximize the efficiency and effectiveness of your operations while keeping employees
satisfied. CHALLENGES TO FLAT ORGANIZATIONAL STRUCTURES Organizations with relatively few
layers of management in their hierarchy are said to have flat organizational structures. The term
"flat" is in reference to the way an organizational structure chart looks when it has fewer managers,
featuring fewer and wider rows delineating the hierarchy of jobs. Flat structures impart distinct
benefits to companies, but there are a number of challenges for flat organizational structures to
overcome. European Journal of Business and Management www.iiste.org ISSN 2222-1905 (Paper)
ISSN 2222-2839 (Online) Vol.6, No.36, 2014 62 Motivational Leadership An advantage of a flat
organizational structure is that it places more responsibility on individual employees to motivate
them and maximize their performance. This creates challenges at the same time, however, because
employees have fewer leaders to motivate them and give them individual attention. Not every
personality type thrives in a self-starting environment; some employees need managers for guidance,
instruction and motivation. The challenge in flat organizations is to create a company culture that
encourages self-motivation and breaking personal performance records. Consistency Another
advantage of flat structures is front-line employees' ability to make decisions on their own to solve
operational and customer-service issues. Again, this strength introduces a new set of challenges.
Organizations with less of an emphasis on supervision can be lacking in strict operational policies,
creating a situation in which different employees handle different situations in different ways. The
same customer complaint may be handled differently on different days, for example, sending
conflicting messages to the marketplace. Or some employees may find a way to sell products that are
inferior in some way, while others throw away damaged goods, creating discrepancies in product
quality and company costs. Decision-Making Taller organizational structures center decision-making
responsibility at the upper layers of a company, increasing decision-making efficiency in addition to
consistency. Strategic decision-making in flat organizations can become complicated and inefficient if
a company relies on voting or building consensus among its employees. Companies with flat
structures who find them facing a decision with far-reaching consequences may find it challenging to
address the issue quickly and decisively. Advancement Employee development programs take on
new challenges in flat organizational structures. With a higher ratio of front-line employees to
managers, there are fewer managers to take note of the individual performance levels of employees.
This can make it easier for high-performers to fall through the cracks in performance reviews,
possibly causing them to leave the company to find a position with more personal recognition. In
addition to this, there are fewer managerial positions in which to promote front-line employees,
reducing the advancement opportunities presented to each employee. COST CUTTING BY ADOPTING
FLAT ORGANIZATIONAL STRUCTURE Most of the companies are facing current economic downturn
and ever increasing competition, which in turn requires cost reduction initiatives, the prudent ones
will make cuts in a way that works with their company’s culture. Whereas, many companies ignore
the critical need to secure employee commitment when making cost cuts. Companies planning cost
reduction initiatives must obtain the positive emotional commitment of their employees to support
decisions and to commit to behavior change that reduces costs. A truly committed workforce can
reduce costs more and sustain the reductions longer than a workforce under pressure. A flat
organization aims to reduce bureaucracy and give employees more active roles by allowing them to
become more involved in problem solving and decision making activities. One of the main
advantages of a having a flat organizational structure is reducing the overall costs of operations. This
type of structure contributes greatly to reducing costs. In particular, fewer levels results in fewer
employees. Fewer employees mean fewer expenses for payroll and office space. Plus, since when
there are fewer people each person is more accountable, a flat structure can encourage better
productivity, and more work gets accomplished. When flat organization works correctly, it can save
on employer costs, decrease employee turnover and increase profit margin. Since manager
compensation is typically more than other employees, fewer management levels means fewer
managers to pay, which saves you money. The bottom-up structure focuses on highly qualified staff
that is generally happier at work and less likely to quit their job or perform poorly. The longer the
employees remain with the company, the less training you have to pay for and the more competent
and productive they become. In addition, flat organizations often avoid granting salary raises and
promotions for length of service, instead focusing their career development efforts on top
performers. Granting promotions based on performance makes more sense cost-wise, since the
higher-salary expense will be directly tied to greater productivity. Companies with flat organizational
structures can outsource non-vital business functions to further reduce expenses. Outsourcing tax
preparation, recruiting activities and IT functions, for example, can allow companies to operate lean
by eliminating entire departments from their payrolls. Taking advantage of staffing agencies for
temporary office help is another technique to keep a company lean and flat.

Adaptability In flat organizational structure employees feel, as they have direct influence on the
company. They feel related to the organization which makes them more adaptable to change in
working environment and conditions. On the contrary, in vertical type of organizational structure,
employees may become frustrated at their relative lack of influence at lower levels within the
company which in turn makes them antagonist.

Innovations & Creativity Flat organizations offer more opportunities for employees to excel their
ideas, innovations and creativity while promoting larger business vision. In such type of
organizational structure employees skills can be better utilized for the achievement of organization
objective of profit maximization with minimum cost. Whereas, other organizational structures with
more layers of management could hamper innovation because the people closest to the end users do
not make resource allocation and design decisions. Employee Morale Decreased layers of
management help to elevate employee’s level of responsibility in the organization which satisfies
self-esteem needs of employees. Increase involvement of employees in decision making process will
also improve their morale which ultimately leads to efficient working for attainment of organizational
goals. Decision Making & Authority Decision making hierarchy is created by assigning tasks,
performing and distributing authority, whereas, authority is the power to make decisions. In flat type
of organizational structure, fewer levels of management create more flexibility in decision making. As
the staff can make decisions quickly, they do not need to wait while they hunt down a manager

Work Specialization Work specialization is the degree to which tasks in an organization are divided
into separate jobs. Individual employees specialize in doing part of an activity rather than entire
activity which requires arrangement of separate human resource planning, recruitment, selection,
training and induction programme for each specialization. This will lead to heavy cost which
sometimes does not appear to be beneficial by cost benefit analysis.

Centralization & Decentralization Organizational structure is said to be centralized when authority is

held by upper-level management and decentralized, when it is delegated to lower level
management. Flat organizations generally follow decentralized organizational structure which may
increase adaptability, creativity and job satisfaction among employees. Employee’s involvement and
flexibility to make decisions can be helpful for effective implementation of company’s strategies.
Formalization Formalization refers to the degree to which jobs within the organization are
standardized and the extent to which employee behaviour is guided by rules and procedures.
Increased bureaucracy hinders an organization’s speed to respond for changes. As in case of flat
organizational structure, there are less rules and procedure; organization can save its cost by
optimum utilization of time, effort and money.

Responsibility & Power In flat organizations employees are empowered to take decisions, they will be
held accountable for their specific tasks. In essence, employees put their best efforts for fulfillment of
their responsibility which ultimately leads to optimum utilization of manpower.

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Span of Control and Performance Span of control, a so-called principle of manage- ment, refers to
the number of subordinates who report directly to a supervisor. Presumably, the ef- fectiveness of
work groups may vary as a function of whether few persons (narrow span) or many (wide span)
report to a supervisor. 54 This content downloaded from 89.111.237.94 on Tue, 05 May 2020
07:02:28 UTC All use subject to https://about.jstor.org/terms Nearly 15 years ago, Porter and Lawler
[1965] indicated that there had been little, if any, empirical study of the classical prescriptions of
span of con- trol. The same could be said today. Worthy [1950], in comments contrary to classical
notions, indicated that large spans were superior because they pro- vide opportunity for personal
initiative and better communication. Unfortunately, empirical support was not provided. Woodward
[1958, 1965], failing to find a consis- tent relationship between span of control and orga- nization
success, categorized companies by tech- nical complexity (unit, batch, process). She con- cluded that
there seemed to be an optimal level of span of control for successful firms in each of the three
technical categories. Less successful firms were characterized by spans of control that were either
too large or too small. An important finding was that the optimal span of control differed de- pending
of the technological category. More recently, Ronan and Prien [1973] found no relationship between
span of control and a variety of effectiveness measures. Of 18 performance va- riables reported, only
1 - total controllable labor and expenses - could be considered a hard criterion. Farris [1969]
reported positive correlations be- tween performance measures and span of control. Two of the
performance measures (number of patents, technical reports) were hard; two others (ratings of
supervisors) were soft. Conflicting reports and a paucity of empirical work in the area make it difficult
to summarize this research. Worthy's conclusions were not supported empirically; Woodward
introduced technical com- plexity as a mediating variable; Ronan and Prien found no association
between span of control and organization performance; Farris reported a posi- tive correlation. In
addition, Woodward investigated first-level supervisors, Farris (1969) engineers. It is probably safe to
say that there is no evidence concerning the relationship of span of control and performance of blue
collar, nonmanagerial, or non- professional employees. Flat/Tall Hierarchy and Performance Span of
control and the "flat/tall" dimensions are closely related. Flat/tall refers to the number of hierarchical
levels of organization. With a given number of employees, relatively tall structure (many hierarchical
levels) must necessarily have a narrower average span of control. Corresponding- ly, a relatively flat
structure (few hierarchical levels) would necessarily have a wider average span of control. For this
reason, studies reviewed in each are interchangeable. Worthy, for instance, stated "flatter ...
structures tend to create a potential for more effective supervision" [p. 179]. Again, no data have
been reported to support this contention. Several studies have directly addressed the flat/ tall
dimension. Meltzer and Salter [1962] examined the productivity of physiologists. A positive asso-
ciation was found between number of publications and vertical span. Blau [1968] reported that tall
organizations tend to have more explicit promotion regulations emphasizing merit rather than
seniority. This is a very soft measure. Whether merit promo- tion affects organization effectiveness
remains an empirical question. Carzo and Yanouzas [1969] investigated this relationship in a
laboratory format. The amount of time taken to complete decisions did not differ significantly
between tall and flat struc- tures; however, flat organizations required more time to resolve conflict
and coordinate effort, and tall organizations performed better with respect to profit and rate of
return on revenue. An important aspect of this study is that "profit" and "rate of return on revenue"
were not organizationally derived, but were laboratory constructs. In a field study, Ivance- vich and
Donnelly [1975] found salespersons were more effective in flat organizations. Three mea- sures of
effectiveness were utilized in this study: absenteeism, total number of orders received by a
salesperson divided by total number of retail outlets visited, and miles traveled by salespersons
divided by the number of retail outlets visited. Summarization of the vertical span relationship is
problematic. It is difficult to generalize across findings with professionals [Meltzer & Salter], lab-
oratory studies [Carzo & Yanouzas], and white collar employees [Blau; Ivancevich & Donnelly], with
both positive and negative associations reported

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Traditional Structure and New Modern Structure Critical assessment of organisations structure will
enable one to understand the management style been adopted by a specific organization. These
management styles indicate how the organisation is run and if employees perform better or worse.
The two main styles are: A hierarchical management structures (traditional structure). A flatter and
more open "humanistic" management structures (New modern structure). The traditional
organisational structure Traditional organisational structure's most common fact is that it shows
distinct demarcation or boundary between the management level and the lower levels
(subordinates). The only reason for this boundary is to show that management is first on the
hierarchy and that all decisions have to be made by them. Whereas employees are seen as bottom
dwellers and they are insignificants in their workplace environment, this however gives the
management more stress and has an impact on the training and motivation for the rest of the
employees. Therefore, this is responsible for reaction on employee job engagement and how they
respond towards management actions. The traditional structure has two levels: Level one: Managers,
these include top management, middle management and lower management. Level two: Employees
This type of structure is outdated and very ancient and research shows that humans have used it
from the start of humanity. However the structure is common it has some advantages and is most
used if a team has to collaborate together to find lasting solutions for problems. The management
style is used in armed forces and is also known as the military management style. The modern
organisational structure The structure is more flat and open; employees and management can be
seen as equal persons aiming for mutual goals and objectives. There is no clear boundary between
managers and employees, as in the case of traditional management style. This gives employees the
right to use their creativity and receives rewards for the work they have done. Rewards = Employees
satisfaction = Employee actively engage = Improved productivity. Modern structures are synonymous
with individuals and teams who can manage themselves, employees become multi skilled, training
investments increase, few status distinctions, more objectives are accomplish, employee security is
guarantee, outsourcing becomes more accessible and stable structure. Types of Modern
Organizational Structures 1. Functional Organisational Structure 2. Geographic Organisational
Structure 3. Product Organisational Structure 4. Market or Users Organisational Structure 5. Hybrid
Organisational Structure 6. Matrix Organisational Structure (Konrad, 2006). Problems associated with
organizational structures are; organisational structures can never show all of the links involved in the
organisation, communicating with other employees on different levels, department conflict. The time
it takes on developing products takes longer. Customer demands become too high for certain levels
(Liebowitz, 2008). The Factors Influencing the Choice of Structure Adopted 1. The magnitude of the
organisation: The size of an institution some time determines the type of organization structure to
integrate into the system. 2. Employees competency and skilfulness: A Matrix structure will be
preferred if the company has a high level of creative and innovative workers. 3. The leadership style:
If owners wish to maintain control they will use a narrow (centralize) structure and others who wants
employees to participate in decisions making will use a wider (decentralize) structure. 4.
Organizational goals and objectives: Organization that aims at growing faster will incorporate a wide
structure. 5. External influence: If country is experiencing recession the organisation will need to
reduce the working force and change the structure from wide to narrow or make it more flat. 6.
Technological changes: The development of administrative systems disables the layer of
administration and the organization will retrench some of the employees in the particular or specific
category. Organisations choose of structure is extremely pertinent to employee engagement
therefore, they should be careful; the wrong structure can have huge negative impacts on the
communication, costs, decisions making and in motivating employees. This has the same effect on
the employee’s attitudes towards the structure and will end up in employee low level of engagement
and corresponding lower productivity

file:///G:/Master%20rad/264311-impact-of-organisational-structure-on-em-b3d821d9.pdf

Employees Have Well-Defined Roles

In organizations with strong centralized leadership, employees typically have well-
defined job descriptions and roles. When employees are aware of their duties, as
well as the duties and responsibilities of their coworkers, they are often more likely
to be productive and feel more confident in making decisions within their sphere of
responsibility. Morale may also improve, as workers may be less likely to resent
each other for either overstepping boundaries, on the other end of the spectrum,
not working hard enough.

When workers have well-defined responsibilities, it can be easier for management

and human resources to determine whether there is a need for creating new roles
or hiring more employees. This can help keep costs down by avoiding redundant
hires while also making it easier to recruit qualified workers for necessary positions.

While centralized organizations may prefer the use of participatory practices during the alternatives
generation phase, we contend that the use of inclusive practices is instead more likely to be
dominant during the subsequent idea selection phase. Decisions are likely to be made by the top
executives who decide which of the generated ideas the organization should select from and
implement moving forward. Because these decisions have strategic implications for all units of an
organization, top managers in centralized organizations are likely to spend time sharing information
and exchanging views and perspectives. The existence of interdependencies between different units
of the centralized organization implies that top managers are likely to engage in joint decision-
making and shape the agenda to ensure that each unit’s concerns are taken into account during idea
selection. Finally, as top managers deliberate on their choices during selection, they are likely to rely
on their past actions and plans as benchmarks or reference points (Cyert and March, 1963). Past
strategic conversations are likely to be referred to, and managers rely on each other’s prior planning
experiences and/or lessons to guide their subsequent choice of strategy during idea selection (Quick
and Feldman, 2011). Hence in centralized organizations the idea selection phase, as opposed to the
alternatives generation phase, is likely to be dominated by inclusive practices rather than
participatory practices. Strategy making in decentralized organizations Although participatory
practices encourage participants to share and contribute perspectives, we argue that less centralized
organizations are more likely to benefit from the use of inclusive practices during the alternatives
generation phase. In less centralized organizations, decision rights are more dispersed to the broader
stakeholders rather than concentrated at the corporate level. The responsibilities and ownership of
strategic decisions rest more among the different stakeholders, and they are more likely to prioritize
attention to their own issues and concerns while minimizing attention to others (Williamson, 1970).
The lack of an emphasis on a centralized authority over all decisions also suggests that coordination
among stakeholders is less formalized and more implicit. As a result, strategic alternatives derived
from participatory activities are less likely to be acted upon and gain little traction. Conversely, the
practice of inclusion not only allows decentralized participants to be connected to a community to
engage in more meaningful and open strategic conversations, but also facilitates the coordination of
actions among the participants (Andersen, 2004; Dickson, 1981). The coproduction of content and
process strengthens links between stakeholders, which in turn is more likely to create a stronger
sense of identification and purpose in engaging each other. The alternatives generated will thus be
more meaningful and relevant for the entire organization. We posit that, similar to centralized
organizations, less centralized organizations are also likely to engage in inclusive practices during the
idea selection phase. As participants have different preferences, the reconciliation of the diversity of
preferences may be difficult, if not impossible. Inclusion allows decentralized participants to bring
their own perspective to the table and shape the process in which the final idea selection is chosen.
Because practices of inclusion facilitate and sustain temporal openness, inclusive practices create
opportunities for decentralized participants to subsequently (re)engage with other stakeholders.
Hence, inclusion not only enhances post-planning implementation of the chosen strategy in a
decentralized organization, but also improves the coordination among stakeholders via the
community that was formed during the open strategy process (Andersen, 2004; Dickson, 1981).
Overall, our arguments suggest that while less centralized organizations may prefer engaging in
inclusive practices during both phases of alternatives generation and idea selection, centralized
organizations may prefer a mix of both participatory and inclusive practices, with the use of
participatory practices in the initial alternatives generation phase. Proposition 1. During open
strategizing, more centralized organizations favor the practice of participation in the alternatives
generation phase and the practice of inclusion in the idea selection phase, whereas less centralized
organizations favor the practice of inclusion in both alternatives generation and idea selection phases

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The final component in building an effective organizational structure is deciding at what level in the
organization decisions should be made. Centralization is the degree to which formal authority is
concentrated in one area or level of the organization. In a highly centralized structure, top management
makes most of the key decisions in the organization, with very little input from lower-level employees.
Centralization lets top managers develop a broad view of operations and exercise tight financial controls. It
can also help to reduce costs by eliminating redundancy in the organization. But centralization may also
mean that lower-level personnel don’t get a chance to develop their decision-making and leadership skills
and that the organization is less able to respond quickly to customer demands.

Decentralization is the process of pushing decision-making authority down the organizational hierarchy,
giving lower-level personnel more responsibility and power to make and implement decisions. Benefits of
decentralization can include quicker decision-making, increased levels of innovation and creativity, greater
organizational flexibility, faster development of lower-level managers, and increased levels of job
satisfaction and employee commitment. But decentralization can also be risky. If lower-level personnel
don’t have the necessary skills and training to perform effectively, they may make costly mistakes.
Additionally, decentralization may increase the likelihood of inefficient lines of communication, competing
objectives, and duplication of effort.

Several factors must be considered when deciding how much decision-making authority to delegate
throughout the organization. These factors include the size of the organization, the speed of change in its
environment, managers’ willingness to give up authority, employees’ willingness to accept more authority,
and the organization’s geographic dispersion.

Decentralization is usually desirable when the following conditions are met:

 The organization is very large, like ExxonMobil, Ford, or General Electric.

 The firm is in a dynamic environment where quick, local decisions must be made, as in many high-
tech industries.
 Managers are willing to share power with their subordinates.
 Employees are willing and able to take more responsibility.
 The company is spread out geographically, such as Nordstrom, Caterpillar, or Ford

.9 DIVISION OF LABOUR AND TASK INTERDEPENDENCE STRUCTURE RELATIONSHIP The division of

labor is the way that, work in organizations is subdivided and assigned to individuals as a job. There
are two different approaches to deciding how others will work and they have different implications
for what a person does in a task and how it is managed- the scientific management approach and the
job enrichment approach. The differences between these two orientations are that, in scientific
management the philosophy to make jobs simple have few tasks assigned to a person, have the job
supervised by someone other than the person doing it, give the worker little autonomy and limit the
amount of responsibility for the tasks. Jobs with these characteristics have low motivating potential.
In the job enrichment approach, jobs are more; complex. They consist of many tasks. The person
controls the work more than in scientific management and has higher autonomy and more
responsibility. Jobs designed this way have more motivation potential. 7.10 WORK SPECIALIZATION
The division of laboor leads to specialization, which means that a person performs only some specific
part of the whole job. For example: In cabinets unlimited Mc Gathey may decide to hire a person
whose only job is to sand and finish the cabinets prior to Organization Structure And Design / 125
Organizational Behaviour / 126 painting. That is a form of specialization called task specialization
organization or he may decide to hire another cabinetmaker who will perform all the cabinet
manufacturing tasks. This type of specialization is called personnel specialization. The main difference
between these two specializations is that, task specialization usually requires less knowledge and
ability. 7.10.1 Task specialization It occurs when job is broken down into smaller components or task
elements. These activities are then grouped into jobs and generally assigned to different people.
When task specialization is carried to extremes, the jobs will have the following characteristics i. The
work is more repetitive: A person is doing only a small part of the complete task; so he or she is going
to be doing it more times during the workday. ii. The work cycle is shorter: The work cycle is the time
that elapses between the start of an activity and when it begins again. iii. The need for direct
supervision decreases: Because tasks are more simple and repetitive, they are easier to learn and to
do. Therefore, face to face supervision is not necessary in order to ensure that the job is done right.
Generally, it is possible to tell if the work is done correctly by inspecting the output rather than
through fine consuming task of direct personal supervision. iv. Workers are less involved with their
jobs: High moral and motivation are specially difficult to maintain when the work is routine,
repetitive or programmed There is a greater evidence that a greater percentage of workers in jobs
with these characteristics are less satisfied and more bored than workers in those settings where the
work is less routine and less repetitive. Many individuals learn to accommodate to the routine work
demands. Those who cannot adopt either leave organization or withdraw psychologically. Further,
some employees in repetitive programmed jobs do not choose more complex jobs when given the
opportunity to do so. Task specialization may have some positive economic effects such as increased
efficiency but some problems such as integrity, self realization raising problems of individual
autonomy, displacement from the intrinsic value of work to its by product of income security,
prestige and leisure have been associated with it. In some cases, the work is so complex and
advanced that a great deal of skill and training are necessary to perform it. When the individual, not
the work, is specialized, it is called personal specialization which is typically associated with
occupations such as law and medicine. Specialists are extremely important as they bring high level of
skills that are critical to the success of the organization. Personal specialists usually invest a good deal
of time, effort and training and money in acquiring their skill. It takes years and much effort to get
through professional training such as medical school

Organizational design and employee behaviour

An organization structure does have significant effect on its employees. It is very difficult to
generalize to link organizational structure to employee performance and satisfaction. For example:
some employees are most productive and satisfied when work task are standardized - in mechanistic
structures. Work specialization contributes to higher employee productivity but it is at the cost of
reduced job satisfaction. But such statement does not surface individual differences and type of job
tasks the employees do. On the other hand there are persons who prefer the routine and
repetitiveness of highly specialized jobs. Some employees want work that makes less intellectual
demands and provides security.

In fact it is difficult to support with full evidence any relationship between span of control and
employee performance, through large span might lead to higher employee performance due to
provision of more distant supervision and more opportunities to perform. The contrast of such
evidence lies in the individual differences. Therefore, no particular conclusion can be summarily
made.

By and large, there is a linking between job satisfaction and centralization. Participative decision
making is positively related to job satisfaction but individual differences do surface. The
decentralization-satisfaction relationship in strongest with low self-esteem employees, because of
less confidence in their abilities. In short, to maximize employee performance and satisfaction, one
has to pay attention to individual differences such as personality, experience and the work tasks. In
fact, the organizational structure gets affected due to the influence of the national culture also. One
should keep in mind that people do not select employers at random, they are attracted to
organizations that suite their personal characteristics. For example: job candidate preferring
predictability are likely to seek out and take employment in mechanirist structure while those who
want autonomy end up in an organic structure. Today, we are in the world of uncertainty,
competition, globalization and high technology inclusive of computer advancement and
communication technology. Therefore, there is a possibility that the world may move towards
electronically configured organic organization. Technology allows organizations to stay close to the
customer to settle jobs where cost are lower and take decisions rapidly. It is because of this that
individuals may prefer to stay in organizations where decision can be at the lower level of
management. This type of quick decision-making at lower levels may result in increasing profitability.
In India, however the technology revolution may not transform the organization structure at a fast
rate, probably because decision-making may be quick, information exchange may also be precise and
fast but the individual concepts and actions may not undergo competitive change. Even emphasis on
speed thus has its own limits. The organization, be it bureaucratic or virtual, also has its own
limitations. In India, the change is taking place in the organizational structure, but is at a slow rate.

7.12.2 Work design

Some of the options left with managers to redesign or change the makeup of employee jobs are: i.
Job rotation ii. Job enlargement iii. Team based design i.

Job rotation This means periodic shifting of a worker from one task to another to avoid frustration of
the employees suffering from the routine work. This is also known as crosstraining. Job rotation is
practiced for increasing the flexibility and also some times avoiding lay-offs. The strength of the job
rotation lies in reduction of employee boredom and increasing the motivation through diversified
activities. This in turn benefits the organization particularly if the employee posseses wide range of
skills. Since job rotation is followed by employee training, it may add to the organizations cost, but
that may ultimately compensate by higher productivity.

ii. Job enlargement This means horizontal expansion of jobs, that means to increase the number and
the variety of tasks that an individual can perform. This leads to diversity in jobs. This however did
not apply by and large to employees probably because of lack of diversity in the specialized jobs.

iii. Job enrichment This refers to vertical expansion of jobs. This means increase in the degree to
which the worker controls the planning, execution and evaluation of his work. In job enrichment the
employee does a complete activity with freedom and bearing extra responsibility. This is bound to
increase the employee’s own performance. The benefits of the organization are in th e form of
reduced absenteeism and turnover cost with increased employee satisfaction.

iv. Team based design Many organizations do have working in groups and teams. We are fully aware
about individual based work design than that at the group level. Therefore, a group or team
involvement can be thought of to contribute to both the employees and the organizations in certain
ways or certain points mentioned here with: a. the group members to use very high level skills. b. the
group tasks is meaningful with possible output vision, c. the output result is consequence oriented to
other employees, d it should generate a trusting feedback about its work performance and e.
provision of sizable economy for individuals to work.

nd doing the job.

5.6 SOURCES OF STRESS Stress is a result of the transactions and interaction between the person and
the environment. Some stressors are in the objective environment while most are part of the
psychological environment. Work factors and non-work factors are sources of stress.

5.6.1 Work factors From the organization’s point of view, work-induced health problems, both
physical and mental, may create serious financial responsibility. It has been estimated, for example,
that about 95% of workers compensation claims, resulting from mental stressors may be due to
cumulative psychic workplace trauma, which is caused by employee abuse by manager. Major- work
Setting stressors are — i. Occupational factors: Some jobs are more stressful than others. Blue—
Collar workers are more likely to be exposed to working conditions that lead to physical health
problems because, many of their jobs are mostly physically dangerous or they are exposed to more
toxic substances. Studies have shown that, those who work in routine jobs have high levels of
alienation from work and boredom, and that machine paced work was more strongly related to
tension, anxiety, anger, depression and fatigue than non-paced work. High-risk jobs make high
psychological demands and provide low decision control. People in these jobs are constantly under
pressure from others as they must respond in a way that the other person wishes, not in the way
they would like to. ii. Role Pressure: Robert Kahn and a group of researchers at the University of
Michigan’s Institute for Social Research examined the extent of role conflict and role ambiguity in
organizations, their causes, how they relate to personal adjustment and how personality might
modify the effects of role strain. This research is based on the premise that individuals are more
effective at work roles when they are clear about what is expected of them and when they do not
have severe conflicting demands. iii. Role conflict: It occurs when a person is in situation where there
are pressures to comply with different and inconsistent elements. If the person complies with one
demand, it is difficult or impossible to comply with other demands. The particular type of role conflict
depends on the sources of the demands. An intercentral role conflict is inconsistent expectations
from a single person. For example: A manager may expect subordinates to increase production but
does not give them added resources. Often managers resort to this kind of demand when there are
cost- cutting drives or other programs to increase efficiency. Intercentral role conflict occurs when 2
or more different individuals place incompatible demands on a person. For example: The quality
control manager of a plant expects the production supervisor to reject more units of the product,
while the production manager wants increased production output and therefore fewer rejections.
Role ambiguity is another type of role strain. It is the uncertainty about the expectations of others.
One type of role ambiguity, task ambiguity, refers to uncertainty about the work requirements
themselves. For example When a person takes a new position and is trying to learn how to do the
job, social-emotional ambiguity, the second type, is uncertainty about how one is evaluated by
another person. This happens when work standards are unclear and performance judgments are
subjective. Role overload occurs when the work requirements are so excessive, they exceed the
limits of time and/or ability. Role underload is when work does not make use of a person’s abilities.
a. Participation Opportunities: Managers who report higher levels of participations in decision
making feel much lower stress, job anxiety and threat than those who report low participation.
Participation is important for two reasons. First, it is related to other stressors. Participation is
associated with low-role conflict and low-role ambiguity. Second, high participation gives a person
the feeling of some control of the stressors in the environment, reducing the effect of stressors
compared to when a person has no real or perceived control. b. Responsibility for people:
Responsibility for others may lead to stress at work. As a manager, effectiveness depends on those
who work for you. If for any reason, you do not have confidence in them, then you are likely to
experience stress, because you do not perceive control over the situation. In addition to that
responsibility for others calls for making decisions about pay, promotion opportunities and career
paths of others and exerting a good deal of influence over their lives. c. Organizational factors: The
organization itself affects stress. For example: Many believe that the mechanistic form of
organization is too restrictive and also does not maximize human performance potential, whereas an
organic structure is more likely to release human productive capacity. Four characteristics of
organizations have been shown to be stressors. 1. Organization level may be related to stress.
Executive work has a good deal of role overload, executives have responsibility for others and a good
deal of conflict and ambiguity is present in the job. Managers tend to have more time constraints and
efficiency problems. Workers at lower levels are more likely to have role overload Stress / 83
Organizational Behaviour / 84 and role conflict due to conflicting demands from supervisors are
introduced and lack of resources. 2. Organizations complexity refers to the rules, requirements and
complicated networks that exits in large organizations. Role strain tends to become increasingly a
problem as work becomes more specialized, more levels of supervision are introduced and more
complexity is added. 3. Organization change may be another important stressor. Organizations in
volatile environments must constantly modify the jobs and responsibilities of employees as they
must accommodate to different external pressures. Some changes reduce a person’s job security
status and power. 4. Organizational boundary roles are stressful because the role incumbent is
subjected to role conflict which emanates from internal and external sources. For Example: Sales
personnel must meet customer demands at the same time they must satisfy company requirements.
5.6.2 Non-work factors Stress also responses to some of the non-work environmental factors such as:
i. Life Structure Changes: Some of the natural flows of life can induce stress as a person goes through
the transition periods of life and career stages. Each of us faces the prospect of changing jobs. High
life stress is related to how individuals seek information to cope the stress-inducing event. When
faced with work stress, people tend to seek help from others at work, looking for help from workers
and supervisors. Personality affects the way managers handle stressful life events. Those executives
who experience high stress but low levels of illness had different personality characteristics from
those who experienced high stress and had high illness rates. These managers are more hardy. Hardy
managers tended to feel more in control: were less alienated from themselves new more oriented
towards challenge and adventure. ii. Social Support: Losing a job is stressful and it has been related
to such effects as arthritic symptoms, cholesteral elevation and heavy drinking. However these
effects ever reduced, or buffered, when a person had a social support system to help deal with the
situation. Social support is the communication of positive feelings of liking, trust, respect, acceptance
along with beliefs and sometimes, assistance from others who are important people in one’s life.
Social support is important because it affects a person’s psychological environment. When a person
has social support, events may seem less stress inducing because the resources that one draws on
are greater — help from others —. and therefore the demands of the environment can be met. It is
perhaps as simple as the fact that you have some help in dealing with pressure. iii. Perceived
Environmental Control:To have real or perceived control over stressors is related to reduced stress
levels and active coping responses. Specifically, the locus of control has been shown to moderate
stress relations. Persons with an internal locus of control believe that, they can influence their
environment, that what they do and how they do it determines what they attain. Those with an
external locus of control believe that they have little influence over the environment and that what
happens to them is a mater of luck, fate or due to the action of others. Internal’s coping strategies
are different than external’s. Anderson demonstrated these differences in a study of entrepreneurs
whose business were severely affected by a huricane. The storm resulted in severe flooding problems
in Pennsylvania. In one community, 430 small business were extensively damaged. Over 100 of the
owner managers of these business were interviewed to determine how they adapted to this
situation, which most would agree to be stress inducing. Internals perceived the situation as less
stressful than the externals. Entrepreneurs who were external tended to be more defensive. The
internals were more effective in bringing their business back from the disaster where the internals
fared a potentially stressful situation, they acted in a way to take control of events by engaging in
more task- oriented coping behaviours. This is more likely to solve the problem than resorting to
more emotional defensive actions. Not only do internals cope differently, it seems they also manifest
stress in different ways from externals. Internals faced with a stressor are more likely to believe that
they can have a significant effort on outcomes while externals are more likely to acquiescent, to be
passive and to see events as more stressful. When faced with stressors, internals report lower stress
levels and are less likely to become severely and frequently ill. iv. Type A Type B Behaviour Pattern:
Those who are hard-driving, highly competitive, impatient with others, irritated when they are in
situations that they believe get in the way of achieving their goals, and strive to accomplish more and
more in less and less time manifest a type a behaviour pattern the type b behaviour pattern is the
opposite. Those who exhibit this pattern tend to be less aggressive, less competitive and more
relaxed. Different responses to stress have been linked to the TYPE A behaviour pattern and the TYPE
B Behaviour pattern. Physiologically, TYPE A’s tend to have more extreme bodily responses to stress
and to recover more slowly than Type B individuals. Those who are Type A are more likely to have a
higher incidence of risk factors associated with cardiovascular disease as well as having a higher
incidence of coronary disease itself. They have higher pulse rates when faced with challenging tasks
and also tend to have elevated blood pressure when their self-esteem is threatened. Behavioural
responses to stress for Type A individuals may contribute to the more extreme physiological
responses. Behaviourally they are less able to handle conflict through accommodation. They smoke
more and are more impatient, aggressive and time pressured. Psychologically, Type A persons
experience more subjective stress in their environment that is moderately uncontrollable. Exposed to
stressors they are more angry, time pressured and impatient. They also respond more cognitive to
stressful situations. They are more likely to use denial and suppression than those who are Type B.
One explanation of these different reactions is that the Type A may internalize stress and perhaps
failure. When they fail, they try again and again to solve the problem. If they are not successful, they
feel that they did not try hard enough, leading to greater frustration and annoyance. They feel
ineffective and attribute the failure to themselves. The cost of their exposure to stressors and coping
with them is very high. v. Self-Esteem: Self-esteem is the way a person perceives and evaluates him
or herself. An individual’s self concept can have an effect on job performance and response to
stressors. Those who have a positive and a reasonably accurate concept of “self’ have a high self-
esteem. They tend to have confidence in themselves — not that they charge headlong into unknown
situations with adventurous disregard, but that they know their capacities and potential and act
accordingly. Self-esteem seems to moderate how a person responds to stressors. In one study,
workers with low self-esteem withdrew psychologically from the stress of starting a new job in a new
plant. People with low self-confidence tend to have more intense relations to high stress than those
with high self-confidence. Those executives who had a complex set of personal values, goals and
capabilities tended to have lower rates of illness than those who did not have such a self concept.
People with complex self perceptions responded differently to stressful events than those who had
more simple self conceptions. When they had higher reported exposure to stressful events,
individuals who described themselves as having many different dimensions to their lives were less
depressed, perceived lower stress and had fewer incidents of flue and other illnesses than those with
simple cognitive representations of themselves. Perhaps the impact of a negative event occurs to a
smaller portion of self-representation. vi. Flexibility Rigidity: Flexible people experience different
stressors and have different stress reactions than rigid people. Flexible people are relatively adaptive
to change, some what free and open and responsive towards others. They may show some
indecisiveness because they may struggle more with decisions. The flexible person does not have
clear-cut rigid rules for handling situations. The main Stress / 85 Organizational Behaviour / 86
stressors for flexible people are role overload and role conflict. Their flexibility makes them
susceptible and willing to respond to many pressures because they can be easily influenced. Flexible
people try to change their behaviour as the situation demands in order to reduce pressures. The rigid
person is closed-minded, generally some what dogmatic in orientation towards life. Rigid people
have a preference for neatness and orderliness. They are also inconsiderate of others, tend to be
critical in judging others and not very tolerant of other’s weakness. Rigid people respond differently
to stressors. They tend to deny or reject the pressures. In other words, the rigid person simply may
not react when experiencing role pressure but will ignore them. The rigid person sometimes pushes
away those who are pressing too hard. Under pressure a rigid person may become increasingly
dependent on his or her boss. A rigid person responds to work stressors by working harder. He or she
may spend more time and effort on the job trying to get more done and ignore other facets of his or
her life. To the extent that results are achieved, the rigid person has accomplished two things,
removing the stressor by completing the work and being seen as more valuable to the organization.
vi. Ability: There is not much evidence to show how ability affects responses to stressful situations.
However, it is reasonable to think that it does. In times of crises, experts are called in to solve
problems. A physician trained in trauma medicine knows what to do in a serious automobile accident
emergency, whereas a psychiatrist may not. Professional athletes are regularly involved in
competition with severe time pressures and extreme performance demands. They know what to do
and perhaps more importantly. are able to focus intensely on relevant factors, not extraneous ones.
Some research does indirectly support that supervisor’s experience is positively related to
performance when stress is high. The high — ability person may perform better in stress- inducing
situations for three reason. First. it is less likely that he or she will experience role overload. The
greater the ability, the more one can do. Second, high-ability persons tend to know their upper
limits. They are, therefore, better able to assess their likelihood of success in stress—inducing
situations that are uncertain and important. The highability person will probably face less uncertainty
than the low-ability one. Third, high-ability people have more control over situation than low-ability
people, and situational control affects how a person responds to stressors. Research on social
facilitation suggests something about the effects of ability, performance and stressors. Social
facilitation refers to the effect of the presence of other people on performance. In the presence of
others some people perform very well, whereas others do not. The difference in performance has to
do with the person’s ability: high-ability people tend to do better in the presence of others, whereas
those with low ability seem to do worse. 5.7 STRESS MANAGEMENT There are several ways to
manage stress. It may be possible to charge the objective environment to remove a stressor or to
alter the psychological environment that the person experiences. Perhaps it is possible to alter the
stress symptoms in some way so that they will not have debilitating long-run effects. All of these
general approaches work, and the most effective way to manage stress may be broad attack on
several dimensions. Personal Approaches to Stress Management Stress can be managed, at least in
the sense that a person can avoid stressful conditions, change them, or leave to cope more effective
with them. There are so many ways to do this that an extensive discussion of each is beyond the
scope of this chapter. However, some that are currently thought to be useful and seem particularly
relevant to organizational stress are discussed here. Psychological strategies Psychological
approaches to managing stress attempt to do one or more of the following: i. Change the
environment in which the stressor exists. ii. Change the cognitive appraisal of the environment iii.
Change some activity or behaviour to modify the environment Counseling and psychotherapy have
long been used to solve stress-induced problems. Personnel trained in mental health intervention,
work regularly with the person to determine the source of stress, help modify his on her outlook, and
develop alternative ways to cope. Often this is done by helping a person gain enough self-confidence
and self- esteem to try a different way of coping with stress. Therapists and counselors use many
different approaches. These methods tend to be based on learning theory and the use of internal or
external reinforcements. They are behavioural self-management tools to help a person monitor,
facilitate and modify his on her own behaviour. The role of the therapist is to teach these methods to
a person and then withdraw so that the person can use them independently. Developing a social
support base is another way of coping with stress. Close friends may provide a listening ear, a less-
biased assessment of the situation, some help in working out of a stressful situation, and finally
suggest ways to change your behaviour so that it is more adaptive. Managing your life can diminish
stress and its symptoms. Many stress inducing situations occur because of poor personal planning
and time management. For example, students often have test anxiety because they do not believe
they have enough time to prepare for tests. Here is a typical scenario. A student has two midterm
examinations scheduled the following week. Because both exams cover a lot of material, the student
begins to worry, especially if it is important to get good grades. She goes to one of her instructors to
ask for permission to take a make- up exam. The reason given is “I don’t have time to prepare”. In
cases like this, the anxiety can easily be avoided or at least reduced by preparing earlier in the term,
instead of waiting until the last minute. Relaxation, meditation and biofeedback are a few of the
mind-clearing approaches that individuals may use to cope with stress. These approaches either
detach the person from the stressor or help the person refocus on other, less-stressful situations.
These approaches may also have important and positive effects on physiological stress symptoms.
For example: Relaxation approaches can reduce hypertension and heart rates. Physiological
Approaches Being in good physical condition will help one deal more effectively with stress. Proper
exercise. a wise diet, and not smoking are likely to yield positive physiological effects for anyone.
Heart rate decreases, blood pressure is generally reduced, and the body becomes more resistant to
pressures. 5.8 ORGANIZATION APPROACHES TO STRESS MANAGEMENT Organization realize that if it
is possible to reduce the number and intensity of stressors or to help employee cope more effectively
with them, there should be increased performance, reduced turnover and absenteeism, and
substantial reduction in costs. This problem can he attacked through the implementation of
employee wellness programs and by management practices which modify the work environment.
5.8.1 Employee wellness program Over the last 10 years. an increasing number of organizations have
instituted some type of employee wellness program. These exercise facilities and programs,
individual counseling when employees feel job or personal strain, and regular seminars and lectures.
Wellness programs are effective in reducing work stress. They are also very cost- effective Stress / 87
Organizational Behaviour / 88 when they have the support of top management and are accessible to
a large number of employees. 5.8.2 Management practice to modify the work environment There are
several ways that some work stressors can be diminished by good management practices. Among
these practices are: i. Improving communication with employee will reduce uncertainty. This is a way
to lessen role ambiguity and may also have direct effect on role conflict if better communication
clarifies lines of responsibility and authority. ii. Effective performance appraisal and reward systems
reduce role conflict and role ambiguity. When rewards are clearly related to performance, the person
knows what he or she is accountable for (reduced role conflict) and where he or she stands (reduced
role ambiguity). When a good coaching relationship between a superior and subordinate exits along
with performance appraisal system, the person may perceive more control over the work
environment. He or she may also sense some social support for the task of getting the job done well.
iv. Increasing participation in decision making will give the person a greater sense of control over the
work environment, a factor associated with less negative reactions to stress. There is a strong
relationship between participation and job satisfaction, role conflict and role ambiguity. Increasing
participation requires decentralization of decision making to more people and delegation of
responsibility to those who are already accountable for work performance. v. Job enrichment gives
the person more responsibility, more meaningful work, more control, more feedback uncertainty will
be reduced, greater control over the work environment will be perceived, and there will be more
variety. Job enrichment increases motivation and encourages higher work quality, especially among
those with high growth needs. vi. An improved match of skills, personality and work is also a way to
manage stress at work. There is nothing so frustrating as being placed in a job that you can’t handle
and do not have the potential to perform well. Similarly, in some jobs there is a good deal of natural
stress because the work that has to be done has been set up that way for these tasks. Organizations
should seek hig

4.5 MOTIVATION STRATEGIES They aim at creation of working environment to develop policies and
practices which will provide for higher levels of performance from employees. They will be
concerned with following: a. Measuring Motivation This is essential to provide an indication of areas
where motivational practices need to be improved. Motivation can not be directly measured. But
indications of the level of motivation can be obtained from attitude surveys, measures of
productivity, employee turnover and absenteeism, analysis of performance reviews. b. Valuing
Employees Motivation and commitment are likely to be enhanced if employees feel that they are
valuable. This means investing in their success, trusting and empowering them, giving them the
opportunity to be involved in matters which they are concerned, treating them fairly and as human
beings rather than ‘resources’ to be exploited in the interest of management, and providing them
with rewards which demonstrate to the extent to which they are valued.

c. Behavioural Commitment It means that individuals will direct their efforts to achieving
organizational and job objectives. It can be engendered by giving people more responsibility to
manage their own jobs as individuals or as teams (empowerment) and providing for rewards to be
clearly related to success in achieving agreed goals

.6 IMPORTANCE OF MOTIVATION No concept of OB receives as much attention of academics,

researchers and practicing managers as motivation. The increased attention towards motivation is
justified by several reasons. First, motivated employee’s are always looking for better ways to do a
job. When people actively seek new ways of doing things, they usually find them. It is the
responsibility of managers to make employees look for better ways of doing jobs. Second, a
motivated employee generally is more quality oriented. The organization benefits, because
individuals, in and outside the organization see the enterprise as quality conscious. A clear
understanding of the way motivation works helps a manager make his employees quality oriented.
Motivation / 73 Organizational Behaviour / 74 Third, highly motivated workers are more productive
than apathetic workers. The high productivity of Japanese workers is attributable mainly to
motivation. Fourth, every organization requires human resources, in addition to the need for
financial and physical resources for it to function. Three behavioural dimensions of human resources
are significant to the organization: i. People must be attracted not only to join the organization but
also to remain in it. ii. People must perform the tasks for which they are hired and must do so in a
dependable manner. iii. People must go beyond this dependable role performance and engage in
some form of creative, spontaneous and innovative behaviour at work. Fifth, motivation as a concept
represents a highly complex phenomenon that affects, and is affected by a multitude of factors in the
organization. A comprehensive understanding of the way in which organization functions requires
that, increasing attention be directed towards the question of why people behave as they do on their
jobs. Sixth, yet another reason why increasing attention is paid towards motivation can be found in
the present and future technology required for production. As technology increases in complexity,
machines tend to become necessary yet insufficient vehicles of effective and efficient operations.
Seventh, while organizations have for some time viewed their financial and physical resources from a
long- term perspective, only recently they have begun seriously to apply this same perspective to
their human resources. Many organizations are now beginning to pay increasing attention to
developing their employees as future resources (talent bank) upon which they can draw as they grow
and develop. Finally, attention paid to motivation by our managers speaks about its importance in
management of human resources.

4.7 MOTIVATIONAL DRIVES People tend to develop certain motivational drives as a product of the
cultural environment in which they live, and these drives affect the way people view their jobs and
approach their lives. Much of the interest in these patterns of motivation was generated by the
research of David C. McClelland of Harvard University. He developed a classification scheme
highlighting three of the more dominant drives and pointed out their significance to motivation. His
studies revealed that people’s motivational patterns tend to be strong among the workers because
they have grown up with similar backgrounds. McClelland’s research focused on the drives for
achievement, affiliation and power. An addition to these is the competence drive, which is important
factor in current attempts to attain high-quality products and services. 4.7.1 Achievement Motivation
It is a drive some people have to pursue and attain goals. An individual with this drive wishes to
achieve objectives and advance up the ladder of success. Accomplishment is seen as important
primarily for its own sake, not just for the rewards that accompany it. A number of characteristics
define achievement- oriented employees. They work harder when they perceive that they will
receive personal credit for their efforts, when there is only moderate risk of failure and when they
receive specific feedback about their past performance. As managers, they tend to expect that, their
employees will also be oriented towards achievement. These high expectations sometimes make it
difficult for achievement-oriented managers to delegate effectively and for average employees to
satisfy their manager’s demands. 4.7.2 Affiliation Motivation It is a drive to relate to people on a
social basis. Comparisons of achievement-motivated employees with affiliation-motivation
employees illustrate how the two patterns influence behaviour. 4.7.3 Power motivation It is a
capacity that one man has to influence the behaviour of the other, that means the other man acts in
accordance with the first man’s wishes. This implies a potential that need not to be actualized to be
effective and a dependency relationship. Power may exist but may not be used and that is why we
call it as capacity or potential. Power is also said to be a function of dependency, for example: The
greater the other man’s dependence on the first, greater is the first man’s power in the relationship.
A person can have a power on other if he controls something, which the other one desires. Leaders
achieve goals through the means of power that facilitates their achievements. Power comes from
two sources namely, formal and personal. Formal power is on the basis of the position of the
individual in an organization. This can come from formal authority or from control of information.
This is subsequently categorized down to different formal powers like coercive power based on fear,
reward power based on ability to distribute rewards that are valuable to others, legitimate power
that is achieved as a result of ones position in the organizational hierarchy and information power
that comes from access to and control over information. Personal power doesn’t depend upon
formal position in an organization. This is vested with the competent and productive managers
having no power. The power comes from the individual’s unique characteristics such as his expertise,
skills, respect and admiration, charisma and knowledge. In short, if you want to get things done in a
group or in an organization, it helps to have power with you. If you maximize your power you do, it
increases the dependency of all others on you. Increasing the power is relative in nature and the
means vary depending upon the relative power base.

3.20 JOB SATISFACTION Employee attitudes are important to monitor, understand and manage. They
develop as a consequences of the feelings of equality or inequality in the reward system as well as
from supervisory treatment. Managers are particularly concerned with three types of attitudes,
namely job satisfaction, job involvement and organizational commitment. Although many of the
factors contributing to job satisfaction are under the control of managers, it is also true that people
do differ in their personal dispositions as they enter organizations. Some people are optimistic,
upbeat, cheerful and courteous. They are said to have positive affectivity. Others are generally
pessimistic, downbeat, irritable and even abrasive. They are said to have negative affectivity. Appears
that people are predisposed to be satisfied or dissatisfied. But it is important to explore the nature
and effect of job satisfaction. 3.20.1 Elements of job satisfaction Job satisfaction is a set of favourable
or non-favourable feelings and emotions with which employees view their work. Job satisfaction is an
affective attitude. Job satisfaction refers to the attitude of an individual single employee. The general
term used to describe overall group satisfaction is MORALE. Group morale is important to monitor
since individuals often take their social cues from their work associates and adapt their attitudes to
conform to those of the group. Job satisfaction studies focus on various parts that are believed to be
important, since job-related attitudes predispose an employee to behave in certain ways. Important
elements of job satisfaction include pay, one’s supervisor, the nature of tasks performed, an
employers co-workers or team and the immediate working conditions. Managers should not allow an
employee’s high satisfaction on one element to offset high dissatisfaction on another by
arithmetically bonding both feelings into an average rating. The attention should be divided between
elements that are related to job content (i.e. nature of job) and those which are part of the job-
context. (supervisor, co-workers and organization) Like attitudes, job satisfaction or dissatisfaction
emerges over a long period of time, but job satisfaction is dynamic. Manager must pay attention to
employee attitudes week after week, month after month, year after year since the stability in job
satisfaction varies in level. Job satisfaction is one part of life satisfaction. So, it is said that there is a
spill-over effect that occurs in both directions between job and life satisfaction. Therefore, managers
need to monitor not only job and immediate work environment but also their employee’s attitudes
towards other parts of life. The level of job satisfaction across groups is not constant, but is related to
number of variables. The key variables revolve around age, occupational level and organizational
size. The level of job satisfaction are higher in smaller organization units. Larger organizations tend to
overwhelm with people, disrupt supportive processes and limit the amounts of personal closeness,
friendship, and small group team work that are important aspects of job satisfaction for many. 3.21
JOB INVOLVEMENT Two other distinct but related, employee attitudes are important to many
employers in addition to job satisfaction. Job involvement is the degree to which employees immerse
themselves in their job, invest time and energy in them and view work as a central part of their
overall lives. Job-involved employees are likely to believe in the work, to exhibit high growth needs,
and to enjoy participation in decision making. As a result, they are willing to work long hours and
they will attempt to be high performers. 3.22 ORGANIZATIONAL COMMITMENT Organizational
commitment or employee loyalty, is the degree to which an employee identifies with the
organization and wants to continue actively participating in it. It is a measure of the employee’s
willingness to remain with a firm in the future. It reflects the Personality And Attitude / 57
Organizational Behaviour / 58 employee’s belief in the mission and goals of the firm, willingness to
expend effort in their accomplishment and intentions to continue working here. Commitment is
usually stronger among longer term employees. Organizationally committed employees will usually
have good attendance records, demonstrate a willing abstinance to company policies, lower turnover
rates. A comprehensive approach to OB suggests that a manager should consider ways in which the
work environment can help produce all three key employee attitudes — job satisfaction, job
involvement and organizational commitment. Higher job involvement tends to higher levels of
dedication and productivity in workers. High performance and equitable rewards encourage high
satisfaction through a performance-satisfaction-effort loop. Higher job satisfaction usually is
associated with lower turnover and fewer absence. Committed employees are also more likely to
embrace company values and its culture

JOB SATISFACTION It is useful to highlight the important aspects of job satisfaction. The important
dimensions to Job satisfaction are: i. Job satisfaction refers to one’s feeling towards one’s job. It can
only be inferred but not seen. ii. Job satisfaction is often determined by how well outcomes meet or
exceed expectations. Satisfaction with one’s job means increased commitment in the Personality And
Attitude / 59 Organizational Behaviour / 0 fulfillment of formal requirements. There is greater
willingness to invest personal energy and time into job performance. iii. The terms job satisfaction
and job attitudes are typically used interchangeably. Both refer to effective orientation on the part of
individuals towards their work and roles which they are presently occupying. Positive attitudes
towards the job are conceptually equivalent to job satisfaction and negative attitudes towards the
job dissatisfaction: Though the terms job satisfaction and attitudes are used interchangeably, there
are differences between the two. Job satisfaction, on the other hand, relates to performance factor.
Attitudes reflect ones feeling towards individuals, organizations and objects. But satisfaction refers to
one’s attitude to a job. Job satisfaction is therefore, a specific subset of attitudes. Attitudes endue
generally, but job satisfaction is dynamic, it can decline ever more quickly than developed. Managers,
therefore, cannot establish the conditions leading to high satisfaction as now and then employee
needs may change. Managers need to pay attention to job satisfaction constantly. Some of the few
definitions of job satisfaction: a. Job satisfaction is defined as a “pleasurable or positive emotional
state resulting from the appraisal of one’s job or job experience”. b. Job satisfaction is a set of
favourable or unfavourable feeling with which employees view their work. c. Job satisfaction will be
defined as the amount of overall positive affect ( or feeling) that individual have towards their jobs.
Consequences of satisfaction High job satisfaction may lead to improved productivity, increased
turnover, improved attendance, less job stress and lower unionization i. Productivity The relationship
between satisfaction and productivity is not definitely established. The result, however, is that in the
long run job satisfaction leads to increased productivity. But, 4 decades of research into this issue,
unfortunately, does not lend support to this belief. First, the relationship between job satisfaction
and job performance is weak. (Brafield and Crokett, 1955 and from 1964). Interestingly, the latest
finding is that the median correlation between satisfaction and performance is only 0.14 Second,
there is more evidence to suggest that job performance leads to job satisfaction and the other way
round (Lawler and Porter, 1967). An employee who performs well in his job gets both intrinsic and
extrinsic rewards which will lead to his satisfaction. A poor performance will make him feel worse
about his incompetence and will receive fewer rewards. He will be less satisfied with his work
experience. Third, there are some conditions under which high productivity, more clearly leads to
high job satisfaction. One condition is that the employee perceives that, intrinsic and extrinsic
rewards are contingent upon his productivity. The second condition is that, the extrinsic rewards (pay
for example) be distributed equitably. Inequitable distribution fails to convince the employees that
there is close correlation between hard work and rewards. However, the adage “a happy worker is a
productive worker” is not always wrong. True, there may not be a relationship between job
satisfaction and productivity. Performance may be affected indirectly by absenteeism or turnover
which is related (negatively) to satisfaction. ii. Job satisfaction and Employee Turnover High
employee turnover is of considerable concern for employee because it disrupts normal operations,
causes morale problems for those who stick on and increases the cost involved in selecting and
training replacements. The employer does whatever possible to minimize turnover, making the
employee feel satisfied on their jobs, being one such. Unlike the relationship between satisfaction
and productivity, the connection with turnover is established beyond doubt. However, the
withdrawal behaviour of employee is modified by certain factors. Loyalty to the organization is one
such. Some employees cannot imagine themselves working elsewhere, however dissatisfied they are
in their present jobs. Availability of other places of employment also influence turnover. If greener
pastures are available, an employee does not mind going in search of them, not withstanding the
present level of job satisfaction he enjoys. iii. Satisfaction and Absences Correlation of satisfaction to
absenteeism is also proved conclusively. Workers who are dissatisfied are more likely to take “mental
health” days i.e. days off due to illness or personal business. Simply stated, absenteeism is high when
satisfaction is low. As in turnover, absenteeism is subject to modification by certain factors. The
degree to which people feel that their jobs are important has a moderating influence on their
absences. Employees who feel that their work is important tend to clock in regular attendance.
Besides, it is important to remember that while high job satisfaction will not necessarily result in low
absenteeism, low satisfaction is likely to bring about high absenteeism. iv. Satisfaction and Safety
Poor safety practices are a negative consequence of low satisfaction level. When people are
discouraged about their jobs, company and superiors, they are more liable to experience accidents.
An underlying reason for such accidents is that, discouragement may take one’s attention away from
the task at hand. Inattention leads to accidents. For e.g., many hand injuries from poorer tools can be
attributed to the operator not paying careful attention. v. Satisfaction and Job stress Job stress is the
body’s response to any job- related factor that threatens to disturb the person’s equilibrium. In the
process of experiencing stress, the employee’s inner state changes. Prolonged stress can cause the
employee serious ailment such as heart disease, ulcer, lower back pain and muscles aches. Chronic
job dissatisfaction is a powerful source of job stress. The employee may see no satisfactory short-
term solution to escaping this type of stress. An employee trapped in a dissatisfying job may
withdraw by such means as high absenteeism and tardiness or the employee may quit. Employee
under prolonged stress stemming from job dissatisfaction often consume too much alcohol, tobacco
and drugs. These employees are costly to the management in terms of time lost due to frequent
absences and increased payment towards medical reimbursement. vi. Unionization It is proved that
job dissatisfaction is a major cause for unionization. Dissatisfaction with wages, job security, fringe
benefits, chances for promotion and treatment by superiors are reasons which make employees join
unions. Another dimension is that job dissatisfaction can have an impact on the tendency to take
action within the union, such as filing grievances or striking. Personality And Attitude / 61
Organizational Behaviour / 62 Other effects of Job-Satisfaction In addition to above, it has been
claimed that a satisfied employee tend to have better mental and physical health and learn new job-
related tasks more quickly. Practicing manager and OB researcher would agree that, job satisfaction
is important to an organization. Critics however, point out that, this is pure conjecture because there
is so much we do not know about the positive effects of satisfaction. On the other hand, when job
satisfaction is low, there seems to be negative effects on the organization that have been
documented. So, if only from the stand point of viewing job satisfaction as a minimum requirement
or point of departure, it is of value to the organization’s overall health and effectiveness and is
deserving of study and application in the field of OB. Sources of job satisfaction Several job element
contribute to job satisfaction .The most important amongst them are wage structure, nature of work,
promotion chances, quality of superior, work group and working conditions I. Wages Wages play a
significant role in influencing job satisfaction. This is because of 2 reason. First, money is an
instrument in fulfilling one’s needs, and two, employees often see pay as a reflection of
management’s concern for them. Employee want a pay system which is simple, fair and in line with
their expectations. When pay is seen as fair, based on job demands, individual skill level, and
community pay standards, satisfaction is likely to result. What needs emphasis is that, it is not the
absolute pay that matters, rather it is one’s perception of fairness. ii. Nature of works Most
employees crave intellectual challenges on jobs. They tend to prefer being given opportunities to use
their skills and abilities and being offered a variety of tasks, freedom and feedback on how well they
are doing. These characteristics make jobs mentally challenging. Jobs that have too little challenge
create boredom. But too much challenge creates frustration and a feeling of failure. Under
conditions of moderate challenge, employees experience pleasure and job satisfaction. iii.
Promotions Promotional opportunities affect job satisfaction considerably. The desire for promotion
is generally strong among employees as it involves change in job content, pay, responsibility,
independence, status and the like. An average employee in a typical government organization can
hope to get two or three promotions in his entire service, though chances of promotion are better in
the private sector. It is no surprise that the employee takes promotion as the ultimate achievement
in his career and when it is realized, he feels extremely satisfied. iv. Supervisions There is a positive
relationship between the quality of supervisor and job satisfaction. Supervisor who establishs a
supportive personal relationship with subordinates and takes a personal interest in them, contributes
to their employee satisfaction. On realizing the role of supervision in creating satisfaction, a number
or supervisory roles have been suggested for the purpose. Some of the supervisory roles are: a.
Maintain open lines of communication b. Create a good physical environment. c. Remedy sub-
standard conditions. d. Transfer discontent employees. e. Change the perception of dissatisfied
employees. f. Display concern for employees. g. Give ample recognition. h. Allow for participative in
management. i. Practice good management j. Conduct morale building programs. v. Work Group
Work Group does serve as a source of satisfaction to individual employees. It does so, primarily by
providing the group member, with opportunities for interaction, with each other. It is well known
that, for many employees, work fills the need for social interaction. The work group is a even
stronger source of satisfaction when members have similar attitudes and values. Having people
around with similar attitudes causes less friction on day to day basis. Co-worker’s with similar
attitudes and values can provide some confirmation of people’s self concept. vi. Working condition
Working condition that are compatible with an employee’s physical comfort and that facilitate doing
a good job, contribute to job satisfaction. Temperature, humidity, ventilation, lighting and noise,
hours of work, cleanliness of work place and adequate tools and equipment are the features which
affect job satisfaction. The assumption that working condition and satisfaction are interrelated
contradicts the two-factor theory of motivation. According to this theory, working conditions are a
part of maintenance factor which, when provided, help remove dissatisfaction. And the opposite of
dissatisfaction is no dissatisfaction, but not satisfaction. Thus, while working condition constitute a
source of job satisfaction they are a relatively minor source. Generally, unless working conditions are
either extremely good or bad, they are taken for granted by most employees. Only when employees
themselves change jobs or when working conditions change dramatically over time. (e.g.; moving
into new facilities) do working conditions assume more relevance. In other words, all workers are not
satisfying dissatisfaction by favourable or unfavourable work environment

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2.1.2. Organizational Structure Literature identifies five established organizational structure types,
which have been adapted to fit this study.

Mintzberg’s original structure types are the Simple Structure, Machine Bureaucracy, Professional
Bureaucracy, Divisional Form, and Adhocracy (Mintzberg, 1983). In this study, the organizational
types have been identified more simply as adhocracy, strategic business unit (SBU), divisional,
functional, and matrix. The adaptation of Mintzberg’s classifications is a result of changing times.
Since the time when Mintzberg defined these classifications in 1983, industry has adjusted to shifting
environments. The framework of the original classifications is very much still relevant, though the
names of the classification have been adapted to better represent today’s times. 2

.1.3. Adhocracy The adhocratic organizational structure is one that adapts readily and promptly to
meet organizational needs. This kind of organization is typically young and small, and may not yet
possess sophisticated technological resources (Mintzberg, 1983). This type of organization can be
thought of as “organic”, meaning the organization does not operate under rigid formalities, but
rather on the relationships and flexibility of those individuals within the organization (Burns &
Stalker, 1994). While the organization may be young and relatively simple, it can still be dynamic,
especially in its top management. Whether comprising one individual or a small group, top
management may be vibrant, strong-willed, and possibly even aggressive. Informal structural
configurations enable an adhocracy to be flexible and make decisions quickly, which is attractive in
dynamic and turbulent environments. Such organizations exhibit a strong sense of adaptability and
sense of mission as well (Mintzberg, 1983).The repetitiveness of work increases the potential for
human error. Additionally, this model presents a constant conflict between engineering efficiency
and employee job satisfaction. The organization is essentially obsessed with control, and it can only
be successful in a stable environment where change is infrequent and predictable. In addition to
operating most successfully in simple, stable environments, Organizational structures are geared
International Journal of Business Systems and Economics arcjournals@africaresearchcorps.com 17 |
P a g e toward mass-production-type of organizations. Often these organizations are old and large. It
is also most common to see this type of organizational structure in highly regulating organizations
that operate with low dependency on technology or technical systems.

2.1.4. Divisional Structure Divisional structure types emphasize divisionalization over

decentralization. Control within the organization is essentially determined within the separate
divisions of the organization. Duplication of operational functions is a strategic decision that is made
so as to minimize the interdependence between divisions. An obvious benefit of the divisional
organizational structure type is risk diversification, also known as “strategic invulnerability” in the
works of Igor Ansoff (Ansoff, 1984). Clearly, with an operating structure that promotes independence
for each of the divisions, risk at the global level is significantly reduced. Strategically, this shields the
organization as a whole from the unique risks that individual divisions may face, making the firm
essentially strategically invulnerable. Additionally, divisional structures enable the efficient allocation
of capital, increases strategic responsiveness, and provide for promotional opportunities for
employment growth and satisfaction (Mintzberg, 1983). A primary challenge present with this kind of
organizational structure is the potential of fragmentation of knowledge management practices.
Knowledge sharing is contained within divisions, information is filtered based on divisional needs,
and the transfer of knowledge throughout the organization is disjointed at best. Most often this
organizational structure type is adopted by organizations within the private sector, including many
organizations listed in the Fortune 500 (Mintzberg, 1983). The structure is optimal for market
diversity and/or organizations that operate in multiple locations or on multiple campuses. Most
organizations of this type have been around for a while and are large in size

. 2.1.5. Functional Structure Within a functional structure, the emphasis is on the professional skills of
the employees. The extensive autonomy granted in a functional structure is both a benefit and a
challenge. Autonomy can enable individuals to think freely and take risks, but it can also lead to the
misuse of discretion. Individuals can succumb to professional blinders that propel them along a
particular path with no regard to checks and balances (Mintzberg, 1983). Additionally, the functional
structure can engender a political environment that may spur internal conflicts among individuals.
Further challenges include the tendency to pigeonhole individuals based on their skill set and
specialization. This can also lead to inflexibility, concerning both the individual and the organization.
The democratic nature of the functional structure makes the structure type attractive to complex, yet
stable environments, where expert power is valued over legitimate power as opposed to the value of
structure. Representative organizations may include universities, hospitals, school systems, and
public accounting firms, among others (Mintzberg, 1983). www.ccsenet.org/ijbm International
Journal of Business and Management Vol. 9, No. 6; 2014 2.1.6.

Matrix Structure The matrix can be considered a blend of functional and divisional structure
characteristics. Similar to the “organic” nature of the adhocracy addressed earlier, the matrix
structure enables an organization to be responsive in dynamic and complex environments.
Additionally, the emphasis placed on learning and risk-taking allows for the potential of sophisticated
innovation. The true benefit of a matrix structure is in its ability to create and manage knowledge
effectively. International Journal of Business Systems and Economics
arcjournals@africaresearchcorps.com 18 | P a g e The matrix structure possesses its own unique set
of challenges. For example, the element of freedom identified as a benefit earlier also presents the
potential for ambiguity, inefficiencies, and misinterpretations (Mintzberg, 1983). Also challenging is
the lack of standardization among the skills of the professionals with regard to coordination efforts.
Both the functional structure and the matrix structure place high value on professional skills, but
whereas the functional structure emphasizes standardization of skills, the matrix structure does not.
The lack of standardization can cause added organizational challenges. As explained by Ashkenas,
“The matrix is ingenious in theory but confusing in practice” (Ashkenas, Ulrich, Jick, & Kerr, 2002, p.
120). He also introduces the term “organizational schizophrenia” when discussing the challenges
posed by the loose operational structure or standardization within a matrix organization.
Organizations best suited for a matrix structure are those which require a combination of
professional and operational skill sets and inter-organizational coordination efforts that will enable
the organization to optimally deliver products or services to meet client needs. These organizations
will likely devise and use liaison mechanisms that assist and enhance the crossfunctional efforts of
the various resources through the organization. Organizations that operate within a matrix structure
may include those within dynamic and fast-paced industries, such as the field of technology.

Definitions - Job design is the process of deciding the contents of the job, deciding methods to carry
out the job, deciding the relationship which exists in the organization. Job analysis helps to develop
job design and job design matches the requirements of the job with the human qualities required to
do the job. According to Michael Armstrong, "Job Design is the process of deciding on the contents of
a job in terms of its duties and responsibilities, on the methods to be used in carrying out the job, in
terms of techniques, systems and procedures, and on the relationships that should exist between the
job holder and his superior subordinates and colleagues."Job analysis helps to develop job design and
job design matches the requirements of the job with the human qualities required to do the job.
Nature of Job Design Identifying the components of a given job is an integral part of job design.
Designing or redesigning jobs encompasses many factors, and a number of different techniques are
available to the manager. Job design has been equated with job enrichment, a technique developed
by Frederick Herzberg, but job design is much broader than job enrichment alone.

Designing Efficient Jobs

If workers perform tasks as efficiently as possible, not only does the organization benefit from lower
costs and greater output per worker, but workers should be less fatigued. This point of view has for
years formed the basis of classical industrial engineering, which looks for the simplest way to
structure work in order to maximize efficiency. Typically, applying industrial engineering to a job
reduces the complexity of the work, making it so simple that almost anyone can be trained quickly
and easily to perform the job. Such jobs tend to be highly specialized and repetitive. International
Journal of Business Systems and Economics arcjournals@africaresearchcorps.com 22 | P a g e In
practice, the scientific method traditionally seeks the "one best way" to perform a job by performing
time-and-motion studies to identify the most efficient movements for workers to make. Once the
engineers have identified the most efficient sequence of motions, the organization should select
workers based on their ability to do the job, and then train them in the details of the "one best way"
to perform that job. The company also should offer pay structured to motivate workers to do their
best. Despite the logical benefits of industrial engineering, a focus on efficiency alone can create jobs
that are so simple and repetitive that workers get bored. Workers performing these jobs may feel
their work is meaningless. Hence, most organizations combine industrial engineering with other
approaches to job design. Designing Jobs That Motivate especially when organizations have to
compete for employees, depend on skilled knowledge workers, or need a workforce that cares about
customer satisfaction, a pure focus on efficiency will not achieve human resource objectives. These
organizations need jobs that employees find interesting and satisfying, and job design should take
into account factors that make jobs motivating to employees. The quest for meaningful work draws
people to such career paths as teaching and public service. For example, when Patrick Bernhardt was
laid off from his job as a marketing executive, he seized on the chance to switch fields. Bernhardt
became a computer science teacher and enrolled in evening classes. When he switched to this job,
Bernhardt took a 50 percent pay cut, but he doesn't mind: "This is the hardest thing I've ever done,
but the sense of satisfaction makes it worth it." A recent Money Magazine and Salary.com survey of
26,000 workers found that workers who considered themselves extremely satisfied with their jobs
were putting in a lot more time at work than others. The most satisfied group in the survey reported
eleven more weekly work hours than the least satisfied group. Generally, as satisfaction rose,
workers reported longer hours worked. A job satisfaction study compiled by CareerJournal.com
asked satisfied workers to describe their jobs. The study found that highly satisfied employees
consistently listed four factors: intellectual stimulation, job security, high levels of control and
autonomy, and direct contact with clients and customers. A model that shows how to make jobs
more motivating is the Job Characteristics Model, developed by Richard Hackman and Greg Oldham.
This model describes jobs in terms of five characteristics: 1. Skill variety. The extent to which a job
requires a variety of skills to carry out the tasks involved. 2. Task identity. The degree to which a job
requires completing a "whole" piece of work from beginning to end (e.g., building an entire
component or resolving a customer's complaint). 3. Task significance. The extent to which the job has
an important impact on the lives of other people. 4. Autonomy. The degree to which the job allows
an individual to make decisions about the way the work will be carried out. 5. Feedback. The extent
to which a person receives clear information about performance effectiveness from the work itself

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2.1.3 Types of Structure Weber (1948), and other contributors to management have revealed the
existence of numerous organisational structures. They are either tall or flat and include pre-
bureaucratic, bureaucratic, post-bureaucratic, functional, divisional, matrix, flat structures, hybrid,
flexible and modernity has introduced the virtual, network and team structures. Basically, they are 12
group into either a hierarchical or Pyramidal and flat structure. Mintzberg (1979) notes that each
structure has its own merits and drawbacks. Ultimately, there may be no ideal structure for a
company. 2.2.1 Pyramidal / Hierarchical Structure In the 21st century, even though most, if not all,
organizations are not of a pure hierarchical structure, many managers are still blind to the existence
of the flat community structure within their organizations, (Butler,1986). Schein’s (1988) hierarchical
dimension. The representation of an organisation in a hierarchy which is occupied on the top level by
the executive of the organisation, the middle management and the lower levels of management in a
descending order respectively is call a pyramid organisational structure. The functioning of the
executive level is enhanced both by the middle management and the lower levels on the pyramid. It
is characterised by bureaucracy owing to the fact that the executives exercise full control of the
organisation including operations, vision and operational strategy. Organisational vision emanates
from the top (Kanter, 1986; Kanter, Stein & Jock, 1992;Wright & McMahm, 1992).The pyramid
organisational structure is composed of three major levels which are the executive, managers and
staff respectively. The supervision of activities of staff in the various departments are done by the
managers who in turn report to the executives. The lowest level which is the staff support managers
in carrying out tasks that fulfil the directives from executive level. In some organizations, there could
be another level beneath the manager level which is the assistant manager level before the staff
level. The responsibilities of each employee is clearly spelt out in a well-executed pyramid
organizational structure. For a corporation to become successful, the individuals must stick to 13
their assigned obligations and be submissive to upper level employees, accepting the policies being
developed by them. Organisational task are well-defined among its member in the pyramid structure
for career advancement and takes the path, staff to manager to executive. The common path is to
move from staff level to manager and executive. There has been a reflection of criticism on the
pyramid organisational structure in the recent models of organisational structure developed,
condemning the bureaucracy in the pyramid structure. The new forms permit greater employee
involvement in decisions at the departmental level since the views of individuals differ on specific
issues of the various departmental.

2.2.1.1 Merits of Pyramidal/Hierarchical Structure Saaty (1977) noted that the hierarchical structure
provides a meaningful integrations of systems. Leadership level and responsibility is defined within
an organisation with pyramid structure which gets recognised by its employees. Employees recognise
the difference in authority with the pyramid structure as well as their individual or team
responsibility in organisation with this kind of structure. They do not go beyond their boundaries and
know who to report to and whom to contact at each point in the organisation when the need arises.
Furthermore, employees get motivated by the opportunities available for promotion. The pyramid
structure presents a clearer picture of authority at different levels as said earlier and this means an
employee can transcend his or her present position on the pyramid to another. Every organisation
have its own policies for promotion and employees aware of this try to 14 rise above their current
level. They get motivated by the authority and other privileges that comes with leadership at
different levels and strife to achieve that too. Saaty (1977) revealed that the hierarchy serves as a
useful tool for decomposing a large-scale problem. This then aids employee development and
presents them with specialised skills in their field. The hierarchical structures put employees into
specialized group or various departments which specialise in carrying out specific task in the
organisation. This therefore builds employees with specialised skills in their fields and they are better
able to carry out their tasks effectively and to an extent without supervision. Last but not the least,
the pyramid structure result in employee loyalty to their departments. This is the wholeheartedness
exhibited by employees in a department in fulfilling task assigned to them. It is measured by the
passion and persistence with which they carry out duties.

2.2.1.2 Demerits of Hierarchical Structure Maclone et al (1991) noted that, hierarchy structures have
severe problems. In spite of the merits outlined for the hierarchical structure, it has its own
disadvantage that confront organisations that uses them. Williamson (1991) states that comparing
the hierarchical structures with markets, internal incentives in hierarchies are flat or low-powered,
which ignores the possibility that some ways of infusing contractual integrity. There is also
impediment in communication across the levels of the organisation as opposed to the flat structure.
Organisations with this kind of structure carries information to the top through the levels on the
hierarchy which has a 15 negative impact on productivity most especially in situation that demands
quick response and information have to ascend gradually on the ladder and descend. In the
hierarchical structure, decisions made by the various department usually tend to benefit that
department rather than the organisation at large and this may result in rivalry among the
departments. This is so because some decisions that favours one department might have negative
consequence on others which would result in conflict in the organisation. This has the tendency to
halt its activities to an extent leading to low productivity. The high degree of bureaucracy that exist in
the hierarchical structure impedes change in the organisation and the pace at which they respond to
their clients need. When clients demand are gathered through marketing research by the marketing
department, their findings need to climb the hierarchy and final decision made through series of
meetings by top management before it descends for action to be taken, hence responding slowly to
clients demands

2.3 Flat Organisational Structure This type of structure is team based. There is a shift from vertical
decision making to horizontal collaboration and cross-functional cooperation (Hedlund & Rolander,
1990; George, Freeling & Court, 1997; McCalman, 1996). The type of organizational structure made
up of mostly the staff and the executive without or with a few levels of middle management is
referred to as the flat organisational structure. Organisations with flat structures believe well-trained
workers without close supervision by levels of management can be productive but are only used by
smaller organisations.

16 2.3.1Merits of Flat Structure Organisations with flat structures equally have advantages like any
other structure. Ivancevich and Donnelly (1975) found salespersons were more effective in flat
organizations as compared to the hierarchical organisation. This can be attributed to the fact that
employees' responsibility level raises in such organisations since an individual is mostly responsible
for carrying out a lot of activities in the organisation. Unlike the hierarchical structure, the flat
structure has an advantage of free flow of communication due to the non-existence of layers in the
organisation. Communication to top management is often direct and does not take a longer time to
receive feedbacks. Clients needs are responded to promptly due to the non-existence of barriers to
communication. Dalton et al (1980) believes that the power to make decisions is exercised by one or
relatively few with regards to flat structures. This makes it faster it structures due to the absence of
the layers. Employees are able to communicate freely to each other as well as management on issues
bothering them and are able to arrive at final decisions quickly. Decisions do not have to go through
series of meetings and does not necessarily need to involve particular members of the organisation
before taken hence the faster pace in making decisions.

2.3.2 Disadvantages of Flat Structure Although there is much flexibility associated with this kind of
structure, it comes with a few demerits too. Flat organizations required more time to resolve conflict
and coordinate effort, (Dalton et al, 1980). There is usually confusion resulting from lack of precise
superiors to whom employees need to report to on organisational issues and this can lead to
impediment in organisation's activities. 17 Also, employees in such an environment do not acquire
speciality in any field unlike the pyramid structure and task clarity becomes a problem to employees
because employees are not put into departments which could give them this opportunity to gain
specialised skills like the employees in the pyramid structure. This problem of low specialization
increases the overlapping of task, (Hanson et al, 1977)

2.4 Matrix Organisational Structure An organisational structure that in which the entire organisation
is made up of work groups and teams is called matrix structure (Robbins and Coulter, 2009). It is the
combination of the project organization structure and the functional organization structure. 2.4.1
Merits of Matrix Organisational Structure Organisations that the use of matrix structure enjoy a
number of benefits which organisations with other structures are deprived of. Explained below are
some of the advantages they enjoy. Johnson, demand media argues that the matrix structure result
in better coordination and control of both functional and production activities in an organisation due
to the direction in which both activities flow. Whilst the project authority flows horizontally, the
functional one flows vertically and this enables better establishment of coordination and control.
Ahamdquqa (2009), is of the view that matrix structures are more vulnerable and has a tendency to
be severely affected by changes in the organizational environment. This is the reason companies who
wish to adopt the matrix structure are advised to take precautions and be familiar with the
diagnoses, prevention and treatment circumstances such as strong group ties, anarchy, power
struggles among a few that may arise in the organisation that have the tendency to affect
organisational performance. 18 Lengel et al (1986) argue that the matrix structure have frequent
group meetings and their policies provide a fixed, objective knowledge base from which employees
can learn. Employees are able to develop their skills much better in the matrix organisation. Their
skills get widened in that people learn from other departments within the organisation. Resources
are effectively utilised in the matrix structure. Many projects run at the same time which put all
resources to full utilisation both human and non-human resource. Resource therefore do not go
waste in the matrix organisation. Quality performance is a feature of the of the matrix organizational
structure owing to the fact that the various functional areas of the organisations are occupied by
specialist and experts. These specialists and experts interact with each other and this result in
excellent specialisation. 2.4.2 Demerits of Matrix Organisational Structure Although a number of
merits have been outlined above concerning the matrix structure, there are a number of problems
encountered by organisations that you the matrix structure. These are outlined below. Larson et al
(1987), are of the view that legitimate conflict spills over to a more personal level, resulting from
conflicting objectives and accountabilities in the matrix organisational structure. The matrix
organisation usually have conflicting objectives due to the fact that different functional managers
supervise the activities there in. This causes a conflict between functional objective and regional
requirements. A manager may require that an employee carries out an activity which is of benefit to
basically to the a particular department whereas management may at the same time require that the
same person or persons carry out other activities which is in line with the regional requirements. 19
Randolph et al (1992) proposed that, matrix structures have dual lines of authority, responsibility,
and accountability which violate the traditional management style. They are of the view that one
subordinate should be assigned to a single boss. In the absence of this there is violation of unity
command with the matrix structure because employees get command from two superiors and have
to report to them at a time. This result in confusion, hence violation in unity of command. The matrix
organization extends its schedules and consequently incurs higher costs, (Knight, 1976). Operating
the matrix organizational structure is relatively expensive due to the huge overhead cost involved.
There will be much paper work and information collection that involves heavy cost. Most of the
worker or employees are specialist and they are given high remuneration and facilities and amount is
given to project workers in many cases as incentives. Matrix organizational structure create problem
of over specialization in some situations. Specialist from both functional project works gather to
show many complex problems of the organization. As many experts gather to solve problems they
waste valuable time in supporting their own ideas and sometimes problems remains unsolved

As indicated in the literature review, the participation of employees in the decision-making process
and their involvement in organizational change plans and goals setting may have a positive impact on
the employee’s commitment towards the organization. Involving employees in these processes, adds
to their satisfaction and commitment. Higher employee participation leads to higher employee
performance and organizational commitment in general.

.5 Components of Organisation Structure

Organisational structure affects the overall execution of task in an organisation. It influences the
separation of individual or a group's responsibilities and coordinating and grouping of activities. The
designing of organisational structure must therefore be dependent on all the factors that influence
the completion of tax. 20 According to Robbins and Coulter (2009), organisation structure stipulates
how tasks are to be allocated, who reports to whom, and the formal coordinating mechanisms and
interaction patterns that will be followed. Ivancevich and Matteson (1996) are of the same view and
have recommended some decisions management need to consider in designing organisational
structure which are;

2.5.1 Division of Labour

Ford and Smith (1937), made known the importance of division of labour in any given industry.
Smith (1937), laid emphasis on division of labour in his work ''Wealth of Nations'' and Henry Ford in
the early twentieth century used division of labour in his automobile industry where each worker
was allocated specific task based on specialisation. The positive result of Ford's action led to other
manufacturing industries adopting the principle of division of labour because it is of varied and
immense benefit to organisations adopting it. Although division of labour is beneficial to
organisations using them, it has been criticised by people on the grounds that not all jobs can adopt
the use of it and it also leads to monotony and boredom. Staffs pay little or no attention to the
behavioural aspects which result in client dissatisfaction. In spite of all these, the advantages
outweighs the disadvantages of using division of labour so it has been widely used and seen as a
significant ingredient which enhances productivity in the organisation

. 2.5.2 Delegation of Authority

Delegation is a two way power sharing process (Robert & Hindle, 2001). The process through which
interrelationships are created among individuals in their different roles in the organisation is called
delegation. Activities and roles in an organisations demands that authority is delegated for it
becomes impossible for an individual to carry out the multi and complex task in the work
environment. It is impossible that a manager in a given organisation possess all the necessary
expertise and skills to perform all task and his or her success depends of getting things done through
others in the organisation. A manager's burden is reduced by delegating authority and this gives him
or her the chance to carry out other significant issues. It becomes the grounds on which employees
get trained so as to be able to carry out higher responsibilities which leads to professionalism,
creativity and innovation in managerial decisions. It provides continuity to the organisation and
creates a healthy organisational climate by creating better understanding among the employees.
Management may however be reluctant in delegating authority which impedes organisational
progress. Efficiency in an organisation is enhanced through delegation of authority.

2.5.2 Departmentalization

Robbins and Coulter (2009) defines departmentalisation as how jobs are grouped together. When
individual activities in division of labour are grouped together for the purpose of coordination, it
results in departmentalization. The process of forming departments or grouping activities of an
organisation into a number of separate units for the purpose of efficient functioning it is called
departmentalization. According to Robbins and Coulter (2009), most managers see work
specialisation as an important organising mechanism because it aids efficiency in employees.
Organisations benefit from specialisation due to the fact that varied activities are grouped in
accordance with their relations with the explicit functions and objectives. There is effective control
and accountability by management on activities by the various departments in executing task. The 22
autonomy enjoyed by the departmental managers help develop their managerial skills as they take
initiative and decisions on their own on activities to be carried out.

2.5.3 Span of Control The total number of persons in an organisation a manager can supervise
effectively is referred to as span of control, (Robbins and Coulter, 2009). This implies that in order to
make control and supervision effective, the number of subordinates reporting directly to a superior
should be sizeable. The degree of decentralisation can determines the span of control. Executives
that are able to make own decisions on many organisational issue do narrow supervision and vice
versa. The creation of either a tall or flat organisational structure is influenced by the span of control.
Other factors considered in designing organisational structure include the following.

2.5.4 Centralization and Decentralisation The degree to which decision making takes place at upper
levels of the organisation is what is termed centralisation, (Robbins and Coulter, 2009). Decision-
making are concentrated at the higher levels of an organisation in centralization and decentralisation
is when decisions are made at the lower levels in an organisation by employees who are seen as the
ones closer to the problems or issues at hand. Decentralisation is a way of employee empowerment
by management. Decisions are mostly made faster in decentralised systems creating a sense of
belongingness and fairness in employees where a centralised system result inefficiencies in decision
making. Robbins and Coulter (2009), however state that an organisation is never centralised or
decentralised.

23 2.5.5 Formalization and Standardization Formalisation is the explicit nature of rules, policies,
work process and procedures that guide work and decision making within the organisation. Martin
Hahn in his work ''Formalisation in Organisation'' is of the view that formalization is influenced by
size of the organisation, technologies available to them, and organizational traditions. It is usually
done by large organizations because of the varied activities and can either be flexible or rigid. In
highly formalised organisations, there are explicit rules and clearly defined procedures covering work
processes, (Robbins and Coulter, 2009). Formalized organizations with rigidity possessed strict rules
which governed the behaviour of individuals in an organization and formed the basis of reward
system. The degree of rigidity went higher such that it resulted in unresponsive to the organisations'
customers and environment by the organisations. There was no autonomy and resulted in loss of
worker productivity, falling competitiveness, increased operational cost, labour degradation, decline
worker productivity, and higher prices. The negative impact of rigidity in formalizing an organisation
with rigidity has long been recognized. Standardization refers to the level of variety or range of
actions in a job or job series. Standardization is created in organisations with a view to maximizing
efficiencies; where similar work activities are performed in a similar fashion

. 2.5.6 Cross-functional Liaison A growing challenge for many organisations is the effective
coordination across lateral departments and functions where variation and incongruence often exists
for goals, time 24 spans, interpersonal communication. Liaison roles typically involves the role of a
person who communicates and coordinates between two departments. Task forces communicate
between several departments, or activities, or functions. Task forces are typically temporary groups
that are set up to address and coordinate problems and include representatives from each
department where as integrators coordinate between departments, and is not a member of any one
department

file:///G:/Master%20rad/CLAUDIA%20NYARKO%20MENSAH.pdf

Autonomy has been found to positively predict various behavioral outcomes such as objective and
subjective employee performance and absenteeism, attitudinal individual and group level outcomes
such as job satisfaction, job involvement and organizational commitment, and organizational
outcomes such as customer satisfaction [5, 19, 51]. Autonomy is considered of particular value in so-
called “adhocracy cultures” in which “an idealistic and novel vision [that] induces members to be
creative and take risks” results in enhanced risk-taking and greater innovative adaptability [52]. On
the downside, however, it has also been shown that high levels of autonomy and low levels of
monitoring can result in lower team performance than high levels of autonomy and high levels of
monitoring [53], implying that putting too much trust in an autonomous team can also be
detrimental.

Dimensions of autonomy

Autonomy is not a one-dimensional construct but has several dimensions [19]. In contrast to the
views taken in the 1970s and 1980s, autonomy is now understood to be a multi-faceted construct
that encompasses more than just strategic autonomy and control over work goals [33]. Today, the
dimensions have been extended to work scheduling autonomy, work methods autonomy, and
decision-making autonomy, each of which differentially predict work outcomes [19, 33, 35, 54, 55].
Work scheduling autonomy at either the individual or group level refers to having control over the
timing and scheduling of work, work methods autonomy refers to having control over the procedures
and methods used to do the work and decision-making autonomy refers to having the freedom to
make work-related decisions [19]. While these dimensions are inherently related, each one has
distinct predictive abilities [19, 21].

Innovative work behavior

Innovation or creativity as an outcome of work design characteristics have rarely been the central
focus of research into work design outcomes [13, 19] and have generally been regarded as
“expanded” or “distal” outcomes [5, 13]. However, creativity and innovation are vital for
organizational effectiveness [56, 57] as organizational success is often dependent on employees who
exceed “standard work behaviors” by being innovative rather than merely fulfilling their formal work
requirements as stated in the job description [58]. An employee’s innovative work behavior is
dependent on a combination of three different behavioral tasks: the generation of ideas, the
promotion of ideas, and the realization of ideas [58–60]. While innovative behavior involves both the
promotion and realization/implementation of ideas, the creativity concept has been seen to be only
involved in idea generation [58, 61]. The antecedents of employee creativity and the elements of
innovative work behavior (e.g., [40, 62]) have been widely examined. For example, Scott and Bruce
[62] studied the influence of leadership, work group relations and individual attributes on innovation
in the workplace and found that the supervisor-subordinate relationship, supervisor role
expectations, and employee systematic individual problem-solving styles predicted high levels of
innovative behavior. Similarly, Yuan and Woodman [56] evaluated the influence of the expected
outcomes of innovative behavior, such as expected performance outcomes or expected image gains,
on employee innovation and found that both performance expectations and image consequences
had a significant impact on employee innovation.

Autonomy and innovative work behavior

From a work design motivational perspective [22], based on an index of job characteristic
dimensions including job autonomy, it was found that job complexity was positively related to
supervisor-rated employee creativity and performance [57]. Several studies have also found a
positive relationship between work design features such as autonomy and creativity and innovation
at work (e.g., [48, 63–65]). For example, Dul and Ceylan [66] investigated the influence of a creativity-
supporting work environment (e.g., challenging job, teamwork, job autonomy) on firms’ new product
introduction to the market and showed that the more a firm’s overall work environment supports
creativity, the higher the firm’s percentage of sales from new

products. In a similar vein Ramamoorthy, Flood [48] directly and indirectly tested the influence of job
autonomy on innovative work behaviors when mediated through an obligation to innovate and
found that job autonomy had a direct positive effect on innovative work behaviors. Autonomy has
further been found to be an influential moderator in the relationship between leadership styles and
relationships and creativity at work (e.g., [67, 68]). The Hypotheses are first introduced in relation to
the main effects of the autonomy dimensions, then, the influence of the climate dimensions as
moderators on the relationship between autonomy and employee perceived innovative work
behavior is examined. Work scheduling autonomy and innovative work behavior. Originally from a
manufacturing context, work scheduling autonomy has been defined as the “extent to which workers
feel they can control the sequencing/timing of their work activities” [54]. Employees that are not tied
to any specific schedules or timing can, therefore, freely choose when and in which order they want
to pursue certain tasks, and thus exert the related behaviors [55]. In comparison to standard tasks in
positions with more “discrete, sequential stages,” innovation and thus innovative behavior is
characterized by discontinuous, intermittent, alternating activities and behavior [62, 69]. Therefore, it
is assumed that when employees are able to freely choose when and in what order they work on
different tasks, their intrinsic motivation is activated, which positively impacts innovative work
behavior in terms of idea generation, idea promotion, and idea implementation, implying the
following relationship between work scheduling autonomy and employee innovative work behavior.
file:///G:/Master%20rad/journal.pone.0204089.pdf

The literature shows that factors such as empowerment and recognition increase employee
motivation. If the empowerment and recognition of employees is increased, their motivation to work
will also improve, as well as their accomplishments and the organizational performance.
Nevertheless, employee dissatisfactions caused by monotonous jobs and pressure from clients, might
weaken the organizational performance. Therefore, jobs absenteeism rates may increase and
employees might leave the organization to joint competitors that offer better work conditions and
higher incentives. Not all individuals are the same, so each one should be motivated using different
strategies. For example, one employee may be motivated by higher commission, while another might
be motivated by job satisfaction or a better work environmen

Empowerment and organizational performance

Empowerment is defined according to Bennis (1989) as an approach to leadership that empowers

subordinates as a main constituent of managerial and organizational effectiveness. Moreover,
employees are given authority and the freedom to make decisions, which encourages them to
discover and use their full potential. Having more control over their own jobs is the main driving
force of empowerment that encourages growth and better productivity. Therefore, the
empowerment process focuses on solving the problems of the organizations by people. Furthermore,
empowering makes workforce fell appreciated and that their feedback on performance is valuable
for the organization. The contribution of the employees and their participation in designing the
organization are essential for the well-being of the organization, as individuals should do efforts in
the environment where they are responsible for their actions. Empowerment gives people
responsibility and authority to act as if they are in control of their own destinies. It is essential for an
organization to recognize the quality and the results of the employees’ work, as next time they will
be even more efficient to get more recognition. Employee participation and empowerment is about
the contributions of the employees in administration and decision-making regarding the policies,
objectives and the strategies of the organization. Studies have shown that employees’ perception of
the goals and the norms of the organization are positively related to employee motivation. Taking
into account that high levels of motivation can be achieved through empowerment, this process also
leads to organizational growth. Customer satisfaction can also be achieved through empowerment,
as employees can make quick decisions to solve the problems without having to ask the manager
what to do. Moreover, increased autonomy increases the productivity and enhances their
capabilities and motivation to accept new challenges and solve them. Proper remuneration and
empowerment combined are imperative if an organization wants to obtain greater dedication and
trust from its members. If the employees are loyal to the organization and highly motivated, superior
levels of effectiveness and growth can be achieved by the organization. Employee involvement and
empowerment are two aspects that should not be overlooked as it increases commitment and
understanding. Therefore, employees will be less likely to be resistant to changes and not only feel
valued by the organization, but also come up with important information, as they are in direct
contact with the customers or with the operational processes. On the one hand, autocratic
leadership and top-down decision-making create a rigid work environment where employees are
given orders to achieve certain tasks. In these organizations, innovation is suppressed and motivation
decreases, which has in turn a negative impact on performance. On the other hand, satisfied and
motivated employees will contribute to enhanced organizational productivity, which leads to better
profits.

If management is “the art of getting things done through people” (Drucker), then managers will be
interested in the way people in organisations behave. The field of organisational behaviour seeks to
observe, understand and predict the way people behave in organisations. For many managers a
further concern is a desire to influence behaviour at work, either towards management goals or to
allow individuals to discover satisfaction in their work or indeed both. While we can look at the ways
individuals behave at work, we need to beware of the trap of thinking that we will ever be able to
predict the behaviour of any one individual in a particular situation or at a particular. time with any
degree of confidence. Even when it seems that the individual will be in the exact situation again we
can find that their reactions quite different. We experience the unpredictability of individuals in
every part of our lives and so shouldn’t be surprised by it at work. Hardly anyone works in complete
isolation from other people. Most individuals in organisations work with other people. Often they
work fairly consistently with the same group. Sometimes a company decides who will work with who
and effectively form groups. Often, individuals come to see themselves as a group. When a group
develops, either by management design or informally, their individual behaviour is influenced by the
group. Any attempt to understand the behaviour of individuals leads us to study the dynamics of
groups and their effect on individuals. The third level of study is of “groups of groups” (either whole
organisations or large parts of organisations). s. Behaviour, and so performance, at work is largely a
result of an individual’s capacity to behave in the way required, plus the motivation to do so and the
opportunity to behave in the expected fashion. All three factors are moderated by the way the
individual perceives the world at the time and by many other surrounding influences. The diagram in
Fig. 3.3 shows a “multiplication” effect. A 20 per cent increase in ability will be multiplied through the
existing motivation and opportunity, giving an enormous increase in overall output. To illustrate this
point let us give a value of 10 each to ability, motivation and opportunity. If these are multiplied we
have a performance factor of 1000. If we increase motivation by 10 per cent (ie to 11) the increase
output will rise 100. This illustrates the dynamic and sensitive nature of changes in the factors
affecting performance and show why seemingly trivial interventions by managers can have large and
far-reaching effects. Any manager seeking to increase performance will be interested in how to
change or at least influence these factors
Possessing ability does not automatically mean the ability will be used; the behaviour and
performance the organisation desires may still not result. We all know people of high ability who do
not perform well despite their natural gifts. Often motivation is lacking and there is no .drive to
perform. One obvious way to increase performance and the use of an individual’s ability is to
increase their motivation to perform.

A hierarchy of pre-potency - Abraham Maslow The most taught and most widely known work in the
motivational area is that of Abraham Maslow. Maslow used a five-fold classification of needs
common to mankind - physiological, safety, social, self-esteem and self- actualisation needs. The
significance of his work is not his typology but the idea that, although we all have all these needs all
the time, they emerge to motivate or drive us in a particular order as the preceding need is satisfied.
He establishes a “hierarchy or pi-e-potency”. If all needs are unmet then human beings will seek first
to satisfy their physiological needs for survival, food, warmth, sleep, etc. They will identify a goal,
take action and, having reached the goal, will become less driven to reach the same goal. As the
needs at this level become largely satisfied, we discover a new need or set of needs to be safe and
secure. As this level of need becomes largely satisfied we discover a desire to meet our social needs,
then our esteem needs and finally we seek to be “what we couid be”. (Maslow calls this the need for
self-actualisation - or a self-realisation.) 16 One common error is to believe that Maslow implies that,
as a need is satisfied, we cease to have that need. All needs are present all the time; it is only the
order in which they emerge to motivate or drive us which is hierarchical. We still need food even
when driven to change job to gain more esteem through status. Anyone who loses employment in a
high status position soon rediscovers the need to have a job, not necessarily an ideal job. A secure
job comes next and then the higher level concerns become motivators. There are two important
implications of the Maslow work. The first is that once a lower level need is satisfied (for example the
need for cash to ensure a good standard of living), the offer of more cash to work harder may be
both ineffective and expensive if the individual is now motivated by self-fulfillment needs. A satisfied
need is not a motivator. It is important to understand that an attempt to offer more of a reward at a
higher level when lower needs are unsatisfied will fail. In an extreme case, workers who cannot
adequately maintain their families, will not be motivated by an assurance that the work they do is of
great importance and that they are highly valued. Their lower level needs will determine their
actions. Lower level needs must be satisfied before higher levels become powerfulAt the
physiological level money provides the source of survival - food, shelter, warmth and sleep. The role
of a manager is constrained in this area by the law, awards and the minimum amount that can be
lived on. A manager who reduces his employees’ income to below a basic living wage will cause
anxiety and attempts to escape or look elsewhere for the satisfaction of basic needs. At the
safety/security level organisations can provide security through contracts, grievance procedures,
disciplinary codes, sickness schemes, pension schemes, and redundancy agreements. A safe
environment can also be provided and training given to avoid accidents and damage. A healthy profit
and long-term employment are both major contributions managers can make. At the social level
some industries can’t help providing contact with other people. Service industries such as retailing,
education and welfare services are basically people-centered areas where often the work is
organised in groups. Work organisation can also focus attention upon and build a series of teams.
Management practices can encourage group satisfactions. At the esteem level the role of a manager
is crucial. Individuals are able to feel self-esteem as they experience success and the esteem of
others. A whole range of things can help with satisfying this need: autonomy, responsibility, the
showing of appreciation, recognition, status (both formal and informal) and the gaining of
knowledge. It is at this level that managers make their most significant contribution. If an individual
becomes reasonably satisfied at this level then the desire to self-actualise becomes important and is
essentially a question of self- motivation. Provided the lower level needs are met, individuals will
motivate themselves and the management role becomes a maintenance one

Job enlargement and enrichment One way to make space for growth in performance is to gradually
enlarge or enrich jobs. Cynics would suggest that job enlargement is an increasing number of tedious
tasks being added one by one, giving greater variety but little else. Herzberg (1968) 20 wrote that
“Job enrichment seeks to improve both task efficiency and human satisfaction by means of building
into people’s jobs, quite specifically, greater scope for personal achievement and its recognition;
more challenging and responsible work and more opportunity for individual advancement and
growth”. He believed job enrichment is concerned only incidentally with matters such as pay,
working conditions, organisational structure, communications and training. “Changes in the working
environment may remove some obstacles to individual contribution. Job enrichment is the attempt
to provide positive opportunity, encouragement and reinforcement of individual contribution”. Job
enrichment requires a lack of concern for demarcation lines and a willingness to encourage
individuals to expand their contribution. It implies regular review of targets, objectives and job
descriptions and a joint approach to the setting of the objectives. One of the worst mistakes an
organisation can make is to train or encourage the development of high order skill, the exercise of
which is discouraged after it has been learned. This causes unnecessary cost, and frustration and
unhelpful behaviour often result. IBM have a systematic job enlargement philosophy and claim to
have changed attitudes of workers, increasing pride and productivity. Maximising jobs has enabled
IBM to create significant opportunities for the semi-skilled. Many Japanese companies are involved in
continuous training throughout working life to prepare for and five enlargement within jobs. It is
important to ensure that there is sufficient opportunity to use the increased abilities and greater
drive which may be produced by other interventions in the area of organisational behaviour

file:///G:/Master%20rad/SWP4690.pdf
Work Specialization Adam Smith first identified division of labour and concluded that it contributed
to increased employee productivity. Early in the twentieth century, Henry Ford applied this concept
in an assembly line, where every Ford employee was assigned a specific, repetitive task. Today we
use the term work specialization to describe the degree to which tasks in an organization are
subdivided into separate jobs. The essence of work specialization is that an entire job is not done by
one individual but instead is broken down into steps, and each step is completed by a different
person. Individual employees specialize in doing part of an activity rather than the entire activity.
When work specialization was implemented in the early twentieth century, employee productivity
rose initially, but when used to extreme, human diseconomies from work specialization—boredom,
fatigue, stress, poor quality, increased absenteeism, and higher turnover—more than offset the
economic advantages. Most managers today see work specialization as an important organizing
mechanism but not as a source of ever-increasing productivity. McDonald’s uses high work
specialization to efficiently make and sell its products, and employees have precisely defined roles
and standardized work processes. However, other organizations, such as Bolton, Ontario– based
Husky Injection Molding Systems and Ford Australia, have successfully increased job breadth and
reduced work specialization. Still, specialization has its place in some organizations. No hockey team
has anyone play both goalie and centre positions. Rather, players tend to specialize in their positions.
organizing A management function that involves determining what tasks are to be done, who is to do
them, how the tasks are to be grouped, who reports to whom, and where decisions are to be made.
organizational structure How job tasks are formally divided, grouped, and coordinated within an
organization. organizational design The process of developing or changing an organization’s
structure. work specialization The degree to which tasks in an organization are subdivided into
separate jobs; also known as division of labour. Tell What are the major elements of organizational
structure? 5.1 • Divides work to be done into specific jobs and departments • Assigns tasks and
responsibilities associated with individual jobs • Coordinates diverse organizational tasks • Clusters
jobs into units • Establishes relationships among individuals, groups, and departments • Establishes
formal lines of authority • Allocates and deploys organizational resources EXHIBIT 5-1 Purposes of
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8013 ... CHAPTER 5 | Organizational Structure and Design  107 Departmentalization Does your
college or university have an office of student affairs? A financial aid or student housing department?
Once jobs have been divided up through work specialization, they have to be grouped back together
so that common tasks can be coordinated. The basis on which jobs are grouped together is called
departmentalization. Every organization will have its own specific way of classifying and grouping
work activities. Exhibit 5-2 shows the five common forms of departmentalization. Functional
departmentalization groups jobs by functions performed. This approach can be used in all types of
organizations, although the functions change to reflect the organization’s purpose and work. Product
departmentalization groups jobs by product line. In this approach, each major product area is placed
under the authority of a manager who is responsible for everything having to do with that product
line. For example, Estée Lauder sells lipstick, eyeshadow, blush, and a variety of other cosmetics
represented by different product lines. The company’s lines include Clinique and Origins, in addition
to Canadiancreated MAC Cosmetics and its own original line of Estée Lauder products, each of which
operates as a distinct company. Geographical departmentalization groups jobs on the basis of
territory or geography, such as the East Coast, Western Canada, or Central Ontario, or maybe by US,
European, Latin American, and Asia–Pacific regions. Process departmentalization groups jobs on the
basis of product or customer flow. In this approach, work activities follow a natural processing flow
of products or even of customers. For example, many beauty salons have separate employees for
shampooing, colouring, and cutting hair, all different processes for having one’s hair styled. Finally,
customer departmentalization groups jobs on the basis of customers who have common needs or
problems that can best be met by having specialists for each. There are advantages to matching
departmentalization to customer needs. Large organizations often combine forms of
departmentalization. For example, a major Canadian photonics firm organizes each of its divisions
along functional lines: its manufacturing units around processes, its sales units around seven
geographic regions, and its sales regions into four customer groupings. Two popular trends in
departmentalization are the use of customer departmentalization and the use of cross-functional
teams. Toronto-based Dell Canada is organized around four customer-oriented business units: home
and home office; small business; medium and large business; and government, education, and health
care. Customer-oriented structures enable companies to better understand their customers and to
respond faster to their needs. Managers use cross-functional teams—teams made up of groups of
individuals who are experts in various specialties and who work together—to increase knowledge
and understanding for some organizational tasks. Scarborough, Ontario–based Aviva Canada, a
leading property and casualty insurance group, puts together cross-functional catastrophe teams,
with trained representatives from all relevant departments, to more quickly help policyholders when
a crisis occurs. During the BC wildfires of summer 2003, the catastrophe team worked on both local
and corporate issues, including managing information technology, internal and external
communication, tracking, resourcing, and vendors. This type of organization made it easier to meet
the needs of policyholders as quickly as possible.3 We discuss the use of cross-functional teams more
fully in Chapter 10. departmentalization The basis on which jobs are grouped together. functional
departmentalization Grouping jobs by functions performed. product departmentalization Grouping
jobs by product line. geographical departmentalization Grouping jobs on the basis of territory or
geography. process departmentalization Grouping jobs on the basis of product or customer flow.
customer departmentalization Grouping jobs on the basis of customers who have common needs or
problems. cross-functional teams Work teams made up of individuals who are experts in various
functional specialties. Burnaby, British Columbia–based TELUS is structured around four customer-
oriented business units to improve customer response times: consumer solutions (focused on
services to homes and individuals); business solutions (focused on services to small and medium-
sized businesses and entrepreneurs); TELUS Québec (a TELUS company focused on services for the
Quebec marketplace); and partner solutions (focused on services to wholesale customers, such as
telecommunications carriers and wireless communications companies). qstockmedia/Fotolia Sergey
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8013 ... 108  PART 3 | Organizing EXHIBIT 5-2 The Five Common Forms of Departmentalization
Manager, Manufacturing Efficiencies from putting together similar specialties and people with
common skills, knowledge, and orientations Coordination within functional area In-depth
specialization Poor communication across functional areas Limited view of organizational goals + + +
– – Manager, Human Resources Manager, Accounting Manager, Engineering Manager, Purchasing
Functional Departmentalization More effective and efficient handling of specific regional issues that
arise Better service of needs of unique geographic markets Duplication of functions Feelings of
isolation from other organizational areas possible + + – – Sales Director, Central Region Sales
Director, Prairies Region Sales Director, Western Region Sales Director, Eastern Region Geographical
Departmentalization Specialization in particular products and services possible Managers able to
become experts in their industry Closer to customers Duplication of functions Limited view of
organizational goals + + + – – Bombardier Transportation Bombardier Aerospace Commercial Aircraft
Regional Aircraft Business Aircraft Amphibious Aircraft Flexjet Skyjet Rail Vehicles Total Transit
Systems Propulsion and Controls Services Retail Control Solutions Bogies Product
Departmentalization Source: Bombardier Annual Report More efficient flow of work activities Use
possible only with certain types of products + – Sawing Department Manager Planing and Milling
Department Manager Assembling Department Manager Lacquering and Sanding Department
Manager Finishing Department Manager Inspection and Shipping Department Manager Process
Departmentalization Specialists able to meet customers’ needs and problems Duplication of
functions Limited view of organizational goals + – – Manager, Wholesale Accounts Manager, Retail
Accounts Manager, Government Accounts Customer Departmentalization Plant Manager Vice-
President for Sales Bombardier Plant Superintendent Director of Sales Military Aviation Training
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8013 ... CHAPTER 5 | Organizational Structure and Design  109 Chain of Command The chain of
command is the continuous line of authority that extends from upper organizational levels to the
lowest levels and clarifies who reports to whom. It helps employees answer questions such as “Who
do I go to if I have a problem?” or “To whom am I responsible?” You cannot discuss the chain of
command without discussing these other concepts: authority, responsibility, accountability, unity of
command, and delegation. Authority refers to the rights inherent in a managerial position to tell
people what to do and to expect them to do it.4 To facilitate decision making and coordination, an
organization’s managers are part of the chain of command and are granted a certain degree of
authority to meet their responsibilities. As managers coordinate and integrate the work of
employees, those employees assume an obligation to perform any assigned duties. This obligation or
expectation to perform is known as responsibility. Responsibility brings with it accountability, which
is the need to report and justify work to a manager’s superiors. Sobeys maintains an environmental
scorecard where it tracks its performance on environmental pledges such as reducing greenhouse
gas emissions by 15 percent, reducing landfill waste by 30 percent, and selling only sustainable
seafood products. The unity of command principle helps preserve the concept of a continuous line of
authority. It states that every employee should receive orders from only one superior. Without unity
of command, conflicting demands and priorities from multiple managers can create problems.
Because managers have limited time and knowledge, they may delegate some of their
responsibilities to other employees. Delegation is the assignment of authority to another person to
carry out specific duties, allowing the employee to make some of the decisions. Delegation is an
important part of a manager’s job, as it can ensure that the right people are part of the decision-
making process. Hey, You’re the Boss Now—Delegating 101 gives more tips on how to do a better job
of delegating. These concepts are far less important today. For example, at the Michelin plant in
Tours, France, managers have replaced the top-down chain of command with “birdhouse” meetings,
in which employees meet for five minutes at regular intervals throughout the day at a column on the
shop floor to study simple tables and charts to identify production bottlenecks. Instead of being
bosses, shop managers are enablers.5 In addition, information technology has provided employees
with immediate access to information instead of waiting to hear from someone higher up in the
chain of command. Line and Staff Authority In many organizations, a distinction can be made
between line and staff authority. Line managers are responsible for the essential activities of the
organization, including production and sales. Line managers have the authority to issue orders to
those in the chain of command. The president, the production manager, and the sales manager are
examples of line managers. Staff managers work in the supporting activities of the organizations,
such as human resources or accounting. Staff managers have advisory authority and cannot issue
orders to those in the chain of command (except those in their own department). The vice-president
of chain of command The continuous line of authority that extends from the top of the organization
to the lowest level and clarifies who reports to whom. authority The rights inherent in a managerial
position to tell people what to do and to expect them to do it. responsibility The obligation or
expectation to perform any assigned duties. accountability The need to report and justify work to a
manager’s superiors. unity of command The management principle that states every employee
should receive orders from only one superior. delegation The assignment of authority to another
person to carry out specific duties, allowing the employee to make some of the decisions. line
managers Managers responsible for the essential activities of the organization, including production
and sales. staff managers Managers who work in the supporting activities of the organizations (such
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8013 ... 110  PART 3 | Organizing accounting, the human resources manager, and the marketing
research manager are examples of staff managers. Matthew Malek, Manager of Talent Management
and Organizational Development at Empire Company Limited, may have recommendations about
potential real estate opportunities, but CEO Marc Poulin is likely more interested in Malek’s advice
about managing employees. Span of Control How many employees can a manager efficiently and
effectively manage? This question of span of control is important because, to a large degree, it
determines the number of levels and managers an organization needs. All things being equal, the
wider or larger the span, the more efficient the organization. An example can show why. Assume that
we have two organizations, both of which have 64 employees. As Exhibit 5-3 shows, if one
organization has a uniform span of four and the other a span of eight, the wider span will have one
fewer level and approximately 12 fewer managers. If the average manager made $50 000 a year, the
organization with the wider span would save more than $600 000 a year in management salaries
alone. Obviously, wider spans are more efficient in terms of cost. However, at some point, wider
spans reduce effectiveness. When the span becomes too large, employee performance can suffer
because managers may no longer have the time to provide the necessary leadership and support.
The top performing manufacturing plants have up to 40 production workers per supervisor.6 In a
large call centre, that number can be as high as 50 customer service representatives per supervisor.
Today’s View The contemporary view of span of control recognizes that many factors influence the
appropriate number of employees a manager can efficiently and effectively manage. These factors
include the skills and abilities of the manager and the employees, and the characteristics of the work
being done. For example, the more training and experience employees have, the less direct
supervision they need. Therefore, managers with well-trained and experienced employees can
function quite well with a wider span. Other contingency variables that determine the appropriate
span include similarity of employee tasks, the complexity of those tasks, the physical proximity of
subordinates, the degree to which standardized procedures are in place, the sophistication of the
organization’s information system, EXHIBIT 5-3 Contrasting Spans of Control Assuming Span of 4 Span
of 4: Employees: Managers (levels 1–3) = 64 = 21 Span of 8: Employees: Managers (levels 1–2) = 64 =
9 (Highest) Assuming Span of 8 Organizational Level (Lowest) Members at Each Level 1 4 16 64 1 8 64
1 2 3 4 span of control The number of employees a manager can efficiently and effectively manage.
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8013 ... CHAPTER 5 | Organizational Structure and Design  111 the strength of the organization’s
culture, and the preferred style of the manager.7 Wider spans of control are also possible due to
technology—it is easier for managers and their subordinates to communicate with each other, and
there is often more information readily available to help employees perform their jobs. The trend in
recent years has been toward larger spans of control, which are consistent with managers’ efforts to
reduce costs, speed up decision making, increase flexibility, get closer to customers, and empower
employees. However, to ensure that performance does not suffer because of these wider spans,
organizations are investing heavily in employee training. Managers recognize that they can handle a
wider span when employees know their jobs well or can turn to coworkers if they have questions.
Centralization and Decentralization In some organizations, top managers make all the decisions and
lower-level managers and employees simply carry out their orders. At the other extreme are
organizations in which decision making is pushed down to the managers who are closest to the
action. The former organizations are centralized, and the latter are decentralized. Centralization
describes the degree to which decision making is concentrated at a single point in the organization. If
top managers make the organization’s key decisions with little or no input from below, then the
organization is centralized. In contrast, the more that lower-level employees provide input or actually
make decisions, the more decentralization there is. Keep in mind that the concept of
centralization/decentralization is relative, not absolute—an organization is never completely
centralized or decentralized. Few organizations could function effectively if all decisions were made
by only a select group of top managers; nor could they function if all decisions were delegated to
employees at the lowest levels. Nestlé uses decentralized marketing with centralized production,
logistics, and supply chain management.8 Today’s View Most organizations start with a centralized
model, where a founder makes all the decisions. As the businesses grow and diversify their
environments become complex. These businesses need to become more flexible and responsive,
resulting in decentralized decision making. In large companies especially, lower-level managers are
“closer to the action” and typically have more detailed knowledge about problems and how best to
solve them than do top managers. For example, the Bank of Montreal’s some 1000 branches are
organized into “communities”—a group of branches within a limited geographical area. Each
community is led by a community area manager, who typically works within a 20-minute drive of the
other branches. This area manager can respond faster and more intelligently to problems in his or
her community than could a senior executive in Toronto. Another term for increased decentralization
is employee empowerment, which means giving more decision-making authority to employees.
centralization The degree to which decision making is concentrated at a single point in the
organization. decentralization The degree to which lower-level employees provide input or actually
make decisions. employee empowerment Giving more authority to employees to make decisions.
Kingsey Falls, Quebec–based Cascades, a leading manufacturer of packaging products and tissue
paper, uses decentralization effectively with more than 100 operating units located in Canada, the
United States, and Europe.9 Companies are treated as separate entities, based on product, and
operate like a federation of small and medium-sized businesses. Each mill is accountable for its own
bottom line, and employees are motivated through profit sharing in the profits generated by their
own mill. The emphasis on decentralized, entrepreneurial management has been copied by other
Canadian forest products companies, such as Domtar. picsfive/Fotolia
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8013 ... 112  PART 3 | Organizing What determines whether an organization will move toward more
centralization or decentralization? Companies facing dynamic environments are more likely to need
to adapt quickly to change, and thus decentralize decision making. Stable environments allow for
more rules and procedures, so decision making can be centralized more easily. A community college
with one location is more likely to be centralized, while a college in a major metropolitan area with
five campuses might treat each of the campuses as a separate unit and decentralize decision making
to support a more complex environment. Formalization Formalization refers to the degree to which
jobs within the organization are standardized and the extent to which employee behaviour is guided
by rules and procedures. If a job is highly formalized, the person doing that job has little freedom to
choose what is to be done, when it is to be done, and how he or she does it. Employees can be
expected to handle the same input in exactly the same way, resulting in consistent and uniform
output. Organizations with high formalization have explicit job descriptions, numerous organizational
rules, and clearly defined procedures covering work processes. On the other hand, where
formalization is low, job behaviours are relatively unstructured, and employees have a great deal of
freedom in how they do their work. The degree of formalization varies widely among organizations
and even within organizations. For example, at a newspaper, news reporters often have a great deal
of discretion in their jobs. They may pick their news topics, find their own stories, research them the
way they want to, and write them up, usually within minimal guidelines. In contrast, employees who
lay out the newspaper pages do not have that type of freedom. They have constraints—both time
and space—that standardize how they do their work. Today’s View Although some formalization is
important and necessary for consistency and control, many of today’s organizations seem to be less
reliant on strict rules and standardization to guide and regulate employee behaviour. Consider the
following situation: It is 2:37 p.m. and a customer at a watch repair store is trying to drop off a watch
for same-day repair. Store policy states that items must be dropped off by 2:00 p.m. for this service.
The clerk knows that rules like this are supposed to be followed. At the same time, he wants to
accommodate the customer, and he knows that the watch could, in fact, be repaired that day. He
decides to accept the watch and, by so doing, to violate the policy. He just hopes that his manager
does not find out.10 Has this employee done something wrong? He did “break” the rule. But by
breaking the rule, he actually brought in revenue and provided the customer good service— so good,
in fact, that the customer may be satisfied enough to come back in the future. Because such
situations where rules may be too restrictive frequently arise, many organizations allow employees
some freedom to make decisions they feel are best under the circumstances. However, this freedom
does not mean that all organizational rules are thrown out the window. There will be rules that are
important for employees to follow, and these rules should be explained so employees understand
the importance of adhering to them. But for other rules, employees may be given some leeway in
application.11

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Empirical Studies Review Campbell, Fowles and Weber (2005) in their study ‘Organizational structure
and job specification in public health nursing’ found that there is a significant relationship between
organizational structure variables and job satisfaction for public health nurses employed in down
state Illinois local health departments. 764 questionnaires were administered to non-managing
nurses in three Belgian general care hospitals and the results showed negative effect of centralization
and positive effects of specification and formalization of nurses on job satisfaction.

Meadows (2000) discovered that the implementation of an organic structure was positively related
to an increase in job satisfaction among employees working in small groups. He also found that
individuals high on personality variables such as a need for dominance, a need for achievement, and
a need for autonomy displayed a stronger correlation between organic structures and job satisfaction
than did individuals low on these personality variables.

1997) argued that structure refers to the relationships among the parts of an organized whole”. In
regards to organization theory, social structure specifically refers to relationships among people,
positions, and organizational units, such as departments and divisions, to which they belong. He
noted that the basic elements of organizational structure, first outlined by sociologist Max Weber,
are hierarchy of authority, division of labor, and rules and procedures are directly related to job
satisfaction. In an extensive overview of organizational structure and its many component parts,
Robbins (2000) discussed ways many of those parts are related to one another and therefore affect
job satisfaction. He maintained that organization structure defines task allocation, reporting
relationships, and formal coordination mechanisms in an organization which might have positive or
negative impact on job satisfaction if not well organized.

Kakabadse and Worall (2001) examined the relationship between aspects of organizational structure
and job satisafaction as experienced by personnel employed in nine social service departments. They
discovered that the best predictors of organizational structure were dimensions of centralization and
formalization which related significantly but negatively to job satisfaction. Ibrahim Ali (2004), in his
study examined the effects of the interaction of technology, structure and organizational climate on
job satisfaction in power generation plants. The result showed that technology was indicated to have
influenced employee’s job satisfaction. Structure of the organization showed a marked consistency in
the effects of specialization, formalization and centralization on job satisfaction. Employees have
higher job satisfaction when they are given the opportunity in some form of decision making. This,
the author said was consistent with Hages Proposition (Hages, 1995) and also in line with the
empowerment model of management whereby a participative workplace climate is created to
provide opportunity for employees in decision making (Spitzer, 1996). The empowerment model
generally assumes that organizational performance improves when hierarchy is reduced and delaying
disposes power to workers (Mites and Snow, 2005).

(Robbins, 2000), observed that structure encompasses three other dimensions that are present in an
organization. Organizations may be mechanistic, organic, or bureaucratic, depending on their levels
of complexity, centralization, and formalization. A mechanistic organization harbors a highly complex,
formalized, and centralized environment where tasks are greatly specialized, workers receive little
discretion through the presence of strict procedures, and decisions are made at the highest level of
the organization. Toffler (2007) believed in the adhocracy, characterized by a task force whose
members are assembled specifically to reach a certain goal, are becoming more and more popular in
corporate organizations, especially in areas of science. Adhocracies are made up of specialists who
can each perform their tasks autonomously; therefore, a hierarchy of authority is nonexistent. There
are no formal rules, and problems are quickly dealt with as they arise. Power has the potential to
change hands randomly and rapidly, depending on who has the expertise to manage the current
situation. Specialists are typically grouped together in teams, but each team operates informally with
adjustments taking place as conditions change. With the autonomy and informal nature of the
adhocracy comes the possibility of conflict due to the absence of formal positions of power. Achrol
(1997) discussed forms of business organizations that first developed out of the Industrial Revolution.
Henry Ford provides a classic example of a functional organizational form, a vertically integrated
organization that was the principal structure during the late 1800s and early 1900s. This type of
organization centered on standard high-volume production but with relatively low cost. Alfred Sloan
at General Motors popularized the multidivisional form after World War I. This type of organization
included the ability to cater to a large variety of consumer preferences by focusing more on the
market and product development. As market preferences began to multiply and product
technologies flourished, Achrol (1997) noted that the matrix organization materialized throughout
the 1960s and ‘70s. In these new matrix structures, the idea was that marketing would develop a
closer working relationship with science and engineering. The emphasis here was more lateral than
vertical, with dual lines of authority in the organization. The rise of Japanese global enterprise in the
1980s gave birth to the network organization. Business began to realize that the success of the global
enterprise was dependent upon sources external to the firm. The network organization started to
prosper further as a means of organizing the information overload and rapid technological
advancements that began to take place However, functional organizations (i.e. organizational
structure based on groups of all the major business functions e.g. production, marketing, finance,
personnel etc. is capable of facilitating both the utilization and coordination of resources in the
organization and as a result enhances job satisfaction especially in area of promotion and career
development- a discrepancy model of job satisfaction. Both the product and geographical structuring
of organizations tend to produce decentralized activities which may cause additional control
problems. With increasing complexity and size of today’s organization and the increasing level of
components of job satisfaction, organization are opting for a mixed structure which combines the
benefits of all forms of organizational structure and this goes a long way to enhance optimization of
job satisfaction by workers. Though the contingency theory does not in any way support organization
sticking to a particular model of organizational structure because of the dynamism of the
environment. The uncertainty and instability of the present day organization’s environment made
them to advocate the use of structures in a situationally appropriate manner. Empirical studies of
Cambell, Fowles, Weber (2005), Kakabadse and Worrall (2004), Ali (2004), Hage (1995), Spritzer
(1996), confirmed a positive relationship between organizational structures and job satisfaction.
Their result substantially support positive effect of structure on job satisfaction Through quantitative
research, this study determined that multidivisional and virtual structures each shared a relationship
with need for recognition, while network and matrix structures each correlated with optimum job
satisfaction. Multi-divisional and virtual structures, respectively, consist of departments and
employees that are dispersed geographically. Due to the fact that employees in these organizational
structures do not work in a shared environment, this correlated with need for autonomy. The
network structure and matrix structure both include groups that need to share effective
communication in order to be successful, hence enhancing employees view in decision making. In the
network structure, groups of businesses share ideas, whereas in the matrix structure employees are
divided into groups based on their specialized skills. Both of these structures enhances optimum job
satisfaction via need for achievement and accomplishment. The significance of this study lies in the
fact that it supports the idea that relationships do exist between organizational structures and job
satisfaction. It is important for employees in every organization to realize that by recognizing and
understanding the organizational structures in which they work, they can better participate actively
towards achieving overall organizational performance towards understanding their roles or
functions. Finally, it should be bore in mind that job satisfaction of workers go a long way to
determine their productivity, and hence the realization of organization’s goals and objectives and
therefore should be given due consideration.

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he researcher mainly wanted to find out how the organization structure has
benefited the employees. 44% of the 25 respondents responded by saying it has
helped them in having clearly defined authority and responsibility, 24% of 25
respondents responded by saying it has helped them to have a better team
spirit,8% of 25 respondents responded by saying it has helped them having clear
promotions and24% responded that it has helped them to be motivated. This
showed having a good organization structure will help employees to have clearly
defines roles. This is in agreement to what Clif (2008) said that to ensure
employees work as efficiently as possible it is important to have clearly defined
job roles and responsibilities. This is particularly important in large firms to ensure
no part of the workload is overlooked. In smaller organizations job roles may be
less structured as employees may be required to take on a variety of tasks and
responsibilities. Clear job descriptions and personal remits enable workers to
focus on their job-specific tasks. It allows employees to prioritize their workload
and reduce the chance of work duplication. In the offshore environment, where
safety is a key priority, defined roles and responsibilities ensure that workers are
competent and qualified for the tasks they undertake.
2 Formal organization structure

The researcher wanted to find out if it is necessary to have good formal organization structure.
From the study, 44% responded that good organization structure help in motivating
perfonnance.24% responded it help them in sharpening their skills, another24% of the employee
responded by saying it has help it helps in increasing the productivity of the organization and 8%
responded by saying a good organization structure helps workers to learn new skills. Hence, this
means that most of the respondents new why is important to have a good organization structure.
This is in support to what Ingram said (2012) Organizational structure provides guidance to all
employees by laying out the official reporting relationships that govern the workflow of the
company. He also said a formal outline of a company's structure makes it easier to add new
positions in the company, as well, providing a flexible and ready means for growth. Without a
formal organizational structure, employees may find it difficult to know who they officially report
to in different situations, and it may become unclear exactly who has the final responsibility for
what. Organizational structure improves operational efficiency by providing clarity to employees at
all levels of a company. By paying mind to the organizational structure, departments can work
more like well-oiled machines, focusing time and energy on productive tasks. A thoroughly
outlined structure can also provide a roadmap for internal promotions, allowing companies to
create solid employee advancement tracks for entry-level workers.

The researcher wanted to find out through what ways the organization structure has helped
employees achieve job satisfaction. From the study, 32% responded that through delegation of
work they have achieved job satisfaction, 20% indicated that they have achieved job satisfaction
through promotion, another 32% indicated that they have achieved job satisfaction trough
receiving benefits and 16% said they have achieve job satisfaction through recognition. The results
of this question show that most of the employee’s achieved job satisfaction through delegation of
work and receiving benefits. Bill (1995) said delegation is assigning responsibility and authority to
someone in order to complete a clearly defined and agreed upon task while you retain ultimate
responsibility for its success. Delegation incorporates empowering your teammates through
effective leadership, and may be directed in any direction and used in any organization. The
following are also underlined as importance of delegation;

Efficiency

Delegation improves efficiency when it allows work to be transferred to people whose skills are a
better match for the work. You are in charge of planning and strategizing the next steps for your
team. When your teammates are able to carry out most of the routine activities required of your
team, it will allow you the time and effort needed to plan for your team’s next move.

Development

As a team leader, you possess important skills and abilities that you can pass on to your team
members. The best way of doing this is to coach them in the new skills and then delegate tasks to
them so that they may use those new skills. Delegating is a great way of encouraging your team
members to develop themselves and for you to develop coaching and mentoring skills.

tructure preference

The researcher wanted to find what kind of decision structure the employees preferred for them to
experience job satisfaction. 8% of the respondents opted for centralized decision making, 36%
indicated that there is a need for decentralized decision making system, 52% responded that group
decision making would help workers in achieving job satisfaction and remaining 4% responded that
individual decision making would help workers in achieving job satisfaction. Therefore, the results
shows that’s for teachers/ staff to experience job satisfaction in relation to experience decision
making structure there is a need for a group decision making. Chand( 2011) outlined the
advantages and disadvantages of group decision making as follows;

1. More information:

A group is better equipped as far as information is concerned. An individual cannot have all the
information that is available to a group as it consists of several individuals.

2. Diversity of views:

A group always has the advantage of varied views. This is because a group always has more than
one member, and since every member is unique, there is bound to be a variety in their views also.
This is also the reason why there are varied approaches to solving a problem. As group decisions
tend to cover a greater area, they provide a better insight for decision-making.

3. Greater acceptability:

The views expressed by a group have more acceptance than those from an individual. This is
because the decisions are not imposed, but are part of a larger consensus (general agreement). A
group decision is automatically assumed to be more democratic, and the decision of an individual
can be perceived as being autocratic (dictatorial).

4. Expert opinions:

There may be some group decisions that require expert opinion. The group can either include
experts or can call them from outside to form a separate group to take a decision on a particular
issue.

Disadvantages:

1. Time-consuming:

A group involves several individuals. Getting them organized, planning and coordinating their
meetings, defining and explaining to them the purpose of a meeting and the goals, and finally
reaching a solution or arriving at a decision can be quite cumbersome. Making decisions in a group
can, thus, be timeconsuming. The time loss involved in group dynamics cannot be ignored.

2. Lack of onus:

It is difficult to fix responsibility in a group. In an organization, it is often essential to fix

responsibility before a problem can be solved. It is difficult to do so if anything goes wrong with a
decision made by a group.

3. Individual domination:

Quite often, discussions in a group are dominated by a few members. Although a group discussion
means a collective discussion, some people usually manage to usurp (draw to them) a position of
informal leadership owing to their personality or style of participation.

This position can also be because of the position held within the organisation or simply because of
selfconfidence generated by previous experiences. Sometimes only a few individuals dominate and
the others fade away in a group, thereby defeating the very purpose of group discussion.

4. Compromise decisions:

The need to arrive at a group decision sometimes results in a compromise. The solution offered is
not essentially the best. It is, instead, a compromise acceptable as a mid-point to all concerned.
There are different demands and social pressures, and members may agree to a proposal without
really evaluating it. Such support may not be wholehearted.

Motivation and incentives

The researcher wanted to find out what institution should do to satisfy their employees. From the
results, 36% responded by saying institution should give incentives to teachers/staff. 12% opted for
delegation of work, another 20% responded that there is a need for salary increment and 32 %
responded that they should clearly define roles in there organization structure. Therefore, the results
of the study indicate that with the introduction of incentives and clearly define roles institutions will
be able to satisfy their employees ·This is in coherence to what McQuerrey (2011) on importance of
incentives. She underlined the following as importance of incentives

1 Motivational Tool

Incentive programs motivate employees to push and challenge themselves to achieve higher degrees
of productivity. This ultimately translates to increased earnings for your company. When incentive
plans are

in place, employees recognize that significant effort on their behalf will be acknowledged and
rewarded. This can increase the amount of time, effort and energy a staffer is willing to put forth on
your company’s.

2 Promoting Teamwork

Incentive plans tied to teamwork or group initiatives can help promote collaborative work efforts in
your business. Staffers working in teams that collectively rely on each other’s' productivity for the
group to receive a bonus or award may support and encourage each other to perform at top levels.
Peer pressure may also encourage additional degrees of performance from underperforming staffers
who don't want to let their team members down.

3 Morale Boosters

Incentive plans have the potential to raise morale and increase job satisfaction in a company.
Employees see a direct correlation between their work effort and their earning potential. Higher
workplace morale can decrease turnover, which saves your company money associated with
recruiting, hiring and training new staffers. Additionally, staffers with high levels of job satisfaction
often exhibit lower degrees of absenteeism, which can also help improve a company's bottom line.

From the results, it also shows that building a good organization structure is in important for
employee to perform well in their W0rk44% of the respondents from the study indicate that it is
necessary for organization to have good organization structure since it helps in motivating employee
performance. Furthermore, the results of the study also provide evidence that group decision making
help employees to experience job satisfaction. If it is not well established that there is no delegation
of work and employees are not receiving benefits in the structure then workers will leave for well-
organized or work in other industries where they will experience job satisfaction, but if good
organization structure are established it will motivate the performance of employees.

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THEORETICAL BACKGROUND Attraction-Selection Framework One explanation for the relationship

between organizational structure and employee reactions to their work can be called the attraction-
selection framework. The explanation has two steps. First, it is proposed that organizations with
certain structural properties or conditions attract and/or select employees with particular personal
and background attributes. It is not necessary to specify what these personal attributes are for
different organizations, only that different types of employees are at66/Administrative Science
Quarterly Organizational Structure and Employee Reactions tracted to or selected by organizations
that have different structural properties. For example, individuals attracted to large, centralized
organizations might have different demographic characteristics than those attracted to small and
decentralized organizations. Or, the large organizations may select and hire, fortuitously or by policy,
employees with different personal attributes than those typically hired by the small organizations.
Second, the attraction-selection framework posits that employee reactions to the work and the
organization are, in large part, explained by the personal attributes of the employees; that is,
individuals with different personal and background attributes have different work attitudes and
behaviors. For example, males with a high school education might well react to organizational
experiences quite differently than college educated females. The attraction-selection framework,
then, specifies that properties of organizational structure are related to employee reactions
indirectly, through the attributes of the employees. Or, alternatively stated, the personal attributes
of individuals are viewed in this framework as mediating the relationship between organizational
structure and employee reactions. This framework has been advocated for understanding the impact
of organizational structure (as well as a number of other organizational and occupational conditions)
on a variety of individual reactions, e.g., attendance, political party preference, choice of leisure
activities, work satisfaction, and intellectual flexibility (lngham, 1970; Kohn, 1971; Knoke, 1973;
Lorence and Mortimer, 1979). Moreover, empirical tests of the framework have provided substantial
support for it. Kohn (1971), in one of the most complete tests of this framework, found significant
associations between bureaucratization (operationalized as the number of formal hierarchical levels
in the organization) and employee intellectual flexibility, openness to change, and choice of leisure
activities. Specifically, employees who worked in more bureaucratic firms tended to be open-minded,
intellectually flexible, and spent their leisure time in intellectually demanding activities. However,
when the employee's educational level was statistically controlled, the impact of the bureaucratic
structure on the outcomes of interest was reduced. Controlling for other background attributes, e.g.,
race and national background, reduced the associations little more than education alone. These
results are consistent with the attraction-selection framework. Research from a quite different
perspective also provides support for the attraction-selection framework. Knoke (1 973) examined
two models of how changes in occupation produced changes in political party preference. In the first
model, called 'resocialization," he argued that after entering occupations, employees were subjected
to pressures from others in that stratum to espouse political attitudes predominant in that class. In
the second model, called "selective-recruitment,' which is similar to the attraction-selection
framework, he argued that employees differ in party preference before changing occupations. The
idea was that individuals were selected into occupations on the basis of their political preference.
Knoke's results suggested that the selective-recruitment model explained 67/ASQ changes in political
party preferences better than the resocialization model. Other studies have examined the first causal
link in the attraction-selection framework, that between organizational structure and the personal
attributes of employees. In explaining the relationship between organization size and employee
absenteeism and turnover, Ingham (1970) concluded that large organizations attract individuals who
are more economically oriented than persons attracted to small organizations. Newman (1 975)
found significant associations in a large insurance company between the structural properties of
departments and the personal attributes of employees, e.g., age, gender, education. In a study of a
major university, Morris and Steers (1 979) found that centralization and formalization were
significantly related to the personal attributes of employees. Educational level was negatively
associated with both centralization and formalization, and age was positively associated with
formalization. Gender did not relate significantly to either of these two structural properties. The
findings of McFalls and Gallagher (1975) suggested that one's personal values might play a central
role in choosing a job and employer. These researchers argued that people are attracted to
occupations directly compatible with their personal and political orientation, conservatives more
often selecting careers in business and liberals tending to select academic or social-change
occupations. The second link, between employee reactions and personal attributes, has also been
supported in several investigations (e.g., Herzberg etal., 1957; Kohn and Schooler, 1973; Herman,
Dunham, and Hulin, 1975; Newman, 1975; Andrisani and Nestel, 1976; Rousseau, 1978b; Morris and
Steers, 1979; Staines and Quinn, 1979; Weaver, 1980). In the Newman (1975) study, for example,
significant associations were found between specific satisfactions (i.e., with work, co-workers, pay,
promotion, and supervision) and gender, age, and education. Morris and Steers (1 979) found
organizational commitment to be positively and significantly associated with age, and negatively and
significantly associated with education. Rousseau (1 978b) also found job satisfaction to be
significantlyassociated with age and gender. And in a national sample of 4,709 employees, Weaver
(1980) found a positive association between global job satisfaction and age and education. Job-
Modification Framework An alternative framework for understanding the relationship between
organizational structure and employee reactions can be called the job-modification framework. Here
it is argued that the structural properties of organizations influence employee reactions by shaping
the characteristics of their jobs. The explanation again has two steps. First, organizational structure is
viewed as significantly affecting the overall amount of challenge and complexity (autonomy, skill
variety, task identity, task significance, feedback) in the employees' jobs; second, job challenge and
complexity are seen as directly influencing employees' reactions to the work and the organization. In
essence, the job modification framework specifies that job characteristics mediate the relationship
between organizational structure and employee reactions. 68/ASQ Organizational Structure and
Employee Reactions The view that organizational structure "presses upon" job characteristics is not a
new one, and the job-modification framework has received considerable theoretical attention (Kohn,
1971; Hall, 1977; Rousseau, 1978b; Milleretal., 1979). Indik (1 968), for example, suggested that
increasing organization size led to increased task specialization and segmentation. Both Forehand
and Gilmer (1964) and Hall, Haas, and Johnson (1 967) pointed out that formalization (i.e., many
written rules and well-defined procedures) could severely limit the amount of individual freedom and
discretion at work; and Hall (1 977) reasoned that highly centralized organizations often limit the
contribution that employees can make in carrying out their work. Several of these relationships have
received support from empirical studies (Porter, 1963; Aiken and Hage, 1968; Pheysey, Payne, and
Pugh, 1971; Ford, 1976; Robey, Bakr, and Miller, 1977; Pierce and Dunham, 1978; Sutton and
Rousseau, 1979). For example, Pierce and Dunham (1978) found that formalization and centralization
were significantly and negatively associated with employee descriptions of the amount of autonomy,
identity, feedback, and variety in their jobs. Ford (1 976) found a significant positive relationship
between size and the "routineness" of employees' tasks. Gannon and Paine (1974) showed that
employees in flat organizational hierarchies described their job responsibilities as "more adequate"
than employees in tall hierarchies. Kohn (1971) found that individuals who worked in organizations
with many formal hierarchical levels tended to perform jobs that were more "substantively complex"
(i.e., requiring thought and independent judgment) than employees who worked in firms with few
hierarchical levels. Other studies have focused on, and found support for, the second proposed link
in the job-modification framework, that between the challenge and complexity of jobs and employee
reactions. For example, positive and significant associations between several characteristics that
reflect a job's complexity and employee reports of satisfaction and motivation have been found in
numerous studies (Pierce and Dunham, 1976; Hackman and Oldham, 1980). Such findings have been
obtained both in laboratory and in field settings, using both experimental and correlational methods
(Umstot, Bell, and Mitchell, 1976; Wall, Clegg, and Jackson, 1978; Orpen, 1979), and using either
employees' or observers' ratings of employee job characteristics (Hackman and Oldham, 1976;
Oldham, Hackman, and Pearce, 1976; Stone and Porter, 1978). In addition, Kohn and his associates
(Kohn and Schooler, 1973, 1978; Kohn, 1976; Milleretal., 1979) have shown thatthe greater the
substantive complexity of jobs, the more employees tended to be self-confident, receptive to
change, committed to their occupations, and relatively free of feelings of powerlessness,
normlessness, and self-estrangement. The above studies provide substantial support for the two
specific links in the job-modification framework. A number of studies have also tested the full
framework, that is, that job complexity intervenes between organizational structure and employees'
reactions (Kohn, 1971; Rousseau, 1 978b; Miller et al., 1 979; Pierce, 1 979). Rousseau (1 978b) found
generally negative relationships between four properties of departmental 69/ASQ 1 The authors
express their appreciation to members of the Roy W. Walters Associates consulting firm for their
cooperation in making these data available to us. structure (i.e., size, number of levels, centralization,
and formalization) and job characteristics and employee satisfaction. Moreover, Rousseau found that
the job characteristics mediated the relationship between the structural and attitudinal variables, as
would be predicted from the job-modification framework. Nearly identical results were obtained in a
similar study of departmental structure conducted by Pierce (1 979). Research by Kohn (1 971) and
his colleagues (Miller et al., 1979) examined the degree to which job characteristics (e.g., the
substantive complexity of work) effectively mediated the relationship between organizational
structure and employees' intellectual flexibility and values. Results of these investigations suggest
that the relationship between two measures of structure (number of hierarchical levels and
hierarchical position) and employees' intellectual flexibility, moral standards, and openness to
change were substantially explained by the complexity of employees' jobs. All these studies suggest
that the job-modification framework may explain considerable variance in the relationship between
organizational structure and employee reactions. How well the framework performs in comparison
to a plausible alternative, the attraction-selection framework, is assessed in the research described
below.

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Discussion This study has compared two frameworks for explaining the relationship between the
structural properties of organizations and employee reactions to the work and the work context. The
attraction-selection framework suggests that the personal attributes of employees mediate the
structure-reaction relationship. The job-modification framework posits that the characteristics of
employees' jobs mediate this relationship. The results provide more support for the job-modification
framework than for the attraction-selection framework. In the test of the attraction-selection
framework, organizational structure measures explained variance in all employee reaction measures
beyond that explained by personal attributes alone. In the test of the job-modification framework, on
the other hand, organizational structure measures did not explain variance in three of the seven
reaction measures beyond that explained by job characteristics alone. However, the job-modification
framework does not perfectly explain the relationship between organizational structure and
employee reactions for four of the dependent variables (internal motivation, general satisfaction,
social satisfaction, and security satisfaction). Moreover, the relationships between organizational
structure and job characteristics are smaller than the relationships between organizational structure
and personal attributes. This raises the possibility that a more comprehensive explanation of the
relationship between organizational structure and employee reactions might be obtained by
considering both job characteristics and personal attributes as mediators of that relationship. The
argument would be that the structural properties of an organization affect employee reactions both
by attracting individuals who are disposed to react to the work in certain ways and also by shaping
the characteristics of the employees' jobs. The possibility of such a joint mediating effect is hardly a
new idea. Several researchers have suggested (and demonstrated empirically) that personal
attributes and job characteristics combine to explain the relationship between organizational
conditions and individuals' attitudes and psychological functioning (Kohn, 1971; Kohn and Schooler,
1973; Fendrich, 1976). Thus, there appears to be good reason to believe that a combined framework
would be very effective in 78/ASQ Organizational Structure and Employee Reactions explaining the
relationship between structure and employee reactions. To test the combined framework, each of
the reaction measures was regressed on (1) the combined set of job characteristics and personal
attributes, (2) the measures of organizational structure, and (3) the total set of structure, job
characteristics, and personal attributes- following the same analytic approach used throughout this
study. The results (Table 5) provide substantial support for the combined framework. For each of the
seven reaction measures, the multiple correlations involving job characteristics, personal attributes,
and organizational structure are much larger than those involving organizational structure alone
(column B vs. C). On the other hand, there are no differences between the size of the multiple
correlations involving job characteristics plus personal attributes and those that included job
characteristics, personal attributes, and organizational structure (column A vs. C). The canonical
correlations and redundancy coefficients reported at the bottom of Table 5 are consistent with these
regression results.

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Need for autonomy and support for autonomy. According to self-determination theory, individuals
strive for autonomy. They need to feel that their behavior is truly chosen by them rather than
imposed on them by others. 44 De Charms 45 suggests that the fundamental requirement for
intrinsic motivation is perceiving oneself as the locus of causality for one’s own behavior. Hackman
and Oldham 46 argue that an experienced sense of selfresponsibility (stemming from autonomy) is
important for voluntary engagement.

Furthermore, Ryan & Deci 47 state that autonomy enables individuals to internalize external
requirements of the workplace. An autonomy-supportive organizational context can be characterized
by choice of tasks, delegation of decision rights and by a leadership style based on promoting
personal initiative and participation rather than exercising pressure. 48 Empirical studies have
concluded that there exists a positive relationship between autonomy support and voluntary work
behavior. Field studies in psychological economics show that participation and delegation of decision
rights are positively related to voluntary work behavior. 49 There is also evidence from research on
organizational behavior. Gagné 50 exposes that autonomy support is conducive to voluntary work
behavior. Farh, Podsakoff, & Organ 51 find that perceived task autonomy has a strong positive effect
on prosocial behavior and voluntary compliance. Furthermore, a number of studies show that
participation in decision-making can lead to engagement in voluntary work behavior, such as helping
new members of the work group. 52 These findings support the following hypothesis: Hypothesis 1.
An autonomy-supportive organizational context increases voluntary work behavior. Need for
competence and support for competence. According to self-determination theory, all individuals
share the need for competence, i.e. they want to control outcomes and to experience efficacy. In
general, motivation requires that individuals see a relationship between their behavior and desired
outcomes. 53 A competence-supportive organizational context provides the individuals with
challenges. Challenges are found in tasks that are neither too easy nor too difficult and thus enable a
meaningful confirmation of individual ability. Another characteristic of a competencesupportive
organizational context is positive and helpful feedback. 54 Finally, competence is also supported
when individuals are provided with a meaningful rationale for their task, even if the assignment is not
challenging. 55 The effect of competence-support on voluntary work behavior has been established
empirically. Positive performance feedback enhances intrinsic motivation of students. 56 Deci,
Connell, & Ryan 57 show that positive work outcomes result when training managers provide
relevant information in a non-controlling way. Oldham & Cummings 58 have discovered that
manufacturing employees produce the most creative outcomes when they work on complex,
optimally challenging jobs and are given positive and mainly 7 informational feedback. Furthermore,
in a meta-analysis Kluger & deNisi 59 conclude that feedback has on average a moderately positive
effect on job outcomes, whereby constructive feedback is thought to be the driver for the positive
effects. Task feedback is also found to be an important antecedent of organizational citizenship
behavior. 60 Thus, we conclude:

2 Dispositions and Motivation: The Concept of Causality Orientation Self-determination theory

differentiates three motivational dispositions that tend to become manifest in behavior: autonomy
orientation, control orientation, and impersonal orientation. 68 Autonomy oriented individuals are
more likely to be intrinsically motivated in their conduct. Control oriented persons are more often
extrinsically motivated in their activities. Impersonal orientation is related to a state of amotivation
where behavior is experienced to be beyond one’s intentional control. 69 It is often linked to a sense
of incompetence. It is called “impersonal” because the behavior is believed to be initiated and
regulated by impersonal forces, such as chance and destiny. 70 Motivational dispositions are seen as
a function of former individual experiences with a supportive or non-supportive context. 71 For
example, long-term unemployed persons often score high in impersonal orientation, due to a history
of rejections. 72 Autonomy orientation. Previous research has revealed that autonomy orientation is
positively correlated with a number of positive behavioral outcomes. Persons who score high on
autonomy orientation show a higher engagement in self-chosen voluntary behavior: autonomy
orientation correlates strongly with self-ratings on the intensity of engagement in an animal welfare
organization. 73 Employees with high autonomy orientation experience higher need satisfaction and,
as a result, score better in performance evaluations. 74 Thus, there is some evidence that:
Hypothesis 4. A higher autonomy orientation increases voluntary work behavior. Control orientation.
Control oriented individuals tend to comply with external demands, that is, they tend to react to
threats, deadlines, and expectations of significant others. Deponte argues that control oriented
individuals are primarily driven by other people’s expectations. 75 Therefore, a negative effect on
voluntary work behavior can be expected. Hypothesis 5. A higher control orientation decreases
voluntary work behavior. 9 Impersonal orientation. Impersonal orientation is often connected to a
sense of helplessness and personal unworthiness. 76 Pelletier, Dion, Tuson & Green-Demers 77 find
that impersonal orientation has a negative impact on environment-friendly behavior. People with a
high score on impersonal orientation feel that they are not capable of performing and that this
behavior would not change environmental problems anyway. Thus, there is some evidence that:
Hypothesis 6. A higher impersonal orientation decreases voluntary work behavior. 3.3 Interaction of
Context and Dispositions: Motivational Dispositions as Moderators To our knowledge, the impact of
the interaction between organizational context and motivational dispositions on voluntary work
behavior has never been tested. The question on how both the organizational context and the
motivational dispositions influence behavior can be answered from several perspectives. First,
interaction could be modeled as a self-selection process, that is, people actively choose their
organizational context. It has been shown that people with high achievement motives are likely to
work as selfemployed entrepreneurs. 78 Second, interaction effects take place when people actively
change their organizational context. Kohn & Schooler 79 have found that people influence their jobs
more than their jobs influence them. In particular, people who are more flexible intellectually
enhance the complexity of their work. A third interaction approach is followed in this study: people
perceive situations differently depending on their dispositions. Mayer, Davis & Schoorman 80 suggest
that the propensity to trust moderates the perception of the trustworthiness-signaling characteristics
of a trustee. A person with a strong disposition to trust tends to view other people in a more positive
way. The same reasoning might also apply to motivational dispositions: motivational dispositions
alter the way individuals perceive the characteristics of the organizational context. The impact of the
organizational context’s characteristics on internal motivation depends on the aspect of the context
that is salient to the perceiver. 81 People differ in the extent to which they perceive the environment
to foster autonomy depending on their prominent motivational disposition. 82 Thus, the influence of
the organizational context on internal motivation should be moderated by the motivational
disposition of the individual. Autonomy orientation as a moderator. According to Deci & Ryan 83 ,
individuals scoring high in autonomy orientation tend to interpret their existing situations as more
promoting. 10 Koestner & Zuckerman 84 describe autonomous individuals as viewing unresolved
problems as challenges. They tend to be more task-involved than ego-involved, which makes them
choose opportunities for growth and challenge. 85 Furthermore, they seem to be more interested,
more open and more supportive in fostering these traits in others. 86 Individuals scoring high in
autonomy orientation feel more autonomous, competent, and related to their managers and
coworkers because of their tendency toward active engagement with the whole social context. 87
Thus, we suggest: Hypothesis 7. Autonomy orientation moderates the relationship between
organizational context and voluntary work behavior. The relationship between a need-supportive
organizational context (providing autonomy-, competence- and relatednesssupport) and voluntary
work behavior is stronger for persons with a high autonomy orientation than for persons with a low
autonomy orientation. Control orientation as a moderator. Control orientated people tend to
perceive their existing situation as more rigid; they interpret events as policing. 88 These individuals
look for guidelines, external standards, and external controls in order to understand what they are
expected to do. They concentrate more on themselves than on their tasks and chronically perceive
pressures from the environment. Hence, they focus on proving and defending themselves rather
than concentrating on the careful completion of tasks. 89 Hodgings, Koestner & Duncan 90 have
observed that control orientation is associated with more defensiveness in interpersonal
interactions. In sum, control oriented people are less likely to perceive the organizational context as
need-supportive. Thus, we assume: Hypothesis 8. Control orientation moderates the relationship
between organizational context and voluntary work behavior. The relationship between a need-
supportive organizational context (providing autonomy-, competence- and relatednesssupport) and
voluntary work behavior is weaker for persons with a high control orientation than for persons with a
low control orientation. Impersonal orientation as a moderator. A person with high impersonal
orientation tends to interpret most situations as threatening, i.e. he or she may believe to be at the
whims of some external agent. 91 This disposition often correlates with a sense of helplessness,
which makes these individuals vulnerable to failure experiences. 92 A need-supportive context, such
as organizational characteristics that are geared toward giving people leeway and autonomy, may
fuel this perception of threat and the fear to fail. Therefore, we expect: 11 Hypothesis 9. Impersonal
orientation moderates the relationship between perceived characteristics of the organizational
context and voluntary work behavior. The relationship between a need-supportive organizational
context (providing autonomy-, competence- and relatedness-support) and voluntary work behavior
is weaker for persons with a high impersonal orientation than for persons with a low impersonal
orientation

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5 STRUCTURE VS JOB SATISFACTION

The researcher wanted to find out through what ways the organization structure has helped
employees achieve job satisfaction. From the study, 32% responded that through delegation of
work they have achieved job satisfaction, 20% indicated that they have achieved job
satisfaction through promotion, another 32% indicated that they have achieved job
satisfaction trough receiving benefits and 16% said they have achieve job satisfaction through
recognition. The results of this question show that most of the employee’s achieved job
satisfaction through delegation of work and receiving benefits. Bill (1995) said delegation is
assigning responsibility and authority to someone in order to complete a clearly defined and
agreed upon task while you retain ultimate responsibility for its success. Delegation
incorporates empowering your teammates through effective leadership, and may be directed
in any direction and used in any organization. The following are also underlined as
importance of delegation;

Efficiency

Delegation improves efficiency when it allows work to be transferred to people whose skills
are a better match for the work. You are in charge of planning and strategizing the next steps
for your team. When your teammates are able to carry out most of the routine activities
required of your team, it will allow you the time and effort needed to plan for your team’s
next move.

Development

As a team leader, you possess important skills and abilities that you can pass on to your team
members. The best way of doing this is to coach them in the new skills and then delegate
tasks to them so that they may use those new skills. Delegating is a great way of encouraging
your team members to develop themselves and for you to develop coaching and mentoring
skills.

4.2.6 STRUCTURE PREFERENCE

The researcher wanted to find what kind of decision structure the employees preferred for
them to experience job satisfaction. 8% of the respondents opted for centralized decision
making, 36% indicated that there is a need for decentralized decision making system, 52%
responded that group decision making would help workers in achieving job satisfaction and
remaining 4% responded that individual decision making would help workers in achieving job
satisfaction. Therefore, the results shows that’s for teachers/ staff to experience job
satisfaction in relation to experience decision making structure there is a need for a group
decision making. Chand( 2011) outlined the advantages and disadvantages of group decision
making as follows;

1. More information:

A group is better equipped as far as information is concerned. An individual cannot have all
the information that is available to a group as it consists of several individuals.

2. Diversity of views:

A group always has the advantage of varied views. This is because a group always has more
than one member, and since every member is unique, there is bound to be a variety in their
views also. This is also the reason why there are varied approaches to solving a problem. As
group decisions tend to cover a greater area, they provide a better insight for decision-making.

3. Greater acceptability:

The views expressed by a group have more acceptance than those from an individual. This is
because the decisions are not imposed, but are part of a larger consensus (general agreement).
A group decision is automatically assumed to be more democratic, and the decision of an
individual can be perceived as being autocratic (dictatorial).

4. Expert opinions:

There may be some group decisions that require expert opinion. The group can either include
experts or can call them from outside to form a separate group to take a decision on a
particular issue.

Disadvantages:

1. Time-consuming:

A group involves several individuals. Getting them organized, planning and coordinating their
meetings, defining and explaining to them the purpose of a meeting and the goals, and finally
reaching a solution or arriving at a decision can be quite cumbersome. Making decisions in a
group can, thus, be timeconsuming. The time loss involved in group dynamics cannot be
ignored.

2. Lack of onus:

It is difficult to fix responsibility in a group. In an organization, it is often essential to fix

responsibility before a problem can be solved. It is difficult to do so if anything goes wrong
with a decision made by a group.

3. Individual domination:
Quite often, discussions in a group are dominated by a few members. Although a group
discussion means a collective discussion, some people usually manage to usurp (draw to
them) a position of informal leadership owing to their personality or style of participation.

This position can also be because of the position held within the organisation or simply
because of selfconfidence generated by previous experiences. Sometimes only a few
individuals dominate and the others fade away in a group, thereby defeating the very purpose
of group discussion.

4. Compromise decisions:

The need to arrive at a group decision sometimes results in a compromise. The solution
offered is not essentially the best. It is, instead, a compromise acceptable as a mid-point to all
concerned. There are different demands and social pressures, and members may agree to a
proposal without really evaluating it. Such support may not be wholehearted.

4.2.7 Motivation and incentives

The researcher wanted to find out what institution should do to satisfy their employees. From
the results, 36% responded by saying institution should give incentives to teachers/staff. 12%
opted for delegation of work, another 20% responded that there is a need for salary increment
and 32 % responded that they should clearly define roles in there organization structure.
Therefore, the results of the study indicate that with the introduction of incentives and clearly
define roles institutions will be able to satisfy their employees ·This is in coherence to what
McQuerrey (2011) on importance of incentives. She underlined the following as importance
of incentives

1 Motivational Tool

Incentive programs motivate employees to push and challenge themselves to achieve higher
degrees of productivity. This ultimately translates to increased earnings for your company.
When incentive plans are

in place, employees recognize that significant effort on their behalf will be acknowledged and
rewarded. This can increase the amount of time, effort and energy a staffer is willing to put
forth on your company’s.

2 Promoting Teamwork

Incentive plans tied to teamwork or group initiatives can help promote collaborative work
efforts in your business. Staffers working in teams that collectively rely on each other’s'
productivity for the group to receive a bonus or award may support and encourage each other
to perform at top levels. Peer pressure may also encourage additional degrees of performance
from underperforming staffers who don't want to let their team members down.

3 Morale Boosters

Incentive plans have the potential to raise morale and increase job satisfaction in a company.
Employees see a direct correlation between their work effort and their earning potential.
Higher workplace morale can decrease turnover, which saves your company money
associated with recruiting, hiring and training new staffers. Additionally, staffers with high
levels of job satisfaction often exhibit lower degrees of absenteeism, which can also help
improve a company's bottom line.

5 What do the results say?

The major reason of this research study was to assess the impact of organization structure.
From the results of the research study, it shows that organization structure has an effect on
employee performance. The results also show that a good organization structure is so
beneficial to employees for them to experience job satisfaction hence improve their
performance.

5.1 What do the results mean?

From the results, it also shows that building a good organization structure is in important for
employee to perform well in their W0rk44% of the respondents from the study indicate that it
is necessary for organization to have good organization structure since it helps in motivating
employee performance. Furthermore, the results of the study also provide evidence that group
decision making help employees to experience job satisfaction. If it is not well established
that there is no delegation of work and employees are not receiving benefits in the structure
then workers will leave for well-organized or work in other industries where they will
experience job satisfaction, but if good organization structure are established it will motivate
the performance of employees.

Orderly If you choose an orderly task design, then you are organizing your firm’s work so that it is
highly divisible and highly repetitive. You break up the work into pieces so that you can direct each
work unit to perform independently of other units. When each unit completes its work, the results
flow back up to the executive level, and then you assign a new piece of work to that unit. Units that
experience problems or difficulties turn to you to resolve problems. An obvious advantage of this
task design is that slowdowns or other difficulties in one unit don’t prevent other units from
continuing progress on their tasks. Within each unit the tasks are standardized as much as possible so
that they can be readily repeated. To the extent that workers in each unit are able to develop skills to
do the tasks assigned to their unit, the specialization of tasks can yield very high efficiency. When
tasks are designed using the orderly approach, there is almost no coordination required between
units performing the subtasks of the organization and no need for them to adjust to one another.
Piece work, whether in manufacturing or service industry, has these characteristics. The work of a
law firm could be organized in this fashion too. As clients contact the firm, they may be assigned to
an attorney who handles their case independently. Once a case is closed, the attorney is assigned
another case. The attorneys operate independently, processing cases, taking as much time as needed
before moving onto the next case. As another variation on the orderly approach, the attorneys might
be grouped by specialty such that customers with family law needs are assigned to the family law
group, clients with criminal law needs are assigned to the criminal litigation group, and so on. Again,
the work of the organization is divided across units such that individual units perform their work
independently of the others, completing the entire task assigned to them (low divisibility).
Completing the “big task” work of the firm is accomplished as the work is more or less standardized
and the individual units gain expertise to do their assigned work in an efficient manner. As another
example, consider mill workers who do hand sewing and are given an inventory or list of things to do.
Each worker takes an assigned garment to sew and places finished items in an out-basket. These in-
process inventories help create the divisibility of work. The worker may have fixed productivity
targets to meet, and these are monitored at the executive level. The executive has little to
coordinate, except to assure that assignment and completion of work is done in a satisfactory
Orderly 115 manner. Further, in the orderly approach it is the executive level that brings in the work
to the organization; the workers or subunits do not typically solicit work on their own. It is the
executive-level responsibility to assure that each unit or worker has something to work on.
Complicated If you choose to design your organization’s task so that it is low on divisibility yet
remains highly repetitive, then you have a complicated task design. Complicated tasks require a high
degree of coordination due to low divisibility; that is, the subtasks can be performed by different
units of the firm, but they are interdependent to get the work done. As an example, suppose you
manage a hospital emergency ward. You might divide the work into four subtasks: (1) admissions, (2)
triage screening, (3) focused care, and (4) release. Patients move sequentially through these
processes, with different groups of people (subunits) responsible for each of the four subtasks. The
work processes are repetitive and the services remain quite standardized (at least at the level of the
“big task” design). The complicated task design suits processing of large volumes of work. There are
many examples of a complicated task design in manufacturing, the most classic being the automobile
assembly line. McDonald’s is an example in the restaurant industry. The subtasks of order processing
are highly repetitive but not divisible, as the completion of an order for a customer requires that
each part of a meal is assembled correctly. Every order is unique within a limited set of possibilities
so that the tasks become very repetitive. Mass production requires not only the skills of orderly
production but also precise coordination among the units responsible for the subtasks. The
production processes must be timed to avoid bottlenecks and to meet efficiency goals in which
inventories between processes are minimized. A well-designed complicated task requires that these
work processes are repetitive and ongoing. The executive level overseeing the firm’s work focuses on
the coordination of the connected processes, which require continuous attention. Given the low
divisibility, a breakdown in any one small task can shut down the whole operation, which can be very
costly. Detailed and ongoing coordination requires a high level of information processing. Advances
in operations research, along with the embedding of information technology into manufacturing
processes, have increased managerial success in using complicated task 116 Task design designs.
Firms that use these designs can compete based on their ability to process work with great speed
and sophistication. Fragmented If you choose to design your organization’s task so that it is high on
divisibility yet low on repetitiveness then you are using a fragmented task design. Fragmented tasks
require less coordination than complicated tasks due to their high divisibility. By reducing
coordination needs, each subunit can process work at its own pace; it doesn’t have to wait for other
units to complete their work in order to proceed. Further, the subunits can take creative approaches
to completing their tasks, perhaps soliciting their own customers or clients, since bottlenecks are not
a concern. By breaking down the big task of the firm, the subunits are likely to be more innovative
and aggressive. Some may outperform others or contribute more to the firm’s overall work
completion. Consider a technology development firm, such as a software developer, that is trying to
grow its business. The needs of its customer base (individuals, small business, large business, and
government) are quite different, that is, they are not repetitive. The work of each subunit is
conducted independently. Alternatively, the firm might divide the work according to type of
software, such as desktop software and network-based software. In either case, if the big task is
treated as highly divisible and with low repetitiveness, then the task design is fragmented. Within
each subtask, the work could be further fragmented, or another task design might be selected. The
fragmented task design means that the firm divides its work so as to accommodate the varied nature
of its business. Although it is tempting to think that task design is inherent in the work itself, it is
important to recognize that in many cases the same work might be designed in different ways. Thus
task design is a matter of managerial choice. Suppose your organization is an investment bank. You
might choose a fragmented approach, dividing your big task into subtasks such as investment
counseling, trust services, and estate planning. Each group is free to solicit its own customers and
design its services to meet customer needs. There may be repetitive work within each of these
subunits, but at the level of the big task design of the bank, there is low repetitiveness; that is,
customers are directed to one group or another, and work is accommodated to meet their unique
needs. The nonrepetitiveness approach to task design requires lots of adjustments (i.e., execution of
work Fragmented 117 is not standardized); but as these adjustments are not connected, the
coordination requirements are quite minimal. To manage a fragmented task design, the executive
needs to ensure that the subtasks (i.e., the subunits) have resources and a reading on the
environment, but the executive need not be involved in detailed coordination. In the case of the
investment bank, the fragmented design may not be the ideal choice, especially if customers prefer
that the subtasks be coordinated, e.g., if they want their estate planning to involve their trust
accounts. This is the downside of designing tasks to have high divisibility. The investment banker
might consider a knotty task design instead. Knotty The knotty task design is low on both divisibility
and repetitiveness. If you choose a knotty task design for your organization, then you will have to
invest in ways to coordinate work among the subtasks and at the same time support the
nonrepetitive approach to doing the work. Knotty tasks are not standardized. This approach to task
design encourages those responsible for subtasks to develop innovative ways to do their work,
accommodating the unique demands of each customer, while at the same time those performing
subtasks must integrate their work with other units in the firm. Knotty tasks are likely to lead to the
greatest customer satisfaction since production is customized, but they are the most demanding type
of task to manage. When products are new, the knotty approach to task design is often favored by
managers. High technology innovative products and services are illustrations – such as a new and
short-lived video game, a biotech entity, or a new global financial instrument. The executive focuses
on the coordination of the connected processes, which are continually changing. Given the low
divisibility, a breakdown in any one small task can shut down the whole operation, which can be very
costly. Given the nonrepetitive approach to task design, the information-processing demands
increase greatly. Taken together, the information-processing demands go up nonlinearly with
executive overload. Therefore, this task design is the most demanding on management. New product
development (NPD) in automobiles at Toyota or Renault, pharmaceuticals at Eli Lilly, or household
products at Unilever, requires high coordination and adjustment of the tasks to the emerging
technology. NPD tasks are often designed according to a knotty approach, but a knotty approach can
be applied in more routine industries for competitive advantage. For 118 Task design example, a
gourmet restaurant may create new food offerings each day, with each new offering requiring
unique production and high coordination among the kitchen staff. Since the task is designed to be
nonrepetitive – providing a new dining experience each time customers visit the restaurant – the
organization must have highly skilled staff that can continually innovate and coordinate with
perfection. Diagnostic questions How is the task designed in the organization you have chosen to
design? As in prior chapters, use the same unit of analysis that you selected in Chapter 1 to answer
the following questions. In answering these questions, it is very important to take a top-down
approach and limit the analysis of the task to the “big task” of your unit analysis. (Remember,
subtasks, once created, have their own designs.) Note that the rating scales for task design are
reversed, so that 1 ¼ high and 5 ¼ low. 1. What is the degree of repetitiveness of the task in the firm,
i.e., high to low? a. Does the firm treat each work task as unique (low)? b. Does it execute the task
today much as it did yesterday (high), or is there a good deal of variation (low)? c. To what extent
does it standardize the task (high) rather than customize it (low)? Score the repetitiveness on a scale
from 1 to 5 as follows: 1 23 4 5 very high moderate very low 2. What is the degree of divisibility of
the task in the firm, i.e., high to low? a. Does the firm divide its big task into subtasks that are
independent of one another (high), or are the subtasks connected, requiring a lot of coordination
(low)? b. Does it manage the task as a set of specialized independent functions (high) or as a process
flow (low)? Diagnostic questions 119 c. To what extent are the units that perform the subtasks free
to design their work as they wish (high) rather than as instructed (low)? Score the degree of
divisibility on a scale from 1 to 5 as follows: 1234 5 very high moderate very low You can now locate
your firm on the graph in Figure 6.2. What is the firm’s task design? Fit and misfits Table 6.1 is the
table from Chapter 5 with the task design row added. Again, there is fit among the design elements
of your chosen firm if the entries for each row fall into the same column. Misfits are deviations from
a common column. The orderly task design is appropriate if your firm’s goal is neither efficiency nor
effectiveness. There can be some efficiencies in the orderly task design due to its repetitiveness, and
for this reason, managers may find this approach to task design to be appealing. The orderly task
design approach works well so long as the environment is calm and the corresponding strategy is a
reactor which is also unfocused. A simple configuration works well for the orderly task design as it
breaks the total task into smaller tasks which require very little coordination from the executive.
Knowledge can be exchanged on an ad hoc basis. So long as things are calm, the organization with
the simple Figure 6.2 Locate your firm in the task design space. 120 Task design configuration using
the orderly task design creates minimal informationprocessing requirements. The executive is not
overloaded with detailed coordination problems – unless the environment changes. The risk for the
firm occurs if new business causes a shift in the type of work needed such that high repetitiveness is
not possible. Then the orderly approach is a misfit and the task design inappropriate. Organizing
work so that it is divisible and can be executed as independent subtasks puts a high load on the
manager if there is any change in the environment. If your organization adopts an orderly task design
approach then you should be aware that this is a misfit with an efficiency strategy of a defender or an
effectiveness strategy of a prospector. Any deviation from a calm environment creates difficulty as
adjustments will be required. Functional, matrix, and divisional configurations are more costly and
are not needed to achieve the Table 6.1 Fit and misfit for task design Corresponding quadrant in
organizational design space A B C D Task design Orderly Complicated Fragmented Knotty Knowledge
exchange Ad hoc communications Informated Cellular Network Geographic distribution Global
International Multidomestic Transnational Complexity Blob Tall Flat Symmetric Configuration Simple
Functional Divisional Matrix Environment Calm Varied Locally stormy Turbulent Strategy types
Reactor Defender Prospector Analyzer with innovation Analyzer without innovation Organizational
goals Neither Efficiency Effectiveness Efficiency and Effectiveness Fit and misfits 121 required
coordination for the highly divisible and highly repetitive task. For most organizations, an orderly task
design is not sustainable except for the most routine operations, making these types of tasks good
candidates for automation or outsourcing. The complicated task design is focused more on efficiency
than on effectiveness. The corresponding strategy is a defender where the efficiency of
repetitiveness helps achieve profitability through low cost. The varied environment, which is complex
but predictable, is a good fit for the complicated task design. So is the functional configuration since
it has the capacity to coordinate detailed and standardized processes which rely heavily on rules and
procedures. The complicated task design is a misfit with an analyzer strategy, which requires
innovation and introduces nonrepetitive processes. Similarly, turbulent and stormy environments
require adjustments which are extremely difficult to make if you have designed your organization
using a complicated task design. The executive will be overloaded with the coordination details. The
fragmented task design is focused more on effectiveness than on efficiency. This approach to task
design works well if you are pursuing a prospector strategy, seeking high degrees of effectiveness
and continual innovation. If your firm faces a locally stormy business environment, i.e., high
unpredictability, then it makes sense to design work so that it is high in divisibility and low in
repetitiveness. The divisional configuration is a good fit; here management focuses on providing
resources and policy but not detailed coordination. The cellular configuration is also a good fit. The
fragmented task design is a misfit if your firm has the dual goals of both efficiency and effectiveness.
Fragmented task design breaks the big task into subtasks which are relatively independent and
optimal in the use of resources. It is therefore hard to achieve efficiencies for the big task if the
fragmented task design is adopted. The knotty task design is appropriate if your firm has the dual
goals of both effectiveness and efficiency. The turbulent environment, which is complex and
unpredictable, is a good fit. The corresponding strategy is an analyzer with innovation. The matrix
configuration is a good fit because it emphasizes coordination across multiple dimensions and
ongoing coordinated adjustments of the work to meet organizational goals. The knotty task design
customizes work and so, if done well, can yield high customer satisfaction for a range of customer
demands. As we shall see in the next chapter, conducting the knotty task requires highly skilled
employees and management that can simultaneously support autonomy, control, and learning as
tasks are executed. 122 Task design The knotty task design is a misfit with any strategy, environment
or configuration which has a dominant focus on either efficiency or effectiveness. If your chosen firm
is pursuing a defender or prospector strategy, then you should avoid the knotty approach to task
design because it is too complex and expensive and so not the best fit for your goals. Summary This
chapter on task design further completes the description of a firm to find a design that fits with its
goals, strategy, and structure. In this chapter you described an organization’s task design in terms of
repetitiveness and divisibility, and categorized it as: orderly, complicated, fragmented, or knotty. If
the organization’s current approach to task design does not fit its organization’s goals, strategy or
structure, it should consider adjusting the task design so that the task design is aligned with the other
dimensions. Next we turn to the human resource requirements that are needed to support a firm’s
task design. Glossary Complicated task design: an organizational task design in which work is
organized in a way that it is not very divisible but highly repetitive; usually requires a high degree of
coordination among the subtasks. Divisible task design: a task which can be broken into subtasks that
are relatively independent of one another with respect to resource utilization and dependency of
operations. Fragmented task design: an organizational task design in which work is organized to be
highly divisible but not repetitive; usually requires less coordination compared to complicated task
design. Knotty task design: an organizational task design in which work is organized in a way that it is
neither divisible nor repetitive; usually requires not only coordination among subtasks but also
support for the nonrepetitive nature of subtasks. Orderly task design: an organizational task design in
which work is organized in a way that it is highly divisible and highly repetitive; usually requires
relatively little coordination among the subtasks. Repetitive task: a task which is well-defined (i.e.,
standardized) so that it is executed again and again. Task design: decomposing work (the big task)
into subtasks and then coordinating among the subtasks to meet organizational goals. Glossary 123 7
People Introduction “An enterprise is its people,” so stated the famous Japanese industrialist
Matsushita Konosuke. Like many successful business leaders, Matsushita believed that effective
management of people was an essential ingredient to a firm’s ability to reach its goals (PHP Institute,
1994). From an organizational design perspective the question for the executive is: what is the best
way to manage people, given the organization’s goals, strategy, structure, and task design? As is the
case for other dimensions of design, multiple approaches are possible. Deciding among these
approaches depends on two critical factors: the number of people in the organization and their
professionalization. The organization and the people must fit together. Depending on the design
choices you have made with regard to goals, strategy, structure, and task, different approaches to
managing people are recommended. We will deal with the people dimension of organizational
design in two ways. In this chapter you will describe the size and capabilities of a firm’s workforce.
These dimensions affect the firm’s information-processing capacity. In the next chapter you will
assess the leadership and organizational climate of the firm. These dimensions affect the ability of
people to handle information, cooperate and make decisions. We defined the organization in
Chapter 1 as a social entity, so it follows that how you manage the people in your firm depends on
how many people you employ and the kinds of capabilities they bring to the organization. Managing
people is a complex matter, and many factors might be considered. Here we want to focus on the
most fundamental factors that relate to organizational design. So we take a minimal approach in this
chapter, focusing on (1) the size of the labor pool, and (2) the degree of professionalization. In the
next chapter we will address the attitudes of top management and employees as they are important
as well with respect to understanding the relationship between people and the organizational design.
Depending on the relative size of the firm’s workforce and its professional capabilities, different
managerial approaches are appropriate. Our attention to these two factors fits with our information-
processing view of the firm. Most of the information processing in a firm is done by the individuals in
the firm. People represent the intellectual capacity of the firm. This is especially true in today’s
knowledge-intense enterprise. Although people bring skills and intellectual resources, having more
people is not necessarily a better state from an organizational design standpoint. Large organizations
(i.e., those with more people) must be designed differently than smaller ones (Burton, Minton and
Obel, 1991). For example, larger firms are usually more decentralized. If there are only two people in
a firm, then the decision-making, communications, and coordination are easy. As the number of
people increases, communication becomes very problematic. People generate information as they do
their work, and they also require information as inputs to their work. So there is a growing need for
information exchange as the size of the firm increases. If each person talks to everyone else, then the
communication links grow quickly and exponentially with the number of people (Burton and Obel,
2004). It is not a practical solution for General Motors to have all of its 300,000 employees talking
with one another. Even for much smaller firms or subunits, communications are limited. Electronic
communication systems may make transmission of information relatively easy, but, as we know from
information-processing theory (Chapter 1), each person’s attention is limited and costly. This is also
true for the subunits in which people are organized. Information-processing capacity is limited. So we
need ways to limit information and focus it on the goals and tasks. The configurations we discussed
in Chapters 4 and 5 limit communications and direct them along the hierarchy in the functional and
divisional configurations or across units in the matrix. Indeed, one of the major reasons to form
configurations is to manage the otherwise extraordinarily high information flow in the firm.
Depending on the organizational configuration, one person communicates with a small fraction of
the total workforce in the firm. The firm is able to coordinate its activities across a very large number
of people. Introduction 125 As you design your organization, you must decide not only whether to
employ many people or a few but also what types of people are needed, given your strategy and
structure. The professionalization of the workforce is a measure of its skills, knowledge, and capacity
to both generate and process information. If your organization has a more professional workforce,
then individuals can perform tasks that are more complicated, lengthy, and cognitively difficult.
Education, training, and experience increase the professionalization. In turn, how people are
managed can affect their professional development. Organizations that are not designed to benefit
from and enhance the professionalization of their workers are less likely to meet their efficiency and
effectiveness goals. The individual’s knowledge is the basis for what he/she can do. In this sense, it is
the realized skill. This knowledge may be explicit, which means it can be codified. Or it may be tacit,
which means it is not readily documented. Explicit knowledge is easier to capture and transfer
around the organization to others; tacit knowledge is far more difficult to transfer and requires rich
forms of social interaction in order to be shared. The more professionalization that exists inside the
firm, the greater is its capacity to exchange tacit knowledge. Whether explicit or tacit, knowledge is
the basis for the skills and other aspects of the professionalization level, as well as the routines and
other capabilities people apply in doing the work of the organization. It is important to note that
individuals are “boundedly rational,” which means that we are limited in our capacity to process
information (March and Simon, 1958). It seems obvious that each of us cannot do all things perfectly
and instantaneously. We have imperfect information, which we interpret reasonably but imperfectly;
and we communicate only a fraction of what we would like to communicate and, again, imperfectly.
The bounded rationality of people is at the heart of why we need an organization. At the most
fundamental level, we need configurations, task designs and information systems to permit us to
reach large goals in the face of our bounded rationality. Even with high professionalization,
individuals are boundedly rational, and the organization is a way to cope with that limitation while at
the same time harnessing the skills and capabilities that people collectively offer in performing work
tasks. The number of people in an organization and their professionalization measure the basic
characteristics of the people dimension of the organization’s design. The number of people is simply
a count of all individuals in the firm (i.e., unit of analysis). Professionalization is the collective skill
level of the individuals and a measure of their capabilities for the work tasks at hand. 126 People
Professionalization depends upon employees’ education, training, and experience, i.e., their
knowledge base, whether accumulated prior to their hire or on the job. In Figure 7.1, there are two
dimensions: professionalization on the horizontal axis and the number of individuals on the vertical
axis. Depending on these two dimensions, there are four general approaches to people management.
Beginning in the lower left corner, there is the shop where the number of people is low and
professionalization is low. Moving to the upper left corner, we have the factory, which has a large
number of people, but relatively low professionalization. In the lower right corner professionalization
is high, but there are few people, which we call a laboratory. Finally, in the upper right corner there
are many people with high professionalization, which we call an office. Each category describes a
different approach to designing the people component of organizational design. We will now look
into each of the four categories. Shop The shop approach to managing people involves employing
few people who are low on professionalization. The shop design works well if the individuals have
not had specialized training or if their experience has not given them extensive skills. Examples of
such organizations are small stores that employ people who are only given a few days of training. In
this design, the informationprocessing capacity of the employees is low. Routines must be simple
with only a few steps; they must be easily understood and easy to learn. The manager of the shop
must be “hands on” in directing people in order for the shop to run Figure 7.1 The people space.
Shop 127 smoothly. Coordination requirements are low so long as there are few people, particularly
if the task design is fragmented. The shop is not focused on efficiency or effectiveness. People are
generally not efficient due to low skill and are expected to wait for direction from management.
People are not encouraged to develop skills, make decisions, or advance significant change to
improve the organization. The shop design is appropriate if tasks are orderly and the available
workforce is small and low-skilled. In this case, the manager can give individualized instructions and
change the instructions as work comes into the organization. Difficulties arise, however, if a large
number of people or those with professional skills are managed via the shop approach. If
management tries to “micro manage” in the sense of directing a large number of people on what to
do on an individualized basis, then the organization will be inefficient. If management tries to micro
manage professionals on what to do on an individualized basis, then the organization will be
ineffective. For larger organizations, or for those with a professional workforce, management should
consider a factory, laboratory, or office approach. Factory The factory approach to managing people
involves employing many individuals who are low in professionalization. Here the assumption is that
people have relatively little specialized expertise and the routines are relatively simple, meaning that
their work tasks can be executed repetitively following training. Employing a large number of
individuals means that there are very high coordination requirements. Thus, the factory is focused on
efficiency, which requires detailed coordination for a large number of individuals. To run a factory,
you need many people, and you need focused skill sets rather than broad professionalization. The
assembly line is a classic example of the factory. To build an automobile, the total task is broken
down into hundreds of small tasks each of which is relatively low-skilled. But the overall coordination
is extremely high as the matching fender, wheel, engine, and hundreds of other items must come
together exactly on the assembly, where task design makes it routine to put the pieces together.
Today’s modern call center manages people as a factory. Large numbers of people are employed and
given focused, repetitive tasks to perform as they place or receive large numbers of phone calls.
People with low 128 People professionalization are ideal for such work. Another example is a large
hotel, where there are a large number of low-skill jobs, and tasks are designed in an orderly fashion
with high repetitiveness. If workers have high professionalization, then the factory approach to
managing people is less desirable, since the design does not take advantage of the knowledge and
skill capacities of professionals. Laboratory The laboratory approach to managing people involves
employing a few people, each with high professionalization. Professional routines which are obtained
through extensive education, training, and experience permit relative independence among the
individuals or among small collections of individuals (such as those working together in a cellular
configuration). High professionalization facilitates worker autonomy rather than strict supervision, so
each one can work alone and the manager’s job is to support the individual. A good example could
be a university faculty where independent scholarship is the norm. Other examples include a
financial research group, salespeople who seek their own clients, and high-tech software design
groups. In the laboratory design detailed coordination of activities is not required; in fact, it may be
considered intrusive in the sense that directive management can stifle knowledge production and
discovery of innovative ways of doing things. Motivation and incentives are the important means for
coordination. The laboratory is focused more on effectiveness and high quality than on efficiency.
Each individual, or subunit of professionals, can work with relative autonomy and achieve the
purpose for the organization. There are many high-level work routines for the individuals, but these
routines are varied and largely under the control of the individuals, not the organization. The
routines are very complex and include many tacit aspects which cannot be codified but have high-
quality requirements. Detailed coordination is usually not required. Instead, workers coordinate in
small groups for intense information sharing, and these groups then build directed knowledge
exchange with the specific clients, subunits, or other sources needed to accomplish their tasks. 3M is
a good example of a company that uses a laboratory approach to managing people. Individuals and
subunits are encouraged to create new Laboratory 129 products and services with relative
autonomy. It is a cellular configuration where there are relatively few individuals in each cell, but it
replicates itself into a very large corporation. Office The office approach to managing people involves
employing many people with high professionalization. Again, professionalization comes from
education, training, and experience. Due to the large number of people to manage, the need for
coordination is very high. The organization must process lots of information and support extensive
communication. High-level work routines are very important as they help define and manage work
for efficiency and effectiveness. Large consulting organizations have highly skilled professionals who
must be coordinated in complicated detail to meet the needs of the client. These organizations often
manage people as an office. Employees are given autonomy to do their work but they also engage in
heavy communication with others as they develop client projects and meet customer needs.
Consultants may be organized into subunits which, in turn, are managed as an office, meaning that
the subunits operate with a combination of autonomy and inter-unit coordination. Many large-scale
engineering construction firms and new product development projects within pharmaceutical firms
are managed in this way. Deciding whether to organize as an office – like deciding about other
components of organizational design – is a matter of managerial choice. The office approach is
recommended if a firm has large numbers of people with high professionalization. Note that the
communication demands of the office are larger than in the laboratory. Workers are given autonomy
to find, process, and produce knowledge; but they also are expected to engage in intense knowledge
sharing with others who are dependent on them to do the work of the organization. The
interdependent nature of work is higher in an office than in a laboratory. Subunits have more people,
though they are managed as professionals. Again, the office consists of a large number of highly
skilled people who work together to accomplish the simultaneous goals of efficiency in using work
routines to execute tasks and effectiveness in meeting organizational goals. 130 People Diagnostic
questions For your firm, you can examine the two dimensions, number of people and their
professionalization, and locate where the firm is in Figure 7.2. Then you can categorize the firm’s
design of people as: shop, factory, laboratory, or office. To begin, answer the diagnostic questions
below. Figure 7.2 Locate your organization in the people space. 1. What is your unit of analysis that
you chose in earlier chapters? Use this unit of analysis as the organization when answering the
questions below. The questions below will help you locate your chosen organization on the number
of people and professionalization dimensions. 2. Number of individuals How many people are there
in the firm? Normally, we mean the number of employees. The measure is the actual count of
individuals who are working in the organization, whether full time or part time.1 Here is the mapping
for the actual number into the scale in Figure 7.1. Less than 100 employees – 1 101–500 employees –
2 501–1000 employees – 3 1001–2000 employees – 4 More than 2000 employees – 5 1 It is
important to include all people, not just full-time equivalents, as it is the number of individuals that
determine the coordination requirements. Diagnostic questions 131 3. Professionalization What
proportion of employees hold advanced (university) degrees or have many years of specialized
training and experience? 0 to 10% – 1 11 to 20% – 2 21 to 50% – 3 51 to 75% – 4 76 to 100% – 5 4.
You can now locate your organization in Figure 7.2. What would you call the people mapping of the
firm? Fit and misfits What is a good fit between management of people and other dimensions of an
organization’s design? Here, we discuss the fit and misfit relations. In Table 7.1, we add fit for the
people to earlier dimensions. In each of the columns A, B, C, and D, the fit relations can be read
vertically from top to bottom. As before, misfits are any set of relations which do not fall within one
column. There are a very large number of possible misfits. The misfits arise from the size of the
workforce or their professionalization. A critical issue is the limited time and skill of the individual as
well as the limited attention and time of management. These misfits can overload the executive
oversight of people and lead to diminished performance for the firm. The telltale signs are:
individuals are not aware of what to do, or are given directives that hamper rather than facilitate
their coordination; decision and communications backlogs increase; adjustments are not timely; or
all work excessively long hours without results. For column A, there is a fit for the shop with a reactor
strategy, a calm environment, a simple configuration, and orderly task design. In the shop setting
people can do their jobs following a rather limited direction and coordination. There are relatively
low information-processing demands on everyone, except on the manager who oversees the shop. If
the strategy or the environment requires more attention and time, then the individual’s tasks need
to change and the executive can quickly become overloaded. The individual’s activities 132 People
quickly become misaligned with the new challenges. One approach to handle these new challenges is
significant professionalization of the employees. The potential misfits are numerous in the shop
setting. If the environment becomes more uncertain and requires changes involving a new strategy
that is not just reacting to the events in the environment, it is very likely that the nonprofessional
people inside the shop will either resist change or lack the skills or experience for change.
Alternatively, if the workforce is professional or very large and managed via one-to-one directives by
the manager, the shop becomes very ineffective and inefficient. Table 7.1 Fit and misfit for people
design Corresponding quadrant in organizational design space A B C D People Shop Factory
Laboratory Office Task design Orderly Complicated Fragmented Knotty Knowledge exchange Ad hoc
communications Informated Cellular Network Geographic distribution Global International
Multidomestic Transnational Complexity Blob Tall Flat Symmetric Configuration Simple Functional
Divisional Matrix Environment Calm Varied Locally stormy Turbulent Strategy types Reactor Defender
Prospector Analyzer with innovation Analyzer without innovation Organizational goals Neither
Efficiency Effectiveness Efficiency and Effectiveness Fit and misfits 133 Moving to B, the factory is a fit
for an efficiency goal, defender strategy, varied environment, a functional configuration, and a
complicated task design. The information-processing demands have increased considerably as there
is a large number of individuals to coordinate. For many variations, a tall functional configuration can
handle a large amount of information needed for detailed and involved coordination. However, if the
environmental unpredictability increases and thus requires additional information processing, then
the functional configuration is not suited to make large coordinated changes quickly. In such a misfit
situation, the individuals will require greater professionalization. Use of automated systems can help
reduce the need for greater professionalization, as computer-based routines and information
substitute for adding skills and experience to the workforce. It is for this reason that call centers are
sometimes criticized as technology-based sweatshops. Technology substitutes for increasing the
professionalization of the workforce. Efficiency is enhanced, but the knowledge capacity of the
people is not enriched. The higher-level routines and formalized rules between and among jobs and
individuals help to coordinate the total set of activities for the factory. High organizational complexity
with a large number of low-skill jobs and a tall organization for coordination works well, but change is
difficult. The functional configuration is a good fit for the detailed operational coordination of the
factory. A varied environment where changes are small and anticipated is a good match as well. The
complicated task design of low divisibility and high repetitiveness fits the factory, because there are a
large number of people who are managed at low skill level. The potential threat for managing people
in a factory setting is change that may involve a higher degree of decentralization and a flexible
response to changes. For column C, the laboratory is a good fit for: a flat complexity, a divisional or
cellular configuration, a locally stormy environment, a prospector strategy, and an effectiveness goal.
In a laboratory the individuals are very skilled and can deal with variation derived from environment
and innovation. The executive can create independent divisions to deal with the local conditions.
Each division has its own environment which is stormy but largely independent of the others. As the
number of subunits increases, the coordination issues will become problematic and will eventually
create a misfit. Alternatively, if the environment changes such that two divisions compete for the
same customer, the executive can become overloaded with coordinating details – again, creating a
misfit. The tall firm is a misfit for the divisional configuration. If the top 134 People executive
becomes involved in the detailed operations of the firm, cognitive overload, neglect of important
issues, and poor firm performance will occur. The cellular configuration is a good fit where there is
relative independence between cells – not necessarily within a cell. On a larger scale, the divisional
configuration is similar; there can be relative independence between divisions – not within divisions.
A prospector strategy which develops new things in a locally stormy environment is a good match.
High skill permits exploration. These tasks can be fragmented with high divisibility and low
repetitiveness. For column D, the office is a fit for a symmetric complexity, a matrix configuration, a
turbulent environment, an analyzer strategy and dual goals. This requires highly skilled individuals to
work together so as to realize the needed coordination. The information-processing demands are
very large as detailed coordination is required by new situations (Galbraith, 1973). The firm simply
cannot be broken down into independent divisions, nor can a tall hierarchy handle all of the changes
required to effectively adapt to a turbulent environment. The executive can create divisions to deal
with the local conditions, but the matrix configuration is a good match when the task design is knotty
and the environment is turbulent. A large number of skilled individuals will help to execute knotty
tasks and deal with continual change and coordination across the matrix. Departures from the
alignment lead to costly misfits. The matrix configuration where there are two or more reporting
dimensions (but fewer than where all individuals can talk with each other) is a midrange solution to
limiting information processing and obtaining the needed coordination. The focus here is both
efficiency and effectiveness. An analyzer strategy with innovation in a turbulent environment is a
good match. Further, the task design can be knotty with high divisibility and low repetitiveness. If
your chosen firm is located in different columns based upon your answers from these four chapters,
then you should think about what you might do to bring the firm into fit in the column that meets
your goals. But also think about what is involved to move to a different goal and thus a different
column. Summary In this chapter, we have outlined the people component of organizational design,
which should fit together with other design components to meet your firm’s goals. There are four
categories: shop, factory, laboratory, and office, which are located on two dimensions: the number of
people and their Summary 135 professionalization. The idea of choosing the two dimensions is
related to the task of processing information, where the degree of professionalization is a proxy
measure for the individual’s ability to process information. Taken together with the number of
people, we thus have a measure of the information-processing capabilities embedded in the human
capital of the firm. We also discussed misfits. These misfits were developed from the idea of
information processing given the setup of the 2 2 model. For example, a defender strategy with its
high volume of standardized activities does not fit a laboratory with few people with a high degree of
professionalization. file:///G:/Master%20rad/pregledano/kupdf.net_organizational-design-burton-
obel-amp-desanctis.pdf

THE EFFECTS OF CENTRALIZATION ON CREATIVITY AND LEARNING Structural centralization refers to

the governing of organizational decision making (Wallach, 1983). The latitude of decision-making
ranges from centralised—decision making is centrally organised within a small group of authoritative
individuals—to decentralised structures— decision making occurs across a range of levels within an
organization—(e.g., Fredrickson, 1986; Floyd and Wooldridge, 1996). Studies (e.g., Amason,
Thompson, Hochwarter, and Harrison, 1995) show that in settings with low levels of centralization,
individuals are exposed to more opinions and information, resulting in a creative integration of
perspectives. Low levels of centralization are more likely to encourage creativity (Leenders, van
Engelen, and Kratzer, 2003). This also facilitates information exchanges and interaction among
individuals, leading to the generation of meaningful information and interpretations (Senge, 1990). In
contrast, high levels of centralization can lead to conflicting perspectives and can hinder the
development and implementation of new ideas (Wi l d a v s k y, 1979; Fiol, 1994). The argument
concerning organisational structure, in general, applies also to alliance settings. That is, high levels of
structural centralization in the alliance team restrict decision-making within the alliance to a
designated set of people within that team. This limits interaction and information exchange between
members within the alliance team, implying, in turn, that high centralization inhibits learning of the
team memb e r s . Document téléchargé depuis www.cairn.info - - - 89.111.237.94 - 06/05/2020
12:54 - © AIMS Document téléchargé depuis www.cairn.info - - - 89.111.237.94 - 06/05/2020 12:54 -
© AIMS M@n@gement, Vol. 7, No. 3, 2004, 257-273 Special Issue: Practicing Collaboration 262 Tania
Bucic . Siegfried P. Gudergan Leaning on work pertaining to organizational structure, Hage’s work
(1980) implies that centralization in alliance teams refers to the hierarchical position of the decision
maker within the alliance. We define structural centralization as the concentration of decision-
making within a small group of people within the alliance team. Applying the understanding of
organizational structure to the interorganizational setting and the alliance team, in particular, we
argue that low levels of centralization in alliance teams are more conducive for learning and
encourage alliance team members to share and integrate their perspectives to produce new ideas,
having a positive impact on creativity. This leads to the following two hypotheses: Hypothesis 1:
Greater centralization in the alliance team is associated with low levels of creativity in the alliance
team. Hypothesis 2: Greater centralization in the alliance team is associated with low levels of
learning in the alliance team. THE EFFECTS OF FORMALIZATION ON CREATIVITY AND LEARNING
Formalization is a primary dimension of organization structure (Pugh, Hickson, Hinings, and Tu r n e r,
1969) and is viewed as a design parameter of formal structure (Mintzberg, 1979). Structural
formalization refers to a mechanistic orientation in organizations and is characterized by rigid
guidelines that instill conformity among members, policies and methods. As a result, individuals are
pressured to adopt mechanistic approaches to their work, interactions and approaches to problem
solving (Burns and Stalker, 1961). Bartlett and Goshal (1991) suggest that organizational structures
that are characterized by high levels of formalization lack effectiveness in current business
environments because of their inflexibility and upholding of closed systems. B o n n e r, Ruekert and
Walker (2002) add to this view by suggesting that while some degree of formal control is necessary
for proficient management, excessive or inappropriate formal control may hinder a t e a m ’s
creativity. Overall, less formalization is beneficial for creativity (Brown and Duguid, 1991). In contrast,
structures that reflect a lower level of formalization make allowances for organizational slack and
allow members to interact relatively freely. Burns and Stalker (1961) suggest that these structures
are suitable for dynamic organizations which require constant change and adaptation. Collier and
Esteban (1999) suggest that organizations in evolving and unsettled environments should be
responsive and flexible to cope with continuous change. We suggest that a structure displaying a high
level of formalization restricts individuals in the alliance team through imposing procedures and
boundaries, limiting interaction opportunities, and hence reducing learning potential. In addition, we
argue that extensive formalization is a hindrance to creativity. We define structural formalization as
an inflexible system of control governing the alliance team reflected in norms and procedures and
conclude with the following two hypotheses: file:///G:/Master%20rad/MANA_073_0257.pdf

Autonomy has been found to positively predict various behavioral outcomes such as objective and
subjective employee performance and absenteeism, attitudinal individual and group level outcomes
such as job satisfaction, job involvement and organizational commitment, and organizational
outcomes such as customer satisfaction [5, 19, 51]. Autonomy is considered of particular value in so-
called “adhocracy cultures” in which “an idealistic and novel vision [that] induces members to be
creative and take risks” results in enhanced risk-taking andgreater innovative adaptability [52]. On
the downside, however, it has also been shown that high levels of autonomy and low levels of
monitoring can result in lower team performance than high levels of autonomy and high levels of
monitoring [53], implying that putting too much trust in an autonomous team can also be
detrimental. Autonomy and innovative work behavior From a work design motivational perspective
[22], based on an index of job characteristic dimensions including job autonomy, it was found that
job complexity was positively related to supervisor-rated employee creativity and performance [57].
Several studies have also found a positive relationship between work design features such as
autonomy and creativity and innovation at work (e.g., [48, 63–65]). For example, Dul and Ceylan [66]
investigated the influence of a creativity-supporting work environment (e.g., challenging job,
teamwork, job autonomy) on firms’ new product introduction to the market and showed that the
more a firm’s overall work environment supports creativity, the higher the firm’s percentage of sales
from new Contextual work design PLOS ONE | https://doi.org/10.1371/journal.pone.0204089
October 4, 2018 5 / 35 products. In a similar vein Ramamoorthy, Flood [48] directly and indirectly
tested the influence of job autonomy on innovative work behaviors when mediated through an
obligation to innovate and found that job autonomy had a direct positive effect on innovative work
behaviors. Autonomy has further been found to be an influential moderator in the relationship
between leadership styles and relationships and creativity at work (e.g., [67, 6

Work scheduling autonomy and innovative work behavior. Originally from a manufacturing context,
work scheduling autonomy has been defined as the “extent to which workers feel they can control
the sequencing/timing of their work activities” [54]. Employees that are not tied to any specific
schedules or timing can, therefore, freely choose when and in which order they want to pursue
certain tasks, and thus exert the related behaviors [55]. In comparison to standard tasks in positions
with more “discrete, sequential stages,” innovation and thus innovative behavior is characterized by
discontinuous, intermittent, alternating activities and behavior [62, 69]. Therefore, it is assumed that
when employees are able to freely choose when and in what order they work on different tasks, their
intrinsic motivation is activated, which positively impacts innovative work behavior in terms of idea
generation, idea promotion, and idea implementation, implying the following relationship between
work scheduling autonomy and employee innovative work behavior

Work methods autonomy and innovative work behavior. Work methods autonomy has been defined
as the “degree of discretion/choice individuals have regarding the procedures (methods) they utilize
at work” [54]. As innovative behavior at work reflects a “complex behavior” comprised of
“interrelated sets of behavioral activities” such as problem recognition, idea generation, idea
promotion, and idea realization [70, 71], it appears critical that employees are able to freely choose
how to approach these stages. This type of autonomy has been found to be particularly important
during the initial idea generation phase [71]. There are many techniques that can be used for new
idea generation such as brainstorming, mind mapping and morphological analysis [72]. Therefore,
limitations defined by an organization toward a certain approach or having a pre-specified selection
or set of certain methods and instructions might negatively impact employee creativity and idea
generation [71, 72]. Employees might also feel limited in the options they can choose to address
certain problems, reducing their motivation to be innovative. It is therefore assumed that there is the
following relationship between work-methods autonomy and innovative work behavior.

Decision-making autonomy and innovative work behavior. The third autonomy dimension is related
to the freedom to make decisions about work [19, 73]. As the two core phases of the innovation
process are initiated through idea generation and implemented through idea fulfillment, many major
and minor decisions need to be made along the way such as the decision to innovate, the decision to
proceed with a certain idea and the decision to implement [74, 75]). Therefore, the interrelated
stages in innovative work behavior (see [70]) require ongoing decision-making within the stages and
between the stages; that is, from idea generation to idea implementation [74]. Low decision-making
authority along this iterative process could result in the constant need to seek approval from
decision-makers, thus constraining motivation and related behaviors [51]. Therefore, it is assumed
that when employees are able to freely make decisions about Contextual work design PLOS ONE |
https://doi.org/10.1371/journal.pone.0204089 October 4, 2018 6 / 35 the direction in which to
proceed rather than having to seek supervisor approval or abide by restrictions, there is a positive
influence on their innovative work behavior and performance, which implies the following
interaction between decision-making autonomy and innovative work behavior

Creativity and innovation require a degree of flexibility and freedom so as to motivate employees
[90]; however, if scheduling and decision making are bound with a definitive structure, employees
have less experience with outcomes, success rates, and organizational consequences because they
have less autonomy and therefore show less innovation than in more Contextual work design PLOS
ONE | https://doi.org/10.1371/journal.pone.0204089 October 4, 2018 9 / 35 discrete working
environments and might even face negative organizational consequences by not adhering to the
formal rules. In these organizations, therefore, conformity with organizational guidelines is valued
more highly than personal satisfaction and motivation (i.e., extrinsic vs. intrinsic motivation; [87]).
When there are high perceived structural levels, employees are more likely to succeed if they follow
the given processes as in highly structured organizations, employees’ personal motivation and
satisfaction is subordinate. Any deviance from these given rules and regulations such as enhanced
autonomy and greater freedom would therefore endanger this success. Less structured
organizations, however, provide greater freedom and encourage/allow higher levels of autonomy
when seeking to achieve certain outcomes in line with organizational regulations, implying the
following

Journal pone
Outcomes of organizational structure According to Hage and Aiken (1967), two important features of
organizational structure are formalization and centralization. Hage and Aiken (1967) also defined
organizational formalization as the level to which an organization precisely spells out rules and
procedures related to jobs in different situations. This aspect is also known as job codification. Rule
observation refers to the extent to which an organization rigidly adheres to the rules and procedures.
In other words, this construct measures how far employees are supervised in ensuring that they are
not committing any offense against the company’s rules and regulations (Hage & Aiken, 1967).
Centralization deals with the amount of power distributed among employees of various positions.
This variable is measured in terms of hierarchy of authority and participation in decision making.
According to Hage and Aiken (1967), the former examines whether or not employees are reliant
upon their supervisors in decision making while the latter identifies the level of employees’
involvement in decisions on resource allocation and policy formation. Vol. 4, No. 3 International
Journal of Business and Management 148 Adler and Borys (1996), on the other hand, conceptualized
formalization into coercive and enabling. This is because Adler and Borys (1996) asserted that
attitudinal and behavioral outcomes among employees are attributed to the type of formalization
enforced in the organization (Adler & Borys, 1996). Hence, a conceptual understanding of this
construct among top management is deemed crucial. Adler and Borys (1996) also explained that
different attitudinal and behavior outcome of formalization originates from the selection process. An
accurate selection process, which takes into account job congruence or ‘person-job’ fit element, may
mitigate negative attitudinal or behavioral outcomes. For instance, highly formalized organizations
should hire individuals who prefer routine tasks and have low growth needs. Adler and Borys (1996)
also introduced four features that embody enabling and coercive dimensions, namely repair, internal
transparency, global transparency, and flexibility. In an enabling situation, repair means allowing
employees to adjust or make necessary changes to the workflow to enhance production process
while in a coercing circumstance, employees have to follow the standardized work procedure and
any deviation from it cannot be tolerated. Internal transparency, in the enabling formalization,
concerns with employees’ knowledge and skill on certain equipment, whereby any malfunctioning
can be overcome immediately. In the coercive formalization, employees are to perform work
instructions assigned, without being given any rationale because it is within their supervisors’
boundary. Global transparency refers to the employees’ savvy on the broader systems within their
working field. Employees are not supposed to work beyond their specified realms. In contrast,
employees in the enabling formalization situation are given full specified and contextual information
to enable them comprehend the work systems (Adlers & Borys, 1996). This is also to promote
creativity, interaction, and innovativeness among employees. In addition, Adler and Borys (1996)
noted that due to lack of task autonomy and identify, highly formalized organizations depend on
extrinsic motivation, such as rewards, to encourage positive attitudinal or behavioral outcomes.
Enabling type of formalization, which gives employees autonomy and identification in their tasks, can
cultivate intrinsic motivation. Further, goal congruence can help make formalization acceptable to
employees because they understand the rationale of the work procedures given. All in all, Adler and
Borys (1996) viewed formalization can be effective depending on the selection process, congruency
of organizational goals, and type of industry in which an organization operates. In other words,
personality traits of an individual determine the employee’s success level regardless the type of
organizational structure practiced. In addition to the burgeoning definitions of organizational
formalization, Bodewes (2002) provided three definitions of organizational formalization but he
proposes that formalization is most accurately defined as “the extent to which documented
standards are used to control social actors’ behavior and outputs”. These functions are gauged based
on two main features of formalization that are similar to Agarwal’s (1993) conceptualization, namely
rule observation and job codification. Bodewes (2002) highlighted that most researchers overlook
the comprehensive definition of formalization by not including the aspect of rule observation or
segregating it into two dimensions. In fact, formalization should be measured and defined collectively
because it deals with the interaction of both job codification and rule observation (Bodewes, 2002).
The negative influence of formalization and centralization has been reported in most empirical
investigations. A study conducted by Nasurdin et al. (2006) examined the influence of organizational
structure (formalization and centralization) on job stress among salespersons in the stock broking
industry of Malaysia. It was found that formalization has a positive influence on job stress because
job that is bounded by inflexible rules and procedures will allow lesser autonomy and freedom for
the incumbents on how to perform their tasks. This will most likely lead to job stress, which will be
experienced by employees in such circumstance. Therefore, it is evident that highly rigid
organization, which adopted formalization and centralization, will result in higher stress level among
employees given the limited autonomy and freedom in performing job.In the same way, Tata and
Prasad (2004) studied the moderating impact of organizational characteristics (formalization and
centralization) on the self-management and team effectiveness relationship. Tata and Prasad (2004)
categorized centralization into macro-level centralization and micro-level centralization whereby the
former deals with employees’ participation in decision making regarding policies and procedures at
the organizational level and the latter concerns with employees’ involvement in decision making
regarding their own tasks. The first level supervisors and middle managers from the manufacturing
companies responded in this study. Findings show that teams with higher self-management
appeared to be more effective in organizations that allow input from employees with regard to their
task performance (micro-level decision making). On the contrary, macro-level decision making does
not influence the strength of self-management and team effectiveness association at any level.
Findings by Tata and Prasad (2004) also suggested that there is a stronger relationship between self-
management and team effectiveness in organizations that have lower level of formalization. In other
words, fewer rules, policies, and procedures allow flexibility in teams’ self-management, which
eventually boost teams’ effectiveness. In addition to organizational centralization and formalization,
Tata and Prasad (2004) highlighted that there are three factors that may contribute to teams’
effectiveness- team leader experience, clear goals, and adequate resources. Drawing on the findings,
it can be concluded that flexibility encourages better team performance, especially at the micro-level
decision making. To enhance team and individual effectiveness, employees should be given adequate
freedom and autonomy in the decision making process, especially decisions that are related to their
tasks. International Journal of Business and Management March, 2009 149 In a study by Michaels,
Dubinsky, Kotabe, and Chae (1996) among sales personnel in the electronics products industry from
USA, Japan, and Korea, it was found that formalization inversely affects role ambiguity among sales
personnel. This is because specified rules, policies, and procedures clarify role expectations, which
inadvertently reduces role ambiguity. Finding by Michaels et al. (1996) also indicates formalization
has a significant and negative influence on role conflict among respondents from the US. This finding
is not applicable to the respondents in Japan and Korea. A plausible explanation for this result is
because of the different work environment in the countries examined. In essence, Japanese and
Korean workers are more collectivistic compared to their American counterparts, who are more
individualistic. Formalization is deemed necessary by American employees to provide them
guidelines in managing job stress and conflict. It was also reported in this study that formalization
increases organizational commitment of Korean and Japanese sales personnel but role conflict has a
negative impact on their work alienation. On top of that, Michaels et al. (1996) provided that role
conflict does not have influence on US salespersons because Americans enjoy working
independently, and therefore, conflict does not have any impact on their commitment level. This
study reveals that employees of different culture may view organizational structure differently.
Therefore, culture difference should be taken into account by the top management in deciding the
level of organizational formalization and centralization to be adopted. Kim and Lee (2006) expanded
the context of a comparative study between public and private sector in the Asian context,
specifically South Korea. Besides organizational culture and information technology, organizational
structure was examined as the predictors of employee knowledge sharing capabilities. Dimensions of
organizational structure investigated are centralization, formalization, and performance-based
reward systems. It was hypothesized that while centralization and formalization influence employee
knowledge sharing capabilities negatively, performance-based reward systems affect the criterion
variable positively. Even though public service organizations reported higher mean scores for
formalization and centralization and lower mean scores for clear vision and goals and performance
based reward systems, these predictors are not related to employee knowledge sharing capabilities.
Nonetheless, the level of knowledge sharing capabilities is higher among the private sector
employees compared to the public sector counterparts. Kim and Lee (2006) contended that
employee knowledge sharing capabilities differ between the two organizations because public sector
managers face various organizational constraints in enhancing employee knowledge sharing
capabilities. Organizational constraints were inadvertently attributed to the higher level of
formalization and centralization reported in the public sector organizations. In sum, Kim and Lee
(2006) asserted that public sector managers can adopt the same strategies practiced by their private
sector counterparts in improving the employee knowledge sharing capabilities. Based on the
findings, the researchers also suggested that leaders in the public sector should be more concerned
about the deleterious impact of formalization and centralization on employee knowledge sharing
capabilities. Empowerment, employee involvement, participative decision making are the means in
promoting flexibility in organizational structure of the public sector.

file:///E:/Master%20rad/linking%20os%20job%20performance.pdf

REVIEW OF THE LITERATURE The investigations into the effects that organizational structural
variables have on the attitudes and behavior of the members of the organization have produced
considerable research covering a myriad of relationships. Among these many relationships have been
some which are related to the subject under investigation in this treatise. Specifically, the review of
the literature in this section will deal with three organizational structural variables and the effect that
these variables have individually and collectively on employee job satifaction. The structural variables
to be examined are organization shape (that is, the degree to which an organization is either tall or
flat), total organization size, organizational level, and the interaction effects of these three variables.
Tall vs. Flat Organizations One of the first studies concerning the effects of organizational shape on
employee job satisfaction was performed by James C. Worthy and the result reported in 1950.^
Worthy, in a study covering almost 100,000 employees ^James C. Worthy, "Organizational Structure
and Employee Morale," American Sociological Review, 15:2 (1950): 1969-79. 24 25 of the Sears
Roebuck Company over a twelve year period, concluded that flat organizations were generally
superior to tall organizations. Worthy stated his conclusions by saying that "Flatter, less complex
structures, with a maximum of administrative decentralization, tend to create a potential for
improved attitudes, more effective supervision, and greater individual responsibility and initiative
among employees. Moreover, arrangements of this type encourage the development of individual
self-expression and creativity which are so necessay to the personal satisfaction of employees and
which are an essential ingredient of the democratic way of life."1 It should be noted that Worthy's
sample consisted almost entirely of non-management personnel and that he never published his
statistical data nor described his method of analysis. Despite these limitations, Worthy's conclusions
remained virtually unchallenged for almost twelve years and his views are still widely quoted today.
The next significant step, in the investigation of the effect of organizational shape on employee job
satisfaction, 2 was taken by Meltzer and Salter in 1962. In a survey study designed to test the degree
of job satisfaction of 704 physiologists employed in research organizations, Meltzer and Salter found
that there was generally an insignificant 1Ibid., p . 179. 2 L. Meltzer and J. Salter, "Organization
Structure and the Performance and Job Satisfaction of Physiologists," American Sociological Review
27 (1962): 351-62. 26 relationship between the level of job satisfaction of the employee and the
shape of the organization. Their conclusions failed to confirm Worthy's view on the superiority of flat
organizations over tall structures. However, it should be pointed out that the Meltzer and Salter
sample dealt with small organizations (their largest category being fifty-one employees or more) and
that their subjects were drawn from the professional ranks. In the early 1960's, Lyman W. Porter
began a series of studies on the effects of organization structural variables and employee job
satisfaction using the shape of the organization as one of his independent variables. In a study
conducted by Porter and E. E. Lawler, the 1900 managers that responded to their questionnaire were
classified as being employed in organizations having either tall, intermediate, 1 or flat structures.
Using the PNSQ as their measuring instrument, the authors reported their findings by stating, "The
results showed no clear over-all superiority of flat over tall organizations in producing greater need
satisfaction among managers . . . A tall type of structure was associated with greater satisfactions in
the security and social need areas, whereas a flat structure was associated with greater 2 satisfaction
in the self-actualization need area." L. W. Porter and E. E. Lawler, "The Effects of Tall vs. Flat
Organization Structure on Managerial Job Satisfaction," Personnel Psychology 17 (1964): 135-48. 2 L.
W. Porter and E. E. Lawler, "Properties of Organization Structure in Relation to Job Attitudes and Job
Behavior," Psychological Bulletin 64:1 (1965): 23-51. 27 Porter and Lawler further qualified their
results by noting that the size of the organization seemed to have some effect on degree of
employee satisfaction. When the data were segmented so that subjects employed by companies
having less than five thousand employees formed one group and those employed by companies
having five thousand or more employees formed another group, they found that the results differed
from the overall results. In the smaller companies job satisfaction was'greater in organizations having
flat structures, while in those having more than five thousand employees the reverse was true. Once
again, the composition of the sample is important in evaluating the results of the study. Porter and
Lawler's sample consisted entirely of management personnel and was a randomly selected sample of
managers at all levels of the managerial hierarchy in many different companies. In 1965, Porter and
Siegel essentially replicated the Porter and Lawler 1964 study, the difference being that the subjects
were an international sample of middle and upper1 level managerial personnel from thirteen
countries. The results of this study generally agreed with the conclusions of the Porter and Lawler
effort. Porter and Siegel found that overall there was no significant advantage for either tall or flat
structures in producing job satisfaction among the three thousand subjects, but when the subjects
were -*-L. W. Porter and J. Siegel, "Relationships of Tall and Flat Organization Structures to the
Satisfaction of Foreign Managers" Personnel Psychology 18 (1965): 379-82. segmented into those
employed by companies having less than five thousand employees and those employed by
companies having more than five thousand employees, the results were slightly different. In the
smaller companies flat structures once again produced higher job satisfaction levels than did the tall
structures, but in the large companies the researchers found no significant difference between flat
and tall structure. A 1970 study conducted by Ghiselli and Johnson examined the relationship
between need satisfaction and organizational success for 413 managers from a diverse group of
organizations. Using a "slightly shortened version" of the Porter Need Satisfaction Questionnaire and
classifying the subjects as being members of either.tall or flat organizations, the authors found that
for higher order needs (esteem, autonomy, and self-actualization) the correlation between need
satisfaction and success was much higher for flat organizations than for tall organizations. The
authors concluded by stating, "The empirical findings of the present investigation, then, support the
hypothesis which was advanced earlier, and provide some confirmation for Worthy's (1950) position
that flat organizations are superior to 1 tall ones in encouraging individuality." In 1971, Carpenter
reported on a study concerning the relationship between organizational structure and the 1 Edwin E.
Ghiselli and Douglas A. Johnson, "Need Satisfaction, Managerial Success, and Organizational
Structure," Personnel Psychology 23 (1970): 569-76. 29 perceived job satisfaction of classroom
teachers."1' Carpenter analyzed the job satisfaction levels of approximately 120 subjects classified as
working for either tall, medium, or flat organizations and concluded that "formal organizational 2
factors did influence teacher job perceptions." He found that subjects in flat organizations had higher
levels of job satisfaction than those in medium or tall organizations. Although Carpenter's
conclusions seemed to be consistent with the views of Worthy as well as the findings of Porter and
Lawler and Porter and Siegel (for organizations having less than 5000 employees), they may be
questioned on one point. Carpenter's findings were based on a relatively small total sample of only
120 subjects, which seems even smaller when you consider that this total was further subdivided
into the three organizational classifications used in the study. In 1975, Ivancevich and Donnelly
reported on the results of a study concerning the relationship between organizational shape and the
job satisfaction levels of 3 295 trade salesmen. The salesmen were all employed by ^Harrell H.
Carpenter, "Formal Organizational • Structural Factors and Perceived Job Satisfaction of Classroom
Teachers," Administrative Science Quarterly 16 (1971): 460-65. 2Ibid., p. 463. 2John M. Ivancevich
and James H. Donnell, Jr., "Relation of Organizational Structure to Job Satisfaction, Anxiety-Stress,
and Performance," Administrative Science Quarterly 20 (1975): 272-80. 30 three large national
organizations which were classified as having either a tall, medium, or flat organizational structure.
The authors found that "trade salesmen in the flat organization perceived more self-actualization and
autonomy satisfaction . . . (but) there were no significant differences found on such job satisfaction
facets as opportunities for innovativeness and social interaction, security, and 1 pay." They go on to
conclude that although there seems to be some differences in the way the salesmen in the three
types of organizations perceived their jobs, "it would be erroneous to conclude that the flatter
organization is unequivocally superior to the tall and medium organizations 2 for trade salesmen."
The results of the above studies do not totally support Worthy's statement that a flat organization
produces greater job satisfaction than a tall organization. Although several of the studies agreed with
Worthy for some aspects of job satisfaction, at least one of the studies found no relationship
between organizational shape and job satisfaction and two others concluded that for very large
organizations a tall structure may produce higher levels of satisfaction than a flat structure. One can
only conclude that further research is need to determine the effects that organiztional shape has on
the degree of job satisfaction of organizational members. 1Ibid., p. 279. 2Ibid., p. 279. Total
Organization Size The topic dealing with the effect of total organization size on employee attitudes
and behavior is one that has not been heavily researched. In their 1965 review, Porter and Lawler
indicated that most of the research they had found dealt with organizational subunit size, and its
effect on job satisfaction, rather than total organization size. Based on their review of the literature
the authors concluded that "overall, the findings relating total organization size to job attitudes do
not present as clear a picture as is the case for findings dealing with subunit size." One of the studies
contained in the Porter and Lawler 2 review is Benge's 1944 study. Benge's sample was taken from a
number of different companies and included only those employees at the rank and file worker level.
Based on his survey, Benge found that the "morale of employees of small companies is appreciably
better than in large companies." This conclusion should be evaluated very carefully since Benge did
not specify the size of his sample or the number of companies involved in his research. ^L. W. Porter
and E. E. Lawler, "Properties of Organization Structure in Relation to Job Attitudes and Job Behavior,"
Psychological Bulletin 64:1 (1965): 40. O E. J. Benge, "How to Learn What Workers Think of Job and
Boss," Factory Management and Maintenance 102 (May 1944): 101-04. ^Ibid., p . 104. O Z Another
study reported by Porter and Lawler is Talacchi's 1960 study concerning the relationship of
organizational size to individual attitudes and behavior.^ Although Talacchi describes his study as
including ninetythree organizations, an investigation of the data indicates that at least forty-five of
the ninety-three organizations are actually "plants" that comprise parts of only five different
companies. The fact that Talacchi confused organizational subunits with total organization units
causes some problems in evaluating the results of this study. Despite these problems, there does
seem to be sufficient evidence to accept Talacchi1s conclusion that a negative correlation exists
between organizational size and employee satisfaction at the rank-and-file worker level. Talacchi's
sample was taken from both manufacturing and non-manufacturing firms which ranged in size from
less than 50 employees to almost 1800 employees. In 1963, Porter published the results of a study
dealing with the job satisfaction levels of more than 1500 2 managers in various sized companies.
The managers were classified as being employed by either a small (less than 500 employees), a
medium (500-4999 employees), or a large (5000 employees or more) company. Using the PNSQ as
his ^S. Talacchi, "Organization Size, Individual Attitudes and Behavior: An Empirical Study,"
Administrative Science Quarterly 5 (1960): 398-420. 2 L. W. Porter, "Job Attitudes in Management:
IV. Perceived Deficiencies in Need Fulfillment as a Function of Size of Company," Journal of Applied
Psychology 47 (1963c): 386-97. testing instrument, Porter concluded that there were no significant
differences between the levels of managerial satisfaction in either of the three size classifications.
Although Porter could not confirm the superiority of small organizations over large organizations as
suggested by Benge and Talacchi, he did note that some differences might show up if one considered
the organization level of the managers as well as the size of the organization. For instance, he noted
that "at the lower and lower-middle management levels, managers from smaller companies were
more satisfied than those from larger companies,"1 while at the higher management levels he found
that managers from large companies were more satisfied. Another important distinction between
Porter's study and the two conducted by Benge and Talacchi is that Porter sampled only
management personnel while both Benge and Talacchi dealt only with rank-and-file workers. In
1966, Lawler and Porter conducted a study which examined the relationship between satisfaction
with pay and six "demographic characteristics," one of which was total organization size. The sample
consisted of 1916 managers from various companies throughout the United States and used a
modified version of the PNSQ as the measuring instrument. The authors concluded that,
"undoubtedly managers' satisfaction with pay does bear a lawful relationship to some factors;
however, the present study suggests that such 1 L. W. Porter and E. E. Lawler, "Properties of
Organization Structure in Relation to Job Attitudes and Job Behavior," Psychological Bulletin 64:1
(1965): 39. demographic variables as age, education, company size, seniority and line/staff position
are not important determinants of it."'*' Since the studies conducted by Porter and his associates in
the 1960's, there have been several attempts to settle the issue concerning the effect of organization
size on employee job satisfaction, but they have been largely inconclusive. In 1969, Strawser,
Ivancevich, and Lyon examined the job satisfaction levels of 269 accountants in large and small CPA
firms. Using a modified version of the PNSQ and classifying their respondents as being affiliated with
either a "Big Eight" firm or a "Non-Big Eight" firm, the authors concluded that "in each case where
statistically significant differences were found, accountants in small firms reported less perceived
need satisfaction than CPA’s 2 employed by large firms." In 1970, Geoffrey Ingham published a
substantial study dealing with organizational size and worker behavior. In one of his many
conclusions, Ingham reported that there seemed to be little difference in the level of satisfaction with
wages between employees of small firms and the employees of large firms. He summarized by
saying, "the most important "'’Edward E. Lawler, III, and Lyman W. Porter, "Predicting Managers1 Pay
and Their Satisfaction with Their Pay," Personnel Psychology 19 (1966): 363— 73. O Robert M.
Strawser, John M. Ivancevich, and Herbert L. Lyon, "A Note on the Job Satisfaction of Accountants in
Large and Small CPA Firms," Journal of Accounting Research 7 (1969): 342-43. 35 point about these
data on the level of satisfaction is the marked similarity of the responses from the workers in the
large and small organizations."^ Cummings and El Salmi, also in a study conducted in 1970, surveyed
456 managers using essentially the same classification system as was used in the studies conducted
by Porter, and concluded that "company size was not related 2 to managers' perceptions of need
fulfillment deficiency." The relationship between organization size and job satisfaction becomes even
more clouded based on two studies conducted in recent years. In 1973, Parr sampled ninetysix agri-
business firms and reported that he found an inverse relationship between size of the firm and the
level 3 of job satisfaction of the employees." In 1975, Osborn and Hunt surveyed members of sixty
chapters of an undergraduate business fraternity and found that "size was found to be positively
related to satisfaction with work and to overall 4 satisfaction." ^Geoffrey K. Ingham, Size of Industrial
Organization and Worker Behavior (Cambridge: Cambride University Press, 1970): p. 107. 2 L. L.
Cummings and A. M. El Salmi, "The Impact of Role Diversity, Job Level and Organizational Size on
Managerial Satisfaction," Administrative Science Quarterly 15 (1970): 1-10. ' ^ J“ Sjohn Edwin Parr,
"Relationship of Organizational Structure to Worker Satisfaction in Agri-Business Organizations"
(Ph.D. dissertation, Cornell University, 1973). 4 R. N. Osborn and J. G. Hunt, "Relations Between
Leadership, Size and Subordinate Satisfaction in a Voluntary Organization," Journal of Applied
Psychology 60:6 (1975): 732. .30 Based on the information available from previous research
concerning the relationship between size and job satisfaction several conclusions are possible. One
might conclude that there is a positive correlation between size and satisfaction (supported by two
studies), that there is a negative correlation between size and satisfaction (supported by three
studies), or one may conclude (as four of the studies did) that no relationship exists. Perhaps the
safest and most appropriate conclusion is that at this time the true relationship between
organization size and employee job satisfaction is not apparent. Organizational Levels The research
examining the effect of the employee's level within the organization upon his degree of job
satisfaction has taken two approaches. Early research into this subject invariably compared the
satisfaction levels of the rank-and-file worker to that of management personnel or it attempted to
correlate the level of satisfaction of managers to their level in the managerial hierarchy. In an article
published in 1957, Herzberg, Mauser, Peterson, and Capwel'l summarized the literature through
1954 pertaining to job satisfaction and its relationship to organization levels.^ The authors stated
that "one unequivocal fact emerges from the studies of job satisfaction; If . Herzberg, B. Mausner, R.
0. Peterson, and Dora F. Capwell, Job Attitudes: Review of Research and Opinion, Pittsburgh:
Psychological Service of Pittsburgh, 1957. 37 the higher the level of occupation, the higher the
morale."^ The Herzberg review cited, as evidence of their conclusions, four studies which indicated
that supervisory personnel perceived higher levels of job satisfaction than were per2 ceived by the
workers that they supervised. In a study not reported in the Herzberg review, Morse (1953)
compared the satisfaction levels of sixty-one supervisory personnel to the six hundred workers being
supervised and reached the following conclusion: The supervisors are considerably more satisfied
with their jobs and with the company as a place to work. They are somewhat less satisfied than the
employees with their salaries and are about equal in satisfaction with the employees regarding the
advancement they have received in the company. Morse seemed to generally agree with the
conclusions reached in the Herzberg review, but pointed out some areas where satisfaction levels for
supervisors may not be higher than those of rank-and-file workers. Further support for the Herzberg
conclusion was provided by Handyside (1961) in a study of 30 managers and 1-Ibid. , p . 20 . ^The
studies cited by Herzberg et a l . were; P. Ash., "The SRA Employee Inventory: A Statistical Analysis,"
Personnel Psychology 7 (1954): 337-64; J. W. Campbell, "An Attitude Survey in a Typical
Manufacturing Firm," Personnel Psychology 1 (1948): 31-39; R. L. Hull and A. Kolstad, "Morale on the
Job," In G. G. Watson (ed.), Civilian Morale (Houghton Mifflin, New York, 1942); A. Kolstad, "Attitudes
of Employees and their Supervisors," Personnel 20 (1944) 241-50. ^Nancy C. Morse, Satisfactions in
the White-Collar Job (University of Michigan, Ann Arbor, 1953), 38 1 467 production workers.. As a
result of his research, Handyside concluded that job satisfaction was higher for managerial personnel
than it was for production workers. Additionally, there has been substantial research into job
satisfaction at the managerial level. Generally speaking, the results have been consistent with those
found when comparing rank-and-file workers to their supervisors. That is, the higher an individiial is
in the managerial hierarchy, the higher his level of job satisfaction. Porter and Lawler, summarizing
the literature to 1965, stated that "recent studies, plus one appearing prior to the Herzberg review,
seem to be nearly unanimous in concluding that job satisfaction or morale does increase
monotonically with 2 increasing levels of management." The studies referred to in the Porter and
Lawler review were Browne and Neitzel (1952), Porter (1961), Rosen (1961), Porter (1962), Opinion
research Corporation (1962), and Haire, Ghiselli, and Porter (1963).3 lj. D. Handyside, "Satisfactions
and Aspirations," Occupational Psychology 35 (1961): 313-44. 2 L. W. Porter and E. E. Lawler,
"Properties of Organization Structure in Relation to Job Attitudes and Job Behavior," Psychological
Bulletin 64 (1965): 26. O C. G. Browne and Betty J. Nietzel, "Communication, Supervision, and
Morale," Journal of Applied Psychology 36 (1952): 86-91; L. W. Port¥r", " A “Study oTTerceived Job
Satisfactions in Bottom and Middle Management Jobs," Journal of Applied Psychology 45 (1961): 1-
10; H. Rosen, '‘Desirable Attributes of Work: Four Levels of Management Describe their Job
Environments," Journal of Applied Psychology 45 (1961): 156-60; L. W. Porter, "JobTttitudes in
Management: I. Perceived Deficiencies in Need Since the Porter and Lawler 1965 review, there have
been many additions to the literature concerning job satisfaction and organizational level. One of the
more interesting was a 1966 study by Edwin L. Miller which examined the satisfaction levels of
"randomly-selected national level union officials."'*' The sample consisted of 171 officials from both
craft and industrial unions. Using the PNSQ, the author concluded that higher level officers were
more satisfied than lower level officers. However, when the data were segmented further, the
researchers found that the data from craft unions strongly supported the findings while the data
from industrial unions only marginally supported the findings. These facts are significant since
previous studies generally had lumped all respondents together (regardless of industry, area of
specialization, etc.) and had assumed that the overall results applied to each of the sub-groups within
the population. In 1967, Porter and Mitchell surveyed 1297 commissioned and non-commissioned
officers of the United States 2 Air Force using a modified version of the PNSQ. The data Fulfillment as
a Function of Job Level," Journal of Applied Psychology 46 (1962): 375-84; Opinion Research
Corporation, Motivating Managers (ORC, Princeton, 1962); M. Haire, E. E. Ghiselli, and L. W. Porter,
"Cultural Patterns in the Rule of the Manager," Industrial Relations 2 (1963): 95-117. ■*Edwin L.
Miller, "Job Satisfaction of National Union Officials," Personnel Psychology 19 (1966): 261-275. O
^Lyman W. Porter and Vance F. Mitchell, "Comparative Study of Need Satisfactions in Military and
Business Hierarchies,” Journal of Applied Psychology 51:2 (1967): 139-44. 40 were classified into
three groups of commissioned officers and three groupings of non-commissioned officers. The results
of the questionnaires indicated that within the two groupings satisfaction generally increased as rank
(level in the organization) increased. That is, generals were more satisfied than majors and majors
were more satisfied than lieutenants. In the noncommissioned ranks, chief master sergeants and
technical sergeants reported about the same level of satisfaction and both ranks were more satisfied
than staff sergeants. The most interesting result was that the middle and higher ranking NCO's
reported consistently higher levels of satisfaction than did the lower ranking commissioned officers.
In fact, both groups of NCO's reported values as high as those reported by the group consisting of
majors and lieutenant colonels. The authors explained this apparent inconsistency by concluding
that: . . . there were clearly two sets of hierarchical relationships, one for commissioned officers and
another for the non-commissioned . . . it appears that each category of respondents (enlisted men
and officers) used its own group as a frame of reference in responding to the questionnaire.1
However, the inconsistency in the enlisted ranks prevents one from concluding that the hypothesis of
increasing need satisfacttion as one goes up the hierarchy was totally supported. ^Ibid. , pp. 143-44.
41 In 1968, Johnson and Marcrum reported on a similar study involving 504 officers of the United
States Army in the ranks of captain through colonel. Reporting on the level of need deficiency as
measured by the PNSQ the authors reported that: . . . with six of the nine needs, the captains' score
is higher than the majors' score and the majors' score is higher than the colonels' score. This suggests
of course that need-fulfillment opportunities' are better at successively higher levels in the
organizational hierarchy. In an attempt to replicate the Porter studies of the 1960's, Rhinehart, et. a
l . surveyed 2026 managers in the Veterans Administration's Department of Medicine and Surgery.
The respondents were classified into four levels of management and were tested using the PNSQ.
The results of the questionnaire indicated that satisfaction tended to decrease with each successive
lower level of management.^ In 1970, Lichtman conducted a study involving ninetyfive employees of
a government agency. Using a measure of 3 satisfaction developed by Harris (1949), and classifying
his respondents as either managers, supervisors or workers, Paul V. Johnson and Robert H. Marcrum,
"Perceived Deficiencies in Individual Need Fulfillment of Career Army Officers," Journal of Applied
Psychology 52:6 (1968): 459. ^J. B. Rhinehart, R. P. Barrell, A. S. DeWolfe, J. E. Griffin, and F. E.
Spaner, "Comparative Study of Need Satisfactions in Governmental and Business Hierarchies,"
Journal of Applied Psychology 53:3 (1969): 230-35. ^F. J. Harris, "The Quantification of an Industrial
Employee Survey. I. Method," Journal of Applied Psychology 33 (1949): 103-11. Lichtman found that
job satisfaction increased as organizational level increased. In a similar study conducted in 1971,
Slocum compared the job satisfaction levels of 123 top and middle-level managers to 87 first-line
supervisors. The respondents, who were employees of a steel plant in central Pennsylvania, were
asked to complete the PNSQ. In the discussion of his results the author stated that, "the higher levels
of management, on the whole, reported greater degrees of need satisfaction in 2 their jobs than did
lower level managers." In 1973, Herman and Hulin attempted to replicate some of the earlier
research concerning job satisfaction and organizational level. Using both the PNSQ and the Job 3
Descriptive Index (JDI), as their measuring instruments, the authors questioned four levels of
supervisory personnel of a midwestern manufacturing plant. The results obtained from the 174
respondents produced mixed results. According to the authors, "the managerial level-job satisfaction
hypothesis failed to replicate on the need satisfaction ^Cary M. Lichtman, "Some Intrapersonal
Response Correlates of Organization Rank," Journal of Applied Psychology 54:1 (1970): 77-80'. 2 John
W. Slocum, J r . , "Motivation in Managerial Levels: Relationship of Need Satisfaction to Job
Performance," Journal of Applied Psychology 55:4 (1971): 315. 3 Patricia C. Smith, Lorne M. Kendall,
and Charles L. Hulin, The Measurement of Satisfaction in Work and Retirement (Chicago: Rand
McNally, 1969). 43 scales (PNSQ) but found support with the JDI variables."^ This inconsistency led
the authors to speculate that "the lack of convergence and failure to replicate casts doubt on the
conclusions about job satisfaction drawn from the o research on the Porter Need Satisfaction
Questionnaire." In 1974, Locke and Whiting compared the job satisfaction levels of white-collar
workers to blue-collar workers using 911 employees of the solid waste management industry as their
sample. Using a seven-point "faces" scale with verbal anchors as their measure of overall satisfaction,
and an additional indirect measure of satisfaction, the authors concluded that white-collar workers
were more satisfied with their jobs than were blue-collar workers. However, when one examines the
results more closely one finds that there seems to be almost no difference in the satisfaction scores
of the three levels of white-collar workers, (secretarial/clerical, supervisory, and managerial) and in
fact the secretarial/clerical group reported higher mean scores on both measures of satisfaction than
did the higher level white-collar workers. The authors failed to report whether the differences
between the three classifications of white-collar workers were significant since the focus on their
study was white-collar vs. blue-collar. In ^"Jeanne B. Herman and Charles L. Hulin, "Managerial
Satisfactions and Organizational Roles: An Investigation of Porter's Need Deficiency Scales," Journal
of Applied Psychology 57 (1973): 123. ^I bid., p . 124. 44 spite of the lack of statistical information,
one must conclude that the hypothesis stating that satisfaction increases with each successive level
in the organization 1 was not supported by this study. Newman, in a study conducted in 1970,
surveyed 710 employees representing all levels of a large insurance company. Using the JDI as his
testing instrument, the author found a positive correlation between the five aspects of job
satisfaction measured by the JDI and the hierarchical level. While the analysis performed by Newman
did not test to determine if the difference between each successive organizational level was
significant, it did provide evidence that the direction of the relationship 2 agreed with much of the
previous research. In 1976, Szilagyi, Sims and Keller compared the satisfaction levels of two samples.
The first sample consisted of 931 hospital employees occupying 5 organizational levels while the
second sample consisted of 174 members of a manufacturing firm in 3 occupational levels. Using the
J D I , the authors found that for the hospital sample occupational level was positively correlated to
satisfaction with work, pay, supervision, and co-workers. ^Edwin A. Locke and Roman J. Whiting,
"Sources of Satisfaction and Dissatisfaction Among Solid Waste Management Employees," Journal of
Applied Psychology 59:2 (1974): 145-56. 2 John E. Newman, "Understanding the Organizational
Structure-Job Attitude Relationship Through Perceptions of the Work Environment," Organizational
Behavior and Human Performance 14 (1975); 371-97. However, the results of the manufacturing
data indicated that only satisfaction with work and co-workers were positively correlated to
organizational level. The apparent differences between the two samples raises further doubts
concerning the actual relationship between job satisfaction and 1 organization level. The conclusions
concerning the relationship between job satisfaction and organization level are not as clear as some
writers would have us believe. Of the twentytwo studies reviewed here, sixteen seem to fully
support the hypothesis that satisfaction increases with each successive level in the organization.
However, one cannot discount the six studies that could not support the hypothesis. These six
studies, using various testing instruments and sophisticated statistical techniques, would seem to be
sufficient reason to call for further research to help resolve the inconsistency in the literature.
Interaction of Organizational Structural Variables Studies that have examined the job satisfaction
levels of employees as a function of the interaction of several organizational structural variables are
rare even though the need for such research has been recognized for quite some time. Porter and
Lawler (1965), in suggesting ^Andrew D. Szilagyk, Jr., Henry P. Sims, Jr., and Robert T. Keller, "Role
Dynamics, Locus of Control, and Employee Attitudes and Behavior," Academy of Management
Journal 19 (1976): 259-76. areas for future research stated: First, we would suggest that future
research investigations in this area must be addressed to more complex questions. It seems evident
that a great deal more attention has to be given to the possible interrelationships between and
among different organizational structural variables than has been the case so far .... Too much
previous theorizing in the area of organizations has neglected such interaction possibilities and hence
there has been an unfortunate tendency to oversimplify vastly the effects of particular variables.^
Vroom also encouraged more sophisticated research when he stated that he hoped "to see
researchers begin to turn their attention from relatively simple problems involving only two variables
to more complicated problems involv2 m g interaction among variables." Despite the urgings of
these two scholars, very little has been done concerning the interrelationship of structural variables
and their effect on employee job satisfaction levels. In research cited earlier in this review, Porter
hinted that certain interrelationships existed between the two independent variables, managerial
level and company size, and that this interaction produced different conclusions concerning
employee job satisfaction than either of the 3 variables produced separately. Another possible
interaction •^L. W. Porter and E. E. Lawler, "Properties of Organiztion Structure in Relation to Job
Attitudes and Job Behavior," Psychological Bulletin 64:1 (1965): 48. O V. Vroom, Motivation in
Management (American Foundation for Management Research, New York, 1965) p. 65. 3 L. W.
Porter, "Job Attitudes in Management: IV. Perceived Deficiencies in Need Fulfillment as a Function of
Size of Company," Journal of Applied Psychology 47 (1963c): 386-97. 47 effect was noted in studies
by Porter and Lawler,^ and 2 Porter and Siegel, both of which suggested that organization shape
(degree of tallness or flatness) interacted with company size in determining the level of managerial
satisfaction. One of the first studies to address itself specifically to determining the interaction effect
of more than one organizational structural variable on job satisfaction was con3 ducted by El Salmi
and Cummings in 1968, Using the PNSQ, the authors sampled a cross-section of 450 managers from
various industries and selected job level, total company size, organization shape and line vs. staff
type of job as their four structural variables. El Salmi and Cummings segmented their data in such a
way that they could determine the effects on managerial satisfaction of the interaction between job
level and total size, of job level and organizational shape, and of job level and line/staff tyj)e of job.
Surprisingly, they did not report on the interaction between line/staff type of job and company size,
between organizational shape and company size, between line/ ^L. W. Porter and E. E. Lawler, "The
Effects of Tall vs. Flat Organization Structure on Managerial Job Satisfaction," Personnel Psychology
17 (1964): 135-48. 2 L. W. Porter and J. Siegel, "Relationships of Tall and Flat Organization Structures
to the Satisfaction of Foreign Managers," Personnel Psychology 18 (1965): 379-82. ^A. M. El Salmi
and L. L. Cummings, "Manager's Perceptions of Needs and Need Satisfactions as a Function Of
Interactions Among Organizational Variables," Personnel Psychology 21 (1968): 465-77. 48 staff type
of job and organizational shape, nor did they examine more than two variables at any one time.
When El Salmi and Cummings examined the interaction between job level and total organization size,
they found that "at the top management level, small-sized companies produced significantly more
need fulfillment than largersized companies .... On the other hand, at the middle and lower-middle
levels, larger-sized companies produce more need fulfillment than smaller-sized companies."1 These
findings directly contradict those reported by Porter in his 1963 study where he found a highly
significant relationship between these two independent variables and job satisfaction, but in the
opposite direction. The interaction between job level and organizational shape also produced some
interesting effects on managerial job satisfaction. At the top levels of management, El Salmi and
Cummings found that tall structures produced higher levels of job satisfaction than either
intermediate or flat structures, while at the lower levels of management, tall structures produced
lower levels of job satisfaction than either of the other two. The consideration of organizational level
along with organization shape may help to explain the conflicting results that were reported when
structure and/or level were considered alone. ^l'bid., pp. 469-70. 49 Although El Salmi and Cummings
included the interactions between job level and line/staff type of job in their study, the results will
not be discussed since line vs. staff type of job is not one of the independent variables to be used in
this study. Overall, El Salmi and Cummings felt that "significant interaction effects were found among
organizational variables as they relate to managerial motivation . . . (and) concluded that it is
inadequate to explain managerial motivation in terms of any one organizational variable alone.
Another study which examined the interaction of structural variables, though not on as large a scale
as the El Salmi and Cummings effort, was one which looked at the relationship between job level and
job satisfaction, total organization size and job satisfaction, and the combined interaction effect of
the two independent variables on job satisfaction. In an article published in 1971, Lyon, Ivancevich,
and Donnelly reported on a sample of 192 management scientists taken from a cross-section of the 2
membership of a management scientists professional society. The authors found that, when
considered alone, size had no effect on the satisfaction level of the subjects, but •'■Ibid. , p . 478. 2
Herbert L. Lyon, John M. Ivancevich, and James H. Donnelly, "A Motivational Profile on Management
Scientists," Operations Research 19:6 (1971): 1282-1299. that organization levels did have a
significant impact on satisfaction, with satisfaction increasing as the subject's level in the organization
increased. When the interactions between the two variables were considered, the authors found
that there were no significant relationships. That is, in this study, high level management scientists in
large companies were just as satisfied as the high level management scientists in small companies
and the lower level management scientists in larger companies were just as satisfied as the lower
level management scientists in small companies. The results of this study should be evaluated very
carefully for several reasons. First, the size of the sample was relatively small, and secondly, the
sample was taken from a highly specialized group performing unique functions within their
respective organizations which makes comparison with other groups of managers very difficult. The
paucity of studies dealing with the interaction effect of organizational structure variables and their
relationship to employee job satisfaction suggests the naive approach that has generally been taken
by researchers in the past. Based upon the few studies that, have been done and the insight that has
been provided by them, one can only conclude that further, more complex research is required.
Conclusions Based Upon The Review of the Literature The studies reviewed in this chapter indicate
that there is sufficient justification for further research into the relationship between organization
structural variables and employee job satisfaction. Specifically, one finds that there are
contradictions in the literature dealing with all three of the variables reviewed; that there has been
very little research done where the interactions effect of variables were considered; and that much
of the previous research has been conducted using a testing instrument that has been highly
criticized.

Citaj conclusions

file:///E:/Master%20rad/The%20Effect%20of%20Organization%20Structure%20on%20Job
%20Satisfaction%20Among%20Em.pdf

Centralization

Centraliz ation is the degree to which decision-making authority is concentrated at higher levels in an
organization. In centralized companies, many important decisions are made at higher levels of the
hierarchy, whereas in decentralized companies, decisions are made and problems are solved at lower
levels by employees who are closer to the problem in question.

As an employee, where would you feel more comfortable and productive? If your answer is
“decentralized,” you are not alone. Decentralized companies give more authority to lower-level
employees, resulting in a sense of empowerment. Decisions can be made more quickly, and
employees often believe that decentralized companies provide greater levels of procedural fairness
to employees. Job candidates are more likely to be attracted to decentralized organizations. Because
centralized organizations assign decisionmaking responsibility to higher-level managers, they place
greater demands on the judgment capabilities of CEOs and other high-level managers.

Many companies find that the centralization of operations leads to inefficiencies in decision making.
For example, in the 1980s, the industrial equipment manufacturer Caterpillar suffered the
consequences of centralized decision making. At the time, all pricing decisions were made in the
corporate headquarters in Peoria, Illinois. This meant that when a sales representative working in
Africa wanted to give a discount on a product, they needed to check with headquarters.
Headquarters did not always have accurate or timely information about the subsidiary markets to
make an effective decision. As a result, Caterpillar was at a disadvantage against competitors such as
the Japanese firm Komatsu. Seeking to overcome this centralization paralysis, Caterpillar underwent
several dramatic rounds of reorganization in the 1990s and 2000s.[293]

Figure 7.4.

Changing their decision-making approach to a more decentralized style has helped Caterpillar
compete at the global level.

However, centralization also has its advantages. Some employees are more comfortable in an
organization where their manager confidently gives instructions and makes decisions. Centralization
may also lead to more efficient operations, particularly if the company is operating in a stable
environment.[294]

In fact, organizations can suffer from extreme decentralization. For example, some analysts believe
that the Federal Bureau of Investigation (FBI) experiences some problems because all its structure
and systems are based on the assumption that crime needs to be investigated after it happens. Over
time, this assumption led to a situation where, instead of following an overarching strategy, each FBI
unit is completely decentralized and field agents determine how investigations should be pursued. It
has been argued that due to the change in the nature of crimes, the FBI needs to gather accurate
intelligence before a crime is committed; this requires more centralized decision making and strategy
development.[295]

Hitting the right balance between decentralization and centralization is a challenge for many
organizations. At the Home Depot, the retail giant with over 2,000 stores across the United States,
Canada, Mexico, and China, one of the major changes instituted by former CEO Bob Nardelli was to
centralize most of its

operations. Before Nardelli’s arrival in 2000, Home Depot store managers made a number of
decisions autonomously and each store had an entrepreneurial culture. Nardelli’s changes initially
saved the company a lot of money. For example, for a company of that size, centralizing purchasing
operations led to big cost savings because the company could negotiate important discounts from
suppliers. At the same time, many analysts think that the centralization went too far, leading to the
loss of the service-oriented culture at the stores. Nardelli was ousted after seven years.[296]

Formalization

Formalization is the extent to which an organization’s policies, procedures, job descriptions, and
rules are written and explicitly articulated. Formalized structures are those in which there are many
written rules and regulations. These structures control employee behavior using written rules, so that
employees have little autonomy to decide on a case-by-case basis. An advantage of formalization is
that it makes employee behavior more predictable. Whenever a problem at work arises, employees
know to turn to a handbook or a procedure guideline. Therefore, employees respond to problems in
a similar way across the organization; this leads to consistency of behavior.

While formalization reduces ambiguity and provides direction to employees, it is not without
disadvantages. A high degree of formalization may actually lead to reduced innovativeness because
employees are used to behaving in a certain manner. In fact, strategic decision making in such
organizations often occurs only when there is a crisis. A formalized structure is associated with
reduced motivation and job satisfaction as well as a slower pace of decision making.[297]The service
industry is particularly susceptible to problems associated with high levels of formalization.
Sometimes employees who are listening to a customer’s problems may need to take action, but the
answer may not be specified in any procedural guidelines or rulebook. For example, while a handful
of airlines such as Southwest do a good job of empowering their employees to handle complaints, in
many airlines, lower-level employees have limited power to resolve a customer problem and are
constrained by stringent rules that outline a limited number of acceptable responses.

Hierarchical Levels
Another important element of a company’s structure is the number of levels it has in its hierarchy.
Keeping the size of the organization constant, tall structures have several layers of management
between frontline employees and the top level, while flat structures consist of only a few layers. In
tall structures, the number of employees reporting to each manager tends to be smaller, resulting in
greater opportunities for managers to supervise and monitor employee activities. In contrast, flat
structures involve a larger number of employees reporting to each manager. In such a structure,
managers will be relatively unable to provide close supervision, leading to greater levels of freedom
of action for each employee.

Research indicates that flat organizations provide greater need satisfaction for employees and
greater levels of self-actualization.[298] At the same time, there may be some challenges associated
with flat structures. Research shows that when managers supervise a large number of employees,
which is more likely to happen in flat structures, employees experience greater levels of role
ambiguity—the confusion that results from being unsure of what is expected of a worker on the job.
[299] This is especially a disadvantage for

employees who need closer guidance from their managers. Moreover, in a flat structure,
advancement opportunities will be more limited because there are fewer management layers.
Finally, while employees report that flat structures are better at satisfying their higher-order needs
such as self-actualization, they also report that tall structures are better at satisfying security needs
of employees.[300] Because tall structures are typical of large and well-established companies, it is
possible that when working in such organizations employees feel a greater sense of job security.

Figure 7.5.

Companies such as IKEA, the Swedish furniture manufacturer and retailer, are successfully using flat
structures within stores to build an employee attitude of job involvement and ownership.

Departmentalization

Organizational structures differ in terms of departmentalization, which is broadly categorized as

either functional or divisional.

Organizations using functional structures group jobs based on similarity in functions. Such structures
may have departments such as marketing, manufacturing, finance, accounting, human resources,
and information technology. In these structures, each person serves a specialized role and handles
large

volumes of transactions. For example, in a functional structure, an employee in the marketing

department may serve as an event planner, planning promotional events for all the products of the
company.

In organizations using divisional structures , departments represent the unique products, services,
customers, or geographic locations the company is serving. Thus each unique product or service the
company is producing will have its own department. Within each department, functions such as
marketing, manufacturing, and other roles are replicated. In these structures, employees act like
generalists as opposed to specialists. Instead of performing specialized tasks, employees will be in
charge of performing many different tasks in the service of the product. For example, a marketing
employee in a company with a divisional structure may be in charge of planning promotions,
coordinating relations with advertising agencies, and planning and conducting marketing research, all
for the particular product line handled by his or her division.

In reality, many organizations are structured according to a mixture of functional and divisional
forms. For example, if the company has multiple product lines, departmentalizing by product may
increase innovativeness and reduce response times. Each of these departments may have dedicated
marketing, manufacturing, and customer service employees serving the specific product; yet, the
company may also find that centralizing some operations and retaining the functional structure
makes sense and is more cost effective for roles such as human resources management and
information technology. The same organization may also create geographic departments if it is
serving different countries.

Each type of departmentalization has its advantages. Functional structures tend to be effective when
an organization does not have a large number of products and services requiring special attention.
When a company has a diverse product line, each product will have unique demands, deeming
divisional (or product-specific) structures more useful for promptly addressing customer demands
and anticipating market changes. Functional structures are more effective in stable environments
that are slower to change. In contrast, organizations using product divisions are more agile and can
perform better in turbulent environments. The type of employee who will succeed under each
structure is also different. Research shows that when employees work in product divisions in
turbulent environments, because activities are diverse and complex, their performance depends on
their general mental abilities.[301]

Figure 7.6. An Example of a Pharmaceutical Company with a Functional Departmentalization

Structure

Figure 7.7. An Example of a Pharmaceutical Company with a Divisional Departmentalization Structure

Two Configurations: Mechanistic and Organic Structures

The different elements making up organizational structures in the form of formalization,

centralization, number of levels in the hierarchy, and departmentalization often coexist. As a result,
we can talk about two configurations of organizational structures, depending on how these elements
are arranged.

Mechanistic structures are those that resemble a bureaucracy. These structures are highly formalized
and centralized. Communication tends to follow formal channels and employees are given specific
job descriptions delineating their roles and responsibilities. Mechanistic organizations are often rigid
and resist change, making them unsuitable for innovativeness and taking quick action. These forms
have the downside of inhibiting entrepreneurial action and discouraging the use of individual
initiative on the part of employees. Not only do mechanistic structures have disadvantages for
innovativeness, but they also limit individual autonomy and self-determination, which will likely lead
to lower levels of intrinsic motivation on the job.[302]

Despite these downsides, however, mechanistic structures have advantages when the environment
is more stable. The main advantage of a mechanistic structure is its efficiency. Therefore, in
organizations that are trying to maximize efficiency and minimize costs, mechanistic structures
provide advantages. For example, McDonald’s has a famously bureaucratic structure where
employee jobs are highly formalized, with clear lines of communication and specific job descriptions.
This structure is an advantage for them because it allows McDonald’s to produce a uniform product
around the world at minimum cost. Mechanistic structures can also be advantageous when a
company is new. New businesses often suffer from a lack of structure, role ambiguity, and
uncertainty. The presence of a mechanistic structure has been shown to be related to firm
performance in new ventures.[303]

In contrast to mechanistic structures, organic structures are flexible and decentralized, with low
levels of formalization. In Organizations with an organic structure, communication lines are more
fluid and flexible. Employee job descriptions are broader and employees are asked to perform duties
based on the specific needs of the organization at the time as well as their own expertise levels.
Organic structures tend to be related to higher levels of job satisfaction on the part of employees.
These structures are conducive to entrepreneurial behavior and innovativeness.[304] An example of
a company that has an organic structure is the diversified technology company 3M. The company is
strongly committed to decentralization. At 3M, there are close to 100 profit centers, with each
division feeling like a small company. Each division manager

acts autonomously and is accountable for his or her actions. As operations within each division get
too big and a product created by a division becomes profitable, the operation is spun off to create a
separate business unit. This is done to protect the agility of the company and the small-company
atmosphere.[305]

KEY TAKEAWAY

The degree to which a company is centralized and formalized, the number of levels in the company
hierarchy, and the type of departmentalization the company uses are key elements of a company’s
structure. These elements of structure affect the degree to which the company is effective and
innovative as well as employee attitudes and behaviors at work. These elements come together to
create mechanistic and organic structures. Mechanistic structures are rigid and bureaucratic and help
companies achieve efficiency, while organic structures are decentralized, flexible, and aid companies
in achieving innovativeness.

EXERCISES

1. What are the advantages and disadvantages of decentralization?

2. All else being equal, would you prefer to work in a tall or flat organization? Why?
3. What are the advantages and disadvantages of departmentalization by product?

[293] Nelson, G. L., & Pasternack, B. A. (2005). Results: Keep what’s good, fix what’s wrong, and
unlock great performance . New York: Crown Business.

[294] Ambrose, M. L., & Cropanzano, R. S. (2000). The effect of organizational structure on
perceptions of procedural fairness. Journal o f Applied Psychology , 85 , 294–304; Miller, D., Droge,
C., & Toulouse, J. (1988). Strategic process and content as mediators between organizational context
and structure. Academy of Management Journal, 31 , 544–569; Oldham, G. R., & Hackman, R. J.
(1981). Relationships between organizational structure and employee reactions: Comparing
alternative frameworks. Administrative Science Quarterly , 26 , 66–83; Pierce, J. L., & Delbecq, A. L.
(1977). Organization structure, individual attitudes, and innovation. Academy of Management
Review , 2 , 27–37; Schminke, M., Ambrose, M. L., & Cropanzano, R. S. (2000). The effect of
organizational structure on perceptions of procedural fairness. Journal of Applied Psychology, 85 ,
294–304; Turban, D. B., & Keon, T. L. (1993). Organizational attractiveness: An interactionist
perspective. Journal of Applied Psychology, 78 , 184–193; Wally, S., & Baum, J. R. (1994). Personal
and structural determinants of the pace of strategic decision making. Academy of Management
Journal, 37 , 932–956.

[295] Brazil, J. J. (2007, April). Mission: Impossible? Fast Company, 114 , 92–109.

[296] Charan, R. (2006, April). Home Depot’s blueprint for culture change. Harvard Business Review,
84 (4), 60–70; Marquez, J. (2007, January 15). Big bucks at door for Depot HR leader. Workforce Ma
nagement, 86 (1).

[297] Fredrickson, J. W. (1986). The strategic decision process and organizational structure. Academy
of Management Review, 11 , 280–297; Oldham, G. R., & Hackman, R. J. (1981). Relationships
between organizational structure and employee reactions: Comparing alternative frameworks.
Administrative Science Quarterly , 26 , 66–83; Pierce, J. L., & Delbecq, A. L. (1977). Organization
structure, individual attitudes, and innovation. Academy of Management Review , 2 , 27–37; Wally,
S., & Baum, R. J. (1994). Strategic decision speed and firm performance. Strategic Management
Journal , 24 , 1107–1129.

[298] Ghiselli, E. E., & Johnson, D. A. (1970). Need satisfaction, managerial success, and
organizational structure. Personnel Psychology, 23 , 569–576; Porter, L. W., & Siegel, J. (2006).
Relationships of tall and flat organization structures to the satisfactions of foreign managers.
Personnel Psychology, 18 , 379–392.

[299] Chonko, L. B. (1982). The relationship of span of control to sales representatives’ experienced
role conflict and role ambiguity. Academy of Management Journal, 25 , 452–456.

[300] Porter, L. W., & Lawler, E. E. (1964). The effects of tall versus flat organization structures on
managerial job satisfaction. Personnel Psychology, 17 , 135–148.
[301] Hollenbeck, J. R., Moon, H., Ellis, A. P. J., West, B. J., Ilgen, D. R., et al. (2002). Structural
contingency theory and individual differences: Examination of external and internal person-team fit.
Journal of Applied Psychology, 87 , 599–606.

[302] Burns, T., & Stalker, M. G. (1961). The Management of innovation . London: Tavistock; Covin, J.
G., & Slevin, D. P. (1988). The influence of organizational structure. Journal of Management Studies .
25 , 217– 234; Schollhammer, H. (1982). Internal corporate entrepreneurship . Englewood Cliffs, NJ:
Prentice-Hall; Sherman, J. D., & Smith, H. L. (1984). The influence of organizational structure on
intrinsic versus extrinsic motivation. Academy of Management Journal, 27 , 877–885; Slevin, D. P., &
Covin, J. G. (1990). Juggling entrepreneurial style and organizational structure—how to get your act
together. Sloan Management Review , 31 (2), 43–53.

[303] Sine, W. D., Mitsuhashi, H., & Kirsch, D. A. (2006). Revisiting Burns and Stalker: Formal structure
and new venture performance in emerging economic sectors. Academy of Management Journal, 49 ,
121–132.

[304] Burns, T., & Stalker, M. G. (1961). The Management of Innovation . London: Tavistock; Covin, J.
G., & Slevin, D. P. (1988) The influence of organizational structure. Journal of Management Studies ,
25 , 217–234.

[305] Adair, J. (2007). Leadership for innovation: How to organize team creativity and harvest ideas .
London: Kogan Page.

Section 2:

Contemporary Forms of Organizational Structures

LEARNING OBJECTIVES

1. Explain what a matrix structure is and the challenges of working in a structure such as this.

2. Define boundaryless organizations.

3. Define learning organizations, and list the steps organizations can take to become learning
organizations.

For centuries, technological advancements that affected business came in slow waves. Over 100
years passed between the invention of the first reliable steam engine and the first practical internal
combustion engine. During these early days of advancement, communication would often go hand in
hand with transportation. Instead of delivering mail hundreds of miles by horse, messages could be
transported more quickly by train and then later by plane. Beginning in the 1900s, the tides of
change began to rise much more quickly. From the telegraph to the telephone to the computer to
the Internet, each advancement brought about a need for an organization’s structure to adapt and
change.

Business has become global, moving into new economies and cultures. Previously nonexistent
industries, such as those related to high technology, have demanded flexibility by organizations in
ways never before seen. The diverse and complex nature of the current business environment has
led to the emergence of several types of organizational structures. Beginning in the 1970s,
management experts began to propose organizational designs that they believed were better
adapted to the needs of the emerging business environment. Each structure has unique qualities to
help businesses handle their particular environment.

Matrix Organizations

Matrix organizations have a design that combines a traditional functional structure with a product
structure. Instead of completely switching from a product-based structure, a company may use a
matrix structure to balance the benefits of product-based and traditional functional structures.
Specifically, employees reporting to department managers are also pooled together to form project
or product teams. As a result, each person reports to a department manager as well as a project or
product manager. In a matrix structure, product managers have control and say over product-related
matters, while department managers have authority over matters related to company policy. Matrix
structures are created in response to uncertainty and dynamism of the environment and the need to
give particular attention to specific products or projects. Using the matrix structure as opposed to
product departments may increase communication and cooperation among departments because
project managers will need to coordinate their actions with those of department managers. In fact,
research shows that matrix structure increases the frequency of informal and formal communication
within the organization.[306] Matrix structures also have the benefit of providing quick responses to
technical problems and customer demands. The existence of a project manager keeps the focus on
the product or service provided.

Figure 7.8.

An example of a matrix structure at a software development company. Business analysts, developers,

and testers each report to a functional department manager and to a project manager
simultaneously.

Despite these potential benefits, matrix structures are not without costs. In a matrix, each employee
reports to two or more managers. This situation is ripe for conflict. Because multiple managers are in
charge of guiding the behaviors of each employee, there may be power struggles or turf wars among
managers. As managers are more interdependent compared to a traditional or product-based
structure, they will need to spend more effort coordinating their work. From the employee’s
perspective, there is potential for interpersonal conflict with team members as well as with leaders.
The presence of multiple leaders may create role ambiguity or, worse, role conflict—being given
instructions or objectives that cannot all be met because they are mutually exclusive. The necessity
to work with a team consisting of employees with different functional backgrounds increases the
potential for task conflict at work.[307] Solving these problems requires a great level of patience and
proactivity on the part of the employee.

The matrix structure is used in many information technology companies engaged in software
development. Sportswear manufacturer Nike is another company that uses the matrix organization
successfully. New product introduction is a task shared by regional managers and product managers.
While product managers

are in charge of deciding how to launch a product, regional managers are allowed to make
modifications based on the region.[30

file:///E:/Master%20rad/pregledano/BUS208-5.4.pdf

mpact of motivation on employees‟ performance

According to Herzberg's two-factor theory of motivation, money is not even a motivator (Herzberg,
1987). Today's workforce is becoming more and more skilful and technologically inclined. Managers
have to think of new ways to manage this knowledge workforce. With knowledge and skills come
higher salary demands. These knowledge workers will no longer “work for beans.” According to
Maslow's hierarchy of needs, people have physical, security, social, ego and self-actualization needs.
People are motivated to fulfil lower-level needs before they move on to fulfil higher-level needs, such
as ego (esteem) and self-actualization. (Herzberg 1987) Knowing what people need can help us
understand how to motivate today's knowledge workers. Given the fact that these workers
command high-paying jobs, we can infer that money alone does not provide enough of an incentive
as a motivator for performance. This is, of course, an element of Herzberg's theory of motivation.
Managers need to provide challenging jobs in order to better motivate today's knowledge workers.
Because the physical or material, and social needs that come with the jobs are already fulfilled,
these knowledge workers tend

to move on to higher-level of needs such as ego (esteem) and self-actualization. The survey we
conducted suggests growth opportunities and challenges have a positive effect on a person‟s
motivation in the work place. The majority of people we surveyed rank growth opportunities higher
than pay when it comes to job motivation. Most of the people in the survey answered that they
would take a high-profile job with more responsibilities but without any pay increase when given the
opportunity. This behaviour suggests that people prefer recognition associated with the job. Also,
the behaviour in choosing the job with more responsibilities suggests that people are not afraid of
challenges associated with the job when they are presented in the right context. In this case, by
taking on the challenges, people may expect a certain amount of recognition. Managers should keep
this in mind when assigning work to their employees. Work itself is a motivator according to
Herzberg's twofactor theory. A worker derives a sense of self-worth in the process of performing the
job and, upon completion of that job, a sense of accomplishment. Studies have shown that satisfied
workers are more productive (Schermerhorn et al,, 2003). In dealing with today's knowledge
workforce, managers need to design jobs that are both challenging and satisfying. In order to design
the “right” job for the right person, the job designing process needs to involve employees because
their needs have to be addressed. A significant number of jobs in the workplace are apparently not
very challenging. In situations like these, managers can set goals and objectives so employees know
what is expected of them. These goals and objectives need to be specifically stated in order to have
most motivating effect. Having a clear goal can make a previously routine job become more of a
challenge. With this view, the worker becomes more motivated in order to achieve that goal.
Whether the job is by design or by goal setting, a highly motivated worker is likely to be one who has
the necessary skills and supplies to accomplish the job. The survey conducted also indicated that a
majority of the respondents consider the opportunity for growth to be more of a factor in job
motivation than pay. Today's knowledge workers also demand growth opportunities from their work
place. These workers value new knowledge and new skills. Companies that can provide these growth
opportunities reap the benefits of having a motivated workforce with improved skills. These growth
opportunities can involve on-the-job training or companypaid technical training. Managers need to
understand that challenging work and opportunities for growth really go hand in hand. Workers who
routinely perform challenging work inherit personal growth and thus become even more motivated
and productive. Designing challenging work and providing growth opportunities can be cost-
effective

ways to boost employees‟ motivation. Non-cash rewards also play an important role in any
organization, as rewards for exceptional performance are vital for employee motivation. Employees
want and need recognition on the job, and an effective way of satisfying this need is through non-
cash rewards. Non-cash rewards appeal to employees on a personal level. Because non-cash
rewards have proven to be effective motivators, companies that “want rewards to be cost-effective
but memorable are seeking the services of firms that specialize in employees‟ recognition According
to the survey we conducted, 94% of those surveyed felt that non-cash rewards can be very effective
in motivating employees. This seems to demonstrate that money is not everything when it comes to
motivating a person on the job. Non-cash awards play an important role in employees‟ motivation
and knowing their contributions count is vital to employee performance. As previously mentioned,
recognition is another important factor that managers must identify in motivating their employees
according to the interview conducted. Recognition can come in many forms, most of them with little
or no real cost to a company. A compliment such as “a simple „thank you‟ still goes a long way in
motivating employees” (Kelly, 2010), or it can be more formal such as an “employee of the month”
award. “The value of recognition is the attention they receive” (Wiscombe, 2002). Gelleman (1992)
states in his book, Motivation in the Real World: The Art of Getting Extra Effort From Everyone –
Including Yourself, “If you are dealing with individuals who, regardless of their demographics, want to
take charge of their own life, at least to the extent that circumstances permit them to do that, you
can motivate them. What that kind of person needs is plenty of opportunity for achievement and
recognition” (Gellerman, 1992). Employees and people in general want to feel like they are
individuals and that they can distinguish themselves by doing an exceptional or outstanding job. This
concept would relate to the level of “ego” in Maslow‟s theory on the hierarchy of needs, which deals
with independence, achievement, freedom, status, recognition, and self-esteem. By acknowledging
the excellence and well-performed activities of employees, managers can determine the type of
recognition required. The level of appreciation from recognition rises if it is an honest and well-
deserve recognition because “if employees believe you are a fair, honest and caring boss, most of
them will remain loyal and respond in kind” (Wiscombe, 2002
file:///E:/Master%20rad/pregledano/Impact_of_motivation_on_employees_perfor.pdf

Hierarchical culture suggests a highly structured and formal place to work, where rules and

procedures govern behavior. Leaders strive to be good coordinators and organizers who are

efficiency-minded. Maintaining a smooth-running organization is most critical. Formal policies

are what hold the group together. Stability, performance, and efficient operations are the long

(-)

(-)

(-)

(+)

(+)

(+)

Impact of Context and Self Efficacy on Performance

11

term goals. Success means dependable delivery, smooth scheduling, and low cost. Management

wants security and predictability. Our rationale for the above hypothesis is that a highly

structured and formal place to work is bound to increase standardized behavior among the

employees which might turn them into highly skilled workers and enhance their in role

performance in the mechanical activities of the organization of which strict rules and procedures

are maintained. The employee would be confident when doing the jobs mentioned in daily

schedules but the same will go down as far as extra role performance. Moreover in a hierarchical

structure they are not willing to take added responsibility and they are not supported by the

organization too. Therefore we predict that it will significantly decrease the extra role

performance of the employees resulting in decrease of commitment among the employees.

Hierarchical culture as explained before will get reflected in self-efficacy levels of employees to

get involved in extra role behavior and there by the exhibited levels commitment. Same time

hierarchical culture through its inherent policies and processes will have a positive impact

towards organizational commitment and we expect self-efficacy levels to mediate this

relationship. Hence we hypothesize that:

Hypothesis 1a: Hierarchical Culture has an inverse relation to Organizational

Commitment mediated by Self-Efficacy

Hypothesis 1b: Hierarchical Culture has a positive relation to In-role behavior mediated

by Self- Efficacy

Hypothesis 1c: Hierarchical Culture has an inverse relation to Extra-role behavior

mediated by Self-Efficacy

Adhocratic culture is characterized by a dynamic, entrepreneurial, and creative work

environment, where Innovation and risk-taking are embraced by employees and leaders. A

Impact of Context and Self Efficacy on Performance

12

commitment to experimentation and thinking differently are what unify the Organization, They

strive to be on the leading edge. The long-term emphasis is on growth and acquiring new

resources. Success means gaining unique and new products or services. Being an industry leader

is important. Individual initiative and freedom are encouraged. Such a culture will encourage

employees to take multiple initiatives resulting in various extra-role behaviors with a significant

improvement in organizational commitment. Employees are not expected to limit themselves to

the defined in-role behaviors and may need to compromise on some of them due to the priority

given for extra-role behaviors. We expect self-efficacy to mediate these relationships and hence

hypothesize as:

Hypothesis 2a: Adhocratic Culture has a positive relation to Organizational Commitment

mediated by Self-Efficacy

Hypothesis 2b: Adhocratic Culture has an inverse relation to In-role behavior mediated

by Self- Efficacy

Hypothesis 2c: Adhocratic Culture has a positive relation to Extra-role behavior

mediated by Self-Efficacy

Collaborative or Clan culture on the other hand is characterized by an open and friendly place to

work where people share a lot of themselves; it is like an extended family. Leaders are

considered to be mentors or even parental figures. Group Loyalty and sense of tradition are
strong. There is an emphasis on the long-term benefits of human resources development and

great importance is given to group Cohesion. There is a strong concern for people. The

organization places a premium on teamwork, participation, and consensus. Such a culture will

automatically result in high levels organizational commitment and anticipate various extra-role

behaviors from the members. Employees are discouraged to focus only on defined in-role

Impact of Context and Self Efficacy on Performance

13

behaviors. We anticipate that the ability to respond to such expectations from the cultural context

will be determined by the self-efficacy levels of employees. Hence we hypothesize that

Hypothesis 2d: Collaborative Culture has a positive relation to Organizational

Commitment mediated by Self-Efficacy

Hypothesis 2e: Collaborative Culture has an inverse relation to In-role behavior

mediated by Self- Efficacy

Hypothesis 2f: Collaborative Culture has a positive relation to Extra-role behavior

mediated by Self-Efficacy

A market culture is practiced in a results-driven organization focused on job completion. People

are competitive and goal-oriented. Leaders are demanding, hard-driving, and productive. The

emphasis on winning unifies the organization. Reputation and success are common concerns.

Long-term focus is on competitive action and achievement of measurable goals and targets.

Success means market share and penetration. Competitive pricing and market leadership are

important. All these cultures have given importance to employee discretion and empowerment at

the lower levels of the organizational hierarchy and hence they are hypothesized to result in high

levels of employee commitment and extra role performance, but an area of concern could be the

in-role performance as there is less emphasize on the standard job process as most of the

employees are creative and guided by their individual thought process rather than the

organizational rules and procedures. In line with previous hypothesizes we anticipate that

commitment and respective behaviors to be influenced self-efficacy.

Hypothesis 2g: Market Culture has a positive relation to Organizational Commitment

mediated by Self-Efficacy

Impact of Context and Self Efficacy on Performance

14

Hypothesis 2h: Market Culture has an inverse relation to In-role behavior mediated by

Self- Efficacy

Hypothesis 2i: Market Culture has a positive relation to Extra-role behavior mediated

by Self-Efficacy

Hierarchical culture is hypothesized to decrease the self-efficacy of an individual more because

actions would be guided by the fixed set of rules and regulations rather on the basis of own will.

Over a period of time, this would reduce an employee’s ability to face uncertain situations and

thereby loss in his self-belief. This feeling would be exacerbated by the degree of bureaucracy

which is imposed by the mechanical organizational structure where all the decisions are taken in

a top-down approach resulting in gradually reducing self-efficacy among individuals. Therefore

we hypothesize that:

Hypothesis 3: Relationship between Hierarchical Culture and Self-efficacy is moderated

by Organizational Structure such that, more mechanistic the Organizational Structure is

less will be the reported levels of Self-efficacy.

Adhocratic, collaborative, and market culture demands discretion to be delegated to the lowest

levels of the organization resulting in a flexible and a boundary less organizational environment

where there is strong collaboration between employees and the top management at all the

hierarchical levels. Research suggests that structural organicity is positively associated with the

use of participative top management among these three cultures. For example in the Burns &

Stalker’s (1961) study of the structural correlates of innovative behavior, participative

management was observed in organizations with organic structures. This treatment over the time

results in the increased self-belief among the employees encouraging them to take risks. Thereby

Impact of Context and Self Efficacy on Performance

15

over the time increase the self-efficacy of the employees encouraging them further through the
organic, organizational structure.

Hypothesis 4: Relationship between (a) Adhocratic, (b) Collaborative culture, (c) Market

Culture and Self-efficacy is moderated by Organizational Structure such that, less mechanistic

the Organizational Structure is higher will be the reported levels of Self-efficacy

file:///E:/Master%20rad/pregledano/OS-PP-312-
IMPACT_OF_ORGANIZATIONAL_CULTURE_AND_STRUCTURE_ON_ORGANIZATIONAL_COMMITMENT
_AND_INDIVIDUAL_b.pdf

2.2.3 Locke’s Value theory According to this theory (Baron and Greenberg 2003), the impact of the
various factors of job satisfaction can be determined. In this aspect, if an organization knows the
value placed on each factor, the greater the shift in satisfaction changes that will be produced. This
theory also advocates that if too much value is placed on a particular factor, stronger feelings of
dissatisfaction will occur. Locke‟s theory is therefore multifaceted and greatly specific for each
individual. This can be illustrated in the following example: Two employees that perform the same
task at the same place of work may experience the same level of satisfaction but in totally different
ways. The one employee may be strongly influenced by the physical aspects of the job whilst the
other employee may be influenced by the challenge and variation inherent in the job (Locke, 1976).
In contrast, Baron and Greenberg (2003) argue that although Locke‟s Theory has not been
extensively researched, a great amount of emphasis placed on values alludes that job satisfaction
may rise from factors. This theory as well is significant to this study as it is essential to guide in
determining the factors that contribute towards the varying degrees of job satisfaction or job
dissatisfaction.

15

2.3 Empirical Review

2.3.1 Effect of talent development on Job satisfaction An organization that wants to strengthen its
bond with its employees must invest in the development of their employees (Woodruffe, 1999). It
entails creating opportunities for promotion within the company and providing opportunity for
training and skill development that let employees to improve their employability on the internal and
the external labour market (Meyer & Smith, 2003). They argue unambiguously that organizations will
do a better retention job by spending more resources on training and development. An organization
that provides education and training will be more competitive and productive and will win the loyalty
of its workforce.

Robert Half International, Inc. conducted a study that examined why people leave their jobs. The
results showed that more often people leave for advanced career opportunities and development
and not necessarily for monetary factors such as compensation (Johnson, 2004). Career development
is important for both the organization and individual. It is a mutual benefit process because career
development provides the important outcomes for both parties (Wright et al., 2005). It is an
effective way to enhance employee retention. Career development constitutes a visible investment
that the company makes in the worker, providing him or her with new skills, and greater
competencies and confidence. It often leads to work that is more intrinsically rewarding.

Ongori & Agolla (2009), contend that lack of personal growth in organizations results in career
plateau which in tend leads to increased employees intentions to quit. Many employees find
themselves in jobs that offer them limited mobility opportunities in terms of upward movement in
the organization. Career plateau is thus seen as a major contributing factor to employees to quit in
organizations. Human Resource professionals thus have a greater responsibility of managing career
plateau and hence minimize employee turnover.

According to Lee (2003), plateau employees are likely to have higher labour turnover because they
want to advance their careers elsewhere in the environment. Studies have shown that employee
who have attained plateau have a high degree of intention to quit due to reduced opportunity in the
present organization (Yamamoto, 2006).

16

Career opportunities encourage workers to make longer-term commitments to their workplace; it

permits them to see a future with the company. Organizations need talented employees for
maintaining the sustainable competitive advantage (Prince, 2005). Employee training and
development should be looked upon as an investment, rather than a cost, with planning and
budgeting requirements similar to those dedicated to capital improvements. An organization‟s
human capital is one of its key sources of differentiation, and employees are more likely to remain
satisfied if they receive an effective orientation and regular access to technical and nontechnical
training. Competency-based training and development increases employee productivity, reduces
turnover, improves job satisfaction, aids in the recruiting process, rewards long-time employees, and
reduces the need for employee supervision (Steel et al., 2002).

Griffeth et al. (2000), asserted that training and development are key factors to good retention.
Meyer et al. (2003), also suggest that employee learning which encompasses training and
development contribute to retention by building employee commitment through a show of support,
providing employees with the means to deal with stress related to job demands and change, serving
as an incentive to stay, and creating a culture of caring. Thus, training and professional development
are seen as ways of building employee commitment in that they allow employees to “see a future”
where they work, and provide them with the support necessary to face the on-going challenges
related to their work.

Kyndt et al. (2009), implemented a study in which they wanted to analyze the reasons why
employees stay in a company or what causes them to look for other job-opportunities. In their
research, they put special focus on workers‟ learning because they assume that learning plays a very
crucial role concerning retention. Learning opportunities have generally referred to three dimensions
of learning on the job: opportunities to learn new things on the job, having a job that requires one to
be creative, and being able to influence what happens on the job. Another study found challenging
and extensive learning opportunities to be associated with better psychological functioning,
subjective health, and coping styles (Taylor, 2004).

Taylor (2004), concluded that the dramatic difference in higher rates of job satisfaction for
employees in small companies relative to large companies could be attributed to the extent of
workplace learning opportunities available in small companies. Way, (2002) claims that if employees
feel they are not learning and growing, they feel they are not remaining competitive

17

with their industry peers for promotion opportunities and career advancement. Once employees feel
they are no longer growing, they begin to look externally for new job opportunities.

Lee-Kelley et al. (2009), also focused on organizational and personal factors which might affect
retention. The investigations showed that the perception of the importance of learning to employees
and the quality of work climate is a strong predictor of employee intentions to remain with their
current employer. The researchers suggest that human resource management should formulate
policies that put more emphasis on employee development and training in order to retain the
needed talent for effective performance. One of the ways they recommend organizations achieve
this is by ensuring that opportunities for personal advancement and growth are consistently available
(Hay Group, 2007).

However, the conundrum is that the more employable organizations makes their employees through
training and development opportunities the more their mobility capital increases (Cappelli, 2000).
Studies have shown that if employers do not attend to employees training needs they leave (Hay
Group, 2007). If employers do develop them, some will leave anyway but the organization will
benefit from their competence for the duration of their tenure. Martin (2003), however contends
that if the training given to employees is off- the -job, then they will go out to explore their skills
acquired. Consequently, researchers suggest that training and development given to employees
should be based on- the- job to development their skills and competencies on their current jobs.

Nonetheless, employees should be given the chance to grow in their careers since employees with
greater opportunities for self-growth and development are as well committed to the organization.
Currivan (1999), defines organizational commitment as the degree to which an employee feels loyal
to an organization. Similarly, Steers & Porter (1991), define organizational commitment as the
relative strength of an individual‟s identification with and involvement in a particular organization.
Meyer & Smith (1997), describe committed employees as people who stay with the organization
through thick and thin. They attend work regularly and put in a full day. Committed people protect
company assets, share company goals, vision, and ethics. Shahzad et al. (2010), give the antecedents
of commitment as procedural justice, expected utility of internal roles, employment security, job
investments and training.

18
Harpur (2002), contends that organizational commitment is an environment created by a company, a
set of values it subscribes to, and the ability of employees to identify with and be loyal to the
company. He asserts that by instilling a sense of organizational commitment, trust and loyalty
increase, and in turn increase job satisfaction and motivation. Wright et al. (2000), found that
individuals with low organizational commitment are just waiting for a good opportunity to leave their
jobs. Thatcher et al. (2003), argue that organizational commitment has a distinct link to turnover and
that it mediates the effects of job satisfaction, job characteristics, and perceived pay competiveness.

Many studies have reported a significant association between organizational commitment and
turnover intentions and have confirmed the link between commitment and actual turnover. Griffeth
et al. (2001), analysis showed that organizational commitment was a better predictor of retention.
Researchers have established that there are different types of organizational commitment. Meyer &
Smith (2003), investigated the nature of the link between turnover and the three components of
attitudinal commitment. Affective commitment refers to employees‟ emotional attachment to,
identification with and involvement in the organization, continuance commitment refers to
commitment base on costs that employees associate with leaving the organization, and normative
commitment refers to employees‟ feelings of obligation to remain with the organization.

They asserted that, employees with strong affective commitment stay with an organization because
they want to, those with strong continuance commitment stay because they need to, and those with
strong normative commitment stay because they feel they ought to. Meyer & Smith‟s study
indicated that all three components of commitment were indicator of retention. In general, most
research has found affective commitment to be the most decisive variable linked to retention.

In their research into the factors influencing employee retention, Wright et al. (2005), identified that
the first important indicator of employee retention is their organizational commitment. They
commented that employees with a high organizational commitment are those who have a strong
identification with the organization, value the sense of membership within it, agree with its

19

objectives and value systems, are likely to remain in it and, finally, are prepared to work hard on its
behalf.

2.3.2 Effects of Reward on Satisfaction Reward is something that an organization gives to the
employees in response of their contribution and performance. A reward can be extrinsic or intrinsic,
it can be a cash reward such as bonuses or it can be recognition such as naming a worker an
employee of the year. The extrinsic rewards are the most tangible, such as salaries, bonuses,
promotions etc, yet these incentives alone are not enough. Employees judge the quality of their job
in the intrinsic satisfaction (the personal reward they reap from their work). Using intrinsic rewards
to increase employee commitment and retention is achievable in any organization. While it is both
an art and science, it has basic component of human nature that are fundamental. When these
intrinsic approaches are understood and ingrained in the organization‟s culture, productive
employees remain. It has been asserted that, when pay and benefits are comparable to the market,
it is the intangibles that make for a dedicated workforce (Shechtman, 2008).

Reward is something that an organization gives to the employee so that the employees become
motivated for future positive behaviour (Ongori, 2008). In a corporate environment, rewards can
take several forms. It includes cash bonuses, recognition awards, free merchandise and free trips. It is
important to note that the rewards have a lasting impression on the employee and it will continue to
substantiate the employee‟s perception that they are valued (Johnson, 2004).

Recognition and reward programs are an important component of an employee retention plan. The
importance of these kinds of program is rooted in theories of positive reinforcement. By saying
“thank you” to employees for a job well done or a pat on a shoulder to show appreciation, an
organization is reinforcing ideal behavior and encouraging more of the actions that will make it
successful (Johnson, 2004). People who feel appreciated are more positive about themselves and
their ability to contribute; employees who understand how their efforts contribute to the success of
the organization overall are the most engaged, and therefore the least likely to leave.

20

The Society for Human Resources Management (SHRM) says that rewards are one of the keys to
avoiding turnover, especially if they are immediate, appropriate, and personal. The Hay Group and
Fortune magazine study of the “Most Admired Companies” also cites rewards and recognition as a
key driver of employee retention, as it create a culture that motivates and supports employees (Hay
Group, 2007). In the absence of a structured program and an accompanying workplace philosophy
about recognizing good work, it is easier for employees to leave. "People don't quit jobs, they quit
relationships," said Ferris, paraphrasing the conclusion of a Gallup study (Murray, 2007).

A valued employee is more likely to stay in employment than unvalued employee is. Sutherland
(2004), argues that reward systems ought to be a significant sphere of innovation for employers. The
increasing diversity of the workforce, she says, suggests the need for more creative approaches to
tailoring the right rewards to the right people. She concluded that recognition and reward are part of
a more comprehensive effort at keeping workers or adopting good workplace practices which can
contribute to increased retention.

Recognition is one of the most important methods of rewarding people. Employees need to know
not only how well they have achieved their objectives or carried out their work, but also that their
achievements are appreciated. Recognition needs are linked to the esteem needs of Maslow‟s
hierarchy of needs. Recognition can be provided by positive and immediate feedback and praises
where it is well observed (Armstrong & Murlis, 2008).

Rewards are very important for job satisfaction because it fulfills the basic needs as well as helps to
attain the higher level of goals. Earnings is the way by which employee get to know how much they
are gaining by dedicating their time, effort and skill in a job (Armstrong, 2010). Attractive
remuneration packages are one of the very important factors of retention because it fulfills the
financial and material desires as well as provide the means of being social by employee‟s status and
position of power in the organization (Pfeffer, 1998). Many researchers demonstrate that there is a
great deal of inter-individual difference in understanding the significant of financial rewards for
employee retention (Woodruffe, 1999). An organization‟s reward system can affect the performance
of the employees and their desire to remain employed (Robinson & Pillemer, 2007).

21

2.3.3 Effect of Organizational Structure on Job satisfaction Cho et al. (2006), emphasized that
organizational policies and Human Resource practices in quest of employee retention will
outperform the competition. Griffeth et al. (2001), categorically explained the significance of human
resource policies and its impact on employee retention. Similarly, proficiently planned and well-
executed employee retention program enhances productivity and reduces employee turnover
expenditures (Sutherland, 2004).

Human Resource policies with respect to stimulating performance evaluation mechanism,

performance based reward mechanism and career growth and promotion opportunities affect
worker‟s decisions of either staying or leaving a job. Employees always look for career growth
opportunities and in this context Human Resource policy functions stimulate employees to stay in
the current job. Large number of research has been conducted on the role of Human Resource
policies in mitigating voluntary turnover, and in each of the studies, the conclusion is that Human
Resource policies go a long way to affect employee retention.

Employee performance appraisal is used to measure employee workplace performance and

improving performance (Taylor, 2004). It is asserted that the impact of fair performance appraisal
process on employee retention is positive as Kuvaas, (2008) contends. Memon et al. (2010),
explained that performance appraisals are designed to relate pay to performance irrespective of
intensity of performance and goal achievement.

Human Resource Training and Development function plays an important role in developing a learning
organization which exploits full potential of its people at an individual, team and organization level.
Somaya & Williamson (2008) suggested, “In an organization where employees receive the proper
training needed to assume greater responsibilities, turnover rates are generally lower”. Beside this,
Lambert et al. (2002), found that employee training considerably mitigates employee desire to leave
the organization particularly for the new employees.

It is observed that the clear and well-articulated career growth strategy mitigates the effect of
employee intention to leave typically at the time when employees have an unclear career
expectation. In this context, clearly defined job growth and advancement opportunities affect

22

employee–employer relationship in many positive ways and it leads to reduced turnover (Samuel &
Chipunza, 2009).
One primary Human Resource tool that is used to affect motivation and performance is
compensation (Robinson & Pillemer, 2007). Employee dissatisfaction with compensation result in
high turnover and it provokes employee intention to leave a specific job or organization
permanently. Kim (2008), recommends that monetary benefit alone is not worth mentioning and
employees are more focused towards non-monetary rewards because these are more attractive
therefore, retention strategies should focus on more than just financial compensation.

The function of job description also signifies another aspect of employee retention. Undecided goal
alignment, regular performance disparagement and blurred organizational objectives create
workplace anxiety, aggravation and dissatisfaction (Silbert, 2005). Early researchers hypothesized
that employees are looking for clearly defined job responsibilities along with exciting work
environment that makes good use of their knowledge, skills and abilities. Robinson & Pillermer
(2007), emphasize that performance based job description is the valuable approach because job
description reflects employee performance expectations.

Employee recognition policy will help to retain quality employees and encourage low performers to
improve with the changing scenario. Effective implementation of the employee recognition function
will play a key role in enhancing motivation within the organization. Kim (2008), sturdily advocates
that employee recognition based on his performance beside with role and value admirations
persuades and supports a satisfying personal life and inspire worker loyalty and commitment. He
further stressed that exceptional employee performance should be recognize and particularly to link
pay and incentive to performance

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2.8 Theoritical framework In this section, it is intended to outline a few influential theories related to
the subject matter and thus provide a background for a better understanding of the mechanism
through which structure affects performance in technical and service firms. 2.8.1 Meier and Bohte’s
model of span of control Meier and Bohte (2000) offer the general theory on the functional form of
relationship between the span of control and the performance of organizations. They propose a
multi-dimensional model in which initial increases in span of control produce increases in
organizational performance, though at a decreasing rate of return. Increasing spans of control,
according to Meier and Bohte, allow for greater specialization, enhancing efficiency and
performance. To them, a higher manager/employee ratio reduces the manger's ability to control,
communicate and coordinate leading to a decrease in performance at an increasing rate. They also
propose that different spans of control can exist within one organization depending on the goal being
pursued in each department of the organization. 2.8.2 Hatch’s Model of decentralization Prior to
Hatch's model of decentralization, Andrew, Christiea, Marc, and Ross (2003) proposed that the
theory underlying the decentralization decision is very simple. Value is increased by minimizing the
total of knowledge transfer costs. Minimizing this total cost requires allocating some decision rights
from the CEO's office to lower level managers of the firm. Hatch (2006) proposes that the
decentralized structure allows for innovation and is thus more suitable and beneficial when used in a
changing environment with high requirement on adapting to the environment. He points out that the
decentralized structure is characterized by interactions that allow for redefinition of tasks and work
methods. A decentralized structure uses formalization to a smaller extent than a mechanic structure,
and uses horizontal communication and consulting between departments rather than vertical
instructions. In such structure Hatch explains that employees rather seek advice from each other
than give instructions. 2.8.3 Hierarchy-community phenotype model of organizational structure This
model was de developed by Lim, Griffiths, and Sambrook (2010). They proposed that organizational
structure development is very much dependent on the expression of the strategies and behavior of
the management and the workers as constrained by the power distribution between them, and
influenced by their environment and the outcome. This goes to show that the extent of
decentralization, task routine and specialization, and the size of span of control in an organization is
dependent on the organizational strategy and behaviours of managers and subordinate within that
organization. In more specific terms, the structure of an organization is dependent on and reflective
of its most dominant internal and external characteristics. 2.8.4 Chester Barnard’s model on
structure Chester Barnard was a practitioner who had read Weber's papers and was influenced by his
writings. Corporate Ownership & Control / Volume 13, Issue 1, 2015, Continued - 10 1282 But unlike
Weber, who had a mechanistic and impersonal view of structure, Barnard saw organizations as social
systems that requires human cooperation. For him, organizations should be structured in such a way
that people will be allowed to be closer and freely communicating, and the organizations should be
more flexible in adjusting to environmental changes to maintain a state of equilibrium (Mohammed,
2009). This model stresses decentralization, narrow span of control, and employee empowerment.

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The Effect of Job Satisfaction on Employee Performance 1. Managers’ interest in job satisfaction
tends to center on its effect on employee performance. Much research has been done on the impact
of job satisfaction on employee productivity, absenteeism, and turnover. 2. Satisfaction and
productivity: • Happy workers are not necessarily productive workers—the evidence suggests that
productivity is likely to lead to satisfaction. • At the organization level, there is renewed support for
the original satisfaction-performance relationship. It seems organizations with more satisfied workers
as a whole are more productive organizations. 3. Satisfaction and absenteeism • We find a consistent
negative relationship between satisfaction and absenteeism. The more satisfied you are, the less
likely you are to miss work. • It makes sense that dissatisfied employees are more likely to miss work,
but other factors have an impact on the relationship and reduce the correlation coefficient. For
example, you might be a satisfied worker, yet still take a “mental health day” to head for the beach
now and again. 4. Satisfaction and turnover • Satisfaction is also negatively related to turnover, but
the correlation is stronger than what we found for absenteeism. • Other factors such as labor market
conditions, expectations about alternative job opportunities, and length of tenure with the
organization are important constraints on the actual decision to leave one’s current job. • Evidence
indicates that an important moderator of the satisfaction-turnover relationship is the employee’s
level of performance. How Employees Can Express Dissatisfaction 1. There are a number of ways
employees can express dissatisfaction • Exit • Voice • Loyalty • Neglect 2. Exit: Behavior directed
toward leaving the organization, including looking for a new position as well as resigning.
Organizational Behavior - MGT502 VU © Copyright Virtual University of Pakistan 32 3. Voice: Actively
and constructively attempting to improve conditions, including suggesting improvements, discussing
problems with superiors, and some forms of union activity. Loyalty: Passively but optimistically
waiting for conditions to improve, including speaking up for the organization in the face of external
criticism, and trusting the organization and its management to “do the right thing.” Neglect: Passively
allowing conditions to worsen, including chronic absenteeism or lateness, reduced effort, and
increased error rate. Exit and neglect behaviors encompass our performance variables—productivity,
absenteeism, and turnover. Voice and loyalty are constructive behaviors allow individuals to tolerate
unpleasant situations or to revive satisfactory working conditions. It helps us to understand
situations, such as those sometimes found among unionized workers, where low job satisfaction is
coupled with low turnover

Sinha (2001) as cited in (Naharuddin and Sadegi, 2013) emphasized that employees’ performance
depends on the willingness and openness of employees on doing their job. Further, he stated that by
having this willingness and openness of the employees in doing their job, it could increase the
employee’s productivity which also leads to the performance. On the other hand, regardless of the
employee skills and experience, necessary resources to perform have to be made available for
employees, tools and materials. Foot and Hook, (2008) asserted that employees need to be given the
ability to contribute to the performance of the firm together with the means and incentive to do so.
They further argued that the management should work in partnership with its employees for
continuous and increased production through the use of involvement and partnership practices. They
also asserted that organizations should attempt to maximize their employee’s contribution to the
achievement of organizational goals so that employees have the ability to add value through high-
performance working while at the same time directly benefiting employees themselves.

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Most research has supported the validity of the Job Characteristics Model (JCM), (Price & Muller
(1986)) as the degree to which a job requires a variety of different activities in carrying out the work,
which involved the use of a number of skills and talents of the employee. Coelho and Augusto (2010)
stated that task identity encourage the feeling that the job is meaningful and worthwhile thus
motivating the employee to work smart. Task significance has been defined by Hackman and Oldham
(1974) as the degree to which a job has a substantial impact on the lives or work of other people
whether in the immediate organization or in the external environment. Hackman and Oldham (1974)
further explained that autonomy is the degree to which a job provides freedom, independence and
discretion to the employees in scheduling his or her work and in determining the procedures to be
used in carrying it out. It is the vertical expansion of responsibility, the amount of decision making
and independence allowed for employee. According to Coelho and Augusto, (2010) autonomy can
motivate 48 Syukrina Alini Mat Ali et al. / Procedia - Social and Behavioral Sciences 129 ( 2014 ) 46 –
52 and enable employee to try new ideas and learn from consequences, and expend their domain-
relevant skills. Hackman and Oldham (1974) defined feedback as the degree to which carrying out
the work activities required by the job results in the employee obtaining information about the
effectiveness of his or her performance. Top management need to give feedback to the employee so
that they know which areas that need to be improved and it can lead to better understanding of their
work nature. (Coelho & Augusto, (2010

In an article written out by Bryner (2007), the findings indicated that across all occupations, on
average 47 percent of those surveyed said they were satisfied with their jobs and 33 percent
reported being very happy. Research has shown that there is a significant relationship between the
situational variables of autonomy, feedback, skill variety, task identity and task significance, and job
satisfaction (Noor Azzah & Rudzi, 2007). Spector and Jex (1991) found that perception on job
characteristics and job satisfaction was moderately related, a value of 0 .32 to 0 .46. Control over
decision making and job autonomy has both been found to be linked with social work job satisfaction
(Arches, 1991; Poulin, 1994). Research conducted by Katsikea, Theodosiou , Perdikis & Kehagias,
(2011) also agreed that there is a strong the positive influence between job autonomy, job variety
and job feedback with sales managers’ job satisfaction by using this model. dependent variable is job
satisfaction. The conceptual framework for this study is motivated by Hackman and Oldham’s job
characteristics model (1974). The theoretical framework indicates the related variables to be studied
as shown in Figure below. Research has shown that there is a significant relationship between the
situational variables of autonomy, feedback, skill variety, task identity and task significance, and job
satisfaction (Anderson, 1984; Colarelli, Dean & Konstans, 1987). Futhermore, Noor Azzah & Rudzi
(2007) has also found that there is a significant relationship between the situational variables of
autonomy, feedback, skill variety, task identity and task significance, and job satisfaction (Noor Azzah
& Rudzi, 2007). Hence, the discussion leads to the following hypotheses:

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When profitability or performance of a business is low, most managers first look at issues
like methods of production, manpower, equipment, production cost, and so on. Very few of
them perceive the cause of this poor performance to be as a result of the organizational
structure. The decision-making process of firms, the span of control, the delegation of tasks,
reporting relationships, supervision and follow up, the ease of communication between
employees, and even the alignment of offices all depend on the type of organizational
structure that the firm decides to choose.

In most developing countries, the study of how employees react towards these structures
and how they perform under these structures can show how important it really is for
organizations to implement the correct structure for the specific environment the
organization is working in. When looking at factors such as the organizational structure itself,
employees’ performance and the factors influencing the organizational structures,
decentralization and centralization, one can identify if there is any relationship between the
structure chosen and the worker’s performance (Clark, 2011). The organizational structure
affects worker’s performance through sales volume (turnover), output (quality product) and
profitability (how profitable).

Employee engagement positively correlates with workplace satisfaction. The

data shows that workers who are highly satisfied with various aspects of their
workplace also demonstrate higher levels of engagement. Yet, only 13 percent of
global workers are highly engaged and highly satisfied with their workplace. The
inverse is true as well: 11 percent of employees are highly dissatisfied with their
offices and are also highly disengaged.
A distinguishing characteristic of engaged employees is that
they have a greater degree of control over where and how they
work

Engaged employees have more control over their experiences at work. A

distinguishing characteristic of engaged employees is that they have a greater
degree of control over where and how they work, including access to privacy when
they need it. They are empowered, both by organisational decisions and the spaces
made available to them within their workplace, to make choices about where and
how they work. This means they can manage their need for privacy, concentrate
more easily and collaborate with their teams without disruptions.
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Enhance and promote collaboration, particularly for teams based across

different locations

Collaboration is key to any workplace, but

the space should be designed to support a wide variety of collaboration styles as
well. For example, a project room for intense activity amongst three to six people
could feature a high seating position to support movement and active brain activity,
with whiteboards and technology to share digital content. That will differ quite
dramatically from what you need for a training session, interacting with a client or
supplier, or for a videoconference with a colleague based on the other side of the
globe.
Space should support those different interactions through varied working
environments, allowing employees to share ideas and co-create, work in teams
without being interrupted and enable a culture of creativity and innovation – whether
this happens with a team physically in the room, or virtually with colleagues spread
across continents and time zones.

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Satisfied, highly-motivated and loyal employees represent the basis of competitive company. The
growth of satisfaction is to be reflected in the increase of productivity, improvement of the products’
quality or rendered services and higher number of innovations. Satisfied employees form positive
reference to the employer and thus increase its attractiveness for potential job seekers and
strengthen its competitive position in the market. Management of the company does not often know
opinions of own employees and underestimates dependence between satisfaction of employees and
total successfulness of the company in the market.

2.3 Discussion agreeing with matrix structures: Many companies are losing methods of finding more
productive strategies for their business management. Most companies initiate their business by a
functional structure but later move on to use a matrix structure as they want more productivity and
alignment of tasks and authority. For the right type of matrix structure, the top level superior must
divide equal amounts of authority to both middle managers in order for maximum completion of
duties and tasks. I have researched many articles and journals in regards to other people's
discussions on why to use a matrix structure and what benefits it provides to the business. In
Management by John R. Schermerhorn, Jr, Schermerhorn says, 'The matrix organization has gained a
strong foothold in the workplace with applications in such diverse settings as manufacturing, service
industries, professional fields and the nonprofit sector.'(pg.243) He also discusses many benefits the
matrix structure can bring to the business and employees. He says, 'The potential advantages of
matrix structures include: better communication and cooperation across functions, improved
decision-making, better performance accountability through the program, product or project-
managers'.(pg.243) Bringing a matrix structure to the company can not only benefit the company but
also the employees or project managers in this case. Better communication within the project-team
will enhance the motivation of the manager to work more productively and improve the overall
performance of the project-team. Decision-making is a key element in project-teamwork as it shows
the right control is being initiated into the tasks, it is the manager's duty to make the right decisions
for their project-team, if there is failure in decision-making by the managers it can result in a general
collapse of the management structure as a whole. Allowing the employees to place their input into
the final decisions can enhance the motivation of the employee as they will feel more authority in
their work. Reviewing the performance of employees and managers is vital in project-teams as
everyone To investigate the improvement of motivation within a matrix structure. Sandra Karmani
10031079 14 looks for their own advantages in situations such as teamwork, every employee wants
to satisfy their job satisfaction and progress in their career. Performance appraisal boots the
motivation of an employee which can be portrayed by a manager through a matrix structure.
According to Oscar Guzman, an author who has written an article in the Small Business says, 'In a
matrix structure, each employee answers to two immediate supervisors: a functional supervisor and
a project supervisor. This kind of organizational structure has several advantages.' Some advantages
he has stated are; range of skill and flexibility. In a matrix structure, employees have constant contact
with other functional areas through their membership in project teams. Through project teams,
employees have the opportunity to develop a wider and strengthening set of skills than they would
in a purely functional structure. Increasing the communication and personal skills of an employee can
result in major growth to their motivation. Flexibility can be achieved as the matrix structure allows
human resources to be shared broadly across different projects or products. If there is flexibility in
the structure it can allow the employee to gain more knowledge and stimulus resulting in the urge to
perform better in their job. Another author I have researched who discusses the matrix organization
and what impact it has on its employees is, Marvin R. Gottlieb. He says, 'the lack of a matrix guardian
was cited by 92% of top-level managers in this study as a major hindrance to performance.' These
were his main findings: 'Lack of consequences and rewards for matrix performance fails to motivate
employees to make the matrix work. Failure to establish and maintain a monitoring process to detect
and identify matrix performance problems (because employees are reluctant to divulge problems
associated with their unit). Not ensuring the matrix guardian has senior level support and authority
to take action. Not preserving the objectivity of the matrix guardian and preventing undue political
pressure.

Recommendations Following completion of primary and secondary research into the area of
improvement of motivation within a matrix structure, the following recommendations are suggested.
 Decision-making effectiveness: A reason for many work-related arguments is indecisiveness within
the project teams. In order to cure this problem, there should be clarity when decisions are being
made within a team to remove any tension there might be towards an unsure conclusion.  Resource
efficiency: It is vital for the firm to not lose any valuable resources it may have gained in the thought
process of teamwork or individual work. In the midst of conflict, unorderly reporting and other
clusters, beneficial resources and ideas can be lost in the process. In order to avoid this, firms should
present each opportunity with the utmost value and time so it is not neglected. To investigate the
improvement of motivation within a matrix structure. Sandra Karmani 10031079 33  Balance of
power: At times in matrix structures, the two managers that report to the top-level manager can
argue about which individual has the most power. This can lead to delay in reporting and overall
efficiency within the firm resulting in the demotivation of many employees. It is necessary for the
managers to be more responsible towards the authority they are delegated as they are wasting
valuable time arguing over the balance of power

file:///E:/Master%20rad/ba_karmani_s_2016.pdf

Porter and Lawler (1965) postulated that attitudes and behavior would differ according to
suborganizational properties, including organizational level, line and staff hierarchies, span of
control, and size of subunits, and total organization properties, including size-total organization,
shape--tall/flat, and shape--centralized/ decentralized. It was shown that five of the seven properties
of organizational structure (span of control and centralization/ 40 decentralization excepted) had
some kind of significant relationship to either job attitudes or job behavior. Empirical Work Porter
and Lawler (1965) postulated that attitudes and behavior would differ according to suborganizational
properties, including organizational level, line and staff hierarchies, span of control, and size of
subunits, and total organization properties, including size-total organization, shape--tall/flat, and
shape--centralized/ decentralized. It was shown that five of the seven properties of organizational
structure (span of control and centralization/ 40 decentralization excepted) had some kind of
significant relationship to either job attitudes or job behavior. Certain variables appeared to have
stronger relationships to attitudes and behavior than others. The two properties of structure with the
strongest relationships were organizational level and subunit size. Line/staff type of position total
organizational size, and tall/flat shape (that is, a size by shape interaction) accounted for some
significant relationships but the strength and clarity was not as great as level and group size.
Herzberg (1957), in a review of the attitude-organization literature up to that time, reported that job
satisfaction increased monotonically with increasing levels within the organization. That is, middle
management was more satisfied than workers but less satisfied than upper management. More
recent studies (Porter 1962, 1964, Rosen 1961, Handyside 1961) tend to support this conclusion. In
addition, the research supports this conclusion for both nonmanagement and management levels.
Although the literature tends to support the importance of size as an influence on job attitudes, the
effects of the size of one organizational unit may be moderated by the size of another organizational
unit (e.g., Cummings and El Salmi 1970, England and Lee 1973, Mahoney et al. 1972, Porter and
Lawler 1965). A number of attempts have been made to provide models for the relationship between
size and behavior (Blau 1970, Meyer 1972, Indik 1968, Bass and Barrett 1972, Pheysey and Payne
1971, Ingham 1970). These studies support the conclusion that size, in and of itself, does not provide
sufficient explanatory power concerning its effect on attitudes. Rather, size requires the inclusion of a
number of other variables (e.g., formalization, specialization, differentiation, complexity, etc.) to
which size is highly interrelated. 41 Talacchio (1960) postulated that with increasing organizational
size, increased division of labor (affecting the nature of the job) and increased status differentiation
(increasing the potential for interpersonal conflict) would result. He found that the larger the
organization, the lower the satisfaction. Low job satisfaction was also related to absenteeism and
interpersonal conflict. However, Cummings and El Salmi (1970) found subunit and company size of
less importance in determining managerial satisfaction than role diversity and job level. Role diversity
and job level were found to be related to perceived need satisfaction and the possibility of need
satisfaction. In terms of job leve~, the position one holds within the organization was found to have
more influence upon one's attitudes than age, tenure, and education level (Herman and Hulin 1972).
Porter and Lawler (1965) reported no significant attitude differences associated with span of control.
The majority of the job enlargement literature (management science) supports an opposite
viewpoint. R~search has shown that span of control is related to complexity of task. Thus, research
on job enlargement has focused "directly on interactions between complexity of the job ... and
individual differences" (Herman and Hulin 1972, p. 87 ). This research tends to support the position
that attitudes toward job enlargement are a function of both job variables and 1ndividual
characteristics (Hackman and Lawler 1971, Hulin and Blood 1968, Blood and Hulin 1967, Turner and
Lawrence 1965). Porter and Lawler (1964) found a size-by-shape interaction accounting for different
levels of job satisfaction in large/tall versus small/tall organizations, and small/flat versus large/flat
organizations. This finding is confounded by the fact that Porter and Siegel (1965) testing the same
hypothesis found no interaction. Herman and Hulin (1972) in a review of the recent literature on
organizational structure and job attitudes and behavior conclude that the evidence supports attitude
differences as influenced by structure but not behavior differences. They state: The evidence
reported for attitude (especially job satisfaction) differentials by level in the hierarchy, functional
division, group size, and perhaps an organizational size-shape interaction, is much more compelling
than that for behavior differences. (p. 85) The literature since the Herman and Hulin review has
tended to focus on the relationships between hierarchical level and job satisfaction. The empirical
support has been mixed. Heller and Yukl 42 (1969) found levels to be related to differences in
"perceived control" within the organization. Cummings and El Salmi (1970) reported differences in
job satisfaction related to levels but Larson and Owens (1965), Jerdee (1966), and Graham (1969) did
not. Berger and Cummings (1978) in a comprehensive review of the empirical literature conclude
that occupational level and decentralization seem to be positively related to job satisfaction but that
the 43 relationships to span of control, organizational or subunit size, and line/staff distinctions were
complex and difficult to determine. Locke (1976) reviewed the historical development of job
satisfaction as a concept, the major theoretical orientations, and reviews of the empirical work and
reports that the literature suggests that satisfaction is caused by challenging jobs (e.g., high
autonomy, stimulation, responsibility, variety), high and equitable pay, good opportunities for
promotion and good work conditions. Adams et al. (1977) report positive relationships between
satisfaction and occupational level and functional specialty. O'Connor and Cummings (1976) report
that tension increases dissatisfaction while influence increases satisfaction. Katz and Van Maanen
(1977) support Locke's (1976) contention that job satisfaction is caused by job properties (e.g.,
independence, challenge, variety), interaction features (leadership, feedback), and organizational
policies (promotion, compensation). In addition, Dyer and Theriault (1976) report that job
satisfaction was positively related to absolute level of pay, as well as some "fairness" measure of the
degree to which it met expectations. Most recently, integrative approaches have been advocated in
which total organizational characteristics, subunit characteristics, and individual characteristics are to
be investigated as they relate to job satisfaction (c.f., Rousseau 1978). As yet holistic approaches are
few and far between and the evidence to support the hypotheses has yet to be widely sought.
Structural Variables Based on a review of the literature, the structural variables postualted.to have
an influence on member attitudes were: (1) size, (2) formalization, (3)· complexity, and (4) external
dependence. Size. Of the many organizational variables examined in relation to member attitudes,
organizational and subunit size are utilized most frequently. Both the theories and the research
regarding the effects of size on various dependent variables have been contradictory. For example,
Blau (1970) has theorized that the larger the organization, the greater the structural differentiation.
This increased differentiation in turn resulted in an enlarged administrative component and staff to
effect coordination, communications 60 and control due to increased complexity. The point Blau is
trying to make is that as size increases, the problems associated with increased differentiation also
increase and thus, a greater need for control mechanisms within the organization arises. This need
for greater control results in the implementation of general and impersonal rules and procedures
(formalization, standardization) in order to achieve organizational goals. A conclusion to be drawn
from the above theory is that many of the structural characteristics of organizations (e.g., size~
formalization, configuration, specialization, standardization, centralization, etc.) may all be positively,
and highly, correlated with one another. For example, in a study by Pugh et al. (1968), specialization,
formalization, and standardization were all found to be highly related to one another and to size.
Also, Hage (1965) found that centralization was highly related to formalization. Chapin (1951) and
Tsouderos (1955) suggest that increased size is related to an increased degree of bureaucratization.
Hall (1963), in contrast, found that size was not a major factor in determining the degree of
bureaucratization in organizations. Terrien and Mills (1955) suggest that the administrative
component increases disproportionately in 61 size as organizational size increases. Anderson and
Warkov (1961) found that larger organizations contained a smaller proportion of personnel engaged
in administration. Haas et al. (1963) suggest that the relationship between size and administrative
component may be curvilinear, with the administrative component at first increasing
disproportionately in size and then decreasing with further organizational growth. Pugh et al. (1969)
concluded that organizational structure was largely determined by size, in addition to dependence on
a parent organization and, what they termed, a "charter-technologynexus." Studies by Inkson et al.
(1970a, 1970b) supported conclusions that organizational size and technology provided the major
influence for structuring of activities within the organization. However, Pandy (1969) and Holdaway
and Bowers (1971) found inverse relationships between size and span of control. Hall et al.
(1967a)also found few relationships between organizational size and other structural variables. Hall
et al. (1967a) point out the following: It is commonly noted that the size of an organization somehow
'makes a difference' in other structural variables. Caplow (1957) and Grusky (1961), among others,
have assumed that large organizations are, by definition, more complex and formalized than small
organizations, while Blau and Scott (1962) ... have argued that size may not be such a critical factor ...
In short, there is agreement that size affects structure, but there is no agreement on the relative
importance of size vis-a-vis other aspects of organizational structure (p. 904). Thus, while the
evidence is somewhat mixed, there is little doubt that size is an important organizational variable,
not only for its postulated influence on member attitudes, but also because it is often related to
many other structural characteristics of organizations. Size is defined as "the scale of operations of an
organization as determined by the number of employees," based on Price (1972), Pugh et al. (1969).
62 Hypothesis Nwnber 1. The larger the organization, the lower the job satisfaction of organizational
members with the organization. Formalization. For the most part, the terms used to describe
formalization in the organizational literature refer to the use of writeen norms (Pugh, Hickson,
Hinings, and Turner 1968). Hage and Aiken (1970) have stated that organizations need daily
guidelines for their operations and that these guidelines are fuenished by rules (the repository of
past experience). An organization which compiles its norms in written form is more formalized than
one which does not. In addition, organizations which compile their norms in written form will
generally have more explicit norms than organizations that do not (Price 1972). Similarly, an
organization that bases its day-today operating procedures on written rules and regulations can also
be thought of as more formalized than one that does not. Many investigators have examined the
concept of formalization. For example, Hage and ~±ken (1969), Pugh et al. (1968), Prien and Ronan
(1971), and Hall et al. (1967). Hage and Aiken (1969) investigated the determinants of routine
technology utilizing interview techniques with the directors or supervisory personnel of 16 social
welfare and health organizations. They predicted a positive relationship between routine work and
formalization, that is, the more routine the work, the great~r the formalization. Significant
relationships were found between routine work, on the one hand, and rule manual, job description,
and specificity of job description, 63 on the other. They concluded that an organization in which the
rules are important is probably an organization in which the rules are explicitly stated. In relation to
the hypotheses concerning formalization, studies have shown that a highly formalized organization is
also one that is more routinized (Hage and Aiken 1969). Routine work may thus become dull,
mechanical, nonchallenging, or boring. Thus, a highly formalized organization may produce tasks that
do not challenge an organization member's talents, abilities, or intellect. A highly formalized
organization may thus create job dissatisfaction for the organization member, through routinized
work tasks and strict procedural guidelines that allow little individual initiative or creativity in the
daily discharge of work. As is the case with organizational size, many variables are considered to be
interrelated with formalization, e.g., centralization (Hage&, Aiken 1967 ), specialization,
standardization and centralization (Pugh et al. 1968), and configuration (tall versus flat) and
administrative centralization (Ghiselli and Siegel 1972). In addition, formalization and standardization
are often confounded in the literature (cf. Prien and Ronan 1971) in that they are operationalized to
measure the same thing. Further, specialization, a structural variable closely related to formalization,
has been considered to increase as the complexity within an organization increases. Thus, increasing
the number of events in the organization leads to increased 1 l 64 division of labor, task
specialization, and often more elaborated line and staff hierarchies (James and Jones 1976). As can
be seen from the literature, formalization is an important aspect of structuring of the activities of an
organization. The degree to which this structuring is explicit is one measure of the degree of
formalization of an organization and the degree to which activities are structured may have an
impact on member attitudes. Formalization is here defined as "the importance of written rules within
an organization, 11 based on Hage and Aiken ( 1969). Hypothesis Nwnber 2. The greater the
formalization within an organization, the lower the job satisfaction of members within an
organization. Complexity. A highly complex organization is characterized by structures with many
levels of aut?ority, or a large number of occupational roles, or many subunits (division or
departments), etc. Vertical and horizontal complexity may be distinguished from a global concept of
complexity. ·For example, the number of levels of authority illustrates vertical complexity whereas
the number of occupational roles and the number of subunits illustrates horizontal complexity (Price
1972, Blau 1966, 1968). Vertical complexity is often discussed in terms of "flatnesstallness, 11 and
the "configural:-ion" of organizational structure. Horizontal complexity is discussed in terms of
"division of labor," "specialization," "role differentiation," "segmentation," and "functional
differentiation. 11 It is important to note that the differ·ent dimensions of complexity are often
treated as separate concepts in 65 the literature. There appears to be little agreement among
organizational researchers on conceptualizing complexity either as a single concept with a series of
dimensions or as a series of separate concepts (Price 1972). Complexity is also referred to or
discussed in terms of "importance of skills in a social system" (Price 1972). When defined in this
manner, complexity is measured by indicators such as the number of occupational specialties,
professionalism, and the time required for training to fill the occupational roles. Based on the
literature, it can be postulated that a highly complex organization will have a greater number of
hierarchical levels, occupational roles, and subunits than an organization of low complexity. In
relation to vertical complexity, a more complex organization would have a high degree of
specialization (e.g., a high number of job titles) and this higher specialization could imply less varied
job content (cf. Indik 1965) which might be associated with lower job satisfaction for its members.
For this thesis, it can be postulated that the greater the complexity of an organization, the greater
the demands placed on the organizational member due to complicated managemen~ procedures
designed to meet.organizational goals. Increased complexity, at least theoretically, thus may lead to
an increase in the impersonality of personal relations within an organization, formalization of
management procedures, and increased supervision measures to control productivity. In this way,
increased complexity may lead to job dissatisfaction. As previously noted, Blau (1970) proposed that
increased organizational size generated a greater structural differentiation, 66 increased
differentiation led to increased efforts at coordination, communication, and control within the
organization. Thus, complexity may be seen as being highly correlated with size, that is, the larger the
organization, the greater the complexity (e.g., increased structural differentiation). Blau further
proposed that the greater the complexity, the larger the administrative component needed to handle
the increase in efforts to coordinate various functions within the organization. This is accomplished
through increasingly formalized communication systems and the increase in efforts at control
(supervision). Thus, complexity is also highly correlated with size, degree of coordination,
communications, and supervision. The larger the organization, the more complex. The more
complex, the more formal the operating procedures.. The more formal the organizational operating
procedures, the more impersonal the organization becomes for the organization member·. Gouldner
(1954) viewed increased size and bureaucracy as leading to greater needs for control which resulted
in the implementation of general and impersonal rules within the organization. Various authors have
examined the dysfunctional results of increased bureaucracy for the organizational member,
including (a) failure to allow for the growth and development of personalities, (b) encouragement
of.conformity and group think, (c) disregard of the formal organization, (d) no adequate judicial
processes, (e) lack of adequate means for resolving organizational conflict, (f) outdated authority and
control systems, (g) failure to easily assimilate new technology and personnel, and (h) conditioning
that leads to the "organizationa man" (Bennis 1969, and cited in James and Jones 1976), (i) reliance
on depersonalized relations and strict enforcement of rules resulting in rigid behavior (Merton 1957),
(j) presence of individuals attracted to supervisory positions who are monocratic and who tend to
reinforce insecurity 67 in subordinates (Thompson 1967), (k) reliance on impersonal rules resulting in
low productivity (Gouldner 1954), (1) productivity effects such as wasted time, higher maintenance
costs, low morale, impaired labor recruitment, etc. (Jasinski 1956), and (m) increased
departmentalization and differences in goals and interests between departments, leading to
departmental conflict (Selznick 1949). Thus, complexity can be seen as interrelated to the previously
selected variables, formalization and size. Complexity is defined as "the degree of structural
differentiation within an organization." based on Price 1972. Hypothesis Number 3. The greater the
complexity of an organization, the lower the job satisfaction of members within the organization.
External Dependence. While many studies have investigated interorganizational relationships within
the organizati-0n's environment (e.g., Emery and Trist 1965, Terryberry 1968, Evan 1966), few have
examined the impact of the environment on internal organizational processes. There are studies that
have attempted to describe the nature of organizational environments in terms of the degree of
turbulence (Emery and Trist 1965, Terryberry 1968) and in terms of organizational sets (Evan 1966).
Others have emphasized transactional interdependencies among organizations (e.g., Guetzkow 1966,
Litwak and Hylton 1962). While others have investigated the importance of 68 interorganizational
relationships (Perrow 1967). However, our understanding of the influence of the environment on
internal organizational processes remains an important, unanswered question. The few exceptions to
this rule include Thompson and McEwen (1958), who showed how the organizational environment
can affect goal-setting in organizations; Simpson and Gulley (1962) found that voluntary
organizations with diffuse pressures form the environment were more likely to have decentralized
structures, high internal communications, and high membership involvement, while those having
more restricted pressures from the environment had the opposite characteristics; Terryberry (1968)
hypothesized that organizational change is largely induced by forces in the environment; and
Yuchtman and Seashore (1967) defined organizational effectiveness in terms of the organization's
success in obtaining resources from the environment. One important study, conducted by Aiken and
Hage (1968), investigated the relationships between organizational interdependence and influenced
internal organizational behavior on 16 health and welfare organizations. Organizational
interdependence was operationalized as the number of joint cooperative programs with other
organizations. Aiken and Hage postulated that the greater the number of joint programs, the more
organizational decision-making is constrained through obligations, commitments, or contracts with
other organizations, and thus the greater the degree of organizational interdependence. It was found
that organizations with many joint programs tended to be more complex, more innovative, have
more active internal communications channels, and somewhat more decentralized decision-making
structures. 69 No relationship was found between number of joint programs and degree of
formalization. Aiken and Hage (1968) conclude that with increased division of labor, organizations
become more complex (i.e., more occupational diversity and greater professionalism of staff) and
more innovative and that the need for resources to support such innovations promotes
interdependent relations with other organizations and the greater integration of the organization in a
corrununity structure. Aiken and Hage (1968) examined joint programs but involvement with other
organizations implies many forms of dependence. The sources of funding or of clients is also an
important form of dependence. Dependence on an external organization for funding can have far
reach~ ing effect on internal organizational processes, whether the external organization is a parent
compnay or local or federal government. This mechanism for gaining resources for the organization
may in fact result in a loss of autonomy over many intraorganizational processes. This form of
dependence is particularly evident in social ser~ vice organizations who are dependent on local
organizations for fund~ ing (e.g., community chest or community human resources money) or on the
federal government (e.g.~ OEO and the Community Action Programs of the late 60 1 s). At a
minimum, this kind of dependence can result in a greater need for internal coordination and external
relations with the funding source. This may mean contractual commitments to outside organizations
that result in constraints on organizational behavior. A prime example of this form of dependence to
external agencies are the agencies and organizations serving elderly clients. Through an act of
Congress, the 1973 Amended Older Americans Act 70 established funding for social service
organizations to establish programs for elderly clients. Along with this funding came requirements
and stipulations as to who the agency could serve with the money (e.g., only those 65 or older) and
the kinds of services that could be paid for (nursing home payments as opposed to community
services such as in home nursing). In addition, the funded agencies had to be officially "coordinated"
and monitored by a regional agent, the Area Agencies on Aging. Thus, dependence on outside
agencies for resources has the potential to greatly influence intraorganizational procedures and
policies. External dependence is defined for this thesis as "the degree to which outside organizations
influence intraorganizational decisions and procedures." Hypothesis Nwnber 4. The greater the
external dependence of an organi~ation, the lower the job satisfaction of organizational members.
Activity Variables Based on the literature review, three activity variables· are hypothesized to
influence attitudes of organizational members. These activity variables are: (1) vertical
communications, (2) supervision, and (3) participation. Vertical communications. Communications
are processes in which the transmission and reception of ideas, emotions, and attitudes (verbaliy and
nonverbally) proquces responses for the purpose of eliciting actions to accomplish organizational
goals and objectives. This transmission of information assumes many forms in organizations; formal
discussions between superordinates and subordinates, informal conferences among subordinates,
publication of newsletters, media, etc. 71 Communications is often discussed under the labels of
"socialization," "feedback," "ambiguity," "acculturation," "assimilation," "education," etc. Four types
of communications have been distinguished by Price (1972). The first and most common distinction is
made between formal and informal communication. The basis of this distinction is whether or not
the information is officially or unofficially transmitted. Formal communication refers to officially
transmitted information. The sanctions and structure of the organization are used to support and
maintain a formal system of communication while informal communication systems have no such
institutionalized supports. A second distinction between vertical and horizontal communication is
also commonly distinguished in the literature. Vertical communication refers to the transmission of
information in the sup~rordinate-subordinate re-- lationship, whether from superordinate to
subordinate or from subordinate to superordinate. Horizontal communication refers to the
transmission of information among peers. A third type is the distinction made between personal and
impersonal communications, and overlaps the first category. The basis of this distinction is whether
or not the information is transmitted in situations where mutual influence is possible during the
transmission event. Personal conversations and telephone calls are examples of personal
communication in contrast to the use of mass media to transmit information (impersonal). Fourth,
instrumental and expressive communication may be distinguished. The distinction here is between
the transmission of cognitive information (instrumental) and the transmission of 72 normative and
affective information (expressive). Measurements of communications systems within organizations
are important in that a system of communication which only informs members about impersonal,
instrumental, or job-related events in a formal manner, and does not furnish information about
performance-related rationale and ideology would tend to have a negative impact on the operations
and members of an organization, especially if those members are more prone to communication
styles that are informal, expressive, and personalized. Of interest to this study 4s the aspect of
communications which are included in upward/downward (vertical) communications and the degree
of formalization with which these communications take place. Vertical communications are defined
as "the degree to which information is transmitted to members personally (informally) or
impersonally (formally) within the organization." Hypothesis NwnbeP 5. The more formal the vertical
communications within the organization, the lower the job satisfaction of merriQers. Supervision.
There are three basic elements within the concept of "control" within an organization: (1) the setting
of standards and obj.ecti ves to serve as a guide for performance, ( 2) measuring and evaluating
performance accordi?g to the standards and objectives, and (3) taking corrective action. Newman,
Summer and Warren (1967) cite major issues involved in controlling the level of performance that
management must address: 1. When and where should a review of performance take place? 2. Who
should make the appraisals? 3. What standard should be used for evaluation? 4. To whom should the
results of evaluation be reported? 5. How may the entire process be completed promptly, fairly, and
at reasonable expense (p. 676)? A major assumption on which this model of management
supervision is based, indeed most behavioral models of management, is the assumption the people
react negatively to supervisory standards. Even so, rules, o~jectives, and standards are necessary to
the survival of the organization. Sisk (1969) explains why there may be negative reactions to set rules
and standards in organizations. There may be a lack of understanding of standards because they are
imposed without any accompanying explanation of their need and value. (In addition) regardless of
how carefully standards have been set and flexibility built in, unexpected conditions may make
accomplishing the standard difficult or impossible but the person or persons involved get blamed for
the poor performance (p. 608). It is evident that rules, objectives and standards are necessary 73
parts of the management process, for the mere survival of an organization may depend upon how
they are formed, adapted and implemented. In addition, the "climate" within the organization,
particularly between management and workers, will be heavily influenced by the kinds of rules and
standards and the manner in which they are implemented within the organization. Supervision is
often discussed in terms of "span of control" and refers to the number of members managed by the
average administrator. The nature of this management will vary greatly for different types of
occupations and for different types of organizations. The terms "superordinates" and "subordinates"
are typically used to define span of control (Price 1972). Span of control can be distinguished l ! 74
from administrative staff and centralization. Administrative staff refers to the full-time career
members of a social system who basically perform the activities that indirectly contribute to its
primary output. Centralization refers to the degree to which power is concentrated among the
members of a social system. For example, an organization may be highly centralized with a low span
of control, that is, with a small number of members managed by the average administrator. On the
other hand, an organization may be lowly centralized with a high span of control. The problem with
this definition of supervison is that it may not apply to professional and non-professional
organizations (Price 1972). Of particular interest to this study is the conceptualization of supervision
in terms of power and influence. Power (legitimate authority) and influence (illegitimate authority)
refer to the degree to which an individual has the capacity to obtain performance from other
individuals. Supervision for this thesis is concerned with control of service provider behavior within
the service delivery setting. A situation in which a supervisor continually monitors a service provider
or one in which a service provider has no authority to make service delivery decisions with clients
tend to create dissatisfaction. Thus, the amount and quality of supervision of service providers is an
important element of job satisfaction. Supervision is defined as "the degree of supervison providing
direction for member conformance to the defined goals of the organization." Hypothesis Nwnber 6.
The greater the supervision in an organization, the lower the job satisfaction of members.
Participation. Participation in decision making is often considered a part of centralization. In this
view, a high degree of participation in decisions affecting the organization implies a low degree of
centralized authority within an organization. Conversely, 75 a low degree of participation in decision-
making implies a high degree of centralization. In this thesis, the degree to which the members of a
social system believe their behavior can determine the outcomes they seek (participation) is
distinguished from the degree to which power is distributed in a social system (centralization).
Participation in a sense refers to the manner in which the members of a social system perceive a
particular type of patterned social interaction whereas the second definition refers to an objective
situation. Participation thus refers to a subjective variable. For example, an individual may have a
self-perception of relative powerlessness when, objectively, the individual may exercise considerable
power. Conversely, an individual may have a self-perception of powerfulness while, objectively,
exercising relatively little power. The influence of structure on participation has not systematically
been attempted in the literature. When participation is discussed, it is usually within the context of
centralization of decision-making. For example, in a study investigating organizational
interdependence on intraorganizational structure, Aiken and Hage (1968) examined the influence of
dependence on external organizations on centralization. Dependence on external organizations was
operationalized as the number of joint programs with other organizations an organization was
involved in. Centralization was defined as staff participation in decision-making over such
organizational practices as hiring of personnel, promotions of staff, adoption of new organizational
policies, and adoption of new programs or services. Also in the definition of centralizations was an
index of the degree of staff participation in decision-making concerning work. 76 The authors
hypothesized that a high degree of centralization varies inversely with the number of joint programs.
The findings indicate that while highly interdependent organizations have slightly more decentralized
decision-making practices concerning organizational resources, there is slightly less control by staff
over the work they do. The results also show that degree of participati·on appears to be a function of
other variables, such as the degree of professionalization of staff and number of committees within
an organization, rather than the dependent variable of number of joint programs. Thus, participation
in decisions over work and organizational resources appears to be important in organizations with a
professional staff. Since many of the organizations in this study's sample are of a professional nature,
the investigation of participation is relevant. Participation is defined as "the degree of participation of
members in the organization in the decision-making processes affecting them and their job."
Hypothesis Nwnber 7. The greater the participation in decision~ making by staff, the greater the job
satisfaction of members with the organization.

file:///E:/Master%20rad/An%20investigation%20of%20the%20relationship%20of%20organizational
%20structure.pdf

file:///E:/Master%20rad/I_MCom_Organizational_theory_and_behaviour_on16March2016.pdf ovdje
imas teorije motivacije
The organization design framework portrayed in Figure 1 is called the “Star Model™.” In the Star
Model™, design policies fall into five categories. The first is strategy, which determines direction. The
second is structure, which determines the location of decision-making power. The third is processes,
which have to do with the flow of information; they are the means of responding to information
technologies. The fourth is rewards and reward systems, which influence the motivation of people to
perform and address organizational goals. The fifth category of the model is made up of policies
relating to people (human resource policies), which influence and frequently define the employees’
mind-sets and skills. Figure 1—The Star Model™ JAY R. GALBRAITH THE STAR MODEL™ 2 © Jay R.
Galbraith. Do not post, publish or reproduce without permission. All rights reserved. Strategy
Strategy is the company’s formula for winning. The company’s strategy specifies the goals and
objectives to be achieved as well as the values and missions to be pursued; it sets out the basic
direction of the company. The strategy specifically delineates the products or services to be
provided, the markets to be served, and the value to be offered to the customer. It also specifies
sources of competitive advantage. Traditionally, strategy is the first component of the Star Model™
to be addressed. It is important in the organization design process because it establishes the criteria
for choosing among alternative organizational forms. (See the book, Designing Dynamic
Organizations by Galbraith, Downey and Kates, published by Jossey-Bass in 2002, for tools to help
translate strategy into criteria.) Each organizational form enables some activities to be performed
well, often at the expense of other activities. Choosing organizational alternatives inevitably involves
making trade-offs. Strategy dictates which activities are most necessary, thereby providing the basis
for making the best trade-offs in the organization design. Matrix organizations result when two or
more activities must be accomplished without hindering the other. Rather than choosing the “or,”
matrix requires an embracing of the “and.” Companies want to be global and local. Structure The
structure of the organization determines the placement of power and authority in the organization.
Structure policies fall into four areas: • Specialization • Shape • Distribution of power •
Departmentalization Specialization refers to the type and numbers of job specialties used in
performing the work. Shape refers to the number of people constituting the departments (that is, the
span of control) at each level of the structure. Large numbers of people in each department create
flat organization structures with few levels. Distribution of power, in its vertical dimension, refers to
the classic issues of centralization or decentralization. In its lateral dimension, it refers to the
movement of power to the department dealing directly with the issues critical to its mission.
Departmentalization is the basis for forming departments at each level of the structure. The standard
dimensions on which departments are formed are functions, products, workflow processes, markets,
customers JAY R. GALBRAITH THE STAR MODEL™ 3 © Jay R. Galbraith. Do not post, publish or
reproduce without permission. All rights reserved. and geography. Matrix structures are ones where
two or more dimensions report to the same leader at the same level. Processes Information and
decision processes cut across the organization’s structure; if structure is thought of as the anatomy
of the organization, processes are its physiology or functioning. Management processes are both
vertical and horizontal. Figure 2—Vertical processes Vertical processes, as shown in Figure 2 allocate
the scarce resources of funds and talent. Vertical processes are usually business planning and
budgeting processes. The needs of different departments are centrally collected, and priorities are
decided for the budgeting and allocation of the resources to capital, research and development,
training, and so on. These management processes are central to the effective functioning of matrix
organizations. They need to be supported by dual or multidimensional information systems. Figure 3
—Lateral Processes Horizontal–also known as lateral–processes, as shown in Figure 3, are designed
around the workflow, such as new product development or the entry and fulfillment of a customer
order. These management processes are becoming the primary vehicle for managing in today’s
organizations. Lateral processes can be carried out in a range of ways, from voluntary contacts
between members to complex and formally supervised teams. JAY R. GALBRAITH THE STAR MODEL™
4 © Jay R. Galbraith. Do not post, publish or reproduce without permission. All rights reserved.
Rewards The purpose of the reward system is to align the goals of the employee with the goals of the
organization. It provides motivation and incentive for the completion of the strategic direction. The
organization’s reward system defines policies regulating salaries, promotions, bonuses, profit
sharing, stock options, and so forth. A great deal of change is taking place in this area, particularly as
it supports the lateral processes. Companies are now implementing pay-for-skill salary practices,
along with team bonuses or gainsharing systems. There is also the burgeoning practice of offering
nonmonetary rewards such as recognition or challenging assignments. The Star Model™ suggests
that the reward system must be congruent with the structure and processes to influence the
strategic direction. Reward systems are effective only when they form a consistent package in
combination with the other design choices. People This area governs the human resource policies of
recruiting, selection, rotation, training, and development. Human resource policies – in the
appropriate combinations – produce the talent required by the strategy and structure of the
organization, generating the skills and mind-sets necessary to implement the chosen direction. Like
the policy choices in the other areas, these policies work best when they are consistent with the
other connecting design areas. Human resource policies also build the organizational capabilities to
execute the strategic directions. Flexible organizations require flexible people. Cross-functional
teams require people who are generalists and who can cooperate with each other. Matrix
organizations need people who can manage conflict and influence without authority. Human
resource policies simultaneously develop people and organizational capabilities. Implications of the
Star Model™ As the layout of the Star Model™ illustrates, structure is only one facet of an
organization’s design. This is important. Most design efforts invest far too much time drawing the
organization chart and far too little on processes and rewards. Structure is usually overemphasized
because it affects status and power, and a change to it is most likely to be reported in the business
press and announced throughout the company. However, in a fast-changing business environment,
and in matrix organizations, structure is becoming less important, while processes, rewards, and
people are becoming more important. JAY R. GALBRAITH THE STAR MODEL™ 5 © Jay R. Galbraith. Do
not post, publish or reproduce without permission. All rights reserved. Another insight to be gained
from the Star Model™ is that different strategies lead to different organizations. Although this seems
obvious, it has ramifications that are often overlooked. There is no one-size-fits-all organization
design that all companies–regardless of their particular strategy needs–should subscribe to. There
will always be a current design that has become “all the rage.” But no matter what the fashionable
design is–whether it is the matrix design or the virtual corporation–trendiness is not sufficient reason
to adopt an organization design. All designs have merit but not for all companies in all circumstances.
The design, or combination of designs, that should be chosen is the one that best meets the criteria
derived from the strategy. A third implication of the Star Model™ is in the interweaving nature of the
lines that form the star shape. For an organization to be effective, all the policies must be aligned and
interacting harmoniously with one another. An alignment of all the policies will communicate a clear,
consistent message to the company’s employees. The Star Model™ consists of policies that leaders
can control and that can affect employee behavior, as suggested in Figure 4. It shows that managers
can influence performance and culture, but only by acting through the design policies that affect
behavior.

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If one then take the elements of an organisational structure and examine them to see if it can make a
difference in how tasks are executed and managed. These elements are decentralisation,
centralisation and levels of management, and these elements are the main foundation of any
organisational structure. But how can the structure have an influence on the attitude and
engagement of employees? Peter Christensen has identified the main objective in the study of
employee's relationship with organisational structure. He said that Maslow's theory of needs
identifies the security and safety needs, and is safe to say that all employees who had security and
safety in their working environment will have a positive reaction towards the management and
organisational structure if coordinated appropriately. How do we give employees security and safety
in a working environment, one work on the attitude and engagement of each employee (Ellis &
Sorensen, 2007). By examining this problem and illuminate it from working conditions one can have a
structure that helps employees to exhibit positive reaction, work faster and more productive.
Organisational structure is the coordination of a specific organisation's individuals and team work. If
an organisation coordinates the individual's task they can achieve all goals and specific objectives.
Organisational structure is one of few mechanisms an organisation can use to coordinate and
manage all subordinates, because of the way it shows the different reporting relationships, cut out
the "middleman" in the communication structure and identifies the worker's actions and how they
come together. All organisations can use structures, though some differ from others but all
structures have some advantages and disadvantages. Even though an organisation has the best
structure it is not something the organisation should leave and not manage, some of the best
structures have failed because of inadequate management and it is not the best suitable structure
for the environment the organisation does business (Carpenter, Bauer & Erdogan 2009).

downsizing. Traditional Structure and New Modern Structure Critical assessment of organisations
structure will enable one to understand the management style been adopted by a specific
organization. These management styles indicate how the organisation is run and if employees
perform better or worse. The two main styles are: A hierarchical management structures (traditional
structure). A flatter and more open "humanistic" management structures (New modern structure).
The traditional organisational structure Traditional organisational structure's most common fact is
that it shows distinct demarcation or boundary between the management level and the lower levels
(subordinates). The only reason for this boundary is to show that management is first on the
hierarchy and that all decisions have to be made by them. Whereas employees are seen as bottom
dwellers and they are insignificants in their workplace environment, this however gives the
management more stress and has an impact on the training and motivation for the rest of the
employees. Therefore, this is responsible for reaction on employee job engagement and how they
respond towards management actions. The traditional structure has two levels: Level one: Managers,
these include top management, middle management and lower management. Level two: Employees
This type of structure is outdated and very ancient and research shows that humans have used it
from the start of humanity. However the structure is common it has some advantages and is most
used if a team has to collaborate together to find lasting solutions for problems. The management
style is used in armed forces and is also known as the military management style. The modern
organisational structure The structure is more flat and open; employees and management can be
seen as equal persons aiming for mutual goals and objectives. There is no clear boundary between
managers and employees, as in the case of traditional management style. This gives employees the
right to use their creativity and receives rewards for the work they have done. Rewards = Employees
satisfaction = Employee actively engage = Improved productivity. Modern structures are synonymous
with individuals and teams who can manage themselves, employees become multi skilled, training
investments increase, few status distinctions, more objectives are accomplish, employee security is
guarantee, outsourcing becomes more accessible and stable structure. Types of Modern
Organizational Structures 1. Functional Organisational Structure 2. Geographic Organisational
Structure 3. Product Organisational Structure 4. Market or Users Organisational Structure 5. Hybrid
Organisational Structure 6. Matrix Organisational Structure (Konrad, 2006). Problems associated with
organizational structures are; organisational structures can never show all of the links involved in the
organisation, communicating with other employees on different levels, department conflict. The time
it takes on developing products takes longer. Customer demands become too high for certain levels
(Liebowitz, 2008). The Factors Influencing the Choice of Structure Adopted 1. The magnitude of the
organisation: The size of an institution some time determines the type of organization structure to
integrate into the system. 2. Employees competency and skilfulness: A Matrix structure will be
preferred if the company has a high level of creative and innovative workers. 3. The leadership style:
If owners wish to maintain control they will use a narrow (centralize) structure and others who wants
employees to participate in decisions making will use a wider (decentralize) structure. 4.
Organizational goals and objectives: Organization that aims at growing faster will incorporate a wide
structure. 5. External influence: If country is experiencing recession the organisation will need to
reduce the working force and change the structure from wide to narrow or make it more flat. 6.
Technological changes: The development of administrative systems disables the layer of
administration and the organization will retrench some of the employees in the particular or specific
category. Organisations choose of structure is extremely pertinent to employee engagement
therefore, they should be careful; the wrong structure can have huge negative impacts on the
communication, costs, decisions making and in motivating employees. This has the same effect on
the employee’s attitudes towards the structure and will end up in employee low level of engagement
and corresponding lower productivity. Centralisation Centralisation is a process in which the decision
making is assigned and devoted to the different higher levels of the structure. Centralisation keeps
off employees from vital knowledge and information that are related to the organization, when an
organisation uses top management International Journal of Advanced Engineering, Management and
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1311 www.ijaems.com Page | 582 in making decisions they take away the innovative of employees
and only tell employees what to do. What happens to employees when they aren't motivated and
self-manageable, they can’t solve problems on their own, especially when useful information cannot
reach employee on time. Centralisation has a broad span of control in top levels and more tiers in the
structure of the organisation. Decentralization Decentralization is a process where lower levels
management or employees of the organisation has privileges to participate in decision making. Many
decisions are made at lower levels, this gives employees the motivation to be creative and be
innovative, and solve the problems in their own sectors (Carpenter et al, 2009). Decentralization is
the movement of decision making to some of the other sections of the organization; these units can
be the branches, divisions and subcontractors. If given all employees the right to make decisions, it
will improve workers, in the aspect of creativity, knowledge and ideas to engage in their respective
tasks. Employees are given more authority and can improve their attitudes towards responsibilities, if
they fell wanted in the organisation. The structure's span of control is smaller and more levels are
given. The three forms of decentralization 1. Deconcentration: this is the lowest level of
decentralisation and decisions are made at the lower levels of the organisation by technician. 2.
Delegation: Is a more modern system of decentralisation, the decisions are made by lower levels and
correspondingly, they have more authority in the organisation. 3. Devolution: This type of
decentralisation only engages autonomous organisational units when making decisions.
Standardisation This refer to the uniform and consistent that employees are to follow in doing their
jobs, such as written procedure, job descriptions, instructions, rules and regulations are employed to
standardize the routine aspects of tasks. Standard permit managers to measure employees’
performance against established criteria. Job descriptions and application forms standardize the
selection of workers. If assignments were not follow a specific standard, many organizations will not
ascertained their respective goals. Matrix Structure Matrix structure is an organizational chart that
encourages active participation of employees in decision making. This enables them to use their skill
for different task in their assigned duties. The fundamental advantage of matrix structure is that it
allows the members of the team to share relevant information more freely across boundaries which
would otherwise have existed. Also, individuals can be chosen to suit the requirements of a project
and the team will be more dynamic and creative that they will be able to approach certain problems
in different ways. There will be a named business or project manager who is responsible for
completing assigned task, so workers will know whom they are responsible to, and the project
supervisor will be aware of the specific deadlines and budget constraints of the business.
Disadvantages of matrix management structure styles include conflicts over the allocation of
resources between line managers and project managers. If a team has too much autonomy then the
projects may be more difficult to manage than if they were more closely monitored. High cost of
implementing projects if more managers are required to manage project teams. Individuals may also
need to acquire new skills and quickly address certain issues including coordinating others and
managing themselves. The matrix management structure is now largely viewed as the preferred
approach and the general feeling is that the structure embrace and support more effective use of
resources, including the human resource, as well as making the company a more comfortable and
conducive place to work. Teams may only exist for the period of the project and then be moved on to
work in another different teams depending upon the skills the individuals can demonstrate. The
Concept of Employee Engagement According to Gallup organization employee engagement is the
involvement with and enthusiasm for specific task. (Dernovsek, 2008) posit that employee
engagement is positive employees’ emotional attachment and employees’ commitment. (Robinson,
Perryman & Hayday, 2004) stated that employee engagement is a positive attitude held by the
employee towards the organization and its value. An engaged employee is aware of business context,
and works with colleagues to improve effectiveness within the job for the benefit of the firms. The
organization must work to improve and sustain engagement, which requires a two-way relationship
between employer and employee. This verdict and definition forwarded by Institute of Employment
Studies gives a clear insight that employee engagement is the result of two-way relationship between
employer and employee pointing out that there are responsibilities to be executed by both parties.
Furthermore, (Fernandez, 2007) shows the distinction between job satisfaction, the well-known
construct in management, and engagement contending that employee satisfaction is not the same as
employee engagement and since managers cannot rely on workers satisfaction to help retain the
best and the brightest, employee engagement becomes a critical concept. Other researchers take job
International Journal of Advanced Engineering, Management and Science (IJAEMS) [Vol-4, Issue-8,
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satisfaction as a part of engagement, but it can merely reflect a superficial, transactional relationship
that is only as good as the organization’s last round of perks and bonuses; Engagement is about
passion and commitment; the willingness to invest oneself and expand one’s discretionary effort to
assist the employer succeed, which is beyond simple satisfaction with the employment arrangement
or basic loyalty to the employer Blessing White, (2008). Therefore, the full engagement equation is
established by aligning maximum job satisfaction and maximum job contribution. (Steven. Elias,
Rakesh & Mittal, 2011) the executive director of Towers Perrin, also distinguishes between job
satisfaction and engagement contending that only engagement (not satisfaction) is the strongest
predictor of organizational performance. The negative aspect for management is that global surveys
conducted by survey houses and research organizations indicate that significant size of employees
are disengaged being sceptical of any organizational initiative or communication and rather more
likely indulging in contagious negativity (Dernovsek, 2008)

The need for Employee Engagement Employee engagement is the extent to which employee
commitment; both emotional and intellectual exist relative to accomplish the work, mission and
vision of the organization (Schmidt, Henges, & Bryson, 2003). Employee engagement is a part of
employee retention. It integrates the classic constructs of job satisfaction (Schmidt et al., 2003) and
organizational commitment (Meyer & Allen, 1991). Engaged employees take into cognisance the
future of the company and are willing to invest discretionary effort (Seijts, Gerard & Crim, 2006).
Engaged employees feel a strong emotional bond to the organization that employs them, which
creates higher retention level; improve productivity levels and lower absenteeism. When reliably
measured, positive employee engagement can be casually related or correlated to specific business
outcomes by team and job type (Robinson, Dilys & Hayday, 2003). An engaged worker is one who is
fully involved in, and enthusiastic about their responsibilities, and thus will act in a way that furthers
their organization’s interest. Engagement can be seen as a heightened level of ownership where each
employee wants to do whatever they can for the benefit of their external and internal customers,
and for the success of the organization as a whole (Lockwood, 2007). According to (Spreitzer, 1995),
engagement has four dimension: meaning (sense of purpose), competence (selfefficacy), feelings of
self-determination (feelings of control) and impact (belief that one’s efforts can make a
difference).There is clear confirmation that high level of employee engagement keenly correlates to
individual, group or corporate performance in areas such retention, turnover, productivity, customer
service and loyally. Some of the distinct advantages of engaged employees included better
performance and more motivation; higher organizational profitability; and higher staff retention rate.
Additionally, higher engaged employees are associated with the company and its products and
services, and contribute to bottom line business success. Competitive engagement environment
creates a sense of loyalty, provides a high energy working environment and engaged employees
serve as a brand ambassador of the organization. These advantages emanate from the fact that there
will be emotional attachment and retention. Employees who are actively engaged in their jobs work
with passion and feel a profound connection to their institutions. They help promote the
organization and they believe they can positively impact quality of their organization’s products
(White, 2010). Engages subordinates feel a strong emotional bond to the organization that employs
them and demonstrate a willingness to recommend the organization to others and commit time and
effort to help the organization succeed (Konrad, 2006). Furthermore, employee engagement has the
potential to create involvement and commitment by workers. This highinvolvement will produce
superior performance. In addition, workers in the high involvement organization show more positive
attitudes including trust organizational commitment and intrinsic enjoyment of their work (Konrad,
2006). Employee engagement levels have a direct impact on employee productivity and
consequently on the company’s bottom line. Engaged employees use their talent and strengths
effectively at work every day to deliver high levels of performance consistently. At the same time,
employees who are not engaged, not only erode the bottom line with their lack of productivity, they
also foster negativity at every opportunity, thus impacting team performance (Konrad, 2006). It has
been routinely found that employee engagement scores account for as much as half of the variance
in customer satisfaction. Studies have statistically demonstrated that engaged employees are more
productive, more profitable, more customer focused, safer and less likely to leave their employer.
Employees with the highest level of commitment perform 20% better and are 87% less likely to leave
the organization which indicates that engagement is linked to organizational productivity (Lockwood,
2007). Drivers of Employee Engagement They are: 1. Align efforts with strategy 2. Empowerment
International Journal of Advanced Engineering, Management and Science (IJAEMS) [Vol-4, Issue-8,
Aug-2018] https://dx.doi.org/10.22161/ijaems.4.8.1 ISSN: 2454-1311 www.ijaems.com Page | 584 3.
Promote and encourage teamwork and collaboration effort 4. Training and workshop for growth and
development 5. Leadership support and recognition where appropriate Employee Engagement
Strategies 1. Acquisition and Retention Strategies: Most organizations do have clear new talent
acquisition strategies. Meanwhile, they lack employee retention strategies. Effective recruitment and
orientation programs are the fundamental foundations to be laid on the first day of the new worker.
Managers should be careful in pooling out the potential talent of the new employee through
effective recruitment. The newly hired employee should be given general orientation which is related
to the company mission, vision, values, policies and procedures and job-specific orientation such as
his or her job duties, and responsibilities, goals and current priorities of the division to which the
employee belongs, in order to enable him or her to develop realistic job expectations and reduce role
conflict that might arise. After the hiring decision is made, the manager has to ensure role-talent fit
when placing a subordinate in a certain position and exert all managerial efforts needed to retain
that talent in the organization. 2. Leadership Support; Employee engagement requires manager
support through establishing specific mission, vision and values. Unless the people at the top believe
in it, own it, make it available to subordinates and employees, and enhance their leadership,
employee engagement will never be more than just a “corporate fad” or “another HR thing”.
Employee engagement does not need lip-service rather dedicated heart and actionoriented service
from top management. It requires “Leading by Being Engage or Practice” 3. Manager-Employee
Inputs; Managers should promote two-way communication. Employees are not s ets of pots to which
you pour out your ideas without allow them to contribute on issues that matter to their task and life.
Clear and consistent communication of what is expected of them paves the way for engaged
workforce. Engage your workers and always show respect to their input. Share power with your
employees through participative decision making so that they would feel sense of belongingness
thereby enhancing their engagement in work. 4. Development and advancement: Encourage
independent thinking through giving them more job autonomy so that employees will have a chance
to make their own freedom of choosing their own best methodology of executing problems, so long
as they are producing the expected result. Manage through results rather than trying to manage all
the processes by which that result is achieved. 5. Resources Availability: Managers are expected to
make sure that employees have all the resources such as physical or material, financial and
information resources in order to effectively engage with their job. 6. Employees Training: Update
and equip employee current knowledge and skills through giving appropriate trainings. Generally it is
understood that when employees get to know more about their job, their confidence increases there
by being able to work without much control or supervision from their immediate managers which in
turn builds their self-efficacy and commitment. 7. Effective Feedback Mechanism: Companies should
develop and maintain a performance management system which holds managers and workers
accountable for the level of their engagement at workplace. Conducting regular assessment of
employee engagement level helps make out factors that make employees engaged. After finalizing
the evaluation, it is advisable to determine all the factors that driving engagement in the
organizations, then narrow down the list of factors to focus on two or three areas. It is important
that organizations begin with a concentration on the factors that will make the most difference to
the employees and put energy around improving these areas as it may be difficult to address all
factors at once. Managers should be behind such survey outcomes and develop action-oriented plans
that are specific, measurable, and accountable and time- bound. 8. Incentives: Managers should
fashion out and introduce both financial and non-financial benefits for employees who show serious
engagement in their tasks respectively. Several management theories have revealed that when
employees get more pay, recognition and praise, they tend to exert more effort into their job. There
should be a clear link between productivity and incentives given to the employees. 9. Distinctive
corporate culture: Companies should promote a strong work culture in which the goals and values of
managers are aligned across all work sections. Companies that build a culture of mutual respect by
keeping success stories alive will not only keep their existing employees engaged but also they
baptize the new incoming workers with this contagious spirit of work culture. 10. Top-performing
employees: A study conducted by Watson Wyatt Worldwide in 2004 to 2005 on Human Resource
practices of 50 large USA firms shows that high-performing organizations are focusing on engaging
their top-performing employees. According to the finding of the same research, the high-performing
firm are meeting the expectation of their employees therefore, International Journal of Advanced
Engineering, Management and Science (IJAEMS) [Vol-4, Issue-8, Aug-2018]
https://dx.doi.org/10.22161/ijaems.4.8.1 ISSN: 2454-1311 www.ijaems.com Page | 585 reduces the
turnover of high-performing employees and as a result leads to top business performance.
Productivity Relating to Organizational Structure Organisational structure designed and how the top
management level provide sufficient motivation and support for employees can break the business
or can turn it positive to become successful. The design of the structure should follow crucial
procedures that will ensure it effectiveness, if it isn't, the organisation stand the risk of demotivating
employees and having a negative influence on their attitude, which in return influence the
productivity of the organisation and all employee, and in the end they may loose some employees in
the future because of ineffective management and lack of a perfect structure (Math 2010). Factors
Influencing Productivity 1. Confidence: Organisational structures that are consistent give employees
security and a positive behaviour towards their task. A consistent structure is one where the hiring of
employees are within the organisation, workers are promoted when they are performing and when
employees can relax about job loss. If an organisation has a constant and reliable structure,
employees will devote their effort and perform best in workplace, which gives an organisation a
higher production rate (Math 2010). 2. Shared Goals: Transparent structures can have an impact on
how employees strive towards the objectives of the division or unit, when an organisation can set
their own goals align with employee expectations, they will be able to motivate the team into a
better productive mode and accomplished higher standards. Organisations can, for example; if they
are busy with a new budget and plans for the next financial year, they can share it with middle
management and ask them to do so with their own divisions and sectors. This will enable the
employees to understand organisational goals, when these specific objectives are set each employee
can set his or her goals which they want to achieve for the next year. Organisations can also notify
employees when goals are actualize, so that these employees can evaluate how their progress are
going to make sure all set goals are met and achieved (Math 2010). 3. Accountability: All
organisations should put in place a strong modality of reporting system, when this system is not in
place, employees will not know what to do with problems or generated ideas. The idea of these
types of systems is to make sure that no information is useless, when employees have challenges
they should be able to talk to someone to reduce or eradicate it, if an employee has a better way of
doing his job, he should be embraced and the innovative idea be explored. However if this structure
is not effective, this information can get lost, demotivate employees and give them negative attitudes
towards management which will have an influence on the culture, productivity and success of the
organisation (Math 2010). Organizational Structures and Employees Engagement 1. Organizational
Structure and Employee Performance The key determinant of organizations effectiveness is the
performance of their workers. Therefore, employee need to adequately engage in the responsibilities
assigned to them, so as to ascertain organizational goals. This is the vision of most companies to be
able to compete favourably in the globalize market. The basic idea of an organisational structure is to
enhance decision making and to identify how the organisation system is working and who has the
authority to make the relevant decisions and what team works in which units and programs.
Employee’s interest is to be recognized in an organization or in their sections. When employees are
recognized they are motivated. This gives them the positive attitude towards the organisation and
the management of the organisation, when employees attitudes change from negative to positive, it
create a platform for employee to be fully engage, which is what organisations want; higher
performance from employees. Now if the structure is made from the idea of the old traditional type
of body, employees can't get the motivation and positive attitude, which in turn deterred their
engagement and consequently gives lower performance ratio towards the organisation. This type of
structure is not the only one that can have a negative influence on subordinate, even modern
structures can, if not utilized in the correct manner or if the structure is not align with the type of
organisation. (Meijaard, Brand & Mosselman. 2002). 1. Organizational Chart and Job Security
Maslow's hierarchical model indicated that person's security needs are high. If organisational
structure improves employee security, the result will be an employee with a positive attitude and
subordinate who will work towards achieving greatness and overall company objectives. 2. Flexible
Management Structures and Employee Efficiency Management is one of the most essential factors of
an organisation, how they do their work and how they relate International Journal of Advanced
Engineering, Management and Science (IJAEMS) [Vol-4, Issue-8, Aug-2018]
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employees. Though within traditional structures one cannot have these types of flexible
management structures, but it is visible under modern structure. A flexible management structure
gives the employees the motivation to be a part of a team and an idea. Employees that are given the
opportunity to make a contribution towards a working program and give ideas are creative and
innovative in the sense that they feel wanted by the organisation and they will be more efficient.. 3.
Decentralize Organizational Structure and Employee Productivity In the present volatile business
environment, organizations employed and retain employees who can think for themselves. When an
employee can manage themselves the managers will not need to coordinate or give instruction to
subordinates on how to carry out specific task will have less conflict and be proactive, the bottom
line is that active workers will want to exercise or engage their skill and experience. Now, if all
employees are self-managed, management may not need to do check and balancing and can do their
own work effectively, this will increase the working capacity, proper employee engagement, which
will lead to higher productivity. Theoretical Framework 1. Motivation Theory Baron (1986)
distinguished between two opposing philosophies of human nature towards work as proposed by
McGregor. Theory X which takes a pessimistic view of human motivation to task and Theory Y which
is more optimistic and assumes workers are not passive and are ready to assume responsibilities and
develop skills according to their organization’s needs. The accuracy of Theory Y assumptions depends
on the extent to which management creates policies and motivational mechanisms that enable
employees develop their own potential. Today’s organizational culture has generally shown that
workers have moved away from the tradition of viewing work as a form of punishment and now
place a high value on work for its own good. The motivation to work has become a cherished value in
society. This is especially so among managerial and professional workers who report that having a
challenging job is more important than the amount of earnings. Clerical and unskilled employees also
place high value on their work environment both social and physical than on the pay itself. This
theory revealed that organizational structure determines employee engagement in an organization.
2. Path Goal Theory The path–goal theory, also known as the path–goal theory of leader
effectiveness or the path–goal model, is a leadership theory developed by Robert House (1996). The
theory states that a leader's behaviour is contingent to the satisfaction, motivation and performance
of her or his employees. The revised version also argues that the leader engages in behaviours that
complement subordinate's abilities and compensate for inefficiencies. The path–goal model can be
classified as a transaction leadership theory. According to the first of all theory, the manager’s job is
viewed as guiding workers to choose the best channels to reach their goals, as well as the
organizational goals. The theory argues that leaders will have to engage in different types of
leadership behaviour depending on the nature and the demands of a particular situation. It is the
leader’s responsibilities to assist followers in attaining goals and to provide the direction and support
needed to ensure that their goals are compatible with the organisation’s goals (Crook, Todd, Combs,
Woehr, & Ketchen, 2011). Path–goal theory assumes that leaders are flexible and that they can
change their style, as situations require. The theory proposes two contingency variables, such as
environment and follower characteristics, that moderate the leader behaviour-outcome relationship.
Environment is outside the control of the follower-task structure, authority system, and work group.
This theory support the variable on leadership styles (Crook et al, 2011). This theory of leadership
was tested against the variable on democratic leadership style and its effect on labour relations and
organisational performance. The theory indicate how effective structure in organization influence
employees engagement. 3. Affective Events Theory Affective events theory (AET) is a model
developed by organisational psychologists Howard M. Weiss (Purdue University) and Russell
Cropanzano (University of Colorado) to illustrate how emotions and moods influence job
performance and job satisfaction. The model explains the linkages between employees' internal
influences (e.g., cognitions, emotions, mental states) and their reactions to incidents that occur in
their workplace environment that affect their engagement, performance, organisational
commitment, and job satisfaction. The theory proposes that affective work behaviours are explained
by employee mood and emotions, while cognitive-based behaviours are the best predictors of job
satisfaction. The theory proposes that positive-inducing (e.g., uplifts) as well as negative-inducing
(e.g., hassles) emotional incidents at work are distinguishable and have a significant psychological
impact upon workers' job satisfaction. This results in lasting internal (e.g., cognition, emotions,
mental states) and external affective reactions exhibited through workers engagement, job
performance, job satisfaction, and organisational commitment. The Affective Events Theory explains
the link between employees’ internal influences and their reactions to incidents that occur in their
workplace environment that affect their engagement, performance, organisational commitment and
job satisfaction (Phua, 2012). It International Journal of Advanced Engineering, Management and
Science (IJAEMS) [Vol-4, Issue-8, Aug-2018] https://dx.doi.org/10.22161/ijaems.4.8.1 ISSN: 2454-
1311 www.ijaems.com Page | 587 proposes that positive-inducing as well as negative emotional
incidents at work have significant psychological impact on employees’ job satisfaction. The impact
results into lasting reactions exhibited through employee’s engagement, job satisfaction,
organisational commitment and job performance. This theory confirms the fact that organizational
structure affects employee engagement.

Productivity Relating to Organizational Structure Organisational structure designed and how the top
management level provide sufficient motivation and support for employees can break the business
or can turn it positive to become successful. The design of the structure should follow crucial
procedures that will ensure it effectiveness, if it isn't, the organisation stand the risk of demotivating
employees and having a negative influence on their attitude, which in return influence the
productivity of the organisation and all employee, and in the end they may loose some employees in
the future because of ineffective management and lack of a perfect structure (Math 2010). Factors
Influencing Productivity 1. Confidence: Organisational structures that are consistent give employees
security and a positive behaviour towards their task. A consistent structure is one where the hiring of
employees are within the organisation, workers are promoted when they are performing and when
employees can relax about job loss. If an organisation has a constant and reliable structure,
employees will devote their effort and perform best in workplace, which gives an organisation a
higher production rate (Math 2010). 2. Shared Goals: Transparent structures can have an impact on
how employees strive towards the objectives of the division or unit, when an organisation can set
their own goals align with employee expectations, they will be able to motivate the team into a
better productive mode and accomplished higher standards. Organisations can, for example; if they
are busy with a new budget and plans for the next financial year, they can share it with middle
management and ask them to do so with their own divisions and sectors. This will enable the
employees to understand organisational goals, when these specific objectives are set each employee
can set his or her goals which they want to achieve for the next year. Organisations can also notify
employees when goals are actualize, so that these employees can evaluate how their progress are
going to make sure all set goals are met and achieved (Math 2010). 3. Accountability: All
organisations should put in place a strong modality of reporting system, when this system is not in
place, employees will not know what to do with problems or generated ideas. The idea of these
types of systems is to make sure that no information is useless, when employees have challenges
they should be able to talk to someone to reduce or eradicate it, if an employee has a better way of
doing his job, he should be embraced and the innovative idea be explored. However if this structure
is not effective, this information can get lost, demotivate employees and give them negative attitudes
towards management which will have an influence on the culture, productivity and success of the
organisation (Math 2010). Organizational Structures and Employees Engagement 1. Organizational
Structure and Employee Performance The key determinant of organizations effectiveness is the
performance of their workers. Therefore, employee need to adequately engage in the responsibilities
assigned to them, so as to ascertain organizational goals. This is the vision of most companies to be
able to compete favourably in the globalize market. The basic idea of an organisational structure is to
enhance decision making and to identify how the organisation system is working and who has the
authority to make the relevant decisions and what team works in which units and programs.
Employee’s interest is to be recognized in an organization or in their sections. When employees are
recognized they are motivated. This gives them the positive attitude towards the organisation and
the management of the organisation, when employees attitudes change from negative to positive, it
create a platform for employee to be fully engage, which is what organisations want; higher
performance from employees. Now if the structure is made from the idea of the old traditional type
of body, employees can't get the motivation and positive attitude, which in turn deterred their
engagement and consequently gives lower performance ratio towards the organisation. This type of
structure is not the only one that can have a negative influence on subordinate, even modern
structures can, if not utilized in the correct manner or if the structure is not align with the type of
organisation. (Meijaard, Brand & Mosselman. 2002).

CONCLUSION AND RECOMMENDATIONS This work identifies the determinant of employee

engagement of manufacturing sectors by reviewing works on organisational structure and by finding
how the independent variables affect the dependent variables. Although previous studies shows
multifaceted results workers’ productivity in the aspect of decentralisation leadership style of
control, this work revealed that decentralisation system of control is crucial to employees’
productivity and organisational development. Decentralisation leadership style is the act of control
that managers take into cognisance, contribution and relevant suggestions from employee to
facilitate operational processes, decision-making and accomplishment of strategic objectives.
Employee participation in decisionmaking make them to feel recognise and ready to assume
responsibility of the outcome of the assigned task. This established the fact that the variable is a
determinant that is of special significance to employee’s engagement. Besides, decentralisation
system of control create avenue for rapid change as the business environment is volatile and
subsequently complex. Units will not need to wait for centre command before taking decision that
will positively affects the organisation. This will enhance rapid delivery of employee services, to both
the organization and customers. Standardisation system of control ensures employee efficiency and
generates quality products that give competitive edge over the competitors in the global market.
Correspondingly, employees will acquire adequate skill and technical know-how that will be an
instrumental to efficiency and quality products. In line with the actual study findings and conclusions
drawn, the following recommendations were suggested: 1. Organisations should always employ
decentralization system of control. This will encourage decision to be made closer to operational
level of work, in return address the persistent issues of delay in decision making which result in non-
committed on the part of employees and low productivity. 2. Decentralization is an approach that
requires managers who and when to delegate, to select and develop personnel and to formulate
appropriate control. This recommendation improves and sustains high level of responsiveness to
local circumstances. Consequently, it increases employee degree of engagement to their jobs. Hence,
business organizations operate in diplomatic and volatile environments. Besides, internally generated
problems can be promptly and probably addressed. 3. In addition, it enhances level of customer
service. Therefore, management should adopt decentralization and see it as mechanism that fosters
effective customer delivery services, considering the geographical or regional location of the business
organization. 4. Standardisation is pertinent to employee efficiency. In the sense that workers will
exert their discretionary effort to ascertained best outputs. In the light of this, it must be
meticulously and systematically integrated, harness and sustains by organizations to ascertain their
specific objectives and compete favourably in the international market. Table.3: Chi-Square Test
Statistics. Workers and collaborative efforts Organizational productivity Chi-Square 24.61 5.29 b Df
198 6 Asymp. Sig. 5.29 1.000 The chi-square is computed at 0.05 level of significant Source: SPSS
analysis of field data 2017 International Journal of Advanced Engineering, Management and Science
(IJAEMS) [Vol-4, Issue-8, Aug-2018] https://dx.doi.org/10.22161/ijaems.4.8.1 ISSN: 2454-1311
www.ijaems.com Page | 589 5. Standardisation is the uniform and consistent procedures that
employee are to follow in execute their tasks. It entail equipping and empowering employee for
quality products, which in return will result to economic development and growth. Really,
standardisation should be embrace, support and adopt by organizations.

file:///E:/Master%20rad/264311-impact-of-organisational-structure-on-em-b3d821d9.pdf

High Performance Organizations vs. Traditional Hierarchical Organizations

Throughout the past couple of decades, a new form of organization has been

taking front stage. These organizations focus on a team based approach rather than the

typical individual approach in organizations. They are often referred to as high

performance organizations—an organization that tries to bring out the best in individuals

and create an exceptional capability to deliver high-end results (Dalton, 2000). These

organizations produce goods and services at higher quality than traditional organizations

and tend to the same or fewer resources (Jordan, 1999). With this newfound identity, high

performance organizations seem to be overtaking the traditional hierarchical

organization.

There are many aspects that are similar between traditional organizations as well

as high performance organizations, but unlike traditional organizations, high performance

organizations build on those similarities to create a more meaningful work experience.

One particular aspect that is quite different between the two is that of job roles, both

management and worker. In a traditional organization, the managements and workers

roles tend to be completely segregated, which is not true of high performance

organizations. In traditional organizations, workers tend to have one specific task or role

that they perform every day. High performance organizations take the approach of

emphasizing skills that will allow the worker to better serve the company by solving
problems and interacting with customer, other workers and other departments (U.S.

Department, 1994).

Another aspect that differs between traditional organizations and high

performance organizations is the goals, both business and human, that each perceives to

17

be important. Goals that traditional organizations tend to focus on are primarily how well

the company is doing (business goals) and that everything is within the organization is

secure for the workers (i.e., working conditions, economic security, fair treatment).

However, high performance organizations go beyond just the basic fundamental goals of

traditional organizations. Their goals tend to be more related to customer satisfaction,

learning, as well as adapting to change within the workplace. When it comes down to

human goals, high performance organizations expand on those of the traditional

organization by adding job satisfaction. Job satisfaction is an important concept to

consider in any organization, no matter what structure is present.

In high performance organizations, workers are given more responsibilities and

are trusted to achieve the goals necessary for the company to succeed; but not only does

the organization succeed, the workers do as well because they are viewed as a valuable

asset which motivates them to want to succeed. Unfortunately, most traditional

hierarchical organizations do not have the same thoughts. According to McCauley and

Kuhnert (1992), “traditional, control-oriented approaches of work force management

represent a strategy of dividing work into small, fixed jobs for which individuals can be

held accountable” (p. 268). On the other hand, individuals in high performance

organizations tend to work in groups, which makes everyone accountable. (People

Process, 2001, p. 30). According to Jordan (1999), there are eight characteristics of high

performance organizations. They:

1) are clear in their mission; 2) define outcomes and focus on results; 3) empower

employees; 4) motivate and inspire people to succeed; 5) are flexible and adjust

nimble to new conditions; 6) are competitive in terms of performance;

18

7) restructure work processes to meet customer needs; and 8) maintain

communications with stakeholders (p. 12).

The eight characteristics define what many organizations would like to say how they run

their business. However, not many companies actually have the ability to achieve this

goal. According to Pfeffer (1998), fewer than 10 percent of all American companies

develop and maintain a high performance organization. This is primarily due to

management not “walking-the-talk.” Walking the talk create environments that foster

communication, build trust, and facilitate teamwork (People Process, 2001). When this is

not done, employees place their trust in other people, rather than the organization leaders.

In order for an organization to be truly high performance, management needs to

understand that there is not a linear structure; instead it is more of a flat structure. This is

where trust and job satisfaction come into play. When management says they are going to

do one thing and then turn around and do another, vertical trust tends to be lost, which

then indirectly affects job satisfaction.

Recommendations for Traditional Hierarchical Organizations

There are many aspects that are similar between traditional organizations as well

as high performance organizations, but unlike traditional organizations, high performance

organizations build on those similarities to create a more meaningful work experience.

The results of this study indicate that traditional hierarchical organizations have not truly

evolved into an organization that is looked upon as “people friendly” because of the low

levels of trust and job satisfaction. However, those organizations that have realized that
certain areas within the organization are not producing as they should, being able to adopt

concepts from high performance organizations in regards to treating employees may help

in reaching organizational effectiveness, both financially and culturally. These

organizations should focus a large amount of their time on developing ways to effectively

communicate with employees when changes are to be done, as well as when it affects the

employee’s job. This will allow the employee to become more in tune with his/her

responsibilities.

Recommendations for High Performance Organizations

All areas covered in this study pertained to the investigation of organizational

trust and job satisfaction in high performance organizations and traditional hierarchical

organizations. Within all areas, employees in high performance organizations achieved

high levels of organizational trust and job satisfaction. With the ever-increasing benefits

of high performance organizations, including high levels of trust and job satisfaction, it is

important for those organizations to continue placing their employee’s first—

empowering them to make important decisions pertaining to their job, as well as

communicating information about the organization. This type of organizational structure

47

does not work for every organization, but can provide some benefits to those companies

that are looking for a little less structure.

Job Satisfaction

“Employees in all organizations want to work in an environment of trust and

respect where they feel they are making a real contribution to organizational goals and

objectives” (Anderson and Pulich, 2000, p. 51). Job satisfaction is one of the most widely

studied variables in research (Rich, 1997; Muchinsky, 1990). As discussed in earlier

sections, trust within an organization is an important facet in many organizations.

Similarly, job satisfaction has also been viewed as an important factor in organizations

(Muchinsky, 1990). Previous research has found that trust has been linked to a variety of

factors that influence overall job satisfaction (Shockley-Zalabak, Ellis and Winograd,

2000; Driscoll, 1978). When evaluating overall job satisfaction, there is not one set of

factors that is common to every job.

10

Components (Factors) of Job Satisfaction

In researching components of job satisfaction, five major components were found.

They are: attitude toward the work group, general working conditions, attitude toward the

company, monetary benefits, and attitude toward management (Byars and Rue, 1997).

Other factors that affect job satisfaction include an individual’s health, age, social status,

social relationships, and perceived opportunities (Byars and Rue, 1997). Since there are

approximately five to twenty influencing factors, depending on the job, this current

research will be focusing on the factors associated with the job (pay, promotion,

supervision, meaningful work, communication, relationships and working conditions).

Figure 2.1 depicts the major factors that influence an employee’s level of satisfaction or

dissatisfaction.

Figure 2.1 Factors Influencing Employee Satisfaction and Dissatisfaction

 or

Turnover, bsenteeism, tardiness, accidents, strikes, ances, sabo a griev tage

Job Dissatisfaction

Commitment to the organization

Job Satisfaction

Style and Quality of Management

Job design (interest, perceived value)

Compensation

Social relationships

Working conditions

Perceived long-range opportunities

Perceived opportunities elsewhere

SOURCE: From Human Resource Management (5th ed.) (p. 319) by L. L. Byars and L.

W. Rue, 1997, Boston, MA: Irwin/McGraw Hill.

11
The far left of Figure 2.1 is a summary of the major factors that cause or influence

an individual to be satisfied or dissatisfied with his/her job. The right side indicates the

results that are obtained as a result of the individual’s satisfaction or dissatisfaction.

Those individuals that tend to be satisfied are generally more committed to the

organization; whereas employee dissatisfaction can lead to several detrimental behaviors

(turnover, absenteeism, tardiness, etc.). To assist in the prevention of the detrimental

behaviors, organizations need to understand what leads to employee satisfaction.

Generally speaking, “having challenging and meaningful work leads to high work

satisfaction and, if rewarded by the organization, to higher satisfaction with rewards as

well” (Harris and DeSimone, 1994, p. 414). A study conducted on quality work

environments found that those individuals who found their job meaningful also worked

for organizations that were considered to be great places to work (Caudron, 1997). As

noted before, there are many factors that affect employee job satisfaction. It is important

to understand the value behind each factor when assessing the satisfaction levels of

employees because satisfied employees can make the work environment more pleasant

file:///E:/Master%20rad/10.1.1.391.248.pdf

14 PRODUCTIVITY
How the specific organisational structure is designed and how the higher levels of management provide sufficient motivation for
employees, can break the business or can turn it positive to become successful. The design of the structure should be studied
thoroughly to ensure that there is no cracks or loose ends in the structure, if it isn’t, the organisation has the risk of demotivating
employees and having a negative influence on their attitude, this can cause that the design has an influence on the productivity
of the organisation and every employee, and in the end they may loose some employees in the future because of bad
management and a lack of a perfect structure

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(Math 2010).

Some factors influencing productivity:

Confidence: organisational structures that are more consistent gives employees security and a positive attitude. A consistent
structure is one where the hiring of employees are within the organisation, when employees are promoted when they are
effective and when employees can relax about job loss. If an organisation has a consistent structure employees will devote
them selves and perform the best at the jobs, which gives an organisation a higher production rate (Math 2010).

Shared Goals: a transparent structure can have an impact on how employees strive towards the goals of the division, when an
organisation can set their own goals and meet them with the goals of employees, they will be able to move the team into a
better productive mode and achieve higher standards. Organisations can, for example; if they are busy with a new budget and
plans for the next financial year, they can share it with middle management and ask them to do so with their own divisions and
sectors. This will show the employees the goals of the organisation, when these goals are set each employee can set his or her
goals which they want to achieve for the next year. Organisations can also notify employees when goals are met, so that these
employees can see how their progress are going to make sure all goals are met and achieved (Math 2010).

Accountability: All organisations should have some type of reporting system, when this system is not in place, employees will
not know what to do with problems or new ideas. The idea of these types of systems is to make sure that no information will be
lost, when employees have challenges they should be able to talk to someone to make it better, if an employee has a better way
of doing his job, it should be looked at and the new idea be explored. However if this system is not strong, this information can
get lost and will demotivate employees and give them negative attitudes towards management which will have an influence on
the culture of the organisation and success of the organisation (Math 2010).

15 WHY ORGANISATIONAL STRUCTURES IMPROVE

THE ATTITUDE AND PERFORMANCE OF
EMPLOYEES
Greater employee security: Maslow’s hierarchical model shows that any person’s security needs are high. If organisational
structures improves employee security, the out come will be a employee with a positive attitude and a employee who will work
towards goals. Employees will work together to achieve greatness and have an different job attitude.

Flexible management structures: Management is one of the most important factors of an organisation, how they do their work
and how they treat employees. But within traditional structures one cannot have these types of flexible management structures,
but can have it when in a modern structure. A flexible management structure gives the employees the motivation to be a part of
a team and an idea. Employees that are given the opportunity to make a contribution towards a working program and give ideas
are more positive in the sense that they feel wanted by the organisation and are not just a number on a system.

People become multi skilled: Working in a organisation that uses an traditional type of structure limits each employee’s job
specifications. The implication of this is that employees can’t grow and become multi skilled. Working in other types of modern
structures gives employees the freedom of to contribute in other programs and is able to give his own input when working in
teams. The importance of multi skilled employees is not only to have one employee which can do two or more jobs, but it gives
the employee motivation and self respect. Employees who are motivated and whose self respect is high has a positive attitude
and will have an impact on productivity

2.8 Impact of Organisational Structure on Employees According to Harley Davidson CEO, Teerlink
(2000) organization structure impact the behaviour and attitude of the employees. Due to a
hierarchy system, the organizations put a constraint or limit to the authority and responsibility of its
employees leading to a reduction in the ability of the organization to cope up with the changing
business environment. In his company, Teerlink realised the need of more authority to be given to
people and because of that the hierarchy steepness had to be reduced. Teerlink suggested that a
system of hierarchy may work well during emergency situations and crisis situations but post the
crisis situations, it may not be of any help to the organization. According to him, the top to bottom
approach implies that the units of the organization may not be able to respond to external threats
and competitions immediately due to inherent resistance. Elsaid et al (2013) explained that
centralised organisational structures have many layers and a high control with top authority in the
organisation. Centralisation leads to limited authority in the hands of the employees and they donot
have the flexibility to take decision without the approval of the top management concerning business
activities. With a centralized structure, line and staff employees have limited authority to carry
something out without prior approval. Communication in this type of organisation starts flowing
from the executive level first and then goes down to the middle managers and then the middle
managers inform it to the first level managers who then take it forward to the staff. System of
bureaucracy in these organisations leads to less freedom for the employees. Decreased span of
control is another feature for such a centralized organisation. Centralized organisations have more
management costs and this is why many companies get down to decentralizing their structure as
decentralisation helps in removing unnecessary layers of management. This leads to less bureaucracy
and faster response to emergency situations. A decentralised structure also faces a bottom-up
approach where communication takes place from the staff level to the authority level. Restructuring
of such organisations take place by downsizing which mainly happens at the mid managerial level as
many managers often do not contribute what they are supposed to. They either take the advantage
of early retirement or severance packages. The 14 restructuring leads to decrease in managerial cost
and widens up the span of control. However, the author feels due to decentralisation a paradoxical
effect take place when the management transfer the power from one hand to the other leading to
increase in bureaucracy. Problem with designing a proper organization structure is a crucial factor for
educational institutes today. Going by our present study on business schools, it has been observed
that the business schools today are facing issues related to their way of maintaining the academic
standards which is an integral part of the institute’s structure. The Carnegie Foundation study, The
Education of American Businessmen, by Frank Pierson concluded that the central problem facing
management education is that academic standards need to be materially increased. Behrman and
Levin (1984) in their report,‟Are Business Schools doing their jobs? Criticized that business schools
are generally oriented toward bureaucratic management rather than toward entrepreneurial
activities. Their report indicted schools for being “risk adverse‟. Importance of other internal and
external factors for improving an institute’s functioning is reflected in the work of Pfeffer and Fong
(2002) spointed out that large body of evidence suggests that the curriculum taught in business
schools has only a small relationship to what is important for succeeding in business. In the early
theories given by Taylor, Fayol and Weber, it was put forth that people are capable to adjust
themselves to the existing structure of the organization. At that time, organizational structure was
treated as a matter of choice. Whereas, the new theories that came up in the 21st century proposed
a complete different idea. Theorists like Lin, Griffiths and Sambrook (2010) were of the view that the
development of an organization’s structure majorly depends on its workers and management. The
environment they work in influences the overall structure of the organization they work in (ibid). 15
Amazon’s Country HR Leader Raj Raghavan has rightly mentioned in his article that the young
workforce today aim at raising the bar of the organization they work and try to develop high quality
products (Raghavan, 2014). He stressed upon the fact that when any organization structure faces a
change, it should primarily strive towards making an impact on the mind set of these workers and
according to him, todays’ HR managers have a key role to play in achieving it. The need for thoughtful
organizational design is reflected in the work of Sudheesh Venkatesh where he talks about the
importance of organizational design in shaping up the structure, process and talent in order to serve
the purpose of that particular organization (Sudheesh Venkatesh, 2012). Any organization depends
majorly on its employees for better functioning. The organization structure should therefore be
designed in a way so that it can benefit its employees. 2.9 Relationship between Organisational
Structure and Performance Study done by Hao, Kasper and Muehlbacher (2012) tried to understand
the relationship between organizational structure and performance based on certain evidences
through organizational learning and innovation. Their study led to three major findings. Firstly,
organizational structure impacts organizational learning more than innovation. Organizational
learning indirectly affects performance through innovation. Secondly, knowledge intensive or
technologically inclined organisations are majorly influenced by innovation and organizational
learning, whereas the labour-intensive or capital‐intensive organisations, affects organizational
performance mainly through innovation. Thirdly, for younger or new organisations, more than
innovation, learning and understanding the oragnisation structure is more important.

file:///E:/Master%20rad/executive%20summary.pdf
file:///E:/Master%20rad/290.pdf

Personal Stress Most people prefer a work environment in which they can clearly state what their
objectives are, what they are responsible for, and, most important, whom they are accountable to. A
matrix requires a certain amount of personal flexibility and a level of comfort with ambiguity and
change. It also requires an ability to understand and adapt to the styles and expectations c04
JWSF009-Kates August 2, 2007 11:1 Char Count= 116 Designing Your Organization of two or more
supervisors and the fortitude to confront and sort out conflicting directives that may come from
above. The organizational flexibility that the matrix promotes also weakens the sense of team
identity that is important for many employees. Staff may find themselves sitting on a number of
teams, each with differing subcultures and operating procedures. This is the nature of a project-
based environment, but for employees used to a more traditional hierarchy, it can be a major
change. The greater dependence on influence and negotiation rather than on clear-cut rules and
procedures can create stress and job dissatisfaction
Personal Stress Most people prefer a work environment in which they can clearly state what their
objectives are, what they are responsible for, and, most important, whom they are accountable to. A
matrix requires a certain amount of personal flexibility and a level of comfort with ambiguity and
change. It also requires an ability to understand and adapt to the styles and expectations c04
JWSF009-Kates August 2, 2007 11:1 Char Count= 116 Designing Your Organization of two or more
supervisors and the fortitude to confront and sort out conflicting directives that may come from
above. The organizational flexibility that the matrix promotes also weakens the sense of team
identity that is important for many employees. Staff may find themselves sitting on a number of
teams, each with differing subcultures and operating procedures. This is the nature of a project-
based environment, but for employees used to a more traditional hierarchy, it can be a major
change. The greater dependence on influence and negotiation rather than on clear-cut rules and
procedures can create stress and job dissatisfaction

file:///E:/Master
%20rad/0787994944.Wiley.Designing.Your.Organization.Using.the.Star.Model.to.Solve.5.Critical.Desi
gn.Challenges.1St.Ed.2007.208080.pdf
Teorije sadržaja motivacije Ova grupa teorija motivacije pokušava da odgovori na pitanje: šta pokreće
ljudsku aktivnost? Kada bismo znali koje su to potrebe ili motivi koje ljudi nastoje da ostvare u
organizacijama, mogli bismo ljude na adekvatan način motivisati na dodatno ulaganje napora u poslu.
Dakle, ove teorije su usmerene na otkrivanje i klasifikaciju potreba (motiva) koje pokreću ljude u
organizacijama da se ponašaju na određeni način. Prema svom doprinosu u rasvetljavanju odgovora
na ovo pitanje ističu se: Maslovljeva hijerarhija potreba, Alderferov ERG-model i Hertzbergova
dvofaktorska teorija. Maslovljeva teorija hijerarhije potreba. Upravo je Maslovljeva teorija hijerarhije
potreba imala najveći uticaj u istraživanju ponašanja ljudi u organizaciji, i uprkos nedostatku jasnih
empirijskih potvrda njenih osnovnih postavki još uvek je najpopularnija teorija motivacije. Smatra se
da gotovo svaki moderni menadžer poznaje ovu teoriju. Razlozi njene popularnosti verovatno se kriju
u njenoj jednostavnosti i humanističkoj orijentaciji. Organizaciono ponašanje 48 Abraham Maslov
(Maslov 1982) je otkrio da ljude u organizacijama pokreće pet grupa potreba koje su hijerarhijski
uređene, a to su: 1. Egzistencijalne (fiziološke) potrebe - podrazumjevaju prirodne potrebe koje svaki
pojedinac ima kao biološko biće: potrebe za hranom, vodom, kiseonikom, spavanjem, zaštitom od
ekstremnih temperatura itd. Imaju vitalnu važnost jer od njihovog zadovoljavanja zavisi život
pojedinca. Zadovoljavanje ovih potreba zaposleni u preduzeću ostvaruju uz pomoć zarade (koju
dobijaju za svoj rad) i radnih uslova. 2. Potrebe sigurnosti - podrazumevaju fizičku sigurnost i
sigurnost radnog mesta, i psihološku bezbednost od različitih vrsta stresa, frustracije, napada, i sl.
Ove potrebe se mogu zadovoljiti merama prevencije stresa, socijalnim programima u slučaju gubitka
zaposlenja, približavanjem poslovne politike i planova organizacije zaposlenima (vid veće izvesnosti).
3. Potrebe za pripadanjem (socijalne potrebe) - odnose se na čovekovu želju da bude prihvaćen i
voljen od strane kolektiva i da se oseća punopravnim članom tog kolektiva. Ta grupa potreba
proističe iz njegovog karaktera kao društvenog bića. Organizacija može zadovoljiti ove potrebe
organizovanjem različitih vidova proslava i druženja. 4. Potrebe poštovanja - podrazumeva čovekovu
potrebu da bude poštovan i od strane drugih ljudi u kolektivu, ali i samog sebe (samopoštovanje).
Ova potreba uključuje i potrebu za statusom i moći. Organizacija može da zadovolji ove potrebe
izgrađivanjem jasne hijerarhijske strukture, uvođenjem sistema nagrađivanja i slično. 5. Potreba
samorealizacije (samoaktualizacije) - podrazumeva čovekovu potrebu da realizuje sve svoje
sposobnosti i potencijale kojima raspolaže, a odnosi se na čovekovu težnju da postigne uspeh u
onome čime se bavi, da sposobnosti, talente i znanja koja nosi u sebi iskoristi kroz svoj posao.
Organizacijske mere usmerene na zadovoljenje ovih potreba bile bi, na primer: usklađivanje zahteva
posla i potencijala zaposlenh davanjem izazovnih zadataka, obučavanje za planiranje karijere i sl.
Organizaciono ponašanje 49 Hijerarhijska uređenost ovih potreba znači da postoji redosled njihovog
zadovoljavanja (slika br. 5). To znači da se potrebe "višeg" nivoa ne mogu zadovoljavati sve dok se ne
zadovolje potrebe "nižeg" nivoa. Kada ostvare dovoljan i siguran prihod kojim zadovoljavaju fiziološke
potrebe, zaposleni mogu da se okrenu socijalnim potrebama nastojeći da budu prihvaćeni u
kolektivu, a tek kada je neko integrisan u kolektiv, on može u njemu zadobiti poštovanje. Potrebe
samorealizacije mogu biti zadovoljene tek ako su sve ostale potrebe prethodno zadovoljene, tada se
ljudi mogu potpuno okrenuti sebi i nastojati da svoje potencijale iskoriste kroz svoj posao. Ovaj način
kretanja kroz hijararhiju potreba Maslov naziva progresija kroz satisfakciju. Motivi ljudskog ponašanja
sa potrebama su povezani po principu homeostaze - neka ljudska potreba ne deluje uvek, već samo
kada je nezadovoljena, i samo u onoj meri u kojoj nije zadovoljena. Na primer, kada zbog
zadovoljavajućeg nivoa zarade zaposleni zadovolji svoje fiziološke potrebe i potrebe sigurnosti, one
više ne predstavljaju izvor motivacije. To znači da plata ne može biti sredstvo za motivisanje
zaposlenih kada nivo plate pređe određenu kritičnu granicu, tu ulogu sada preuzimaju potrebe
pripadnosti itd. Slika br. 5: Maslovljeva hijerarhija potreba Po našem mišljenju, Maslovljeva teorija
motivacije se može posmatrati i kao model harmoničnog rasta i razvoja kroz zadovoljenje,
izgrađivanje ili aktiviranje određenog nivoa potreba, kako kod pojedinca tako i kod organizacije u
celini. U programima "organizacija koja uči" vid dijagnoze na kom nivou su zadovoljene potrebe
pojedinih kategorija zaposleh može biti korisna početna osnova za kreiranje razvojnih strategija. Ovaj
model ima poseban Organizaciono ponašanje 50 značaj u društvima u tranziciji, kao što je naše, za
koje je karaterističan nesklad u zadovoljenju potreba. Naime, svedoci smo postojanja tendencije ljudi
da svoju aktivnost usmere ka zadovoljenju potreba za prestižom iako nisu zadovoljili niz
egzistencijalnih uslova za život. Na primer, opredeljuju se za kupovinu najluksuznijih mobilnih
telefona mada sa svojim primanjima ne mogu priuštiti minimalan kvalitet života. Organizacija bi
trebala da bude zainteresovana da svojim aktivnostima doprinosi otklanjanju ovakvog nesklada u
motivaciji zaposlenih jer on svakako ima niz negativnih posledica, kako na samog pojedinca tako i na
sistem u celini. Implikacije za menadžment:  Specifična potreba može izgubiti svoj motivacijski
potencijal. Ljudi se ne mogu uvek motivisati na isti način, potrebno je stalno pratiti potrebe
zaposlenih i nalaziti nove startegije za njihovo motivisanje.  Ljudi imaju potrebu za
samoaktualizacijom. Čovek koji se razvija i samoaktualizuje ima potrebu za različitim znanjima i
iskustvima, i potvrđivanjem i primenom svojih potencijala u radu. Potrebno je upoznavati i pratiti
svoje zaposlene, i u skladu sa tim stvarati prostor za njihov razvoj. Alderferov ERG-model. Nakon
Maslova brojni autori su pokušali da modifikuju njegovu teoriju. Tako je Adlerfer razvio trostepenu
hijerarhiju potreba koja u sebi ne sadrži pretpostavku o hijerarhijskom odnosu ljudskih potreba.
Adlerfer tvrdi da ljude u organizaciji pokreću tri vrste potreba: potrebe egzistencije, potrebe
povezanosti i potrebe rasta (engl. existence - relatedness - growth, otuda i skraćeni naziv ERG-
model). Egzistencijalne potrebe odgovaraju Maslovljevim osnovnim potrebama, tj. fiziološkim
potrebama i potrebama sigurnosti, i podrazumjevaju faktore koji su u funkciji njihovog
zadovoljavanja: plata, ostali materijalni dobici i beneficije, fizički uslovi rada i sl. (slika br. 3). Potrebe
povezivanja su, isto što i kod Maslova, potrebe pripadanja i ljubavi. Šire se mogu označiti kao
socijalne potrebe, a uključuju sve faktore vezane za odnose sa osobama važnim za pojedinca:
prihvatanje, poverenje, razumjevanje, ljubav od strane porodice, kolega, menadžera i sl.
Organizaciono ponašanje 51 Potrebe razvoja odnose se na želju ljudi da se razvijaju, da uče nove
stvari, usavršavaju svoje sposobnosti, rade interesantne i izazovne poslove i postižu rezultate. Ove
potrebe se razvijaju i intenziviraju njihovim zadovoljavanjem. Što se osoba više razvija, to njene
potrebe razvoja postaju veće. Što se osoba manje razvija, ona to manje i želi preusmeravajući svoje
želje u drugom pravcu. Slika br. 6: Alderferov ERG-model: trostepena piramida potreba Primećuje se
velika sličnost ove teorije sa Maslovljevom teorijom u samom definisanju potreba. Medutim, postoje
i značajne razlike. One se odnose na način na koji se pojedine potrebe aktiviraju kao motivatori kod
pojedinaca (slika br. 6). Alderferova teorija počiva na tri pretpostavke: 1. Alederfer smatra da je i
zadovoljena potreba motivator ponašanja, da može jačati potrebu, za razliku od Maslova koji smatra
da su samo nezadovoljene ljudske potrebe motivatori - pokretači ponašanja. 2. Alderfer je
relativizirao hijerarhijsku uređenost potreba. On tvrdi da određeni faktori, kao što su kulturni
ambijent ili lična istorija, mogu kod pojedinaca favorizovati jedne potrebe na račun drugih potreba.
To znači da pojedinac može biti motivisan nekom potrebom višeg nivoa koja je za njega značajna
(npr. potrebe povezivanja) i pored toga Organizaciono ponašanje 52 što nisu zadovoljene neke
potrebe nižeg nivoa (npr. egzistencijalne potrebe) ukoliko su te potrebe višeg nivoa iz nekog razloga
veoma važne za pojedinca (npr. zbog profila ličnosti, nacionalne kulture itd.). 3. Pored principa
kretanja kroz hijerarhiju potreba, odnosno, progresije kroz satisfakciju, Alderfer uvodi i princip
regresija kroz frustraciju - ukoliko pojedinac u više pokušaja ne zadovolji neku potrebu višeg nivoa, on
se može vratiti ostvarivanju potreba nižeg nivoa. Na primer, ako je pojedinac u organizaciji blokiran u
svom nastojanju da zadovolji razvojne potrebe, on se može vratiti zadovoljavanju potreba pripadnosti
i u njima nalazi svoju satisfakciju (slika br. 7). Slika br. 7: ERG-model Implikacije za menadžment: 
Ljudi imaju slične potrebe, ali je njihov značaj za pojedince različit. Stoga, svakom zaposlenom treba
pristupiti individualno i pokušati da se utvrdi koje su potrebe za njega dominantne.  Potrebe mogu
da rastu sa njihovim zadovoljavanjem. To znači da se i individualne potrebe razvoja mogu povećati.
Što se pred zaposlenog postavljaju složeniji i kreativniji zadaci, to njegove potrebe za razvojem
postaju veće.  Ukoliko zaposleni u organizaciji iz određenog razloga ne može da zadovolji razvojne
potrebe, njegov nivo motivisanosti za posao moguće je podići ponovnim naglašavanjem potreba
povezivanja. Takođe, Organizaciono ponašanje 53 mogućnostima individualnog razvoja, odnosno,
kreativnim zadacima, i boljim socijalnim odnosima, timskim radom i saradnjom donekle je moguće
kompenzovati nezadovoljstvo i frustriranost egzistencijalnih potreba. Hertzbergova dvofaktorska
teorija. Dvofaktorska teorija motivacije Herzberga označava se i kao motivacijsko-higijenska teorija.
Pored Maslovljeve teorije motivacije, to je najpopularnija i najpoznatija teorija motivacije sa
značajnim uticajem na razumevanje organizacije i mehanizma ponašanja ljudi unutar nje. Ovaj model
motivacije zasnovan je na dvema pretpostavkama. Prva pretpostavka je da zadovoljstvo i
nezadovoljstvo poslom ne predstavljaju suprotne krajeve jednog kontinuuma, već su to dva odvojena
kontinuuma povezana sa različitim faktorima. Prema tome, suprotni kraj kontinuumu zadovoljstva
poslom nije nezadovoljstvo poslom, već odsutnost zadovoljstva poslom, dok je kod nezadovoljstva
poslom suprotni kraj kontinuuma odsutnost nezadovoljstva poslom. Druga pretpostavka modela je
postojanje dve različite kategorije motivacijskih faktora: higijenski ili situacijski faktori i motivatori ili
faktori sadržaja posla. Higijenski faktori su nagrade ili izvori zadovoljenja potreba koji potiču iz
organizacijskog konteksta, i nemaju direktan uticaj na motivaciju pojedinca. Motivatori vezani uz
posao koji čovek obavlja, odnosno, sadržaj i dizajin posla, imaju direktan uticaj na motivaciju
pojedinca. Motivatori prema Herzbergu, predstavljaju one faktore koji kod Maslova zadovoljavaju
potrebe poštovanja i samorealizacije. Tu spadaju: izazovnost posla, postignuće, mogućnost učenja
novih stvari, napredovanje na poslu, priznanja i sl. To su faktori motivacije za rad i izvori zadovoljstva
poslom. Oni vode većem zadovoljstvu poslom što dalje vodi većem zalaganju na poslu. Dakle, u
osnovi je pretpostavka o uzročno-posledičnoj vezi zadovoljstva i zalaganja na poslu. U konteksu
motivacije njihovo delovanje je pozitivno, oni povećavaju motivaciju za rad. U higijenske faktore
Herzberg je svrstao one faktore koji kod Maslova predstavljaju bazične potrebe i delimično potrebe
pripadanja. Tu spadaju: plata, uslovi rada, poslovna politika, međuljudski odnosi sa kolegama, odnosi
sa rukovodiocem, sigurnost posla i sl. To nisu faktori koji podstiču veće zalaganje na poslu već samo
sprečavaju Organizaciono ponašanje 54 nezadovoljstvo poslom. Oni mogu privući čoveka u
organizaciju, zadržati ga u njoj, ali ne deluju na motivaciju za rad. Visoka plata, dobri međuljudski
odnosi, dobri uslovi za rad i sl. samo sprečavaju ili otklanjaju nezadovoljstvo, ali ne mogu delovati na
zadovoljstvo i preko njega na motivaciju za rad. Oni su samo pretpostavka, odnosno, osnova za
pozitivno delovanje motivatora na ponašanje na poslu. Da rezimiramo, glavni doprinos ove teorije
jeste u otkriću da zadovoljstvo i nezadovoljstvo ljudi na poslu određuju različiti faktori. Prisustvo ili
odsustvo nezadovoljstva određuju higijenski faktori, dok prisustvo ili odsustvo zadovoljstva određuju
motivacioni faktori ili motivatori. Iz toga sledi da umesto jedne skale sa dva stanja: zadovoljstvo i
nezadovoljstvo, postoje dve skale sa četiri stanja: skala nezadovoljstva zaposlenih - čiji su polovi
nezadovoljstvo i odsustvo nezadovoljstva, i skala zadovoljstva zaposlenih - čiji su polovi zadovoljstvo i
odsustvo zadovoljstva (slika br. 8). Tako, prema Hertzbergu, ukoliko neko ima visoku platu (higijenski
faktor), to ne znači da je on zadovoljan, već samo da nije nezadovoljan. Nasuprot tome, ako je plata
mala, zaposleni će biti nezadovoljan i demotivisan. Ako posao nije izazovan (motivator), to ne znači
da će radnik biti nezadovoljan, već samo da neće biti zadovoljan, a ako posao pruža mogućnosti za
učenje i razvoj, ako je izazovan i dinamičan, ljudi će biti zadovoljni. Slika br. 8: Uticaj higijenskih i
motivacionih faktora na zadovoljstvo poslom Organizaciono ponašanje 55 Implikacije za
menadžment:  Isključivim oslanjanjem na higijenske faktore ne može se iskoristiti sva kreativna
energija i potencijal zaposlenih, zaposlene treba motivisati i motivatorima.  Postavljanje izazovnih
zadataka i ciljeva koji omogućavaju individualni razvoj predstavlja važan način delovanja na
zadovoljstvo i motivaciju zaposlenih. Teorije procesa motivacije Ova grupa teorija motivacije
pokušava da odgovori na pitanje: kako se pokreće ljudsko ponašanje? One nastoje da otkriju proces
putem kojeg se čovek motiviše na preduzimanje određene aktivnosti. Označavaju se i kao kognitivne
teorije motivacije (Vroom 1964) jer polaze od pretpostavke da ljudi procenjuju moguće posledice
vlastite aktivnosti i svesno biraju između različitih mogućnosti procenjujući verovatnost ostvarivanja
određenih ličnih ciljeva. Najznačajnije teorije u ovoj grupi su: Vromova teorija očekivanja, Adamsova
teorija pravednosti ili jednakosti u socijalnoj razmeni i Lokova teorija postavljanja ciljeva. Vromova
teorija očekivanja. Ova teorija polazi od pretpostavke da je najveći deo ponašanja zaposlenih u
organizaciji rezultat njihovog slobodnog izbora. Vrom proces motivacije posmatra kao kognitivni
proces u kome pojedinac racionalno i slobodno odlučuje, odnosno, vrši izbore da li će i koje
ponašanje da preduzme i to u zavisnosti od procena efekata tih ponašanja. U pokušaju pronalaženja
odgovora na pitanje zašto pojedinac u konkretnoj radnoj situaciji bira jedne alternative ponašanja, a
druge odbacuje, Vrom uvodi tri koncepta: valencu, očekivanje i instrumentalnost. Valenca se odnosi
na privlačnost i važnost koju različiti ishodi (nagrade) imaju za pojedinca. To je preferencija koju
pojedinac ima prema određenoj vrsti nagrada. Valencija ili privlačnost može biti pozitivna i negativna,
uključujući i indiferentnost. Ukoliko je valenca neke nagrade pozitivna to znači da pojedinac tu
nagradu preferira u odnosu na druge nagrade. Ukoliko je valenca neke nagrade negativna, to znači da
pojedinac tu nagradu ne preferira ili je izbegava, a ukoliko je valenca nula, pojedinac je indiferentan
prema toj nagradi. Očekivanje se odnosi na verovanje pojedinca da je ostvarenje željenih ciljeva u
određenoj situaciji moguće. To je uverenje pojedinca Organizaciono ponašanje 56 u pogledu
verovatnoće da će određeno ponašanje (ulaganje napora) dovesti do ostvarenja željenih ciljeva
(nagrade). Očekivanja se razlikuju po intenzitetu, i idu od potpune subjektivne sigurnosti da će
ulaganje napora dovesti do postizanja željenih ciljeva, do minimalne subjektivne sigurnosti da
ulaganje napora do toga neće dovesti. Na primer, uverenost osobe da će veća produktivnost voditi
većoj plati. Instrumentalnost predstavlja percepciju verovatnoće da će rezultati (učinak,
performanse) dovesti do nagrade. Kada čovek radi, on ostvaruje određene rezultate koje nazivamo
rezultati prvog reda (performanse), npr. kada radnik u fabrici radi za mašinom, on ostvaruje određeni
radni učinak meren brojem proizvedenih komada. Ovi rezultati prvog reda vode ka rezultatima
drugog reda, odnosno, nagradi za radnika u vidu bonusa za prebačenu normu. Instrumentalnost je,
dakle, percepcija radnika da će njegovi rezultati prvog reda (performanse) dovesti do rezultata
drugog reda (nagrade), odnosno, da će prebačaj norme u proizvodnji dovesti do bonusa. Motivacija
zaposlenih objašnjava se kao rezultanta tri navedena faktora: 1. očekivanja da će napor koji neko
ulaže u ponašanje dovesti do rezultata prvog reda (performanse), 2. instrumentalnosti rezultata
prvog reda, odnosno, procene verovatnoće da će oni voditi ka rezultatima drugog reda (nagrade) i 3.
valence, odnosno, preferencije ka rezultatima drugog reda (nagradi). Motivacija zaposlenih zavisi od
tri vrste odnosa (izvor: www.ekof.bg.ac.yu): 1. Napor - performanse (rezultat prvog reda). Ovaj odnos
određen je očekivanjima zaposlenog, odnosno, njegovom percepcijom da će ukoliko uloži dovoljno
napora, ostvariti određene performanse (npr. prebačaj norme). 2. Performanse - nagrade (rezultat
drugog reda). Ovaj odnos određen je instrumentalnošću rezultata, odnosno, percepcijom zaposlenog
da će rezultati prvog reda voditi ka rezultatima drugog reda (npr. dobiću bonus ako prebacim normu).
3. Nagrade - lični ciljevi zaposlenog. Ovaj odnos regulisan je valencom nagrada, odnosno, visinom
preferencije koju zaposleni ima prema određenoj nagradi. Ova valenca zavisi Organizaciono
ponašanje 57 od stepena slaganja ličnih ciljeva i interesa zaposlenog i samih nagrada. Znači, da bi
zaposleni bio motivisan on mora prvo verovati da će ukoliko radi uspeti da ostvari rezultat, odnosno,
učinak koji vodi ka nagradi, zatim mora verovati da će ukoliko ostvari učinak zaista dobiti nagradu, i
mora dobiti nagradu koju lično vrednuje (slika br. 9). Slika br. 9: Vromova teorija motivacije
Implikacije za menadžment:  Zaposlene treba poznavati, treba znati koja nagrada za određenog
pojedinca ima vrednost.  Zaposlene treba uveriti da će njihov rezultat sigurno dovesti do nagrade.
Ukoliko radni učinci ne rezultiraju obećanim nagradama, instrumentalnost je ugrožena i nema
motivacije. Zbog toga je vrlo važno da menadžment bude konzistentan, da kada jednom obeća
nagradu za neki rezultat, to obećanje uvek i ispuni (izvor: www.ekof.bg.ac.yu). Adamsova teorija
pravednosti ili jednakosti u socijalnoj razmeni. Adams odnos između pojedinca i organizacije
posmatra kao specifičan odnos razmene u kojem pojedinac ulaže sebe, a za uzvrat od organizacije
dobija različite nagrade. Polazna osnova koncipiranja motivacije, prema Adamsovoj, jeste doživljaj ili
percepcija jednakosti/nejednakosti. U razmeni pojedinca i organizacije, u ulaganja pojedinca spadaju:
rezultati njegovog rada i preduslovi za to - radno iskustvo i stručnost, obučenost i obrazovanje,
zalaganje i vrednoća, radni napor, Organizaciono ponašanje 58 rad u otežanim uslovima i sl., dok u
dobijanja spadaju: plate i zarade, uvažavajuće ophođenje rukovodioca prema njemu, dobijanje
odgovornih zadataka, priznanja, pohvale, povlastice, unapređenja itd. Prema teoriji pravičnosti ili
jednakosti na motivaciju zaposlenih ne utiče samo odnos napora koje oni ulažu i nagrada koje
dobijaju, već i poređenje sopstvenih napora i nagrada sa naporima i nagradama drugih u organizaciji
ili van nje (Adams 1965). Dakle, motivacija zaposlenih ne zavisi samo od nagrada već od: a) poređenja
odnosa uloženog i dobijenog i b) poređenja sopstvenog odnosa ulaganja i dobijanja sa odnosom
ulaganja i dobijanja referentnih osoba. Ljudi su motivisani kroz upoređivanje sa drugim ljudima sa
kojima rade. Važni elementi upoređivanja su: 1.osoba koja se upoređuje, 2.inputi/ulaganja koje ta
osoba ulaže u organizaciji (rad, iskustvo, obrazovanje itd.), 3.autputi/dobijanja koje ta osoba dobija
ulaganjem inputa (novčane i nenovčane nagrade), 4.referentna osoba ili grupa (osoba ili grupa sa
kojom se data osoba upoređuje u inputima i autputima), 5.inputi/ulaganja referentne osobe,
6.autputi/dobijanja referentne osobe. Osoba prvo upoređuje svoje inpute/ulaganja i svoje
autpute/dobijanja, i tako stiče percepciju sopstvenog racia inputa i autputa. Ovaj racio ima svoje
implikacije na motivaciju. Osoba može biti visoko motivisana iako ima malu platu (autput) ako ona
procenjuje da je količina napora koji je uložen da bi se ta plata dobila još manja. Nakon toga,
pojedinac bira referentnu osobu sa kojom se poredi, to može biti osoba iz organizacije ali i van nje, a
pojedinac čak može i sopstveno iskustvo sa ranijih radnih uloga da koristi kao svoj referentni okvir za
poredenje. Zatim osoba procenjuje inpute i autpute referente osobe i "izračunava" njen input/autput
racio. Na kraju, osoba poredi svoj input/autput racio sa input/autput raciom referentne osobe, i tako
izvodi zaključak o pravičnosti svoje nagrade (slika br. 10). Rezultat toga procesa upoređivanja može
biti doživljaj (Schermerhorn, Hunt, Osborn 2005):  jednakost/pravičnost - osoba percipira da je njen
racio inputa i autputa jednak onome kod referentne osobe, Organizaciono ponašanje 59  manja
plaćenost - osoba koja se poredi percipira da je manje plaćena bilo zato što percipira da ulaže više
inputa od referentne osobe za istu nagradu ili zato što percipira da za isti uloženi input kao
referentna osoba dobija manju nagradu od nje,  veća plaćenost - osoba koja se poredi percipira da
je više plaćena, bilo zato što misli da ulaže manje napora od referentne osobe za istu nagradu, bilo
zato što procenjuje da dobija veću nagradu od referentne osobe za isti uloženi napor. Slika br. 10:
Doživljaji procesa upoređivanja Prema teoriji jednakosti ljudi uvek nastoje da izbegnu stanje
neravnoteže/nejednakosti, stanje manje plaćenosti i veće plaćenosti. Suočeni sa situacijom manje
plaćenosti ili veće plaćenosti zaposleni se odlučuju za jednu od šet metoda rešavanja nepravodnosti
(Luthans 2005): 1. promeniti svoje inpute/ulaganja (npr. da smanje uloženi napor), 2. promeniti svoje
autpute/dobijanja (npr. da traže veću platu), 3. promeniti percepciju sopstvenih inputa i autputa
(npr. ako su manje plaćeni, mogu početi da misle da njihove nagrade vrede više nego što su do sada
mislili, a da njihov uloženi napor vredi manje nego što su do tada mislili, ili ako su više plaćeni, mogu
početi manje da cene svoje nagrade koje dobijaju ili više da cene svoje inpute), 4. promeniti
percepciju inputa i autputa referentne osobe (npr. ako su manje plaćeni, oni mogu početi više da
cene uložene inpute referentne osobe ili manje da cene nagrade koje oni dobijaju, ili ako su više
plaćeni, mogu početi da potcenjuju Organizaciono ponašanje 60 inpute referentne osobe ili da
precenjuju nagrade koje drugi dobijaju za isti napor), 5. promeniti referentnu osobu sa kojom se
porede, 6. promeniti posao i organizaciju u kojoj rade. Dakle, prema ovoj teoriji, motivacija pojedinca
proizilazi iz zadovoljenja njegove potrebe da u svojoj organizaciji bude pošteno tretiran. Na
motivaciju zaposlenih ne utiče stvarna nagrada za njihov uloženi trud, već njihova percepcija
pravičnosti, te nagrade koja opet proizilazi iz procene njene jednakosti sa nagradama drugih osoba.
Implikacije za menadžment:  Veća plaćenost zaposlenih neće povećati njihovu motivaciju. Oni će
verovatno racionalizovati te nagrade.  Veća plaćenost određenih osoba u organizaciji, će samo
umanjiti motivaciju onih koje te osobe koriste kao svoje referente ličnosti. Lokova teorija postavljanja
ciljeva. Osnovna ideja Loka jeste da postavljanje cilja predstavlja mehanizam motivacije. Ciljevi
govore zaposlenom šta treba da se napravi. Postavljen cilj mnogo više motiviše ljude nego kada im se
kaže: "Radite najbolje što znate". Ovaj zahtev je vrlo neodređen jer ljudi vrlo često ne znaju šta je i
koliko je to "najbolje što umeju". Kada ima jasan cilj koji treba da ostvari, osoba je u poziciji da
upoređuje svoje sposobnosti sa onima koje su joj potrebne za ostvarenje cilja, ona tačno zna koliko je
napora potrebno uložiti u njegovo ostvarivanje. Prema ovoj teoriji zaposlene u organizaciji motivišu
tri mehanizma: 1. Specifičan i jasno postavljen cilj. Specifični ciljevi povećavaju radni učinak, a teški
ciljevi, kad su prihvaćeni, rezultiraju višim radnim učinkom nego što to čine laki ciljevi. Takođe,
specifični teški ciljevi proizvode viši nivo ishoda nego što to čini generalizovani cilj "učiniti najbolje što
možeš". 2. Povratna informacija o ostvarivanju postavljenog cilja. Povratna informacija o ostvarivanju
postavljenog cilja dovodi do višeg radnog učinka, ljudi su više motivisani ako znaju kako ostvaruju
postavljene ciljeve. Organizaciono ponašanje 61 3. Učestvovanje zaposlenih u postavljanju ciljeva.
Motivacija za ostvarivanje ciljeva se povećava ukoliko zaposleni učestvuju u postavljanju tih ciljeva.
To se posebno odnosi na ciljeve koje je teško postići, tada se participacijom zaposlenih u njihovom
postavljanju značajno smanjuje otpor prema njihovom ostvarivanju. Takođe, smopouzdanje ljudi
značajno utiče na njihovu sposobnost ostvarivanja ciljeva, a time i na motivaciju. Samopouzdanje
zaposlenog da može da ostvari cilj povećava njegovu motivaciju, a time i verovatnoću da će cilj zaista
i ostvariti. Ostvarenjem cilja samopouzdanje zaposlenog se opravdava i samim tim povećava

Zadovoljstvo poslom Zadovoljstvo poslom predstavlja jednu od najviše istraživanih tema u oblasti
ljudskog ponašanja u organizacijama. Ovaj emocionalno-kognitivno-konativni način reagovanja ljudi
sastavni je deo procesa motivacije. Mogli bismo reći da su zadovoljstvo i nezadovoljstvo pozitivan,
odnosno, negativan ishod procesa motivacije. Zadovoljan zaposleni motivisan je za dalje aktivnosti na
jedan način, dok nezadovoljan pojedinac svoju dalju motivaciju gradi na nekim drugačijim sadržajima
i orijentacijama. Razlog zašto je zadovoljstvo poslom jedna od najviše istraživanih tema je verovanje
da je zadovoljan radnik produktivan radnik, te da se uspešnost organizacije ne može postići sa
nezadovoljnim zaposlenima. Zanimanje menadžera za zadovoljstvo poslom fokusirano je na uticaj
zadovoljstva poslom na radni učinak zaposlenih, pa se i veliki broj istraživanja bavi procenom uticaja
zadovoljstva poslom na produktivnost, izostanke i otkaze zaposlenih. Na primer, studija sprovedena u
Sirz Robaku, dobra je ilustracija kako zadovoljstvo neposredno vodi do prisustva na poslu kad je uticaj
ostalih činioca minimalan. Sirzova politika je bila ne dozvoliti zaposlenima da budu odsutni s posla
zbog razloga koji su se mogli izbeći i da tada prođu bez kazne. Pojava velike snežne oluje 2. aprila u
Čikagu omogućila je da se uporedi prisustvo na poslu zaposlenih u predstavništvu u Čikagu s onima u
predstavništvu u Njujorku, gde je vreme bilo prilično ugodno. Snežna oluja zaposlenima u Čikagu je
dala izgovor da ne dođu na posao. Oluja je osakatila gradski prevoz i pojedinci su znali da su mogli
bez kazni da ne dođu na posao. Ovaj prirodni eksperiment je dozvolio poređenje dolazaka za
zadovoljne i nezadovoljne zaposlene na dvema lokacijama - na jednoj gde se očekivalo da ćete biti na
poslu (s normalnim pritiscima da se bude prisutan) i na drugoj gde ste mogli slobodno izabrati bez
uključenih kazni. Ako zadovoljstvo vodi do prisustva na poslu, kad ne postoje spoljašnji činioci, u
Čikagu su trebali na posao da dođu zadovoljniji zaposleni, a nezadovoljni zaposleni su trebali da
ostanu kod kuće. Studija je ustanovila da su na ovaj poseban dan, 2. aprila, stope izostanaka u
Njujorku bile jednako visoke za zadovoljne grupe radnika kao i za nezadovoljne grupe, ali u
Organizaciono ponašanje 70 Čikagu zaposleni s visokom ocenom zadovoljstva su imali mnogo višu
prisutnost nego oni s nižim nivoima zadovoljstva. U uslužnim organizacijama zadržavanje i prebeg
kupaca zavise od toga kako se zaposleni ophode s kupcima u neposrednim kontaktima. Zadovoljni
zaposleni su prijateljski raspoloženi i spremni za pitanja - a kupci to cene. Stoga su danas mnoge
kompanije u svetu koje su orijentisane uslugama, kao što su Fedeks, Sautvest erlajns, Ameriken
expres i Ofis Depot, opsednute ugađanjem kupcu. Prema tom cilju, fokusira se i izgradnja
zadovoljstva zaposlenih prepoznajući da će zadovoljstvo zaposlenih poprilično pridoneti njihovom
cilju - posedovanje sretnih kupaca. Ove kompanije nastoje da zaposle vedre i prijateljski nastrojene
zaposlene, obučavaju zaposlene o važnosti usluge kupcu, nagrađuju uslugu kupcu, pružaju pozitivne
radne atmosfere za zaposlene, ali i redovno prate zadovoljstvo zaposlenih ispitivanjima stavova.
Pojam, oblici i teorijska osnova zadovoljstva poslom Lično zadovoljstvo uveliko zavisi od toga koliko je
čovek zadovoljan poslom koji obavlja, kao i društvenim ugledom tog posla. Zadovoljstvo poslom
predstavlja i vid humanizacije rada, rad nije human ukoliko su ljudi nezadovoljni na poslu. S druge
strane, nezadovoljstvo na poslu je povezano sa motivacijom i učinkom na poslu. Takođe, ukoliko se
pojedinac bavi poslom kojim nije zadovoljan i koji mu ne odgovara, to za njega može predstavljati
stresnu situaciju, pa nije retkost da čujemo: "Poludeću od ovog posla", što za sobom povlači
posledice po njegovo psihičko zdravlje. Zadovoljstvo poslom predstavlja stav prema poslu.
Zadovoljstvo poslom, u užem smislu, odnosi se na pozitivnu emocionalnu vezanost pojedinca prema
njegovom poslu. U širem smislu, zadovoljstvo poslom je jedan složen stav prema poslu koji uključuje
tri komponente: kognitivnu komponentu - određene pretpostavke i verovanja o tom poslu, mišljenja
zaposlenog o vrednosti, važnosti i težini posla, afektivnu komponentu - osećanja prema poslu s
obzirom na sadržaj posla i uslove rada, i evalutivnu, tj. konativnu komponentu - ocenu posla i
spremnost za zalaganje na osnovu toga. Tako, osobe sa visokim nivoom zadovoljstva poslom imaju
pozitivan stav o poslu, dok osobe koje su nezadovoljne svojim poslom imaju negativne stavove o
poslu. Organizaciono ponašanje 71 Ističu se tri oblika zadovoljstva poslom (Pajević 2006): 1.
Unutrašnje zadovoljstvo poslom - koje uživanje u radu vezuje za subjektivne nagrade i psihičke
pobude koje proističu iz samog posla (npr. interesovanje, kreativnost), a najčešće se izražava kroz
iskaze: volim posao, sviđa mi se posao. 2. Spoljašnje zadovoljstvo poslom - koje svoje izvore ima u
sekundarnim dobitima koje posao pruža, a to su plata, uslovi rada, društveni ugled posla i sl. 3. Opšte
zadovoljstvo poslom - koje zavisi od obe navedene grupe faktora, i predstavlja najvažniji vid
zadovoljstva za radnu motivaciju. Brojni pokušaji da se dođe do jednistvene teorije zadovoljstva
poslom nisu urodili željenim rezultatom. Neke teorije nisu empirijski dokazane, a kod nekih su
dobijeni protivrečni rezultati. Ipak, teorija koja najviše obećava i koja se danas smatra teorijskom
osnovom zadovoljstva poslom jeste Lokova teorija vrednosti prema kojoj: zadovoljstvo poslom
postoji u onoj meri u kojoj su ljudi zadovoljni ishodom samog posla (Grinberg 1998). Dakle, na
zadovoljstvo ne utiče samo veličina nagrade, već i koja se nagrada prima, odnosno, da li za uloženi
trud radnik dobija one nagrade koje on ceni. Na primer, mladi kreativni inženjer u razvoju biće
zadovoljan poslom, i pored male plate, ako na svom poslu ima mogućnost kreativnog rada,
usavršavanja, učenja i napredovanja jer je to ono što on ceni na poslu. Na ukupno zadovoljstvo
poslom utiče zapravo nesklad ili odstupanje zadovoljstva od očekivanja u pogledu pojedinih aspekata
posla, a ne visina zadovoljstva tim aspektima sama po sebi. Na primer, neko može biti nezadovoljan
poslom iako ima visoku platu i zadovoljan je visinom plate, ako on i nema visoka očekivanja u pogledu
visine same plate, već na primer, u pogledu mogućnosti napredovanja u karijeri. Faktori zadovoljstva
poslom Razmere zadovoljstva i nezadovoljstva poslom zavise od raskoraka između onog šta
pojedinac očekuje i šta dobija za svoj rad, onog što pojedinac očekuje kao svoj cilj i ispunjenih
očekivanja. Istraživanja su pokazala da zadovoljstvo i nezadovoljstvo zavisi od više faktora koji su
međusobno povezani. Faktori koji utiču na to da zaposleni budu zadovoljni poslom koji obavljaju
mogu se grupisati u Organizaciono ponašanje 72 dve kategorije: organizacione i lične faktore
zadovoljstva poslom (Grinberg 1998). Organizacioni faktori zadovoljstva poslom su: 1. Posao sam po
sebi. Zaposleni su zadovoljniji ako obavljaju posao koji je mentalno izazovniji, nego ako obavljaju
jednostavan i rutinski posao. Izazovan posao ima tri karakteristike: a) omogućava zaposlenom da radi
raznovrsne zadatke, b) daje slobodu delovanja zaposlenom i c) omogućava povratnu informaciju
zaposlenom o tome kako je obavio posao. 2. Sistem nagrađivanja. Što je plata viša, ljudi su generalno
zadovoljniji poslom. Medutim, važniji faktor od visine plate je percipirana pravednost sistema
nagrađivanja. Zaposleni imaju veća očekivanja od pravičnosti sistema nagrađivanja, nego od same
visine plate. Zaposleni su zadovoljniji ako percipiraju da je sistem nagrađivanja fer i podjednako
tretira sve zaposlene. 3. Prijatni radni uslovi. Što su uslovi rada bolji, veće je i zadovoljstvo zaposlenih
jer i bolji radni uslovi stvaraju veću mogućnost za bolje obavljanje radnih zadataka i uspeh na poslu.
4. Kolege na poslu. Zaposleni su zadovoljniji poslom ako sa radnim kolegama imaju vrlo dobre
personalne odnose i ako na poslu vlada prijatna socijalna atmosfera (naročito ljudi koji nisu u većoj
meri zainteresovani za karijeru). Važan je i odnos sa neposrednim rukovodiocem (šefom) -
zadovoljstvo zaposlenih je veće ako postoji otvoreniji odnos sa šefom, šef češće pohvaljuje
zaposlenog, prati njegov rad i nastoji da izgradi otvorene odnose sa zaposlenim. Nacionalna kultura
takođe može imati uticaj na značaj ovog faktora - u kolektivističkim kulturama je značaj prijatne
socijalne atmosfere i odsustvo sukoba čak važniji faktor nego visina plate. 5. Organizaciona struktura.
Zaposleni su zadovoljniji ako je organizacija više decentralizovana jer je zaposlenima data veća
mogućnost participacije u odlučivanju. Međutim, postoje kulturna ograničenja: decentralizacija može
biti izvor zadovoljstva zaposlenih samo ako oni očekuju da Organizaciono ponašanje 73 moć treba da
bude, što je moguće više, ravnomerno raspoređena u organizaciji. To je slučaj samo u nacionalnim
kulturama koje imaju nisku distancu moći, npr. SAD, dok u kulturama sa visokom distancom moći
zaposleni i ne očekuju i ne preferiraju njihovo uključivanje u odlučivanje, pa decentralizacija nema
efekta na zadovoljstvo zaposlenih. Takođe, zaposleni su zadovoljniji ako je organizaciona struktura
jasna, poznata i stabilna. Lični faktori zadovoljstva poslom su: 1. Sklad izmedu ličnih interesovanja i
posla. Poslom su zadovoljniji radnici čiji lični profil, znanja i sposobnosti bolje odgovaraju potrebama
radnog mesta, tada radnik oseća da mu posao omogućava da izrazi svoje znanje, sposobnosti i
ličnost. Sklad između sposobnosti i zahteva posla vodi do boljih radnih rezultata, oni do većih
nagrada, a sve zajedno vodi većem zadovoljstvu zaposlenih. 2. Pozicija i status. Što je viši hijerarhijski
nivo zaposlenog, to je on zadovoljniji poslom kojim se bavi. Uz viši položaj idu veća primanja,
određeni statusni simboli, veća moć i društveni uticaj, što sve vodi većem zadovoljstvu poslom. 3.
Ukupno zadovoljstvo životom (efekat "prelivanja zadovoljstva"). Zadovoljstvo ukupnim životom se
pozitivno odražava na zadovoljstvo poslom kojim se čovek bavi i obrnuto, zadovoljstvo poslom ima
pozitvan efekat na ukupno zadovoljstvo životom. 4. Radni staž i starost. Stariji i ljudi sa većim radnim
stažom su više zadovoljni poslom. Razlog tome nije to što čovek vremenom postaje sve bolji u svome
poslu, daje veće rezultate pa je više i nagrađivan, već i zbog efekta kognitivne disonance. Čak i oni koji
nisu bili u početku zadovoljni svojim poslom, ako su na njemu ostali duže vreme, racionalizuju svoju
inertnost time što sebe ubeđuju da su zadovoljni tim poslom. Istraživanja su pokazala da zadovoljstvo
poslom raste sa godinama staža i starosti ali ne linerano: do tridesete godina se naglo povećava
zadovoljstvo poslom zato što čovek postaje sve uspešniji u svom poslu i napreduje u karijeri, a oko
četrdesete čovek dostiže zenit u poslu, gubi mnoge iluzije o poslu i manje je Organizaciono ponašanje
74 zadovoljan, da bi u drugoj polovini pete decenije i do penzije opet raslo zadovoljstvo poslom. Kako
zaposleni mogu izraziti nezadovoljstvo Nezadovoljni radnici imaju više načina na koje mogu da izraze
nezadovoljstvo. Te reakcije zaposlenih na nezadovoljstvo poslom mogu se klasifikovati po dvema
dimenzijama: aktivna - pasivna reakcija i konstruktivna - destruktivna. Tako dobijamo četiri tipa
reakcije zaposlenog na nezdovoljstvo poslom kojim se bavi (Robbins 2003). a) Napuštanje - aktivna
destruktivna reakcija, odlazak iz organizacije zbog nezadovoljstva. b) Nemar - pasivno puštanje da se
situacija pogoršava, povećava se odsustvovanje sa posla, redukuje zalaganje, povećava stopa
pogreški. c) Protestvovanje - aktivna konstruktivna reakcija, zalaganje da se otklone uzroci
nezadovoljstva, pokušavanje poboljšavanja uslova, uključujući predlaganje poboljšanja, diskutovanje
o problemu s nadređenima i neki oblici sindikalnih aktivnosti. d) Lojalnost - pasivno kontruktivno
čekanje da se stvari poprave uključujući dizanje glasa za organizaciju pred spoljašnjim kriticizmima i
verovanje organizaciji i njenom menadžmentu da će "učiniti ispravnu stvar" (slika br. 11). Slika br. 11:
Strategije rešavanja nezadovoljstva poslom (Robbins 2003) Organizaciono ponašanje 75 Efekti
zadovoljstva poslom Zadovoljstvo zaposlenih ima tri osnovna efekta: a)Zadovoljstvo i produktivnost.
Logično je da su zadovoljniji radnici produktivniji. Međutim, na produktivnost utiču i drugi faktori. U
nekim slučajevima tehnološki proces određuje brzinu rada (produktivnost), tada zadovoljstvo ili
nezadovoljstvo radnika može malo uticati na produktivnost. Takođe, povećavanje produktivnosti
može biti uzrok, a ne posledica zadovoljstva zaposlenih; povećanje produktivnosti izaziva povećanje
nagrada zaposlenima, što dovodi do povećanja njihovog zadovoljstva. b)Odsustvovanje sa posla.
Zadovoljni radnici manje odsustvuju sa posla. Međutim, ima više faktora koji prisiljavaju
nezadovoljnog radnika da ipak dolazi na posao - strah od gubitka posla, odgovornost prema
kolegama na poslu ili prema klijentu. c)Fluktuacija.Zadovoljni radnici manje napuštaju posao.
Međutim, postoje varijable koje su manje vezane za zadovoljstvo poslom a utiču na fluktuaciju, npr.:
opšte ekonomske prilike i stepen nezaposlenosti (nezadovoljni radnik će možda ostati na poslu jer
nema drugih mogućnosti), a takođe na sklonost napuštanju posla utiče i generalno zadovoljstvo ili
nezadovoljstvo zaposlenog životom (posao lakše napuštaju radnici koji su generalno zadovoljni
životom, ali su nezadovoljni poslom, nego oni koji su nezadovoljni i poslom i životom u celini). Kako
merimo zadovoljstvo poslom Zadovoljstvo poslom predstavlja subjektivni fenomen koji zavisi od
mnoštva faktora, pa je teško i dobiti pravu sliku o zadovoljstvu. Zadovoljstvo poslom može se meriti i
korišćenjem objektivnih pokazatelja kao što su izostanci, bolovanja, konflikti na poslu i napuštanje
posla. Dva najčešće korišćena pristupa u merenju zadovoljstva poslom su: a) Holistički pristup ili
metod jedinstvenog globalnog procenjivanja kojim se meri opšte zadovoljstvo poslom. Predstavlja
odgovor pojedinca na pitanje kao što je: "Ako se Organizaciono ponašanje 76 Moj posao je: Zanimljiv
1 2 3 4 5 6 7 8 9 Nezanimljiv Ugodan 1 2 3 4 5 6 7 8 9 Neugodan Ugledan 1 2 3 4 5 6 7 8 9 Neugledan
Siguran 1 2 3 4 5 6 7 8 9 Nesiguran Potcenjen 1 2 3 4 5 6 7 8 9 Nagrađen Poštovan 1 2 3 4 5 6 7 8 9
Omalovažavan Monoton 1 2 3 4 5 6 7 8 9 Dinamičan Opasan 1 2 3 4 5 6 7 8 9 Bezopasan Dosadan 1 2
3 4 5 6 7 8 9 Raznovrstan sve stvari uzmu u obzir, koliko ste zadovoljni vašim poslom?" Osobe zatim
odgovaraju zaokruživanjem broja između 1 i 5 koji odgovara odgovorima od "sasvim sam zadovoljan"
do "sasvim sam nezadovoljan" (tabela br. 1). b) Aditivni pristup kojim se meri zadovoljstvo pojedinim
aspektima posla. Odrede se ključni elemente posla i zaposleni se pitaju o njihovim osećajima prema
svakom elementu (tipični činioci su: priroda posla, nadgledanje, sadašnja plata, prilike za
napredovanje, odnosi s kolegama). Ovi činioci se procenjuje na skali (npr. skala semantičkog
diferencijala) i zatim se sabiraju kako bi se stvorio ukupni rezultat zadovoljstva poslom. Ovaj pristup
je detaljniji od holističkog pristupa, daje nam više informacija preko kojih možemo saznati čime su
zaposleni zadovoljni, a čime nisu. Tabela br. 1: Primer skale semantičkog diferencijala zadovoljstva
poslom Organizaciono ponašanje 77 Rezime - implikacije za menadžere Menadžeri i organizacije idu
vrlo daleko kako bi poboljšali zadovoljstvo zaposlenih poslom. Ipak, ističu četiri činioca koji u najvećoj
meri dovode do visokog nivoa zadovoljstva zaposlenih poslom, a koje menadžent organizacije može
da kontroliše, i to su: Intelektualno izazovan rad. Ljudi preferiraju poslove koji im pružaju priliku da
koriste svoje veštine i sposobnosti, koji pružaju raznolike zadatake, slobodu i povratnu informaciju o
tome kako im ide. Ovo svakako treba imati na umu kod oblikovanja posla. Ravnopravne nagrade.
Zaposleni žele platne sisteme i politike napredovanja koje opažaju pravednim, nedvosmislenim i u
skladu s njihovim očekivanjima. Kad se plata vidi pravednom na osnovu zahteva posla, nivoa veština i
standarda plata u zajednici, to rezultira zadovoljstvom zaposlenih. Na sličan način, zaposleni traže
pravednu politiku i praksu unapređenja. Unapređenje pruža priliku za lični rast, veću odgovornost i
povišen društveni status. Stoga svakako treba imati na umu da će pojedinci koji opažaju donošenje
odluka o napredovanju pravednim i adektavnim biti zadovoljniji na poslu. Podržavajući radni uslovi.
Zaposleni su zabrinuti za svoje radno okruženje i zbog osećaja lične ugodnosti i zbog mogućnosti
adekvatnog odrađivanja posla. Zaposleni preferiraju fizička okruženja koja nisu opasna ili neugodna,
takođe, preferiraju da rade u čistim i relativno modernim prostorima i s prikladnom opremom.
Podržavajuće kolege. Za većinu zaposlenih rad popunjava potrebu za društvenim kontaktom. Zato
posedovanje prijateljski nastrojenih i podržavajućih kolega vodi do povećanog zadovoljstva poslom.
Ponašanje šefa je takođe važna odrednica zadovoljstva. Zadovoljstvo zaposlenih se povećava kad je
neposredni šef pun razumevanja i prijateljski nastrojen, kada pohvaljuje za dobar radni učinak, sluša
mišljenja zaposlenih i pokazuje lični interes za njih (Locke 1976).

Fluktuacija Važno je da razlikujemo dva osnovna oblika fluktuacije: namernu i neizbežnu fluktuaciju.
Neizbežnu fluktuaciju čine oni odlasci iz organizacije na koje ne mogu uticati ni pojedinac ni
organizacija (npr. zbog penzionisanja, smrti). Namerna fluktuacija obuhvata napuštanje organizacije
na osnovu lične odluke i želje onog ko odlazi (dobrovoljna) ili na osnovu organizacijskih potreba
(organizacijski uslovljena). Ova fluktuacija se može kontrolisati, tj. organizacija može uticati na činioce
koji je uslovljavaju i zato se može izbeći. Za nas je ona svakako važnija jer ukazuje na neke negativne
Organizaciono ponašanje 81 trendove i probleme u organizaciji. Redovno je uzrok nezadovoljstva i
pokazatelj nezadovoljavajućeg stanja u organizaciji. Može narušiti reputaciju organizacije kao
poslodavca i smanjiti šanse za uspešno regrutovanje novih zaposlenih, i dalji razvoj organizacije.
Uzroci fluktuacije Šta uzrokuje fluktuaciju? Šta doprinosi odluci o napuštanju organizacije? Namernu
fluktuaciju je teško predvideti i na nju delovati. Namerna fluktuacija, odnosno, odluka o odlasku iz
organizacije zavisi od dva glavna faktora: 1. nivoa zadovoljstva organizacijom, tj. organizacijske
privrženosti, 2. broja privlačnih alternativa koje zaposleni ima izvan organizacije. Organizacijska
privrženost predstavlja jačinu identifikacije pojedinca sa svojom organizacijom i uključenost u nju, i
karakterišu je tri faktora: jako verovanje u ciljeve i vrednosti organizacije i njihovo prihvatanje,
spremnost na veliko zalaganje u korist organizacije, i želja da se održi članstvo u organizaciji.
Međutim, osim organizacijske privrženosti fluktuaciji doprinosi i niz drugih faktora vezanih za
pojedinca, organizaciju i širu okolinu koji se mogu podeliti u četiri grupe, a to su: Faktori vezani za
opštu društveno-ekonomsku klimu - odnose se na ekonomsku stabilnost privrede i razvijenost
pojedinih grana privrede. Oni diktiraju odnos ponude i potražnje radne snage, i time i lakoću
zaposlenja, odnosno, broja privlačnih alternativa koje zaposleni ima izvan organizacije. Ukoliko je niža
stopa nezaposlenosti na tržištu rada, to je viša stopa fluktuacije pošto su zaposlenima koji napušataju
organizaciju dostupna alternativna zaposlenja. Ukoliko je veća razvijenost određene privredne grane,
veća je i potražnja i deficit određene vrste stručnjaka što doprinosi njihovom češćem fluktuiranju.
Faktori vezani za organizaciju - odnose se na ekonomsku stabilnost i perspektivu organizacije, nivo
tehnološke opremljenosti organizacije, organizaciju posla, način rukovođenja, opštu
socijalnopsihološku klimu u organizaciji, platu i mogućnost napredovanja. Ovi faktori posredno utiču
na mogućnost zadovoljenja očekivanja pojedinca, i takođe mogu dovesti do porasta nezadovoljstva i
Organizaciono ponašanje 82 fluktuacije. Na primer, kada zaposleni primeti da je njegova organizacija
slabo tehnički opremljena u odnosu na neku drugu sličnu organizcije, to će doprineti njegovom
nezadovoljstvu svojom organizacijom i učiniti tu drugu organizaciju za njega privlačnijom
alternativom. Organizacije koje karakterišu snažnije sindikalno organizovanje imaju nižu fluktuaciju
jer je bolje organizovan sindikat u stanju da se izbori za povoljnije uslove, pa su zaposleni motivisaniji
da rade u takvom okruženju. Faktori vezani za posao - odnose se na vrstu posla, sadržaj posla i uslove
rada. Zanimljivo je pomenuti da nam istraživanja pokazuju da značaj uslova rada varira sa starošću
zaposlenih. Naime, pokazalo se da mlađi zaposleni više izražavaju nezadovoljstvo uslovima rada od
starijih i da stoga češće napuštaju organizaciju (Možina 1965). Faktori vezani za ličnost zaposlenog -
odnose se na starost, pol, radni staž i intelektualne sposobnosti zaposlenih. Na primer, vezano za
starost, istraživanja nam pokazuju da najviše fluktuiraju mlađe osobe što se objašnjava razlozima kao
što su: nastavak školovanja, promena profesije, veća mobilnost mladih. Takođe, vezano za pol,
podaci nam govore da postoji razlika u razlozima fluktuacije muškaraca i žena; muškarci češće
fluktuiraju zbog nezadovoljstva poslom, organizacijom rada, zaradom i nemogućnošću napredovanja,
dok žene najčešće fluktuiraju zbog zdravstvenih razloga, udaljenosti organizacije od mesta stanovanja
i udaljenosti ustanova za brigu o deci od organizacije. Što se tiče radnog staža, pokazalo se da
fluktuacija opada sa porastom radnog staža jer duži radni staž znači izvesnu adaptaciju na posao i
uslove rada (Guzina 1980). Intelektualne sposobnosti određuju mogućnost angažovanja i
samoaktualizacije pojedinca na poslu što utiče na zadovoljstvo, pa time i na fluktuaciju. Pojedinci koji
svojim intelektualnim sposobnostima prevazilaze zahteve posla, usled nedovoljnog angažovanja i
stimulacije, napuštaju posao i traže novi posao koji im više odgovara. Takođe, pojedinci čije se
intelektualne sposobnosti nalaze ispod nivoa potrebnog za obavljanje posla, moraju ulagati više
napora i to ih čini spremnijim da napuste posao i potraže neki lakši posao koji im više odgovara (slika
br. 12). Jasno nam je da svaki pojedinac dolazi u organizaciju sa nizom očekivanja. Dakle, za pojedinca
je značajno da njegova najvažnija Organizaciono ponašanje 83 očekivanja budu realizovana da bi on
smatrao opravdanim svoj ostanak u organizaciji. Nerealna očekivanja povlače za sobom
nezadovoljstvo što doprinosi stvaranju odluke o napuštanju organizacije. Odluka da se ostane ili
napusti organizacija proces je odmeravanja zadovoljenih i željenih očekivanja. Što su zaposleni
zadovoljniji poslom i organizacijom, to je fluktuacija niža, i obrnuto. Slika br. 12: Uzroci fluktuacije
Organizaciono ponašanje 84 Modeli namernog napuštanja organizacije Postoje dva osnovna modela
donošenja odluke o napušatanju organizacije: Moblijev model fluktuacije i Šeridanov model
katastrofe. Moblijev model fluktuacije - prema ovom modelu odluka o napušatnju organizacije
donosi se kao logičan izbor. Pojedinci počinju sa ocenjivanjem svog posla i stepena zadovoljstva.
Ukoliko su nezadovoljni, počinju da razmišljaju o napuštanju organizacije, računaju troškove
napuštanja i nalaženja novog posla. Zatim počinju da tragaju za alternativnim zaposlenjem, porede
potencijalne poslove sa postojećim sa aspekta troškova i koristi, razvijaju nameru da napuste
organizaciju i konačno donose odluku i odlaze. Šeridanov model katastrofe - prema ovom modelu
odluka o napuštanju organizacije posledica je samo male promene u stepenu zadovoljstva ili nivou
stresa. Zaposleni koji ne pokazuje nikakve znake stresa ili otvorenog zadovoljstva i ne razmišlja
ozbiljno o napuštanju organizacije, moguće je da ipak oseća neko akumulirano nezadovoljstvo
organizacijom u kojoj radi, te u situaciji kada se pojavi i beznačajan problem ili neprijatno iskustvo na
poslu to postaje uzrok koji pojedinca navodi na donošenju odluke o napuštanju organizacije.
Istraživanja su potvrdila tačnost oba modela donošenja odluke o napuštanju organizacije, međutim,
još uvek se ne zna kada će koji od modela nastupiti. Modeli imaju i donekle različite implikacije na
prevenciju fluktuacije. Ako je donošenje odluke o napuštanju organizacije duži i racionalniji proces,
organizacija ima dovoljno vremena da uoči da zaposleni gubi interes za posao i da interveniše. Da bi
sprečila fluktuaciju zaposlenih u situaciji kada je odluka o napuštanju organizacije iznenadna,
organizacija bi trebala kontinuirano da radi na unapređenju uslova rada i zadovoljstva zaposlenih jer
nema vremena da uoči signale nezadovoljstva. Efekti fluktuacije Na prvi pogled nam se može učiniti
logi

Izvori stresa u organizacijskim uslovima Izvore stresa na radu ili stresore, možemo podeliti na dve
grupe: individualne i organizacijske. Ipak, u osnovi su svi organizacijski jer se događaju u okviru
organizacije i posledica su organizacijskih uslova. Individualni stresori. Pod individualnim stresorima
podrazumevamo stresore koji na neposredan i specifičan način deluju na svakog pojedinca u
organizaciji. Oni se vezuju uz posao, uloge u organizaciji i razvoj karijere. Organizaciono ponašanje 98
1. Posao - postoji niz stresora povezanih sa poslom koji pojedinac obavlja u organizaciji, a najčešće su
to: a) Zahtevi - koje konkretan posao postavlja pred pojedinca. Premali i preveliki zahtevi, odnosno,
zahtevi koji su iznad i ispod individualnih mogućnosti pojedinca frustriraju ga i čine nezadovoljnim, i
trajan su izvor stresa. b) Pritisak vremena - odnosno kratki rokovi za obavljanje zadataka. Tempo rada
u savremenim organizacijama postaje sve brži i brži, a time i sve stresniji za zaposlenog. c) Radna
preopterećenost - i kvantitativna preopterećenost (previše posla koji treba obaviti u kratkom
vremenu) i kvalitativna preopterećenost (kao posledica nedostatka veština i sposobnosti za
obavljanje posla) izvor su stresa na poslu. d) Odgovornost za ljude - je naročito stresna karakteristika
posla. Velika odgovornost predstavlja i veliki teret za pojedinca. e) Fizički uslovi rada - kao što su
neprikladno osvetljenje, buka, temperatura, opasnost od nesreća i profesionalnih oboljenja
dugotrajan su izvor stresa za pojedinca koji obavlja takav posao. 2. Uloge u organizaciji - najčešće
izvore stresa vezane za uloge predstavljaju zahtevi uloge, a najčešći stresori vezani za uloge su: a)
Konflikt uloge - događa se kada postoji konfliktnost različitih uloga koje pojedinac obavlja u
organizaciji. Na primer, menadžeri su po svojoj poziciji u organizaciji istovremeno u ulozi i
podređenog i nadređenog i u situaciji su stalnog konflikta tih uloga, naročito ako se njihov stil
rukovođenja značajno razlikuje od stila rukovođenja njihovog nadređenog. b) Nejasnoća i
nedvosmislenost uloge - posledica je nejasnih ili nepoznatih zahteva uloge ili nerazumevanja
dužnosti, prava i odgovornosti koje pojedinac ima u obavljanju posla. c) Statusna nekonzistentnost
uloge - odnosno situacija da određenu ulogu u organizaciji, po mišljenju pojedinca koji se u njoj
nalazi, ne prate odgovarajući status, nagrade i ugled. Organizaciono ponašanje 99 3. Razvoj karijere -
svako napredovanje u karijeri ili promena posla predstavlja i potencijalno stresnu situaciju za
pojedinca. Pojedine faze razvoja karijere nose sa sobom i različite stresore. Najčešći izvori stresa
vezani za karijeru su: a)Prenisko napredovanje - sve što je pozicija pojedinca u hijerarhiji organizacije
viša, to su njegove mogućnosti daljeg napredovanja manje jer je prostora na vrhu organizacije malo.
Plato u krijeri izazvan nedostatakom viših pozicija često je stresor za menadžere. b)Previsoko
napredovanje - uzrok je stresa u slučaju kada pojedinac dođe do pozicije koja je iznad njegovih
mogućnosti, npr. kada od uspešnog stručnjaka u svom poslu postane neuspešan i frustriran
menadžer. c)Nesigurnost posla - promene u tehnologiji i prirodi posla, restruktuiranje i smanjivanje
broja zaposlenih, te opšti trend smanjenja organizacija i broja menadžera čest su stresor.
Organizacijski stresori. U grupu organizacijskih stresora spadaju oni stresori čije delovanje proizilazi iz
karakteristika i ponašanja organizacije. Najčešće su to: a) Organizacijska struktura - niz karakteristika
organizacijske strukture kao što su formalizacija, standardizacija, centralizacija i dr. mogu biti izvor
stresa, posebno za kreativne i stručne pojedince. Brojna istraživanja su potvrdila da zaposleni osećaju
najmanje stresa u nebirokratskim i najmanje hijerarhijskim organizacijama. b) Dizajn posla - značajan
izvor radnog stresa je specijalistički pristup oblikovanju radnog mesta čija je posledica korišćenje
samo malog segmenta potencijala izvršioca. c) Stil liderstva - način ponašanja lidera prema
zaposlenima koji su mu neposredno odgovorni veoma često je izvor stresa na poslu. Lider koji ne daje
podršku i ne pokazuje brigu i interes za zaposlene, izvor je stalnog stresa za podređene. Autokratski
stil vođenja snažan je stresor za ljude koji imaju potrebu za participacijom, izražavanjem vlastitih
sposobnosti i znanja, te kreativnim doprinosom. d) Participacija - kao obim u kom se znanja, veštine,
mišljenja i ideje zaposlenih uključuju u proces odlučivanja o poslu može imati višestrano stresno
delovanje. S jedne strane, nedostatak Organizaciono ponašanje 100 participacije, odnosno,
nemogućnost da se da doprinos u procesu odlučivanja o relevantnim stvarima, posebno je izvor
stresa za stručne i kreativne pojedince. S druge strane, participacija koja podrazumeva mnogo
vremena, uvažavanje suprotnih mišljenja i gledišta, a često znači odgađanje odluka, posebno je izvor
stresa za lidere i menadžere. e) Organizacijska kultura i klima - takođe može biti važan izvor stresa za
zaposlene. Posebno tip organizacijske kulture - kultura uloga u kojoj dominiraju pravila i procedure,
zanemaruju se ljudi, njihovi potencijale i potrebe, te i njen sastavni deo klima nepoverenja i loših
odnosa deluju stresno na većinu zaposlenih. f) Menadžment ljudskih resursa - neadekvatnom
selekcijom, lošim rasporedom ljudi, lošim sistemom praćenja radne uspešnosti, neadekvatnim
motivisanjem i nagrađivanjem, te nejasnim kriterijumima napredovanja i razvoja zaposlenih često je
uzročnik stresa u organizaciji (slika br. 14).

Struktura organizacije sa stanovišta ponašanja pojedinca Za razumevanje i analizu organizacione

strukture značajna je distinkcija između predviđene i stvarne strukture. Predviđena struktura je
formalan obrazac diferncijacije organizacije po nekom od kriterijuma te podele. Ova struktura bi
trebala da bude podešena prema opštim ciljevima i zadacima organizacije. Dakle, predviđena
struktura je instrument za uspešno funkcionisanje organizacije. Međutim, formalno predviđenu
strukturu tj. zahteve koji proizilaze iz pojedinih položaja realizuju ljudi. Usled individualnih razlika u
strukturi ličnosti i motivaciji pojedinci različito interpretiraju postavljene zahteve. Oni se u organizaciji
ponašaju na način koji u većoj ili manjoj meri odstupa od formalnih zahteva. Zbog toga je pri analizi
organizacionog ponašanja značajno sagledati kako predviđenu tako i stvarnu organizacionu strukturu.
Stvarna organizaciona struktura se proučava sa stanovišta organizacijskih uloga čemu je posvećeno
posebno poglavlje u ovoj knjizi. Organizaciji je u interesu da poveća stepen kontrole individualnih
odstupanja od predviđene strukture, te posebna pažnja treba da se posveti pretpostavljenim ili
verovatnim ulogama. Osnovna funkcija procesa profesionalne selekcije je upravo predviđanje
ponašanja osobe na određenom budućem položaju u organizaciji. Organizaciono ponašanje 165 U
ovu kategoriju načina dizajniranja strukture organizacije može se uvrstiti i diferencijacija na formalnu
i neformalnu strukturu. Svaka organizacija ima pored formalne ili predviđene strukture i neformalne
oblike struktuiranja. Neformalne grupe jesu deo strukture svake organizacije. Za razliku od elemenata
strukture organizacije koji su definisani formalnim kriterijumima neformalne grupe, barem u prvoj
fazi struktuiranja, nastaju spontano i ne mogu se predvideti. Neformalne grupe su odraz potrebe ljudi
da u okviru organizacije zadovolje i svoje socijalne potrebe kao što su: potreba da se bude sa sebi
sličnim ljudima, potrebe za moći i ugledom koje nisu zadovoljene na formalnom nivou, potreba za
sigurnošću - u grupi smo jači i slično. Ove grupe imaju snažan uticaj na ponašanje pojedinaca. Često je
taj uticaj mnogo veći nego uticaj formalnih segmenata organizacije kojima osobe pripadaju. Jedan od
razloga takvog uticaja jeste osećaj da su odluku o pripadnosti neformalnoj grupi doneli sami i da u toj
socijalnoj grupaciji zadovoljavaju svoje lične socijalne potrebe. Zbog toga je značajno da organizacija
poštuje postojanje neformalnih grupa u smislu da ih poznaje, da ih ne sputava i da grupnu dinamiku
neformalnih grupa iskoristi, u pozitivnom značenju te reči, za formiranje timova ili za formiranje
stavova preko neformalnih lidera u mišljenju. Organizacije koje poštuju neformalne grupacije mogu
imati najmanje dve vrste dobiti: 1.još jedan veoma snažan instrument za ostvarivanje ciljeva
organizacije, 2.veći stepen lojalnosti jer osobe, zaposleni, imaju osećaj da u okviru organizacije mogu
zadovoljiti niz svojih potreba. Kao primer za gore navedeno možemo uzeti situaciju u mnogim
preduzećima u našoj zemlji u periodu tranzicije. I pored činjenice da nisu dobijali platu mesecima, što
je za pojedinca osnovna funkcija organizacije, ljudi su uredno dolazili na posao. Jedan od razloga ovog
vida lojalnosti jeste mogućnost da u okviru organizacije zadovolje i svoje socijalne potrebe. Na
osnovu funkcije koju imaju u odnosu na ciljeve organizacije neformalne grupe se mogu podeliti na: 
funkcionalne neformalne grupe  nefunkcionalne neformalne grupe. U prvu kategoriju spadaju
interesne grupe čije vrednosti i ciljevi se ne suprodstavljaju vrednostima i ciljevima organizacije ili ih
Organizaciono ponašanje 166 mimo formalnih zahteva i podstiču. Na primer, to su grupe ljudi koji
provode pauze zajedno ili grupa stručnjaka koji u nekim trenucima razmenjuju ideje u vezi sa
različitim projektima iako to od njih niko ne očekuje. U kategoriju nefunkcionalnih neformalnih grupa
spadaju: različite klike, saboteri, grupe alkoholičara u organizaciji i slično. Neformalne grupe mogu se
dijagnostikovati posmatranjem ili primenom sociometrisjkog testa. Sociometrijski test je konstruisao
Moreno i danas ima veliku primenu u ispitivanju socijalnog statusa i odnosa među članovima grupe.
Detaljniji opis sociometrijskog testa prevazilazi okvire ove knjige.1 Na ovom mestu želimo samo da
ukažemo na potrebu primene ovog isntrumenta u dijagnostikovanju neformalne strukture
organizacije pri čemu je neophodno definisati posebne kriterijume ili pitanja u skladu sa ciljevima
istraživanja. Neka od pitanja koja se mogu postaviti zaposlenima u organizaciji su: s kim bi sedeli u
kancelariji? kada bi imali mogućnosti, koga bi izabrali za neposrednog rukovodioca? s kim bi
učestvovali u timu za izradu projekta? sa kim najradije provodim pauze? Za organizaciju je veoma
značajno da sistematski prati neformalne grupe, njihove članove, sistem vrednosti i slično. Pri tome je
značajno uporediti formalne i neformalne grupacije u organizaciji. Ako zahtevi posla omogućavaju
prestruktuiranje formalnih grupa, izgrađene neformalne odnose organizacija može upotrebi u
takvom vidu prestruiktuiranja. Uz takvu njihovu upotrebu može se očekivati dvostruka dobit:
efikasnija grupa koja rezultate postiže uz lično zadovoljstvo kroz socijalnu razmenu. Na nivou
organizacije sagledavanje i praćenje formalnih i neformalnih odnosa je značajno jer oni daju opšti ton
grupnoj dinamici. Poželjno stanje grupne dinamike je balans između formalnih i neformalnih odnosa,
kao i jasno razgraničenje u kojim situacijama treba i mogu dominirati formalni, a u kojoj neformalni
odnosi. Ako na nivou organizacije isključivo dominiraju formalni odnosi, ovakvo opšte stanje grupne
strukture i dinamike dovodi do sputavanja kreativnosti pojedinaca i frustriranosti zadovoljenja
socijalnih potreba, a organizacija se doživljava kao hladna i nestimulativna za lični razvoj 1 Jedan od
izvora u kome se čitaoci mogu detaljnije upoznati sa konstrukcijom i obradom podataka dobijenih
sociometrisjkim testom je: Tomašević, N. (1991). Vežbe iz pedagoške psihologije: Priručnik.:
Pedagoška akademija "Zora Krdžalić Zaga". Kikinda. str. 66-72. Organizaciono ponašanje 167 u
kontekstu grupe. Dominacija neformalnih odnosa nad formalnim dovodi do haosa, dezorijentacije i
neefikasnog poslovanja. U nekim analizama, koje su vršili autori ove knjige, ustanovljeno je da u
organizacijama u našoj zemlji u vreme tranzicije dominiraju neformalni odnosi koji se manifestuju u
nepoštovanju pravila, protoku značajnih informacija za poslovanje po neformalnim kanalima,
prilagođavanju pravila pojedincima sa kojima smo u dobrim ili lošim međuljudskim odnosima i slično.
U ovom kontekstu, zadatak organizacije je da razvija takvu organizacionu kulturu koja će stimulisati
formalne odnose, kada je reč o izvršavanju radnih zadataka, uz istovremeno negovanje neformalnih
odnosa u svim situacijama kada je to funkcionalno kako za organizaciju tako i za pojedince u njoj. Kao
rezultat ovakvog oblika (re)socijalizacije unutar organizacije javlja se svest ljudi o potrebi
razgraničenja formalnih i neformalnih odnosa ili poslovnih i prijateljskih uloga što po nama
predstavlja poseban vid zrelosti i osnovu poslovnog ponašanja. Ovakav vid dijagnoze je važan
orijentir pri kreiranju daljeg razvoja organizacije i predstavlja jedan od aspekata u okviru projekta
poznatog pod nazivom organizacija koja uči. Struktura koja sadrži rangiranje pojedinih pozicija
Organizacije se stvaraju namerno i planski. Kreč, Kračfild i Balaki ističu da je većina ponašanja u
organizaciji "hotimično razumno ponašanje" (Krech, Crutchfield and Ballachey 1972: 420). Ovim
terminom žele da naznače da je organizaciono ponašanje karakteristično nastojanje da se uskladi
ponašanje pojedinaca sa ciljevima za koje su ljudi sposobni. Da bi se postigla ova usklađenost, uvode
se organizacioni principi. Neki od tih principa koji se danas definišu kao tradicionalni i prevaziđeni, ali
koji po našem mišljenju ukazuju na specifičnost organizacione strukture, su:  specijalizacija zadataka,
 lanac zapovedanja,  raspon kontrole,  minimalan broj nivoa. U navedenim principima je
implicirana hijerarhijska struktura organizacije. I pored brojnih kritika ovih principa, mišljenja smo da
su oni i danas neprevaziđeni u opisu organizacione strukture koja čini osnovnu šemu uređenja
komunikacije među ljudima. Ono što bi Organizaciono ponašanje 168 trebalo da bude trend
modernizacije ovih principa jeste obogaćivanje sadržaja i načina komunikacije između različitih
vertikalnih i horizontalnih položaja u strukturi organizacije. Struktura koja sadrži rangiranje pojedinih
pozicija u organizaciji vezuje se za pravce i sadržaje komunikacije. Opšta šema organizacione
strukture prikazana je na slici br. 26 Slika br. 26: Opšta šema organizacione strukture, modifikovano
po Liptonu (Linton 1961) Polazeći od neophodnosti vertikalne strukture za funkcionisanje organizacije
Mintcberg definiše osnovne nivoe te hijerarhije (Mintzberg 1981). On navodi sledećih pet osnovnih
nivoa: 1.viši menadžment (senior management) - odgovoran za direkciju i organizaciju aktivnosti
drugih ljudi; 2.menadžment srednjeg nivoa (middle management) - odgovoran za obezbeđenje
organizacije i efikasne upotrebe resursa za postizanje ciljeva koje je definisao viši menadžment;
3.tehnička podrška (technical support staff) - profesionalno osoblje koje vrši stručnu ekspertizu
(dizajneri, inženjeri, pravnici itd.); 4.administrativno osoblje (administrative support staff) - daje
podršku izvršavanjem administrativnih aktivnosti i obezbeđivanjem neophodnih sredstava;
5.funkcionalno jezgro zaposlenih (functional core employees) - kategorija zaposlenih koji aktivno rade
na proizvodima i uslugama koje pruža organizacija (nastavnici, zaposleni u proizvodnji, računovodstvo
i sl.). Organizaciono ponašanje 169 Razuđenost hijerarhijske strukture zavisi od veličine organizacije i
složenosti njene delatnosti. Tako, na primer, struktura može obuhvatiti više nivoa ili samo jedan nivo
menadžmenta. Opšti pravci komunikacije mogu biti vertikalni i horizontalni. Svaki od ovih pravaca
komunikacije imaju određene funkcije iz čega proizilaze i različiti sadržaji. Vertikalna komunikacija
usmerena je na ostvarivanje organizacionih zadataka i ciljeva dok je horizontalna, pored gore
navedenog, usmerena i na zadovoljenje socijalnoemocionalnih potreba članova grupe. Vertikalna
komunikacija može da se odvija u dva pravca: od gore ka dole i od dole ka gore. Ovi pravci određuju i
prirodu sadržaja i način vertikalne komunikacije. Polazeći od radova Kaca i Kana (Katz i Kahn 1966),
Rot (Rot 1983) navodi sledeće sadržaje vertikalne komunikacije od gore ka dole:  naređenja o
zadacima i instrukcije o poslovima,  obaveštenja i objašnjenja o smislu poslova,  informacije o
pravilima ponašanja u organizaciji,  informacije o načinu izvršenja poslova,  informacije čija je
namena da se što potpunije usvoje opšti ciljevi organizacije. Kako ova znanja mogu iskoristiti
savremeni menadžeri na višim hijerarhijskim pozicijama pri izgrađivanju efikasnog stila rukovođenja?
Odgovor na postavljeno pitanje može se, po našem mišljenju, svesti na sledeće. U svom načinu
rukovođenja potrebno je da budu prisutni svi navedeni sadržaji. Za svaki od ovih sadržaja značajno je
izabrati adekvatno vreme i način saopštavanja, kao na primer: da li informaciju saopštiti usmeno ili
pismeno, da li neposredno ili posredno, da li individualno ili pred grupom itd. Pored negovanja
komunikacije od gore ka dole savremeni menadžeri bi trebali da budu otvoreni i za informacije koje
mogu dobiti kanalima od dole ka gore. Detaljnija razrada svakog od načina komunikacije prevazilazi
okvire ove knjige i predstavlja posebne edukativne sadržaje čija je funkcija izgrađivanje
komunikacionih veština u organizaciji. Sadržaji uzlaznih vertikalnih komunikacija mogu biti:  traženje
objašnjenja i dodatnih informacija u vezi sa zadacima,  dostavljanje izveštaja o urađenim zadacima,
Organizaciono ponašanje 170  upućivanje sugestija rukovodiocima na višim položajima (na primer: o
motivaciji zaposlenih, propustima u rukovođenju, zahtevima korisnika usluga i slično). Mada su
sadržaji komunikacije od dole ka gore istog značaja za funkcionisanje organizacije, praksa koju smo
stekli kroz brojne komunikološke radionice u velikom broju preduzeća ukazuje da se ovaj pravac
komunikacije ne neguje u našim preduzećima. Razlozi za to su brojni, kao na primer: postojanje
neprobojnih granica između viših i nižih položaja, neprepoznavanje potrebe da se neka saznanja i
nejasnoće saopšte rukovodiocima i da se od njih traži podrška, neprepoznavanje svoje uloge kao
važnog izvora informacije (kakve zahteve na primer imaju kupci), neposedovanje komunikoloških
veština ili znanja kako na adekvatan način pretpostavljenom preneti značajnu informaciju i slično. Ovi
sadržaji bi takođe trebali biti sastavni deo projekta pod nazivom organizacija koja uči. Za svaku
organizaciju značajno je da izgrađuje dvosmerne vidove komunikacije. Na taj način se stvaraju uslovi
za adekvatno i pravovremeno informisanje njenih članova što je osnovni preduslov za donošenje
konstruktivnih odluka, razumevanje problema i pravaca razvoja. Takođe, na ovaj način se smanjuje
verovatnoća pojave različitih ometajućih faktora u komunikaciji i funkcionisanju organizacije, kao što
su: širenje glasina, svojevoljno postupanje bez osnova, stvaranje barijera između ljudi na različitim
hijerehijskim nivoima i polarizacije na MI i ONI. Važan deo komunikacije u organizaciji su horizontalne
komunikacije koje se odvijaju među jednakima po statusu. Za većinu članova to su najčešće
komunikacije. Sadržaji ove komunikacije mogu biti: a) pružanje pomoći i saradnje u izvođenju
pojedinih radnih zadataka, b) informacije potrebne radi koordinisanja aktivnosti organizacije
(aktivnosti različitih sektora istog nivoa), c) sadržaji kojima se ostvaruju lični, socijalni i emocionalni
odnosi među članovima organizacije, d) dogovaranje radi ostvarivanja različitih ciljeva i interesa. Neki
od navedenih sadržaja horizontalne komunikacije su po svojoj prirodi u većoj meri formalni a neki
neformalni. Na osnovu bogatog iskustva stečenog kroz komunikološke treninge možemo
Organizaciono ponašanje 171 konstatovati da u preduzećima postoje sledeći problemi u vezi sa
horizontalnom komunikacijom. Jedan od tih problema je da dodatne informacije zaposleni traže
najčešće od osoba na istom hijerarhijskom nivou, a ne od pretpostavljenih koji su često
kompetentniji za davanje takvih informacija. Drugi problem je nedovoljan obim komunikacije između
različitih stručnjaka na istom hijerarhijskom nivou. Za uspostavljanje sistema kao što je organizacija
neohodno je usklađivanje i koordinacija različitih aktivnosti. Ako izostane ovakav vid koordinacije,
sistem se ne može uspostaviti ili pojedini elementi tog sistema iskaču na određeni način što
predstavlja svojevrsan problem. Zato je značajno da i u formalnim šemama strukture organizacije
budu naznačeni poželjni pravci horizontalne komunikacije čiji sadržaji će biti usmereni upravo na
usklađivanje rada pojedinih sektora. Ovakav vid struktuiranja komunikacije i odnosa bi trebao da
bude i osnova za formiranje visokoproduktivnih timova i timskog rada u organizaciji. Sledeći problem
se sastoji u prevelikom obimu i prisutnosti sadržaja koji su usmereni na lične, socijalne i emocionalne
potrebe članova organizacije pri čemu se zanemaruju sadržaji značajni za poslovanje. U
organizacijama se često stvaraju statusni simboli koji omogućavaju članovima organizacije da tačno
uoče status drugih osoba i da prilagode svoje ponašanje na prikladan način. U vojsci i policiji takvi
statusni simboli su oznake činova. U drugim vrstama organizacija statusni simboli mogu biti: vrsta i
veličina kancelarija, da li kancelarije imaju prozor ili ne (primer nekih univerziteta u SAD-u), parking
mesto za automobile i slično. Još neki kriterijumi dizajniranja organizacione strukture U ovom delu
ukratko ćemo prikazati komunikacionu strukturu i strukturu i dinamiku karakterističnu za timski rad.
Pri izboru ovih tema pošli smo od njihovog značaja za uspešno funkcionisanje organizacije.
Komunikaciona struktura. Jedan od osnovnih preduslova za uspešno funkcionisanje grupe je da
komunikacija među njenim članovima bude razvijena i sistematska. Komunikacija je, kako ističe Rot,
srž grupnog procesa (Rot 1983). Pojmom komunikaciona Organizaciono ponašanje 172 struktura
označavaju se predviđeni putevi dostavljanja informacija, njihov sadržaj i obim. Dakle elemeti
komunikacione strukture su:  kanali komunikacije koji čine komunikacionu mrežu,  pravac
komunikacije,  obim komunikacije i  sadržaj komunikacije. Empirijska proučavanja komunikacione
strukture započeta su pedesetih godina prošlog veka. Kao rezultat niza istraživanja Bavelsa, Livita,
Gickova i Sajmona, Šoa i mnogih drugih izdvojeno je nekoliko tipova komunikacionih mreža: a) kružna
komunikaciona mreža - krug b) lančana komunikaciona mreža - lanac c) mreža u obliku slova Y
Organizaciono ponašanje 173 d) komunikaciona mreža u vidu točka - točak e) tačka potpune
povezanosti - mreža Ove mreže mogu se svrstati u dve grupe: decentralizovane (krug i mreža
potpune povezanosti) i centralizovane (lanac i točak). Komunikacione mreže "određuju" kanale,
pravce i obim komunikacije. Mogu se analizirati sa stanovišta broja neposrednih komunikacija. Tako,
na primer, u mreži krug svaki član može da neposredno komunicira samo sa dva susedna člana dok u
tipu mreža svi učesnici mogu imati neposrednu komunikaciju. Po sadržaju moguće je razlikovati tri
kategorije komunikacije: komunikacija u vezi sa obavljanjem tekućih poslova i rešavanjem zadataka,
komunikacija o opštim pitanjima rada i organizacije rada, i komunikacija koje su izraz socio-
emocionalnih potreba članova grupe. Istraživanja su pokazala da komunikacione mreže imaju efekat
na brzinu rešavanja zadatka, broj učinjenih grešaka i zadovoljstvo svojim položajem u komunikacionoj
mreži. Adekvatnost ili funkcionalna vrednost pojedinog tipa mreže određuje se u odnosu na prirodu
zadatka. Jednostavni zadaci brže se rešavaju u centralizovanoj mreži dok se složeni brže rešavaju u
decentralizovanoj mreži. Više je grešaka u centralizovanoj mreži kada su zadaci složeni, a kada su
jednostavni, više ih je u decentralizovanoj mreži. Zadovoljstvo članova je uvek veće u
decentralizovanim tipovima mreže. Sledeće pitanje koje je privuklo pažnju istraživača je uticaj
određenih faktora na efekat pojedinih tipova komunikacionih mreža. Organizaciono ponašanje 174
Proučavan je uticaj veličine grupe, smetnje pri komunikaciji i crte ličnosti učesnika. Rezultati su
pokazali da se sa povećanjem broja članova grupe iznad pet smanjuje efikasnost svakog od tipova
komunikacionih mreža. Ovakav efekat se može videti ako se u okviru komunikološke radionice
napravi situacija za mrežu u obliku slova ipsilon u kojoj imate više od pet početnih karika, a koje imaju
zadatak da prosleđuju informacije samo osobi F. Osoba F može da komunicira samo sa osobom G, a
osoba G samo sa osobom E. Veoma brzo dolazi do zagušenja informacijama osobe F usled čega ona
ne može da stigne da proceni i prosledi adekvatne informacije osobi G, odnosno, osobi E što rezultira
neuspehom u rešavanju zadatka, pojavom nezadovoljstva i utroškom velike količine vremena. U gore
opisanoj situaciji demonstracije dolaze do izražaja i smetnje u komunikaciji poput: interferencije
poruka, prosleđivanja nerelevantnih poruka, smetnji u kodiranju i slično. Rezultati psiholoških
istraživanja su pokazali da na efikasnost pojedinih tipova mreža utiču i crte ličnosti učesnika i to
naročito težnja ka dominaciji i autoritativnosti. Pri spontanom struktuiranju vrlo verovatno će osobe
sa težnjom ka dominaciji preuzeti neku od centralnih pozicija i usmeravati pravce komunikacije
analogne tipu mreže točak što je u skladu sa njenim motivacionim predispozicijama. Ovi psihološki
nalazi mogu biti korisna orijentacija pri kontrolisanom struktuiranju komunikacionih kanala u
organizaciji pri čemu treba obratiti pažnju na crte ličnosti pojedinih učesnika, naročito onih koji
dobijaju centralno mesto u toj strukturi. Ako položaj učesnika u mreži nije u skladu sa njihovim ličnim
predispozicijama, oni će nastojati da prestruktuiraju zadatu mrežu u pravcu zadovoljenja svojih
tendencija i time stvoriti izvesne smetnje u komunikaciji. Koje su mogućnosti primene znanja o
komunikacionim mrežama u okviru organizacije? Mada se tipovi komunikacionih mreža prvenstveno
proučavaju pri rešavanju određenih zadataka, značajno je razviti ove komunikacione mreže i u okviru
formalne strukture organizacije. Tako, na primer, pri kreiranju radnog mesta sekretara departmana u
okviru fakulteta, adekvatno je zamisliti i primeniti obrazac mreže točak. Zadatak osobe na ovom
radnom mestu bi trebao da bude sabiranje informacija od većeg broja zaposlenih i njihovo
prosleđivanje osobama kojima je informacija upućena. Za to Organizaciono ponašanje 175 se mogu
osmisliti različiti instrumenti kao što su i-mejl adrese, poštanski fahovi i slično za svaku kariku u točku.
Na taj način stvaraju se preduslovi za otvorenu komunikaciju i dostupnost informacija svim članovima
jedne organizacione jedinice, a osoba u središtu dobija i formalno ulogu spone i posrednika. Da bi
komunikacija u ovoj mreži bila adekvatna, značajno je osobu posrednika osposobiti za procenu koje
sadržaje treba uputiti kojoj osobi u situacijama kada nije naznačen primalac poruke, kao i da li
informaciju treba proslediti u usmenoj ili pisanoj formi. Znanja o komunikacionim mrežama po našem
mišljenju su, ili bi trebala da budu, i sastavni deo organizacionih sposobnosti menadžera.
Komunikacione mreže predstavljaju korisne mape menadžerima pri proceni celine zadatka (ŠTA je
potrebno postići ili uraditi) i analize KAKO (koje sve segmente aktivnosti predvideti pri realizaciji),
KADA (kojim redosledom) i KO u organizacionom lancu treba da izvrši pojedine zadatke. Dakle,
menadžeri pri odabiru tipa mreže treba da procene prirodu zadatka, broj potrebnih učesnika i na koji
način zbog prirode svojih kompetencija oni treba da budu povezani. Tako, na primer, u pokušaju
pronalaženja najboljih rešenja za neke probleme u početnoj fazi menadžeri mogu inicirati mrežu
potpune povezanosti (brain storming), a pri realizaciji usvojenih rešenja mrežu lanac. Timski rad.
Jedno od osnovnih obeležja organizacije je neophodnost zajedničkog rada više ljudi različitih po
svojim personalnim karakteristikama i ulogama koje imaju u preduzeću. U navedenoj konstelaciji
kontradiktornih faktora poseban vid izazova predstavlja uvođenje integrativnih procesa u kontekstu
ličnih različitosti koji bi trebali da rezultiraju pozitivnim ishodima. Ključ je u izgrađivanju timskog rada.
Zajednička aktivnost većeg broja ljudi ne predstavlja uvek timski rad. Da bi neka grupa predstavljala
tim, ona treba da ima sledeća obeležja:  postojanje zajedničkog cilja,  uzajamna, međusobna i
zajednička odgovornost i u situacijama uspeha i u situacijama neuspeha,  produkti koji su rezultat
zajedničke aktivnosti,  razgraničenje uloga u timu uz uvažavanje njihovog istog značaja za
funkcionisanje grupe u celini, Organizaciono ponašanje 176  visoka kohezivnost,  saradnja u
odlučivanju o zadacima i proceduri,  zajedničko procenjivanje uspeha tima. Navedene karakteristike
imaju različite modalitete ako se procenjuju na nivou organizacije u celini i malih grupa. Ovu
distinkciju treba imati u vidu kako bi se našla adekvatna mera i postavila realna očekivanja za
izgrađivanje kolektivnog duha i kulture saradnje na nivou organizacije, odnosno, pri izgrađivanju
manjih radnih timova kao funkcionalnih segmenata unutar sistema. Značajno je istaći da se svaka od
navedenih karakteristika timskog rada može zamisliti kao dimenzija na čijem je jednom polu
maksimalna izraženost datog obeležja dok drugi pol ove dimenzije ukazuje na odsustvo takve
karakteristike. Dakle, pri proceni prisutnosti ili stepena izgrađenosti tima svaka od ovih dimenzija
može biti zastupljena u nekom stepenu, na primer, na skali od 0 do 5. Navedene karakteristike mogu
se tretirati i kao tehnike, odnosno, instrumenti za timsko postignuće. Timovi su osnovne jedinice za
ostvarivanje zadataka u kojima se povezuju i dopunjuju sposobnosti, iskustva i domišljatost nekoliko
ljudi. Prednosti timskog rada su: veći stepen različitih vidova kompetentnosti, stabilan nivo
motivacionog potencijala (uvak je barem neko od članova maksimalno motivisan), mogućnost
socijalne razmene i zadovoljenje socijalnih potreba. Mogući nedostaci timskog rada su: uniformnost u
mišljenju (vremenom članovi tima počinju da misle jednako čime se smanjuje mogućnost razmatranja
različitih opcija za rešavanje problema), podeljena odgovornost ako je praćena nedostatkom osećaja
lične odgovornosti, jačanje granica između članova tima i onih koji to nisu (povećava se distanca i
polarizacija MI i ONI) itd. Navedeni nedostaci se mogu prevazići umešnim rukovođenjem i uvođenjem
različitih tehnika usmerenih na negovanje lične kreativnosti (na primer: brain storming tehnika pri
donošenju odluka), i uvođenjem otvorene komunikacije unutar i van tima. Procenjujući vrednost i
efekte timskog rada značajno je istaći da celina nikada nije prost zbir pojedinaca koji je čine. "Efekti
timskog rada mogu biti u poređenju sa individualnim postignućem, manji ili veći u zavisnosti od toga
koliko ti pojedinci dobro rade zajedno" (Goleman 2000: 195).

file:///G:/Master%20rad/Organizaciono-ponasanje.pdf

Determinants and Consequences of Job Satisfaction Determinants of job satisfaction occur at the
individual as well as at the organisational level. Individual differences (personality traits) exert a clear
influence on employees’ experienced satisfaction with the facets noted above. In a similar fashion,
years in one’s career and one’s job expectations of challenge and responsibility also determine levels
of job satisfaction. Years in Career As employees grow older, they experience more satisfaction at
work. This continues until they near retirement, when a sharp decrease usually occurs. Also, a sharp
but often temporary decline in job satisfaction may appear among employees who have been
working for between six months and two years. This early career dip is a consequence of the
realisation by employees that the job will not meet all of his personal needs as quickly as expected.
The long-term relationship between years in a career and job satisfaction is shown in Figure 1.2.
Module 1 / The Basics of Organisational Behaviour and Its Relation to Management 1/28 Edinburgh
Business School Organisational Behaviour Figure 1.2 The years in career–job satisfaction relationship
If the level of job satisfaction is considered in the aggregate (a nation’s labour force for instance), we
find in some instances that workers are postponing retirement for a variety of economic and
personal reasons. Some have not saved enough for retirement, or they find to their frustration that
their pensions and healthcare coverage will be much less than they expected once they retire
(inadequate retirement portfolios due to sub-par performance of the company or the nation’s
economy). These factors cause many older (and healthy) workers to delay indefinitely their
retirements. Increasingly, mergers and corporate bankruptcies leave behind angry and disillusioned
employees with no financial ‘safety net’ and no healthcare benefits. Widespread corporate defaults
on long-standing pension and healthcare obligations create high economic uncertainty for older
workers who nervously choose not to retire, or simply wait to be terminated by the inevitable
corporate downsizing programme. We saw this problem on a much larger scale in Greece, Ireland,
Portugal and Spain during the most recent financial crisis. Expectations Everyone develops
expectations about future jobs. As individuals search for jobs, their expectations about work and
careers are influenced heavily by information from their colleagues, from recruiters and from their
personal knowledge of labour market conditions. These ‘pre-work’ expectations (aspirations) remain
intact until individuals start working full-time, perhaps after they finish their university degrees. As
the new employee goes into his first job, his pre-work expectations are subject to dramatic change. If
they are met or surpassed, then the employee experiences a significant and useful jolt of satisfaction
for all the facets described above. If those pre-work expectations are dashed, then the neophyte
asks: ‘What have I done? How can I extract myself from this mess as soon as possible?’ These
sentiments (the buyer’s regrets, if you will) are potent drivers of early career implosion. In fact, many
MBA programmes depend on this phenomenon to drive up their enrolment! The initial fall in job
satisfaction (see Figure 1.2) should be a concern to managers (Sheridan, 1985). If large numbers of
new and disgruntled employees leave an organisation at the same time, it is highly disruptive, a bit
embarrassing and costly in terms of recruiting, hiring, training and corporate reputation. Many firms
attack the ‘satisfaction dip’ by using realistic job previews to characterise the positive and Years in
career 1 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32 34 36+ Job satisfaction Module 1 / The Basics of
Organisational Behaviour and Its Relation to Management Organisational Behaviour Edinburgh
Business School 1/29 negative aspects of a job before an individual is hired. If it is learned through
the previewing process that the potential employee’s expectations do not align with the job
requirements, they can drop out of the recruiting process before they learn ‘This job’s not for me’,
and the company avoids numerous costs going forward. Insurance companies have found realistic
job previews to be effective tools for reducing turnover among newly hired insurance agents. The
replicated benefits of job previewing include lower turnover among new hires, more rapid
contributions to competitive advantage, more rapid integration into work units and work teams, and
higher levels of job involvement than among those new hires who have not experienced realistic job
previews. In a related fashion, firms use internships to assess the work potential of promising
students who might become full-time employees after graduation. These nostrings-attached
temporary appointments end naturally and give students a ‘realistic job preview’ lasting for a
designated period of time (perhaps a summer in some cases). Firms like internships because they do
not require a hiring decision and may reduce future recruiting and training costs if the student intern
winds up being a full-time employee. Not all firms utilise realistic job previews or internships to help
potential employees sort out their ‘pre-work’ expectations. The job applicant has to do his own
research to answer the question: ‘How can I find out if I’m going to like this job?’ Let’s assume that
you’ve been brought in for an interview and this very question comes through your mind. What
should you look for in interviews and site visits? Remember first that attractive firms are run by
people who respect their employees. Therefore, be wary of any interviewer who treats you like an
interchangeable part. Second, never make assumptions; instead, ask a neutral question to get more
information. For instance, do not assume that you won’t travel in the job: ask if you should expect to
travel for business reasons or ask what percentage of your job may involve travel. Nothing is more
useful than the third point: speak to current employees. And, fourth, try to uncover information from
employees about the styles (X or Y) of upper management. You might ask if they encourage
employees to manage their own time or if they require all employees to put in significant amounts of
‘face time’ in the office.

The Organisational Determinants of Job Satisfaction The nature of control in organisations, the
quality (and fairness) of supervision and punitive or empowering employment policies all greatly
influence employees’ levels of experienced job satisfaction. In short, the organisation is a bundle of
powerful forces that influence employees’ satisfaction with their work lives and careers. These forces
or drivers of satisfaction are reviewed below. Top managers ignore these drivers of job satisfaction at
their peril because they reflect instrumental values that are important to employees and are also the
basis for the development of sound employment practices that support (and sustain) competitive
advantage. Module 1 / The Basics of Organisational Behaviour and Its Relation to Management 1/30
Edinburgh Business School Organisational Behaviour Supervision Considerate (empathetic)
supervision supports employees’ self-esteem and selfworth and leads to greater job satisfaction.
Supervisors who consult with their subordinates on job decisions and policies and work rules have
better-informed employees who are confident in their understanding of their work and more
satisfied with it. Thus, employee involvement in job-related decision making spreads job satisfaction
across employees and helps them to become motivated internalisers. Not all decisions need to be
participative, however. It may be that the boss has to make the decision (a crisis for instance) and
employee participation would be inefficient and inappropriate. Those decisions, and goals, that
require subordinate support or that affect employee welfare should be subject to employee
discussion and involvement. Participation has the effect of clarifying employees’ expectations about
their work. Employees with clear work expectations are more likely to be self-confident than their
confused counterparts, who do not participate in job-related decisions. Supervisors can readily
influence their subordinates’ optimism about participation and their desire to be involved in
workplace decisions if these supervisors are selfconfident in their managerial skills and styles (Y
practices in Y firms). Job Challenge When jobs require creativity, application of personal skills and risk
taking, employees report higher job satisfaction. High achievers (see Section 1.3.8) are more satisfied
when their jobs require intellectual or physical effort. When employees are challenged, they become
physically energised and intellectually involved in their work. Job challenge therefore makes the
employee physically alert and mentally prepared to deliver job performance. Job Clarity The extent
to which employees understand what they are supposed to do contributes to job satisfaction. When
employees receive feedback on their performance, their job clarity (understanding) improves.
Encouraging employee participation in substantive job issues also enhances job clarity. Over time,
positive (and constructive) feedback on past job actions builds the self-confidence of employees and
they come to think that they are capable of sustaining their performance at acceptable levels. The
net result for these earnest employees is increased job satisfaction. Managers who continuously
refine and clarify job requirements are doing themselves a favour because they are building rapport
and trust in their work relationships, and their subordinates will return it with improving loyalty and
performance. This is a win–win result, and it forms the basis for team performance and high unit
morale (see Module 6). Incentives Extrinsic and intrinsic rewards are related to job satisfaction.
Extrinsic rewards (incentives) are those that the organisation provides based on employee merit
(performance). Examples of extrinsic rewards are pay rises, promotions, supervisor Module 1 / The
Basics of Organisational Behaviour and Its Relation to Management Organisational Behaviour
Edinburgh Business School 1/31 praise and recognition, job status symbols and job security. Intrinsic
rewards (incentives) are those that the employee experiences internally (personally) as the job or
work unfolds. For example, achievers’ feelings of competence, pride, determination to excel and
craftsmanship are intrinsic rewards for a job well done. They appear and change in intensity as the
employee evaluates his own performance progress and goal achievement. These rewards affect how
employees feel about themselves and exert a powerful influence on their sustained motivation and
performance. Both types of reward are related strongly to job satisfaction. The bond between
rewards (work incentives) and performance is governed by a process of social comparison called
equity theory. This theory posits that employees make comparisons about the extrinsic and intrinsic
rewards they receive relative to their effort and performance levels. Further, they make these
comparisons relative to the extrinsic and intrinsic rewards, efforts and performance conferred to
other employees. These judgements are called ‘social comparisons’, and they produce sometimes
very powerful attitudes of perceived fairness or unfairness in employees. A typical employee social
comparison is illustrated below. My rise compared to co-worker rise My efforts and performance co-
worker efforts and performance To make such comparisons, an employee usually selects a
‘comparison other’, who is most often another colleague or perhaps the members of a particular
profession or selected employees in a similar organisation. If the results of these ‘social judgements’
seem fair, the employee is satisfied with his levels of extrinsic and intrinsic rewards. If, on the other
hand, the employee judges the comparison other’s reward to be greater than his own, a perceived
inequity (unfairness) occurs. Perceived inequity represents a state of psychological imbalance
(discomfort). The only reasonable ways for the individual to restore himself to a state of balance are
to 1) reduce his own effort and performance, 2) change the ‘comparison other’ to a more suitable co-
worker, 3) increase his effort and performance and hope that he earns more rewards or 4) eliminate
the problem by leaving the job or seeking a transfer. Employees make equity comparisons for all
facets of job satisfaction and for both types of rewards. Employees exist in a state of ‘constant
comparisons’ as they move through their work days and work experiences. Therefore, managers
must attend to supervision, job challenge, job clarity and incentives so that employees’ judgements
of the fairness of their work demands and performance outcomes (rewards) are reasonable and
stable. Self-confident supervisors who inject participation, trust and support into the process of
social comparison on the job build the pillars that support a skilful and motivated workforce. The
insecure (frightened) supervisor usually fails this crucial test, and his subordinates respond by
cynically ‘gaming’ the reward system: they try to obtain more rewards in exchange for less effort and
lower performance. All too often these patterns reflect widespread Theory X assumptions and
practices on the part of managers.

Managers need to monitor job satisfaction because it is an important overall indicator of the extent
to which the firm is meeting the needs of its workforce. Many methods have been developed to
measure job satisfaction. All of them are indirect because job satisfaction can only be inferred: it is
both intangible and personal. The methods include 1) observation of employee behaviour, 2)
interviewing employees and 3) paper-and-pencil questionnaires. The least expensive and most
dependable is number 3. Table 1.8 shows sample items from the Job Descriptive Index (JDI), the most
widely used measure of job satisfaction (Smith et al., 1975). Table 1.8 Sample items from the Job
Descriptive Index (JDI) Think of your present work. What is it like most of the time? In the blank
beside each word or phrase given below, put: Y If it describes your work Work on present job N If it
does NOT describe it Routine ? If you cannot decide Satisfying Good On your feet Module 1 / The
Basics of Organisational Behaviour and Its

Think of the pay you get now. How well does each of the following words describe your present pay?
In the blank beside each word or phrase given below, put: Y If it describes your pay Present pay N If it
does NOT describe it Adequate for normal expenses ? If you cannot decide Insecure Less than I
deserve Highly paid Think of the kind of supervision that you get on your job. How well does each of
the following words describe this supervision? In the blank beside each word or phrase given below,
put: Y If it describes the job supervision you get Supervision on present job N If it does NOT describe
it Impolite ? If you cannot decide Praise for good work Influential Doesn’t supervise enough Think of
the opportunities for promotion that you have now. How well does each of the following words
describe these? In the blank beside each word or phrase given below, put: Y If it describes your
promotion opportunities Promotion opportunities N If it does NOT describe them Promotion on
ability ? If you cannot decide Dead-end job Unfair promotion policy Regular promotions Think of the
majority of people that you work with now or the people you meet in connection with your work.
How well does each of the following words describe these people? In the blank beside each word or
phrase given below, put: Y If it describes the people you work with People on your present job N If it
does NOT describe them Boring ? If you cannot decide Responsible Intelligent Talk too much The JDI
is copyright Bowling Green State University. The complete forms, scoring key, instructions and norms
can be obtained from Department of Psychology, Bowling Green State University, Bowling Green,
Ohio 43404, United States. The JDI measures the five facets of job satisfaction that were mentioned
earlier. The JDI’s use of positive and negative descriptors achieves balance and avoids problems
associated with other measures. The adjectives selected for the JDI enable it to be used in any work
situation and with any employee group. Another measurement tool, the Minnesota Satisfaction
Questionnaire, has been developed by researchers (Weiss et al., 1977). It uses a different method to
generate answers. Table 1.9 shows some sample questions from this instrument. Its format allows
for respondents’ partial agreement with items composing the facets of job Module 1 / The Basics of
Organisational Behaviour and Its Relation to Management Organisational Behaviour Edinburgh
Business School 1/35 satisfaction. Although this method takes longer than the JDI, it too yields very
dependable results. Table 1.9 Excerpt from the Minnesota Satisfaction Questionnaire Not satisfied
Slightly satisfied Satisfied Very satisfied Extremely satisfied My job security 1 2 3 4 5 The amount of
pay for the work I do 1 2 3 4 5 The working conditions (heating, lighting, ventilation, etc.) on this job
1 2 3 4 5 The opportunities for advancement on this job 1 2 3 4 5 The technical ‘know-how’ of my
supervisor 1 2 3 4 5 Source: Weiss, D.J., Davis, R.V., England, G.W. and Lofquist, L.H. (1977) Manual
for the Minnesota Satisfaction Questionnaire (Minnesota Studies in Vocational Rehabilitation, No.
22). Minneapolis, MN: University of Minnesota Industrial Relations Center. Work Adjustment Project.
Reproduced by permission. Copyright 1977 by Vocational Psychology Research, University of
Minnesota.

Problems with Using Questionnaires The use of questionnaires assumes that employees are both
willing to describe their feelings about work accurately, without any distortion, and capable of doing
so. It is known that employees often distort information about their jobs for a variety of reasons, not
the least of which is their fear of termination for expressing their honest opinions. Additionally, the
items in a questionnaire do not have the same meaning to each employee. What is fascinating to you
may appear dull and monotonous to your colleagues. Questionnaire items can have different
meanings, and survey results can be biased in systematic ways. These are more likely to be problems
for researchers who study job satisfaction than for managers who wish to track employees’
satisfaction.

file:///G:/Master%20rad/Organisational-Behaviour-Course-Taster.pdf

Designing Jobs to Allow Work/Family Balance Many companies in the United States are
experimenting with work design and benefit offerings that encourage employees to achieve a
balance between their work and personal lives. This trend is being driven by two major forces: first,
organizations want to attract, motivate, and retain valued employees owing to skill shortages in
several key job categories (e.g., information systems, global marketing, etc.); and second, many
employees are working longer hours, enduring longer commutes, and traveling more days out of
each month and, as a result, may need flexible work arrangements to maintain and preserve their
home life. Responding to these forces, more and more organizations are helping their employees
achieve a better work/family balance. For example, Deloitte LLP (the U.S.- based member firm of
Deloitte, Touche and Tohmatsu), a leading audit, consulting, financial advisory, tax, and risk
management firm, provides flexible work arrangements. James E. Copeland Jr., ex-CEO of the firm,
summed up the importance of these flexible work design options by saying: “Flexible work
arrangements are one more way to keep talented people in the firm. If we manage our flexible work
arrangements well, they’ll benefit our firm, our clients, and our people.” The Deloitte LLP program
consists of the following aspects of flexible work design: 1. Reduced hours —Employees can take
advantage of part-time and job sharing arrangements. Job sharing occurs when two individuals share
the responsibilities of one position. 2. Reduced workload —High-performing senior-level individuals
work reduced schedules for a defined period to pursue an advanced degree, care for a newborn or a
sick parent, and the like. 3. Flextime —Full-time professionals are allowed to design their work
schedules to fit their particular needs. Typically, this includes variations in starting and ending times
or in the number of hours worked per day. 4. Telecommuting —Full-time professionals can elect to
work from home for part of the week (no more than 50 percent) to accommodate family or personal
needs. 5. Extended leaves of absence —Employees who want time off for family (e.g., to raise
children or to care for an elderly parent) and other personal reasons can apply for a leave up to five
years in duration. During this period, they don’t receive pay or benefits, but they are able to stay
connected through mentoring, short ad hoc projects, and training opportunities. Building on these
successful work practices, Deloitte LLP has recently launched a “Mass Career Customization” (MCC)
program that gives employees the opportunity to either increase or decrease their job
responsibilities to fit their personal goals regarding work/life balance. More long-term career-
oriented than the flexible work schedule options outlined above, the MCC program is being rolled
out to the firm’s 46,000 employees in the United States. The goal of the new program is to create a
more transparent and formalized system that satisfies the changing work/life needs of employees
while continuing to service the needs of its clients. The program is showing early signs of success in
that a recent survey found that employee satisfaction with “overall career/life fit” has increased by
25 percent. Also, turnover of high-performing employees at Deloitte LLP has reportedly decreased
after the MCC program was introduced. Sources: Adapted from Jessica Toonkel Markuez, “Tailor-
Made Careers,” Workforce Management 89, no. 1 (January 2010): 16–22; Mai Browne, “Flextime to
the Nth Degree,” Journal of Accountancy 200, no. 3 (September 2005): 95–96; Bryan-Low Cassell,
“Deloitte Chief Wrestles to Get Consultants Back in Firm,” Wall Street Journal, August 15, 2003, p. C1;
Lotte Bailyn, Paula Rayman, Dale Bengtsen, Françoise Carré, and Mark Tierney, “Fleet Financial and
Radcliffe Explore Paths of Work/Life Integration,” Journal of Organizational Excellence (Summer
2001): 49–64; Michael Prince, “Work/Life Benefits Growing,” Business Insurance, May 7, 2001; and
Deloitte & Touche Mass Career Customization Web site (http://www.deloitte.com/
view/en_US/us/Services/additional-services/mass-career-customization/index.htm). The jobs that
people perform in organizations are the building blocks of all organization structures. In fact,
organizations exist to enable people to do work in assigned jobs. The phrase Let’s get organized!
usually means that we need to clarify what job each individual gib12664_ch13_367-395.indd Page
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370 Part Four The Structure and Design of Organizations should be doing. But we are also interested
in performing jobs effectively and we need to understand the causes of effective and ineffective job
performance. Ultimately, an organization’s effectiveness hinges on the ability of its employees to
perform their jobs effectively. A major cause of effective job performance is job design—what we get
when we clarify what each employee should be doing. In a more technical sense, job design refers to
the process by which managers decide individual job tasks and authority. Apart from the very
practical issues associated with job design (i.e., issues that relate to effectiveness in economic,
political, and monetary terms), we can appreciate its importance in social and psychological terms.
Jobs can be sources of psychological stress and even mental and physical impairment. On a more
positive note, jobs can provide income, meaningful life experiences, selfesteem, regulation of our
lives, and respect from and association with others. Thus, the well-being of organizations and people
relates to how well management designs jobs. This chapter describes some of the many theories and
practices that deal with job design and redesign. We must understand the implication of the term job
redesign in the context of our discussion. It means that management has decided that it’s worthwhile
to reconsider what employees are expected to do on the job. In some instances, the redesign effort
may be nothing more than requiring the individual to use a computer rather than a calculator to do
clerical work. In other instances, the redesign effort may require the individual to work with other
employees in a team effort rather than to work alone on the task. The contemporary trend in
organizations is to redesign jobs that require individuals to work together in groups. Whether
Americans can work effectively in groups is the controversial issue. In contrast to job redesign, job
design refers to the first instance in which management creates a job by specifying its duties and
responsibilities. But with the passage of time and the development of new tools and processes,
management’s expectations for that job will change (i.e., it will be redesigned). We should
understand job design to be an ongoing, dynamic process. Thus, we will use the term job design to
refer to any and all managerial efforts to create jobs, whether initially or subsequently. We begin the
discussion of job design by introducing the issue of quality of work life. As is apparent to anyone who
has ever worked, what we do on the job plays a major role in our social, health, and psychological
statuses as well as in our economic standing. After introducing the relationships between job design
and quality of work life, we’ll address the more technical aspects of job design. job design The
process by which managers decide individual job tasks and authority. job redesign The process by
which managers reconsider what employees are expected to do. Designing Jobs to Enhance Quality
of Work Life As the opening vignette illustrates, the issue of designing jobs has gone beyond the
determination of the most efficient way to perform tasks. The concept of quality of work life (QWL) is
now widely used to refer to “a philosophy of management that enhances the dignity of all workers;
introduces changes in an organization’s culture; and improves the physical and emotional well-being
of employees (e.g., providing opportunities for growth and development).” 1 Indicators of quality of
work life include accident rates, sick leave usage, employee turnover, and number of grievances filed.
2 In some organizations, QWL programs are intended to increase employee trust, productivity,
involvement, retention, and problem solving so as to increase both worker satisfaction and
organizational effectiveness. 3 Thus, the concept and application of QWL are broad and involve more
than jobs, but the jobs that people do are important sources of satisfaction. It is not surprising to find
that the quality of work life concept embodies theories and ideas of the human relations movement
of the 1950s and the job enrichment efforts of the 1960s and 1970s. The continuing challenge to
management is to provide for quality of work life and to improve production, quality, and efficiency
through revitalization of business and industry. quality of work life (QWL) Management philosophy
that enhances employee dignity, introduces cultural change, and provides opportunities for growth
and development. gib12664_ch13_367-395.indd Page 370 2/4/11 2:47 PM user-f494
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present, the trade-offs between the gains in human terms from improved quality of work life and the
gains in economic terms from revitalization aren’t fully known. Some believe that we must defer
quality of work life efforts so as to make the American economy more productive and efficient. 4
Others observe that the sense of urgency to become more competitive in domestic and overseas
trade presents opportunities to combine quality of life and reindustrialization efforts. 5 To those
ends, job design can play a vital role. For example, a recent study analyzed the productivity of
approximately 25,000 IBM employees in 75 countries. The researchers reported that employees who
had jobs that allowed them to telecommute and work from home were able to work 57 hours per
week before experiencing conflict between their work and family lives. 6 For those employees who
had traditional office jobs, the “breaking point” for work-family stress was at 38 hours per week. 7
These findings suggest that IBM employees who telecommute are working 50 percent more hours
than those who drive to the office each day. Other companies like Deloitte LLP and
PricewaterhouseCoopers have also embraced these virtual workplaces. It has been suggested that as
the U.S. economy increasingly shifts to virtual work environments (e.g., more employees working
from home), the savings will be substantial: 100 hours per person each year will be saved; 50 million
less tons of greenhouse emissions; and $200 billion in productivity gains by American companies. 8
Job design attempts to identify the most important needs of employees and the organization and to
remove obstacles in the workplace that frustrate those needs. Managers hope that the results are
jobs that fulfill important individual needs and contribute to individual, group, and organizational
effectiveness. Managers are, in fact, designing jobs for teams and groups. Some studies have
reported that employees who participate in teams get greater satisfaction from their jobs. 9 But
other studies report contrary results. 10 So we’re left with the uncomfortable but realistic conclusion
that quality of work life improvements through job design cannot be assured in specific instances.
Obviously, designing jobs is complex. This chapter reviews the important theories, research, and
practices of job design. As will be seen, contemporary management has at its disposal a wide range
of techniques that facilitate the achievement of personal and organizational performance.
Work/Family Balance and Job Design As we progress into the 21st century, organizations will
continue to direct more attention and resources toward helping employees balance their work and
family demands. Driving this work/family tension is a number of variables related to the economy
and changing demographics of the workforce. For example, during the most recent recession, many
employers turned to flexible work arrangements as a way to avoid or minimize layoffs. 11 Good for
maintaining overall productivity and motivation, such arrangements included shortened workweeks,
days off without pay, telecommuting, and job sharing (see Figure 13.1). Also, the number of women
and single parents entering the workforce is expected to increase. Often viewed as primary
caregivers, these individuals will continue to experience stress as they attempt to balance career and
family priorities. Another example of demographic changes includes the increase in dual-career
couples. In some cases, caregiving responsibilities may be shared, leading both working spouses to
require flexible work arrangements to meet family life and career cycle needs. The aging population
will be another factor that requires a response from working-age caregivers. As the baby boom
generation begins to retire in larger numbers, this issue will grow in importance. How are
organizations responding to these challenges? Although not as dramatic as originally anticipated, a
trend is emerging in which some organizations are trying to accommodate diverse employees’ needs
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Four The Structure and Design of Organizations of flexible work arrangements include job sharing,
flextime, and telecommuting. 13 It is believed that by allowing employees more control over their
work lives, they will be better able to balance their work/home demands. Many have argued that
companies that offer and encourage participation in such family-friendly work arrangements will
reap one or more of the following benefits: higher recruitment and retention rates, improved
morale, lower absenteeism and tardiness, and higher levels of employee productivity. Job sharing
(sometimes referred to as “work sharing”) is a work arrangement in which two or more employees
divide a job’s responsibilities, hours, salary, and benefits among themselves. 14 Several steps are
critical to the success of such job-sharing programs, including identifying those jobs that can be
shared, understanding employees’ individual sharing style, and matching “partners” who have
complementary scheduling needs and skills. 15 Companies such as CoreStates Financial, Bristol-
Myers Squibb, AT&T, Kraft, and Household International all have job-sharing options available for
their employees. As previously stated, some companies are using job-sharing arrangements as an
alternative to layoffs during recessionary periods. 16 The next OB at Work describes how two
employees successfully share their job at Xerox. Flextime is another type of flexible work
arrangement in which employees can choose when to be at the office. 17 For example, an employee
may decide that instead of working five days a week for 8 hours a day, she may prefer to work a 4-
day/10-hours-per-day work schedule. With this schedule, the employee does not have to be at the
office on Friday. To avoid peak rush hour, another employee might use his flextime to arrive at and
leave from work one hour later Monday through Friday. Linda Skoglund, owner of J.A. Counter, a
$2.5 million insurance and investment advisory company in New Richmond, Wisconsin, has taken
flextime to new levels. She decided to implement a “ROWE” (or Results-Only Work Environment),
which means employees can leave the office at any time for any reason (without telling anyone why
they’re leaving), as long as they get their jobs done. 18 Skoglund suggests that ROWE works as long
as employees have a clear idea of what they need to accomplish in their jobs, co-workers are
prohibited from making negative comments when an employee leaves the office “early,” and the
rules are applied to everyone (the owner, secretaries, etc.). 19 Flextime approaches were supported
by a research study that concluded that flexible workweek schedules had a positive influence on
employee performance, job satisfaction, and absenteeism. 20 However, these authors also reported
that flextime programs should not be too unstructured and that they lose some of their effectiveness
over time. Companies that offer flextime options include Best Buy, KPMG, Hewlett-Packard, Merrill
Lynch, and Cigna. Telecommuting refers to the work arrangement that allows employees to work in
their homes part or full time, maintaining their connection and communication with the office
FIGURE 13.1 Examples of Flexible Work Arrangements Flextime Telecommuting Job sharing
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through a smart phone, laptop, texting, instant messaging, videoconference meeting software, and e-
mail. 21 According to a survey by WorldatWork, the number of U.S. employees who worked at home
at least one day per month reached 17.2 million in 2008, which represented an increase of 39
percent over 2006. 22 Several companies are expanding their telecommuting programs, including
Cisco Systems, Lotus, Northrop & Grumman, and Booz-Allen & Hamilton. 23 For example, Best Buy
allows members of its geographically dispersed teams to set their own schedules and meet anywhere
they desire; the company also eliminated mandatory meetings and “bases productivity strictly on
output rather than hours.” Best Buy’s telecommuting program seems to be working; voluntary
turnover has decreased and employee productivity is up by 35 percent. 24 Although often times
resisted by managers who fear loss of control and subordinate accessibility, one company has taken a
methodical approach to implementing a telecommuting program. Pfizer Inc., a large health care
company, took the following steps to establish their program: 1. Chose a small division to pilot the
telecommuting initiative. 2. Limited the number of days to work at home to two per week. 3. Opened
the program to all employees of the division. 4. Required interested employees to satisfy a formal
proposal and performance standards. 5. Required demonstration that the work could be
accomplished offsite and that the employee could sustain and/or enhance performance. Although
organizations like Pfizer and the other family-friendly firms are moving forward to attract, motivate,
and retain employees with diverse nonwork needs, organizations need to consider three important
issues when developing and implementing such flexible work arrangement options. First, every
attempt should be made to open these programs to all employees who could potentially use them.
The risk here is that if only certain groups are offered these options, then excluded groups may feel
discriminated against. Managers need to be aware that excluded employees can create a backlash
against work/family programs. 25 Second, telecommuting does not fit the work style of every
employee. Some employees have trouble concentrating at home or feel isolated when they work on
their own away from O B A T W O R K how mail would be handled, a recommendation for the
number of phone lines that would be required, a list of Xerox employees and managers who would
have to be notified, and rough drafts of letters to send to district sales managers to notify them of
the job-share arrangement. How did Cafero and Como’s superiors react to the proposal? They
supported the proposal and allowed the job-sharing arrangement to be implemented. Since then,
Cafero and Como have shared their sales position for more than 10 years. These two employees are
satisfied that they were able to strike a balance between their work and home lives, while Xerox is
pleased that it was able to retain two productive and experienced employees. Source: Adapted from
Amanda Beeler, “It Takes Two,” Sales and Marketing Management 155, no. 8 (2003): 3–8. Barbara
Cafero and Robin Como both work for Xerox Corporation. But there’s much more that they have in
common: Cafero and Como share the same one-hour-long commute to work, both have young
children at home, both are in sales, and they share the same job at the company. Where did the idea
for job sharing come from? Cafero and Como had just returned to the company after taking
maternity leave and discussed the difficulty of balancing a full-time work schedule with the desire to
spend more time with their young children. After considering this challenge, they decided that
sharing the same job would be the solution. By following Xerox’s quality process training—a process
by which employees identify all of the steps necessary to address a problem or concern within the
firm—Cafero and Como put together a detailed proposal outlining how the job-sharing idea would
work. Included in the proposal were the following: a procedure for Job Sharing at Xerox: How Two
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and Design of Organizations the office. 26 Third, having the CEO of an organization announce these
programs is not enough to effect change. Many career-minded employees do not take advantage of
job sharing, flextime, or telecommuting for fear of being derailed from their career progression. 27
Basically, some employees feel too much time working at home reduces the amount of face time
they have in front of peers and supervisors. Many employees and career specialists feel that face
time is important for career progression because it can signal that they are working hard and are
committed to the organization. To make these programs an accepted part of the organization,
managers need to be trained and rewarded for encouraging their subordinates to use them without
fear of derailing their good standing within the firm. Of course, managers should avoid pressuring
employees to use their programs. Some employees prefer to maintain more traditional work
arrangements and schedules. Last, organizations need to be mindful of the laws that may affect how
these flexible work arrangement policies are developed and managed. Some applicable laws include
the Fair Labor Standards Act, workers’ compensation, Occupational Safety and Health Act, and
others. 28 The Important Concepts of Job Design The conceptual model in Figure 13.2 is based on the
extensive research literature appearing since the 1970s. The model includes the various terms and
concepts appearing in the current literature. When linked together, these concepts describe the
important determinants of job performance and organizational effectiveness. The model takes into
account a number of sources of complexity. It recognizes that individuals react differently to jobs.
While one person may derive positive satisfaction from a job, another may not. It also recognizes the
difficult trade-offs between organizational and individual needs. For example, the technology of
manufacturing (an environmental difference) may dictate that management adopt assembly-line
mass production methods and low-skilled jobs to achieve optimal efficiency. Such jobs, however, may
result in great unrest and worker discontent. Perhaps these costs could be avoided by carefully
balancing organizational and individual needs. The ideas reflected in Figure 13.2 are the bases for this
chapter. We’ll present each important cause or effect of job design, beginning with the end result of
job design, job performance . job performance The outcomes of jobs that relate to the purposes of
the organization such as quality, efficiency, and other criteria of effectiveness. FIGURE 13.2
Conceptual Model of Job Design and Job Performance Technological factors Social setting differences
Task factors Job analysis Job design Perceived job content Job performance Human factors Individual
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Job Performance Outcomes Job performance includes a number of outcomes. In this section, we’ll
discuss performance outcomes that have value to the organization and to the individual. Objective
Outcomes Quantity and quality of output, absenteeism, tardiness, and turnover are objective
outcomes that can be measured in quantitative terms. For each job, implicit or explicit standards
exist for each of these objective outcomes. Industrial engineering studies establish standards for
daily quantity, and quality control specialists establish tolerance limits for acceptable quality. These
aspects of job performance account for characteristics of the product, client, or service for which the
jobholder is responsible. But job performance includes other outcomes. Personal Behavior Outcomes
The jobholder reacts to the work itself. She reacts by either attending regularly or being absent, by
staying with the job, or by quitting. Moreover, physiological and health-related problems can ensue
as a consequence of job performance. Stress related to job performance can contribute to physical
and mental impairment; accidents and occupation-related disease can also result. Intrinsic and
Extrinsic Outcomes Job outcomes include intrinsic and extrinsic work outcomes. The distinction
between intrinsic and extrinsic outcomes is important for understanding people’s reactions to their
jobs. In a general sense, an intrinsic outcome is an object or event that follows from the worker’s
own efforts and doesn’t require the involvement of any other person. More simply, it’s an outcome
clearly related to action on the worker’s part. Contemporary job design theory defines intrinsic
motivation in terms of the employee’s “empowerment” to achieve outcomes from the application of
individual ability and talent. 29 Such outcomes typically are thought to result solely in the province of
professional and technical jobs; yet, all jobs potentially have opportunities for intrinsic outcomes.
Such outcomes involve feelings of responsibility, challenge, and recognition; they result from such
job characteristics as variety, autonomy, identity, and significance. 30 Extrinsic outcomes, however,
are objects or events that follow from the workers’ own efforts in conjunction with other factors or
persons not directly involved in the job itself. Pay, working conditions, co-workers, and even
supervision are objects in the workplace that are potentially job outcomes but aren’t a fundamental
part of the work. Dealing with others and friendship interactions are sources of extrinsic outcomes.
Most jobs provide opportunities for both intrinsic and extrinsic outcomes, so we must understand
the relationship between the two. It’s generally held that extrinsic rewards reinforce intrinsic
rewards in a positive direction when the individual can attribute the source of the extrinsic reward to
his own efforts. For example, a pay raise (extrinsic reward) increases feeling good about oneself if the
cause of the raise is thought to be one’s own efforts and competence and not favoritism by the boss.
This line of reasoning explains why some individuals get no satisfaction out of sharing in the gains
derived from group effort rather than individual effort. Job Satisfaction Outcomes Job satisfaction
depends on the levels of intrinsic and extrinsic outcomes and how the jobholder views those
outcomes. These outcomes have different values for different people. job satisfaction An individual’s
expression of personal well-being associated with doing the job assigned. gib12664_ch13_367-
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and Design of Organizations For some people, responsible and challenging work may have neutral or
even negative value depending on their education and prior experience with work providing intrinsic
outcomes. 31 For other people, such work outcomes may have high positive values. 32 People differ
in the importance they attach to job outcomes. Those differences alone would account for different
levels of job satisfaction for essentially the same job tasks. For example, one company that has
initiated management systems intended to provide employees with a great deal of opportunity for
exercising judgment and making decisions has found many individuals unable or unwilling to work for
it. The company, W. L. Gore & Associates, has been the subject of considerable interest among those
who advocate employee empowerment. 33 Other important individual differences include job
involvement and commitment to the organization. 34 People differ in the extent that (1) work is a
central life interest, (2) they actively participate in work, (3) they perceive work as central to self-
esteem, and (4) they perceive work as consistent with self-concept. Persons who are not involved in
their work or the organizations that employ them cannot be expected to realize the same satisfaction
as those who are. This variable accounts for the fact that two workers could report different levels of
satisfaction for the same performance levels. A final individual difference is the perceived equity of
the outcome in terms of what the jobholder considers a fair reward. 35 If outcomes are perceived to
be unfair in relation to those of others in similar jobs requiring similar effort, the jobholder will
experience dissatisfaction and seek means to restore the equity, either by seeking greater rewards
(primarily extrinsic) or by reducing effort. Thus, we see that job performance includes many potential
outcomes. Some are of primary value to the organization—the objective outcomes, for example.
Other outcomes, such as job satisfaction, are of primary importance to the individual. Job
performance is without a doubt a complex variable that depends on the interplay of numerous
factors. Managers can make some sense of the issue by understanding the motivational implications
of jobs through the application of job analysis. 36 Describing Jobs through Job Analysis The purpose
of a job analysis is to provide an objective description of the job itself 37 and to provide important
information for use in a variety of human resource areas in organizations (e.g., job descriptions,
selection tests, training programs, and performance appraisals). 38 Individuals who perform job
analysis gather information about three aspects of all jobs: job content, job requirements, and job
context. Many different job analysis methods help managers identify content, requirements, and
context. Job Content Job content refers to the activities required of the job. Depending on the
specific job analysis used, this description can be broad or narrow in scope. The description can vary
from general statements of job activities down to highly detailed statements of each and every hand
and body motion required to do the job. One popular source for content about jobs comes from the
U.S. Department of Labor’s Occupational Information Network (or O*NET). The O*NET
(www.onecenter.org) is an online database that “provides occupational descriptions and data for use
by job seekers, workforce development offices, human resources professionals, students,
researchers and others.” 39 A user-friendly and flexible online resource, the O*NET allows individuals
to describe work accurately and efficiently. Recently, several “green” or environmentally oriented job
descriptions have been added to job analysis Providing a description of how one job differs from
another in terms of demands, activities, and skills required. job content Specific activities required in
a job. O*NET An online database hosted by the U.S. Department of Labor that provides occupational
descriptions and data such as job descriptions, worker knowledge, skills and abilities, and work
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the massive online database so that job seekers and career counselors can access these increasingly
popular occupations. 40 Another widely used method, functional job analysis (FJA) , describes jobs in
terms of 1. What the worker does in relation to data, people, and jobs. 2. What methods and
techniques the worker uses. 3. What machines, tools, and equipment the worker uses. 4. What
materials, products, subject matter, or services the worker produces. The first three aspects relate to
job activities. The fourth aspect relates to job performance. FJA provides descriptions of jobs that can
be the bases for classifying jobs according to any one of the four dimensions. In addition to defining
what activities, methods, and machines make up the job, FJA also defines what the individual doing
the job should produce. FJA can, therefore, be the basis for defining standards of performance. Job
Requirements Job requirements refer to education, experience, licenses, and other personal
characteristics that are expected of an individual if he’s to perform the job content. In recent years,
the idea has emerged that job requirements should also identify skills, abilities, knowledge, and other
personal characteristics required to perform the job content in the particular setting. One widely
used method, position analysis questionnaire (PAQ) , takes into account these human factors through
analysis of the following job aspects: 1. Information sources critical to job performance. 2.
Information processing and decision making critical to job performance. 3. Physical activity and
dexterity required of the job. 4. Interpersonal relationships required of the job. 5. Reactions of
individuals to working conditions. 41 The position analysis questionnaire can be adapted to jobs of all
types, including managerial jobs. Job Context Job context refers to factors such as the physical
demands and working conditions of the job, the degree of accountability and responsibility, the
extent of supervision required or exercised, and the consequences of error. Job context describes the
environment within which the job is to be performed. Numerous methods exist to perform job
analysis. Different methods can give different answers to important questions such as “How much is
the job worth?” Thus, selecting the method for performing job analysis isn’t trivial—it’s one of the
most important decisions in job design. Surveys of expert job analysts’ opinions bear out the
popularity of PAQ and FJA. 42 Job Analysis in Different Settings People perform their jobs in a variety
of settings—too many to discuss them all. We’ll instead discuss two significant job settings: the
factory and the office. One has historical significance, the other has future significance. Jobs in the
Factory Job analysis began in the factory. Industrialization created the setting in which individuals
perform many hundreds of specialized jobs. The earliest attempts to do job analysis followed
functional job analysis (FJA) Method of job analysis that focuses on specific activities, machines,
methods, and required output. job requirements The education, experience, licenses, and other
personal characteristics an individual needs to perform the job content. position analysis
questionnaire (PAQ) A method of job analysis that takes into account human characteristics as well
as task and technological factors of job and job classes. job context Physical environment and other
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and Design of Organizations the ideas advanced by the proponents of scientific management. They
were in dustrial engineers who, at the turn of the 20th century, began to devise ways to analyze
industrial jobs. The major theme of scientific management is that objective analyses of facts and data
collected in the workplace could provide the bases for determining the one best way to design work.
43 F. W. Taylor stated the essence of scientific management as follows: First: Develop a science for
each element of a man’s work that replaces the old rule-ofthumb method. Second: Scientifically
select and then train, teach, and develop the workman, whereas in the past he chose his own work
and trained himself as best he could. Third: Heartily cooperate with the men so as to ensure that all
of the work is done in accordance with the principles of the science that has been developed. Fourth:
There is almost an equal division of the work and the responsibility between management and
workmen. Management takes over all work for which it’s better fitted than workmen, while in the
past, almost all of the work and the greater part of the responsibility were thrown upon workmen. 44
These four principles express the theme of scientific management methods. Management should
take into account task and technology to determine the best way for each job and then train people
to do the job that way. Scientific management produced many techniques in current use. Motion and
time study, work simplification, and standard methods are at the core of job analysis in factory
settings. Although the mechanistic approach to job analysis is widespread, many service
organizations as well as manufacturers are discovering some of the negative consequences of jobs
that are overly routine as the next OB at Work feature suggests. 45 Consequently, many
organizations are turning away from the idea of one person doing one specialized job. As we’ll learn
later in the chapter, many manufacturing firms are now analyzing jobs to determine the extent to
which content and requirements can be increased to tap a larger portion of the individual’s talents
and abilities. Jobs in the Office In the short space of time since the advent of scientific management,
the American economy has shifted from factory-oriented to office-oriented work. The fastest
growing segment of jobs is secretarial, clerical, and information workers. The growth of these jobs is
due to technological breakthroughs in both factory and office settings. Technological breakthroughs
in automation, robotics, and computer-assisted manufacturing have reduced the need for industrial
jobs. But that same technology has increased the need for office jobs. Still, the modern office isn’t a
mere extension of the traditional factory. The modern office reflects the pervasiveness of computer
technology. Its most striking feature is the replacement of paper with some electronic medium,
usually a personal computer (PC). One individual interacts with the PC to do a variety of tasks that in
earlier times would have required many individuals. A significant aspect of job analysis in modern
offices is the creation of work modules—interrelated tasks that can be assigned to a single individual.
In recent times, managers and researchers have found that human factors must be given special
attention when analyzing jobs in the electronic office. PC users report that they suffer visual and
postural problems such as headaches, burning eyes, and shoulder and backaches and repeti tive
stress injuries such as carpal tunnel syndrome. 46 The sources of these problems seem to be in the
design of the workplace, particularly the interaction between the individual and the PC. Job analysis
in the office must pay particular attention to human factors. The tendency is to overemphasize the
technological factor—in this case, the computer—and to analyze jobs only as extensions of the
technology. As was true of job analysis in factories, it’s simply easier to deal with the relatively fixed
nature of tasks and technology than to deal with the variable of human nature

The Way People Perceive Their Jobs The way people do their jobs depends in part on how they
perceive and think of their jobs. Even though Taylor proposed that the way to improve work (i.e., to
make it more efficient) is to determine the “best way” to do a task (motion study) and the standard
time for completion of the task (time study), the actual performance of jobs goes beyond its technical
description. The belief that job design can be based solely on technical data ignores the very large
role played by the individual who performs the job. Individuals differ profoundly, as we noted in the
chapter on individual differences. They come to work with different backgrounds, needs, and
motivations. Once on the job, they experience the social setting in which the work is performed in
unique ways. It’s not surprising to find that different individuals perceive jobs differently. Perceived
Job Content Perceived job content refers to characteristics of a job that define its general nature as
perceived by the jobholder. We must distinguish between a job’s objective properties and its
subjective properties as reflected in the perceptions of people who perform it. 48 Managers can’t
understand the causes of job performance without considering individual differences such as
personality, needs, and span of attention. 49 Nor can managers understand the causes of job
performance without considering the social setting in which the job is performed. According to Figure
13.2, perceived job content precedes job performance. Thus, if managers desire to increase job
performance by changing perceived job content, they can change job design, individual perceptions,
or social settings—the causes of perceived job content. If management is to understand perceived
job content, some method for measuring it must exist. In response to this need, organization
behavior researchers have attempted to measure perceived job content in a variety of work settings.
The methods that researchers use rely on questionnaires that jobholders complete and that measure
their perceptions of certain job characteristics. Job Characteristics The pioneering effort to measure
perceived job content through employee responses to a questionnaire resulted in the identification
of six characteristics: variety, autonomy, required interaction, optional interaction, knowledge and
skill required, and responsibility. 50 The index of these six characteristics is termed the Requisite Task
Attribute Index (RTAI). The original RTAI has been extensively reviewed and analyzed. One important
development was the review by Hackman and Lawler, who revised the index to include the six
characteristics shown in Table 13.1. 51 Variety, task identity, and feedback are perceptions of job
range. Autonomy is the perception of job depth; and dealing with others and friendship
opportunities reflect perceived job content perceptions of job relationships. Employees sharing
similar perceptions, job designs, and social settings should report similar job characteristics.
Employees with different perceptions, however, report different job characteristics of the same job.
For example, an individual with a high need for social belonging would perceive “friendship
opportunities” differently than another individual with a low need for social belonging. 52 Individual
Differences Individual differences in need strength, particularly the strength of growth needs, have
been shown to influence the perception of task variety. 53 Employees with relatively perceived job
content Specific job activities and general job characteristics as perceived by individual performing
the job. Two individuals doing the same job may have the same or different perceptions of job
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weak higher order needs are less concerned with performing a variety of tasks than are employees
with relatively strong growth needs. Thus, managers expecting higher performance to result from
increased task variety would be disappointed if the jobholders did not have strong growth needs.
Even individuals with strong growth needs cannot respond continuously to the opportunity to
perform more and more tasks. At some point, performance turns down as these individuals reach the
limits imposed by their abilities and time. Social Setting Differences Differences in social settings of
work also affect perceptions of job content. Examples of social setting differences include leadership
style and what other people say about the job. As more than one research study has pointed out,
how one perceives a job is greatly affected by what other people say about it. Thus, if one’s friends
state their jobs are boring, one is likely to state that his job is also boring. If the individual perceives
the job as boring, job performance will no doubt suffer. Job content, then, results from the
interaction of many factors in the work situation. The field of organization behavior has advanced a
number of suggestions for improving the motivational properties of jobs. Invariably, the suggestions,
termed job design strategies, attempt to improve job performance through changes in actual job
characteristics. The next section reviews the more significant of these strategies. TABLE 13.1 Six
Characteristics of Perceived Job Content Source: Henry P. Sims, Jr., Andrew D. Szilagyi, and Robert T.
Keller, “The Measurement of Job Characteristics,” Academy of Management Journal (June 1976):
197. Characteristic Description Variety Degree to which a job requires employees to perform a wide
range of operations in their work, and/or degree to which employees must use a variety of
equipment and procedures in their work. Autonomy Extent to which employees have a major say in
scheduling their work, selecting the equipment they use, and deciding on procedures to be followed.
Task identity Extent to which employees do an entire or whole piece of work and can clearly identify
with the results of their efforts. Feedback Degree to which employees, as they are working, receive
information that reveals how well they are performing on the job. Dealing with others Degree to
which a job requires employees to deal with other people to complete their work. Friendship
opportunities Degree to which a job allows employees to talk with one another on the job and to
establish informal relationships with other employees at work. Designing Job Range: Job Rotation
and Job Enlargement The earliest attempts to design jobs date to the scientific management era.
Efforts at that time emphasized efficiency criteria. With that emphasis, the individual tasks that
constitute a job are limited, uniform, and repetitive. This practice leads to narrow job range and,
consequently, reported high levels of job discontent, turnover, absenteeism, and dissatisfaction.
Accordingly, strategies were devised that resulted in wider job range through increasing the requisite
activities of jobs. Two of these approaches are job rotation and job enlargement.
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and Design of Organizations Job Rotation Managers of organizations such as Marriott, General
Electric, Ford, TRW Systems, and Greyhound Financial Corporation have used different forms of the
job rotation strategy. 54 This practice involves rotating managers and nonmanagers alike from one
job to another. In so doing, the individual is expected to complete more job activities because each
job includes different tasks. 55 Job rotation involves increasing the range of jobs and the perception
of variety in the job content. Increasing task variety should, according to recent studies, increase
employee satisfaction, reduce mental overload, decrease the number of errors due to fatigue,
improve production and efficiency, 56 and reduce on-the-job injuries. 57 However, job rotation
doesn’t change the basic characteristics of the assigned jobs. Some relatively small firms have
successfully used job rotation. One relatively small manufacturing operation, Rohm & Haas Bayport
(owned by The Dow Chemical Company), was founded in 1981 to produce specialty chemicals. The
plant is located in LaPorte, Texas, and its 67 employees play active roles in management because
their jobs are designed with that activity in mind. The company’s philosophy is to provide autonomy
and responsibility in each individual’s job and, consequently, to enable employees to feel a sense of
“ownership” of key decisions and actions. Every person in the organization is trained to be and to act
like a manager. The 46 process technicians and 15 engineers and chemists report to one of the two
manufacturing unit managers who in turn report to the executive team. The technicians make
operating decisions among themselves while working in teams of four to seven people. The company
has no shift foremen or line supervisors in the usual sense of these positions. Rather, technicians are
expected to be self-managed. Team members rotate jobs with other team members every 4 to 12
weeks to provide task variety and cross-training. They’re also trained to do routine maintenance and
repairs of their equipment and not to depend on a separate maintenance team for that support. The
company’s idea is to give individuals near complete control of the conditions that govern work pace
and quality. Employees evaluate each other’s performance and interview applicants for positions. Job
designs at Rohm & Haas Bayport contribute to individual performance, according to company
spokespersons. 58 Critics state that job rotation often involves nothing more than having people
perform several boring and monotonous jobs rather than one. An alternative strategy is job
enlargement. Job Enlargement The pioneering Walker and Guest study 59 was concerned with the
social and psychological problems associated with mass production jobs in automobile assembly
plants. The study found that many workers were dissatisfied with their highly specialized jobs. In
particular, they disliked mechanical pacing, repetitiveness of operations, and a lack of a sense of
accomplishment. Walker and Guest also found a positive relationship between job range and job
satisfaction. Findings of this research gave early support for motivation theories predicting that
increases in job range will increase job satisfaction and other objective job outcomes. Job
enlargement strategies focus upon the opposite of dividing work—they’re a form of despecialization
or increasing the number of tasks that an employee performs. 60 For example, a job is designed such
that the individual performs six tasks instead of three. Although, in many instances, an enlarged job
requires a longer training period, job satisfaction usually increases because boredom is reduced. The
implication, of course, is that job enlargement will lead to improvement in other performance
outcomes. The concept and practice of job enlargement have become considerably more
sophisticated. In recent years, effective job enlargement involves more than simply increasing task
job rotation Practice of moving individuals from job to job to reduce potential boredom and increase
potential motivation and performance. job enlargement Practice of increasing the number of tasks
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variety. In addition, it’s necessary to design certain other aspects of job range, including providing
worker-paced (rather than machine- or computer-paced) control. Each of these changes involves
balancing the gains and losses of varying degrees of division of labor. Contemporary applications of
job enlargement involve training individuals to perform several different jobs, each requiring
considerable skill, whether in manufacturing or service organizations. Some employees can’t cope
with enlarged jobs because they can’t comprehend complexity; moreover, they may not have a
sufficiently long attention span to complete an enlarged set of tasks. However, if employees are
amenable to job enlargement and have the requisite ability, then job enlargement should increase
satisfaction and product quality and decrease absenteeism and turnover. These gains aren’t without
costs, including the likelihood that employees will demand larger salaries in exchange for performing
enlarged jobs. Yet these costs must be borne if management desires to implement the design
strategy— job enrichment—that enlarges job depth. Job enlargement is a necessary precondition for
job enrichment. Designing Job Depth: Job Enrichment The impetus for designing job depth was
provided by Herzberg’s two-factor theory of motivation. The basis of his theory is that factors that
meet individuals’ need for psychological growth (especially responsibility, job challenge, and
achievement) must be characteristic of their jobs. The application of his theory is termed job
enrichment . The implementation of job enrichment is realized through direct changes in job depth.
Managers can provide employees with greater opportunities to exercise discretion by making the
following changes: 1. Direct feedback—the evaluation of performance should be timely and direct. 2.
New learning—a good job enables people to feel that they are growing. All jobs should provide
opportunities to learn. 3. Scheduling—people should be able to schedule some part of their own
work. 4. Uniqueness—each job should have some unique qualities or features. 5. Control over
resources—individuals should have some control over their job tasks. 6. Personal accountability—
people should be provided with an opportunity to be accountable for the job. The process as
implemented at Texas Instruments (TI) is continuous and pervades the entire organization. Every job
in TI is subject to analysis to determine if it can be enriched to include managerial activities.
Moreover, as the jobs of nonmanagerial personnel are designed to include greater depth, the jobs of
managers must emphasize training and counseling of subordinates and de-emphasize control and
direction. As the theory and practice of job enrichment have evolved, managers have become aware
that successful applications require numerous changes in how work is done. Important changes
include giving workers greater authority to participate in decisions, to set their own goals, and to
evaluate their (and their work group’s) performance. Job enrichment also involves changing the
nature and style of managers’ behavior. Managers must be willing and able to delegate authority.
Given employees’ ability to carry out enriched jobs and managers’ willingness to delegate authority,
gains in performance can be expected. These positive outcomes are the result of increasing
employees’ expectations that efforts lead to performance, that performance leads to intrinsic and
extrinsic rewards, and that these rewards have power to satisfy needs. These significant changes in
managerial jobs, job enrichment Practice of increasing the discretion an individual can use to select
activities and outcomes. Increases job depth and accordingly fulfills growth and autonomy needs.
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and Design of Organizations coupled with changes in nonmanagerial jobs, suggest that a supportive
work environment is a prerequisite for successful job enrichment efforts. Job enrichment and job
enlargement aren’t competing strategies. Job enlargement may be compatible with the needs,
values, and abilities of some individuals, while job enrichment may not. Yet job enrichment, when
appropriate, necessarily involves job enlargement. A promising new approach to job design that
attempts to integrate the two approaches is the job characteristic model. Hackman, Oldham, Janson,
and Purdy devised the approach, basing it on the Job Diagnostic Survey . 61 The model attempts to
account for the interrelationships among (1) certain job characteristics; (2) psychological states
associated with motivation, satisfaction, and performance; (3) job outcomes; and (4) growth need
strength. Figure 13.4 describes the relationships among these variables. Although variety, identity,
significance, autonomy, and feedback don’t completely describe perceived job content, according to
this model they sufficiently describe those aspects that management can manipulate to bring about
gains in productivity. Steps that management can take to increase the core dimensions include 1.
Combining task elements. 2. Assigning whole pieces of work (i.e., work modules ). 3. Allowing
discretion in selection of work methods. 4. Permitting self-paced control. 5. Opening feedback
channels. These actions increase task variety, identity, and significance; consequently, the
“experienced meaningfulness of work” psychological state is increased. By permitting employee
participation and self-evaluation and by creating autonomous work groups, the feedback and
autonomy dimensions are increased along with the psychological states “experienced responsibility”
and “knowledge of actual results.” Implementing the job characteristics in a particular situation
begins with a study of existing job perceptions by means of the Job Description Survey. Hackman and
Oldham have reported numerous applications of the model in a variety of organizations. 62 They
have also compiled normative data for a variety of job categories so that managers and practitioners
can compare the responses of their own employees to those of a larger population. 63 work modules
Whole pieces of work assigned to individuals. FIGURE 13.4 The Job Characteristics Model Source: J.
Richard Hackman and Greg R. Oldham, “Development of the Job Diagnostic Survey,” Journal of
Applied Psychology (1975): 159–70. Job Characteristics Critical psychological states Personal and
work outcomes Skill variety Task identity Task significance Experienced meaningfulness of work
Experienced responsibility for outcomes of work High internal work motivation High-quality work
performance High satisfaction with work Low absenteeism and turnover Knowledge of the actual
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Although the track record of job design efforts is generally positive, some caveats are warranted. The
positive benefits of these efforts are moderated by individual differences in the strength of
employees’ growth needs. That is, employees with strong need for accomplishment, learning, and
challenge will respond more positively than those with relatively weak growth needs. In more
familiar terms, employees with high need for self-esteem and selfactualization are the more likely
candidates for job design. Employees who are forced to participate in job design programs but who
lack either the need strength or the ability to perform designed jobs may experience stress, anxiety,
adjustment problems, erratic performance, turnover, and absenteeism. Another potential moderator
of successful job design efforts is the changing nature of jobs in the United States (see the OB and
Your Career feature on the next page). The available research on the interrelationships between
perceived job content and performance is meager. It’s apparent, however, that managers must cope
with significant problems in matching employee needs and differences and organizational needs. 64
Problems associated with job design include the following: 1. The program is time-consuming and
costly. 2. Unless lower-level needs are satisfied, people will not respond to opportunities to satisfy
upper-level needs. And even though our society has been rather successful in providing food and
shelter, these needs regain importance when the economy moves through periods of recession and
high inflation. 3. Job design programs are intended to satisfy needs typically not satisfied in the
workplace. As workers are told to expect higher-order need satisfaction, they may raise their
expectations beyond what’s possible. Dissatisfaction with the program’s unachievable aim may
displace dissatisfaction with the jobs. 4. Job design may be resisted by labor unions who see the
effort as an attempt to get more work for the same pay. 5. Job design efforts may not produce
tangible performance improvements for some time after the beginning of the effort. One study
indicated that significant improvements in effectiveness couldn’t be seen until four years after the
beginning of the job design program. 65 Practical efforts to improve productivity and satisfaction
through job design have emphasized autonomy and feedback. Relatively less emphasis has been
placed on identity, significance, and variety. Apparently, it’s easier to provide individuals with greater
responsibility for the total task and increased feedback than to change the essential nature of the
task itself. To provide identity, significance, and variety often requires enlarging the task to the point
of losing the benefits of work simplification and standardization. But within the economic constraints
imposed by the logic of specialization, it’s possible to design work so as to give individuals complete
responsibility for its completion to the end and at the same time to provide supportive managerial
monitoring. In general, one reaches two conclusions when considering the experience of job design
approaches. First, they’re relatively successful in increasing quality of output. This conclusion
pertains, however, only if the reward system already satisfies lower-level needs. If it presently
doesn’t satisfy lower-level needs, employees can’t be expected to experience upper-level need
satisfaction (intrinsic rewards) through enriched jobs. In particular, managers can’t expect individuals
with relatively low growth needs to respond as would those with relatively high growth needs. 66
Second, successful efforts are the result of the circumstances that initiate the effort and the process
undertaken to manage the effort. Organizations under external pressure gib12664_ch13_367-
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and Design of Organizations to change have a better chance of successfully implementing job design
than those not under such pressure. Moreover, successful efforts are accompanied by broad-scale
participation of managers and employees alike. Since a primary source of organizational effectiveness
is job performance, managers should design jobs according to the best available knowledge. 67 O B A
N D Y O U R C A R E E R should strive to continuously update your skill set and education. 4. Be
flexible. The mantra for a successful career in the 21st century is to maintain a sense of flexibility.
Jobs are continuously changing, and in order to be successful, you need to change with them. 5.
Develop and maintain a large network of contacts. From time to time, jobs require collaboration and
input from a variety of stakeholders like customers, co-workers, friends and associates in other
organizations, and others. So, it’s important to maintain an extensive network of people to whom
you can turn for advice and recommendations when needed. Also, an extensive network can help
you find a new job in case you want to leave your current employer or get laid off. 6. Keep abreast of
employment trends. Monitor what your organization and other organizations within the industry are
doing with respect to jobs. If your company’s competitor announces that it will offshore thousands of
jobs over the next 10 years, then it is possible that your organization will follow a similar path. If your
job were one that could be offshored, then it would make sense to try to move higher up or move to
a different job or division within the organization that has more job security. 7. Develop global skills.
The old adage “If you can’t beat ‘em, join ‘em” may make sense as more jobs require global skills and
experience. Pursue international job opportunities that will give you relevant cross-cultural,
language, and international business skills. For example, a traveling international assignment (where
you don’t have to relocate overseas) that takes you to China, Brazil, and India four or five times a
year could be a great way to try out international assignments. Or, if you’re more adventurous, a
one- to two-year expatriate assignment to an important new host country market may make sense.
The key is to get out in front of the globalization wave before it overtakes your job. Sources: Adapted
from Michelle Conlin, Peter Coy, and Moira Herbst, “The Disposable Worker,” Businessweek , January
2010, pp. 32–39; Pete Engardio, “Can the Future Be Built in America?” Businessweek , September
2009, pp. 46–51; and Michael Mandel, “Which Way to the Future: Globalization and Technology Are
Drastically Changing How We Do Our Jobs–And That’s Both a Promise and a Problem,”
Businessweek , August, 2007, p. 45. Technology, globalization, and a prolonged recession are forces
that are changing the nature of jobs and pushing larger amounts of risk onto U.S. workers. About 20–
30 years ago, most jobs could have been characterized in the following way: if employees were
reliable and did their jobs reasonably well, they would be rewarded with solid base pay and annual
pay raises, benefits, and job security. Nowadays, these “permanent jobs” are increasingly being
replaced by jobs that are more temporary in nature, characterized by lower base pay, bonuses that
have to be renegotiated annually, reduced or no benefits, and little to no job security. Some have
labeled this new work design trend temporary or “just-in-time” jobs. One of the major drivers for this
change to treating workers as temporary resources are companies that want to trim labor costs and
have the flexibility to adjust their staffing needs (rapidly) to the cyclical ups and downs of their
industries. For example, Boeing cut some of its permanent staff in 2009 and replaced them by hiring
1,500 “contract labor” technologists in India. Microsoft has always used temporary staffing firms for
well-defined, short-term projects including software development. Once the project is finished, the
temporary employees move on to other projects with other companies. Companies like Kelly
Services, Robert Half, and Manpower that provide organizations with temporary workers have been
growing and have reported large increases in their stock prices in 2009 and 2010. What’s the bottom
line? U.S. workers are increasingly taking on more risk in their jobs, compensation, and careers. The
following suggestions may help workers increase their job prospects and take advantage of the
changes that are occurring regarding the nature of many jobs: 1. Envision yourself as your own brand
or company. This mindset will help you take control over your career and point you toward jobs (and
projects) that will give you marketable skills and training. 2. Try to work for job-intensive, high-
growth industries. Healthcare, financial services, and education are growth industries that offer large
numbers of jobs and careers. Do your research to see whether the industries you are interested in
are prone to offshoring jobs and using temporary workers. 3. Make education a lifelong process.
Research shows that in general, workers with higher levels of education fare better when it comes to
job security and earnings. You The Changing Nature of Jobs in America gib12664_ch13_367-395.indd
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Teams and Job Design Evolving from the research at the individual level, the concept of job design
has also been applied to work groups in organizations. For a variety of reasons, the use of work
teams has become common in organizations. 68 Admittedly, work teams do not always achieve high
levels of productivity, cooperation, or success. It can be argued that overall team effectiveness can be
enhanced through job design methods that increase the motivation of team members. One group of
researchers has taken the position that the job characteristics identified and developed by Hackman
and colleagues can also be applied to teams. 69 It has been argued that appropriate work team job
design can lead to higher levels of team productivity, employee satisfaction, and managers’ judgment
of effectiveness. Drawing on the Job Characteristics Model presented in Figure 13.4, the following
characteristics should be addressed when designing jobs for work teams: 1. Self-management —This
concept is similar to autonomy at the individual job level and refers to the team’s ability to set its
own objectives, coordinate its own activities, and resolve its own internal conflicts. 2. Participation —
This issue refers to the degree to which all members of the team are encouraged and allowed to
participate in decisions. 3. Task variety —This concept is the extent to which team members are
given the opportunity to perform a variety of tasks so as to allow members to use different skills. 4.
Task significance —This term refers to the degree to which the team’s work is valued and has
significance for both internal and external stakeholders of the organization. 5. Task identity —This
concept focuses on the degree to which a team completes a whole and separate piece of work and
has control over most of the resources necessary to accomplish its objectives. Although research
investigating these five aspects of team job design is limited, preliminary findings are somewhat
promising. After an extensive review of the literature on effective work groups, one set of
researchers studied the degree to which work group job design could affect such important
effectiveness outcomes as work group productivity, group member satisfaction, and managers’
judgments of group effectiveness. 70 They reported that with the exception of task identity, all of the
other job design characteristics (self-management, participation, task variety, and task significance)
showed positive relationships with one or more of the effectiveness criteria. In a subsequent
research study that used a different sample and different measures of effectiveness, similar findings
were reported. 71 In summary, teamwork design appears to be an important issue to the overall
functioning and effectiveness of teams. Managers have control over this area and should consider
building in several of the job characteristics mentioned above when designing the work that teams
will be doing. Total Quality Management and Job Design Total quality management (TQM), according
to those who espouse and practice it, combines technical knowledge and human knowledge. To deal
with the inherent complexity and variability of production and service delivery technology, people
must be empowered with authority to make necessary decisions and must be enabled with
knowledge to know when to exercise that authority. Aspects of TQM job designs have appeared
throughout this discussion. We’ve discussed job enrichment including provision of autonomy,
creation of work modules, and development of trust and collaboration. We’ve seen these attributes
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and Design of Organizations of jobs in the practices of organizations discussed throughout this
chapter. But even as we close this chapter, we must raise a fundamental question: Can American
workers adjust to the requirements for working together in teams and in collaboration with
management? Are the ideas of TQM totally applicable to the American worker? Is TQM the wave of
the future? Do American managers have the ability and commitment to implement the necessary
changes in jobs required by new technologies and new global realities? 72 Many contemporary
observers warn us that the answers to all these questions must be yes because no other choice
exists. 73 Job design strategy focuses on jobs in the context of individuals’ needs for economic well-
being and personal growth. But let’s put the issue in a broader framework and include the issue of
the sociotechnical system. Sociotechnical theory focuses on interactions between technical demands
of jobs and social demands of people doing the jobs. The theory states that too great an emphasis on
the technical system in the manner of scientific management or too great an emphasis on the social
system in the manner of human relations will lead to poor job design. Rather, job design should take
into account both the technology and the people who use the technology. Sociotechnical theory and
application of job design developed from studies undertaken in English coal mines from 1948 to
1958. 74 The studies became widely publicized for demonstrating the interrelationship between the
social system and the technical system of organizations. The interrelationship was revealed when
economic circumstances forced management to change how coal was mined (the technical system).
Historically, the technical system consisted of small groups of miners (the social system) working
together on “short faces” (seams of coal). But technological advancement improved roof control and
safety and made longwall mining possible. The new technical system required a change in the social
system. The groups would be disbanded in favor of one-person, one-task jobs. Despite the efforts of
management and even the union, miners eventually devised a social system that restored many
characteristics of the group system. This experience has been completely described in organizational
behavior literature and has stimulated a great deal of research and application. There’s no
contradiction between sociotechnical theory and total quality management. In fact, the two
approaches are quite compatible. The compatibility relates to the demands of modern technology for
self-directed and self-motivated job behavior. Such job behavior is made possible in jobs designed to
provide autonomy and variety. As worked out in practice, such jobs are parts of self-regulating work
teams responsible for completing whole tasks. The work module concept pervades applications of
sociotechnical theory. 75 Numerous applications of sociotechnical design and total quality
management are reported in the literature. 76 Some notable American examples include the
Sherwin-Williams Paint factory in Richmond, Kentucky, and the Quaker Oats pet food factory in
Topeka, Kansas. Both factories were constructed from the ground up to include and allow for specific
types of jobs embodying basic elements of autonomy and empowerment. Firms that don’t have the
luxury of building the plant from scratch must find ways to renovate both their technology and their
job designs to utilize the best technology and people. Some of the most influential industrial and
service organizations have confronted the necessity to design jobs to take advantage of the rapid
pace of technological advance. In the contemporary global environment, sociotechnical system
design has been incorporated in the total quality management approach to management.

The Way People Perceive Their Jobs The way people do their jobs depends in part on how they
perceive and think of their jobs. Even though Taylor proposed that the way to improve work (i.e., to
make it more efficient) is to determine the “best way” to do a task (motion study) and the standard
time for completion of the task (time study), the actual performance of jobs goes beyond its technical
description. The belief that job design can be based solely on technical data ignores the very large
role played by the individual who performs the job. Individuals differ profoundly, as we noted in the
chapter on individual differences. They come to work with different backgrounds, needs, and
motivations. Once on the job, they experience the social setting in which the work is performed in
unique ways. It’s not surprising to find that different individuals perceive jobs differently. Perceived
Job Content Perceived job content refers to characteristics of a job that define its general nature as
perceived by the jobholder. We must distinguish between a job’s objective properties and its
subjective properties as reflected in the perceptions of people who perform it. 48 Managers can’t
understand the causes of job performance without considering individual differences such as
personality, needs, and span of attention. 49 Nor can managers understand the causes of job
performance without considering the social setting in which the job is performed. According to Figure
13.2, perceived job content precedes job performance. Thus, if managers desire to increase job
performance by changing perceived job content, they can change job design, individual perceptions,
or social settings—the causes of perceived job content. If management is to understand perceived
job content, some method for measuring it must exist. In response to this need, organization
behavior researchers have attempted to measure perceived job content in a variety of work settings.
The methods that researchers use rely on questionnaires that jobholders complete and that measure
their perceptions of certain job characteristics. Job Characteristics The pioneering effort to measure
perceived job content through employee responses to a questionnaire resulted in the identification
of six characteristics: variety, autonomy, required interaction, optional interaction, knowledge and
skill required, and responsibility. 50 The index of these six characteristics is termed the Requisite Task
Attribute Index (RTAI). The original RTAI has been extensively reviewed and analyzed. One important
development was the review by Hackman and Lawler, who revised the index to include the six
characteristics shown in Table 13.1. 51 Variety, task identity, and feedback are perceptions of job
range. Autonomy is the perception of job depth; and dealing with others and friendship
opportunities reflect perceived job content perceptions of job relationships. Employees sharing
similar perceptions, job designs, and social settings should report similar job characteristics.
Employees with different perceptions, however, report different job characteristics of the same job.
For example, an individual with a high need for social belonging would perceive “friendship
opportunities” differently than another individual with a low need for social belonging. 52 Individual
Differences Individual differences in need strength, particularly the strength of growth needs, have
been shown to influence the perception of task variety. 53 Employees with relatively perceived job
content Specific job activities and general job characteristics as perceived by individual performing
the job. Two individuals doing the same job may have the same or different perceptions of job
content. gib12664_ch13_367-395.indd Page 382 2/4/11 2:47 PM user-f494
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weak higher order needs are less concerned with performing a variety of tasks than are employees
with relatively strong growth needs. Thus, managers expecting higher performance to result from
increased task variety would be disappointed if the jobholders did not have strong growth needs.
Even individuals with strong growth needs cannot respond continuously to the opportunity to
perform more and more tasks. At some point, performance turns down as these individuals reach the
limits imposed by their abilities and time. Social Setting Differences Differences in social settings of
work also affect perceptions of job content. Examples of social setting differences include leadership
style and what other people say about the job. As more than one research study has pointed out,
how one perceives a job is greatly affected by what other people say about it. Thus, if one’s friends
state their jobs are boring, one is likely to state that his job is also boring. If the individual perceives
the job as boring, job performance will no doubt suffer. Job content, then, results from the
interaction of many factors in the work situation. The field of organization behavior has advanced a
number of suggestions for improving the motivational properties of jobs. Invariably, the suggestions,
termed job design strategies, attempt to improve job performance through changes in actual job
characteristics. The next section reviews the more significant of these strategies. TABLE 13.1 Six
Characteristics of Perceived Job Content Source: Henry P. Sims, Jr., Andrew D. Szilagyi, and Robert T.
Keller, “The Measurement of Job Characteristics,” Academy of Management Journal (June 1976):
197. Characteristic Description Variety Degree to which a job requires employees to perform a wide
range of operations in their work, and/or degree to which employees must use a variety of
equipment and procedures in their work. Autonomy Extent to which employees have a major say in
scheduling their work, selecting the equipment they use, and deciding on procedures to be followed.
Task identity Extent to which employees do an entire or whole piece of work and can clearly identify
with the results of their efforts. Feedback Degree to which employees, as they are working, receive
information that reveals how well they are performing on the job. Dealing with others Degree to
which a job requires employees to deal with other people to complete their work. Friendship
opportunities Degree to which a job allows employees to talk with one another on the job and to
establish informal relationships with other employees at work. Designing Job Range: Job Rotation
and Job Enlargement The earliest attempts to design jobs date to the scientific management era.
Efforts at that time emphasized efficiency criteria. With that emphasis, the individual tasks that
constitute a job are limited, uniform, and repetitive. This practice leads to narrow job range and,
consequently, reported high levels of job discontent, turnover, absenteeism, and dissatisfaction.
Accordingly, strategies were devised that resulted in wider job range through increasing the requisite
activities of jobs. Two of these approaches are job rotation and job enlargement.
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and Design of Organizations Job Rotation Managers of organizations such as Marriott, General
Electric, Ford, TRW Systems, and Greyhound Financial Corporation have used different forms of the
job rotation strategy. 54 This practice involves rotating managers and nonmanagers alike from one
job to another. In so doing, the individual is expected to complete more job activities because each
job includes different tasks. 55 Job rotation involves increasing the range of jobs and the perception
of variety in the job content. Increasing task variety should, according to recent studies, increase
employee satisfaction, reduce mental overload, decrease the number of errors due to fatigue,
improve production and efficiency, 56 and reduce on-the-job injuries. 57 However, job rotation
doesn’t change the basic characteristics of the assigned jobs. Some relatively small firms have
successfully used job rotation. One relatively small manufacturing operation, Rohm & Haas Bayport
(owned by The Dow Chemical Company), was founded in 1981 to produce specialty chemicals. The
plant is located in LaPorte, Texas, and its 67 employees play active roles in management because
their jobs are designed with that activity in mind. The company’s philosophy is to provide autonomy
and responsibility in each individual’s job and, consequently, to enable employees to feel a sense of
“ownership” of key decisions and actions. Every person in the organization is trained to be and to act
like a manager. The 46 process technicians and 15 engineers and chemists report to one of the two
manufacturing unit managers who in turn report to the executive team. The technicians make
operating decisions among themselves while working in teams of four to seven people. The company
has no shift foremen or line supervisors in the usual sense of these positions. Rather, technicians are
expected to be self-managed. Team members rotate jobs with other team members every 4 to 12
weeks to provide task variety and cross-training. They’re also trained to do routine maintenance and
repairs of their equipment and not to depend on a separate maintenance team for that support. The
company’s idea is to give individuals near complete control of the conditions that govern work pace
and quality. Employees evaluate each other’s performance and interview applicants for positions. Job
designs at Rohm & Haas Bayport contribute to individual performance, according to company
spokespersons. 58 Critics state that job rotation often involves nothing more than having people
perform several boring and monotonous jobs rather than one. An alternative strategy is job
enlargement. Job Enlargement The pioneering Walker and Guest study 59 was concerned with the
social and psychological problems associated with mass production jobs in automobile assembly
plants. The study found that many workers were dissatisfied with their highly specialized jobs. In
particular, they disliked mechanical pacing, repetitiveness of operations, and a lack of a sense of
accomplishment. Walker and Guest also found a positive relationship between job range and job
satisfaction. Findings of this research gave early support for motivation theories predicting that
increases in job range will increase job satisfaction and other objective job outcomes. Job
enlargement strategies focus upon the opposite of dividing work—they’re a form of despecialization
or increasing the number of tasks that an employee performs. 60 For example, a job is designed such
that the individual performs six tasks instead of three. Although, in many instances, an enlarged job
requires a longer training period, job satisfaction usually increases because boredom is reduced. The
implication, of course, is that job enlargement will lead to improvement in other performance
outcomes. The concept and practice of job enlargement have become considerably more
sophisticated. In recent years, effective job enlargement involves more than simply increasing task
job rotation Practice of moving individuals from job to job to reduce potential boredom and increase
potential motivation and performance. job enlargement Practice of increasing the number of tasks
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variety. In addition, it’s necessary to design certain other aspects of job range, including providing
worker-paced (rather than machine- or computer-paced) control. Each of these changes involves
balancing the gains and losses of varying degrees of division of labor. Contemporary applications of
job enlargement involve training individuals to perform several different jobs, each requiring
considerable skill, whether in manufacturing or service organizations. Some employees can’t cope
with enlarged jobs because they can’t comprehend complexity; moreover, they may not have a
sufficiently long attention span to complete an enlarged set of tasks. However, if employees are
amenable to job enlargement and have the requisite ability, then job enlargement should increase
satisfaction and product quality and decrease absenteeism and turnover. These gains aren’t without
costs, including the likelihood that employees will demand larger salaries in exchange for performing
enlarged jobs. Yet these costs must be borne if management desires to implement the design
strategy— job enrichment—that enlarges job depth. Job enlargement is a necessary precondition for
job enrichment. Designing Job Depth: Job Enrichment The impetus for designing job depth was
provided by Herzberg’s two-factor theory of motivation. The basis of his theory is that factors that
meet individuals’ need for psychological growth (especially responsibility, job challenge, and
achievement) must be characteristic of their jobs. The application of his theory is termed job
enrichment . The implementation of job enrichment is realized through direct changes in job depth.
Managers can provide employees with greater opportunities to exercise discretion by making the
following changes: 1. Direct feedback—the evaluation of performance should be timely and direct. 2.
New learning—a good job enables people to feel that they are growing. All jobs should provide
opportunities to learn. 3. Scheduling—people should be able to schedule some part of their own
work. 4. Uniqueness—each job should have some unique qualities or features. 5. Control over
resources—individuals should have some control over their job tasks. 6. Personal accountability—
people should be provided with an opportunity to be accountable for the job. The process as
implemented at Texas Instruments (TI) is continuous and pervades the entire organization. Every job
in TI is subject to analysis to determine if it can be enriched to include managerial activities.
Moreover, as the jobs of nonmanagerial personnel are designed to include greater depth, the jobs of
managers must emphasize training and counseling of subordinates and de-emphasize control and
direction. As the theory and practice of job enrichment have evolved, managers have become aware
that successful applications require numerous changes in how work is done. Important changes
include giving workers greater authority to participate in decisions, to set their own goals, and to
evaluate their (and their work group’s) performance. Job enrichment also involves changing the
nature and style of managers’ behavior. Managers must be willing and able to delegate authority.
Given employees’ ability to carry out enriched jobs and managers’ willingness to delegate authority,
gains in performance can be expected. These positive outcomes are the result of increasing
employees’ expectations that efforts lead to performance, that performance leads to intrinsic and
extrinsic rewards, and that these rewards have power to satisfy needs. These significant changes in
managerial jobs, job enrichment Practice of increasing the discretion an individual can use to select
activities and outcomes. Increases job depth and accordingly fulfills growth and autonomy needs.
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and Design of Organizations coupled with changes in nonmanagerial jobs, suggest that a supportive
work environment is a prerequisite for successful job enrichment efforts. Job enrichment and job
enlargement aren’t competing strategies. Job enlargement may be compatible with the needs,
values, and abilities of some individuals, while job enrichment may not. Yet job enrichment, when
appropriate, necessarily involves job enlargement. A promising new approach to job design that
attempts to integrate the two approaches is the job characteristic model. Hackman, Oldham, Janson,
and Purdy devised the approach, basing it on the Job Diagnostic Survey . 61 The model attempts to
account for the interrelationships among (1) certain job characteristics; (2) psychological states
associated with motivation, satisfaction, and performance; (3) job outcomes; and (4) growth need
strength. Figure 13.4 describes the relationships among these variables. Although variety, identity,
significance, autonomy, and feedback don’t completely describe perceived job content, according to
this model they sufficiently describe those aspects that management can manipulate to bring about
gains in productivity. Steps that management can take to increase the core dimensions include 1.
Combining task elements. 2. Assigning whole pieces of work (i.e., work modules ). 3. Allowing
discretion in selection of work methods. 4. Permitting self-paced control. 5. Opening feedback
channels. These actions increase task variety, identity, and significance; consequently, the
“experienced meaningfulness of work” psychological state is increased. By permitting employee
participation and self-evaluation and by creating autonomous work groups, the feedback and
autonomy dimensions are increased along with the psychological states “experienced responsibility”
and “knowledge of actual results.” Implementing the job characteristics in a particular situation
begins with a study of existing job perceptions by means of the Job Description Survey. Hackman and
Oldham have reported numerous applications of the model in a variety of organizations. 62 They
have also compiled normative data for a variety of job categories so that managers and practitioners
can compare the responses of their own employees to those of a larger population. 63 work modules
Whole pieces of work assigned to individuals. FIGURE 13.4 The Job Characteristics Model Source: J.
Richard Hackman and Greg R. Oldham, “Development of the Job Diagnostic Survey,” Journal of
Applied Psychology (1975): 159–70. Job Characteristics Critical psychological states Personal and
work outcomes Skill variety Task identity Task significance Experienced meaningfulness of work
Experienced responsibility for outcomes of work High internal work motivation High-quality work
performance High satisfaction with work Low absenteeism and turnover Knowledge of the actual
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Although the track record of job design efforts is generally positive, some caveats are warranted. The
positive benefits of these efforts are moderated by individual differences in the strength of
employees’ growth needs. That is, employees with strong need for accomplishment, learning, and
challenge will respond more positively than those with relatively weak growth needs. In more
familiar terms, employees with high need for self-esteem and selfactualization are the more likely
candidates for job design. Employees who are forced to participate in job design programs but who
lack either the need strength or the ability to perform designed jobs may experience stress, anxiety,
adjustment problems, erratic performance, turnover, and absenteeism. Another potential moderator
of successful job design efforts is the changing nature of jobs in the United States (see the OB and
Your Career feature on the next page). The available research on the interrelationships between
perceived job content and performance is meager. It’s apparent, however, that managers must cope
with significant problems in matching employee needs and differences and organizational needs. 64
Problems associated with job design include the following: 1. The program is time-consuming and
costly. 2. Unless lower-level needs are satisfied, people will not respond to opportunities to satisfy
upper-level needs. And even though our society has been rather successful in providing food and
shelter, these needs regain importance when the economy moves through periods of recession and
high inflation. 3. Job design programs are intended to satisfy needs typically not satisfied in the
workplace. As workers are told to expect higher-order need satisfaction, they may raise their
expectations beyond what’s possible. Dissatisfaction with the program’s unachievable aim may
displace dissatisfaction with the jobs. 4. Job design may be resisted by labor unions who see the
effort as an attempt to get more work for the same pay. 5. Job design efforts may not produce
tangible performance improvements for some time after the beginning of the effort. One study
indicated that significant improvements in effectiveness couldn’t be seen until four years after the
beginning of the job design program. 65 Practical efforts to improve productivity and satisfaction
through job design have emphasized autonomy and feedback. Relatively less emphasis has been
placed on identity, significance, and variety. Apparently, it’s easier to provide individuals with greater
responsibility for the total task and increased feedback than to change the essential nature of the
task itself. To provide identity, significance, and variety often requires enlarging the task to the point
of losing the benefits of work simplification and standardization. But within the economic constraints
imposed by the logic of specialization, it’s possible to design work so as to give individuals complete
responsibility for its completion to the end and at the same time to provide supportive managerial
monitoring. In general, one reaches two conclusions when considering the experience of job design
approaches. First, they’re relatively successful in increasing quality of output. This conclusion
pertains, however, only if the reward system already satisfies lower-level needs. If it presently
doesn’t satisfy lower-level needs, employees can’t be expected to experience upper-level need
satisfaction (intrinsic rewards) through enriched jobs. In particular, managers can’t expect individuals
with relatively low growth needs to respond as would those with relatively high growth needs. 66
Second, successful efforts are the result of the circumstances that initiate the effort and the process
undertaken to manage the effort. Organizations under external pressure gib12664_ch13_367-
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and Design of Organizations to change have a better chance of successfully implementing job design
than those not under such pressure. Moreover, successful efforts are accompanied by broad-scale
participation of managers and employees alike. Since a primary source of organizational effectiveness
is job performance, managers should design jobs according to the best available knowledge. 67 O B A
N D Y O U R C A R E E R should strive to continuously update your skill set and education. 4. Be
flexible. The mantra for a successful career in the 21st century is to maintain a sense of flexibility.
Jobs are continuously changing, and in order to be successful, you need to change with them. 5.
Develop and maintain a large network of contacts. From time to time, jobs require collaboration and
input from a variety of stakeholders like customers, co-workers, friends and associates in other
organizations, and others. So, it’s important to maintain an extensive network of people to whom
you can turn for advice and recommendations when needed. Also, an extensive network can help
you find a new job in case you want to leave your current employer or get laid off. 6. Keep abreast of
employment trends. Monitor what your organization and other organizations within the industry are
doing with respect to jobs. If your company’s competitor announces that it will offshore thousands of
jobs over the next 10 years, then it is possible that your organization will follow a similar path. If your
job were one that could be offshored, then it would make sense to try to move higher up or move to
a different job or division within the organization that has more job security. 7. Develop global skills.
The old adage “If you can’t beat ‘em, join ‘em” may make sense as more jobs require global skills and
experience. Pursue international job opportunities that will give you relevant cross-cultural,
language, and international business skills. For example, a traveling international assignment (where
you don’t have to relocate overseas) that takes you to China, Brazil, and India four or five times a
year could be a great way to try out international assignments. Or, if you’re more adventurous, a
one- to two-year expatriate assignment to an important new host country market may make sense.
The key is to get out in front of the globalization wave before it overtakes your job. Sources: Adapted
from Michelle Conlin, Peter Coy, and Moira Herbst, “The Disposable Worker,” Businessweek , January
2010, pp. 32–39; Pete Engardio, “Can the Future Be Built in America?” Businessweek , September
2009, pp. 46–51; and Michael Mandel, “Which Way to the Future: Globalization and Technology Are
Drastically Changing How We Do Our Jobs–And That’s Both a Promise and a Problem,”
Businessweek , August, 2007, p. 45. Technology, globalization, and a prolonged recession are forces
that are changing the nature of jobs and pushing larger amounts of risk onto U.S. workers. About 20–
30 years ago, most jobs could have been characterized in the following way: if employees were
reliable and did their jobs reasonably well, they would be rewarded with solid base pay and annual
pay raises, benefits, and job security. Nowadays, these “permanent jobs” are increasingly being
replaced by jobs that are more temporary in nature, characterized by lower base pay, bonuses that
have to be renegotiated annually, reduced or no benefits, and little to no job security. Some have
labeled this new work design trend temporary or “just-in-time” jobs. One of the major drivers for this
change to treating workers as temporary resources are companies that want to trim labor costs and
have the flexibility to adjust their staffing needs (rapidly) to the cyclical ups and downs of their
industries. For example, Boeing cut some of its permanent staff in 2009 and replaced them by hiring
1,500 “contract labor” technologists in India. Microsoft has always used temporary staffing firms for
well-defined, short-term projects including software development. Once the project is finished, the
temporary employees move on to other projects with other companies. Companies like Kelly
Services, Robert Half, and Manpower that provide organizations with temporary workers have been
growing and have reported large increases in their stock prices in 2009 and 2010. What’s the bottom
line? U.S. workers are increasingly taking on more risk in their jobs, compensation, and careers. The
following suggestions may help workers increase their job prospects and take advantage of the
changes that are occurring regarding the nature of many jobs: 1. Envision yourself as your own brand
or company. This mindset will help you take control over your career and point you toward jobs (and
projects) that will give you marketable skills and training. 2. Try to work for job-intensive, high-
growth industries. Healthcare, financial services, and education are growth industries that offer large
numbers of jobs and careers. Do your research to see whether the industries you are interested in
are prone to offshoring jobs and using temporary workers. 3. Make education a lifelong process.
Research shows that in general, workers with higher levels of education fare better when it comes to
job security and earnings. You The Changing Nature of Jobs in America gib12664_ch13_367-395.indd
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Teams and Job Design Evolving from the research at the individual level, the concept of job design
has also been applied to work groups in organizations. For a variety of reasons, the use of work
teams has become common in organizations. 68 Admittedly, work teams do not always achieve high
levels of productivity, cooperation, or success. It can be argued that overall team effectiveness can be
enhanced through job design methods that increase the motivation of team members. One group of
researchers has taken the position that the job characteristics identified and developed by Hackman
and colleagues can also be applied to teams. 69 It has been argued that appropriate work team job
design can lead to higher levels of team productivity, employee satisfaction, and managers’ judgment
of effectiveness. Drawing on the Job Characteristics Model presented in Figure 13.4, the following
characteristics should be addressed when designing jobs for work teams: 1. Self-management —This
concept is similar to autonomy at the individual job level and refers to the team’s ability to set its
own objectives, coordinate its own activities, and resolve its own internal conflicts. 2. Participation —
This issue refers to the degree to which all members of the team are encouraged and allowed to
participate in decisions. 3. Task variety —This concept is the extent to which team members are
given the opportunity to perform a variety of tasks so as to allow members to use different skills. 4.
Task significance —This term refers to the degree to which the team’s work is valued and has
significance for both internal and external stakeholders of the organization. 5. Task identity —This
concept focuses on the degree to which a team completes a whole and separate piece of work and
has control over most of the resources necessary to accomplish its objectives. Although research
investigating these five aspects of team job design is limited, preliminary findings are somewhat
promising. After an extensive review of the literature on effective work groups, one set of
researchers studied the degree to which work group job design could affect such important
effectiveness outcomes as work group productivity, group member satisfaction, and managers’
judgments of group effectiveness. 70 They reported that with the exception of task identity, all of the
other job design characteristics (self-management, participation, task variety, and task significance)
showed positive relationships with one or more of the effectiveness criteria. In a subsequent
research study that used a different sample and different measures of effectiveness, similar findings
were reported. 71 In summary, teamwork design appears to be an important issue to the overall
functioning and effectiveness of teams. Managers have control over this area and should consider
building in several of the job characteristics mentioned above when designing the work that teams
will be doing. Total Quality Management and Job Design Total quality management (TQM), according
to those who espouse and practice it, combines technical knowledge and human knowledge. To deal
with the inherent complexity and variability of production and service delivery technology, people
must be empowered with authority to make necessary decisions and must be enabled with
knowledge to know when to exercise that authority. Aspects of TQM job designs have appeared
throughout this discussion. We’ve discussed job enrichment including provision of autonomy,
creation of work modules, and development of trust and collaboration. We’ve seen these attributes
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and Design of Organizations of jobs in the practices of organizations discussed throughout this
chapter. But even as we close this chapter, we must raise a fundamental question: Can American
workers adjust to the requirements for working together in teams and in collaboration with
management? Are the ideas of TQM totally applicable to the American worker? Is TQM the wave of
the future? Do American managers have the ability and commitment to implement the necessary
changes in jobs required by new technologies and new global realities? 72 Many contemporary
observers warn us that the answers to all these questions must be yes because no other choice
exists. 73 Job design strategy focuses on jobs in the context of individuals’ needs for economic well-
being and personal growth. But let’s put the issue in a broader framework and include the issue of
the sociotechnical system. Sociotechnical theory focuses on interactions between technical demands
of jobs and social demands of people doing the jobs. The theory states that too great an emphasis on
the technical system in the manner of scientific management or too great an emphasis on the social
system in the manner of human relations will lead to poor job design. Rather, job design should take
into account both the technology and the people who use the technology. Sociotechnical theory and
application of job design developed from studies undertaken in English coal mines from 1948 to
1958. 74 The studies became widely publicized for demonstrating the interrelationship between the
social system and the technical system of organizations. The interrelationship was revealed when
economic circumstances forced management to change how coal was mined (the technical system).
Historically, the technical system consisted of small groups of miners (the social system) working
together on “short faces” (seams of coal). But technological advancement improved roof control and
safety and made longwall mining possible. The new technical system required a change in the social
system. The groups would be disbanded in favor of one-person, one-task jobs. Despite the efforts of
management and even the union, miners eventually devised a social system that restored many
characteristics of the group system. This experience has been completely described in organizational
behavior literature and has stimulated a great deal of research and application. There’s no
contradiction between sociotechnical theory and total quality management. In fact, the two
approaches are quite compatible. The compatibility relates to the demands of modern technology for
self-directed and self-motivated job behavior. Such job behavior is made possible in jobs designed to
provide autonomy and variety. As worked out in practice, such jobs are parts of self-regulating work
teams responsible for completing whole tasks. The work module concept pervades applications of
sociotechnical theory. 75 Numerous applications of sociotechnical design and total quality
management are reported in the literature. 76 Some notable American examples include the
Sherwin-Williams Paint factory in Richmond, Kentucky, and the Quaker Oats pet food factory in
Topeka, Kansas. Both factories were constructed from the ground up to include and allow for specific
types of jobs embodying basic elements of autonomy and empowerment. Firms that don’t have the
luxury of building the plant from scratch must find ways to renovate both their technology and their
job designs to utilize the best technology and people. Some of the most influential industrial and
service organizations have confronted the necessity to design jobs to take advantage of the rapid
pace of technological advance. In the contemporary global environment, sociotechnical system
design has been incorporated in the total quality management approach to management.

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An organizational structure that has characteristics of both centralization and decentralization is the
multiunit organization. Multiunit organizations are starting to dominate practically every service
industry where there is direct contact between the customer and the organization, such as retail,
banking and insurance, meanwhile being increasingly important to the world economies (Ingram &
Baum, 1997, p.69; Garvin & Levesque, 2008, p.108). Multiunit organizations are often mid- to large
size and practice a mix of centralization and decentralization throughout the organizations. Jacobsen
& Thorsvik (2008, p.92) identifies advantages and disadvantages with centralized decision-making;
the advantages are that it creates uniformity, sends clear signals to the employees and provides a
clear path for the organization. On the other hand, the disadvantages are that it can have a negative
effect on the employees’ motivation and creativity. The degree of centralization and standardization
reduce the flexibility and autonomy and increase control, which may result in a decreased level of
self-determination, and also a reduced level of intrinsic motivation among the employees (Sherman
& Smith, 1984, p.883). Multiunit organizations impose certain challenges; they need to practice a
certain degree of standardization; products, services, and policies are often the same for all units of
the organization. Products can be both tangible products, such as credit cards, and intangible
products as for example a service within banking or insurance. Meanwhile the organizations have to
adapt to the regional markets that they are in, on a regional and unit level, decisions are
decentralized and can be made based on their local customers and conditions. Multiunit
organizations have to find the right balance between local responsiveness and uniformity (Garvin &
Levesque, 2008, p.109). A multiunit organization is often more towards a decentralized structure,
where certain decision-making is left to the units (Mintzberg, 1983, p.217). If the organization is a
bank for example, units can make decisions regarding their daily activities such as who will receive a
loan or what insurance to offer a customer. However, the organization still requires control from the
top of the organization down to the lower levels. While the activities are dispersed, there is still a
common system for control and communication in order to create uniformity (Greve, 2003, p.111).
The headquarter of the organization are often facing decisions regarding for example performance
targets, product positioning, and size of the annual budget (Garvin & Levesque, 2008, p.109). Based
on the annual budget, the regions and the units receive separate performance targets as they are
often measured separately. When performance goals are distributed among the units of the
organization, they are by extension transferred to the individual employees. Many multiunit
organizations in sales use assigned goals, such as sales targets, in order to motivate and control their
employees (Fu, Richards & Jones. 2009, p.278). The use of goal-setting in business organizations is
almost universal (Merchant & Van der Stede, 2007, p.333), and it can have both positive and
negative effects on employee motivation (Ordóñez, Schweitzer, Galinsky & Bazerman, 2009, p.11). It
has been an increased focus on measuring sales performance and customer satisfaction on an 2
individual level in the bank/insurance industry (Finansförbundet, 2013). In addition, many employees
describe an increased focus on selling and close monitoring in their daily work (Finansförbundet,
2013). A North American review of goal-setting and task performance studies concluded that
between 1968 and 1980, 90% of the studies found that challenging goals lead to higher performance
than soft goals, or no goals at all (Locke et al., 1981, p.125). Goal-setting, including centralized goals,
can have negative effects within an organization through increased risk taking and unethical
behavior, low collaboration among employees, a too narrow focus and a hinder for learning (Ordóñez
et al., 2009, pp.8-12). Another drawback of goal-setting in an organization is that employees may
focus on quantity such as selling more products instead of quality as for example more service and
vice versa depending on the organization’s focus (Latham, 2004, p.129). On the other hand, people
with very specific goals are more even in their performance than those who have vague goals
(Latham & Locke, 1991, p.216). Goals are also the standard of which people tend to evaluate their
own performance, and therefore the more often one would succeed in reaching the goals, the more
often one would feel satisfied and motivated (Latham & Locke, 1991, p.231). Some researchers claim
that goals work best if they are participatively set (Vroom, 1964, p.267; Merchant & Van Der Stede,
2007, p.240), and that goals should be realistic but challenging to the individual (Fu et al., 2009,
p.278; Locke, Shaw, Saari & Latham 1981, p.145). Previous research has examined goals, effort and
self-efficacy connected to the salesperson performance (Fu et al., 2009, p.277). Studies have shown a
strong relationship between goal levels in terms of difficulty and sales performance (Wood, Bandura
& Bailey 1990, p.198; Locke & Latham, 1990, p.220). Although conflicting results has emerged, for
example assigned goals that are too high may not lead to improved performance (Fu et al., 2009,
p.278). The degree to which employees are motivated to perform the task is dependent on factors
such as involvement, commitment and previous performance (van Riel, Berens & Dijkstra 2009,
p.1201). Employees with customer contact, like within the banking and insurance industry, can
sometimes be seen as stuck-in-the-middle between meeting productivity targets, external quality
goals, while fulfilling the needs of their customers (Yee, Yeung & Cheng et al., 2008, p.653).
Organizations with customer contact should focus on improving employee motivation in order to
have a high level of service quality (Yee et al., 2008, p.662). Motivation is the center of a productive
and innovative organization; therefore, it is important for an organization and its managers to
understand motivation to be able to satisfy the needs of the employees (Bloisi et al., 2007, pp.195-
196). In a competitive industry where customers view products and services as fairly homogenous, it
is important for companies to distinguish themselves, which can be done by the people working in
the organization (Kotler & Keller, 2009, p.407). In management studies, motivation as well as goal-
setting are two commonly researched topics (Latham & Pinder, 2005, p.486, 496). Motivation and
goal-setting have been studied for a long time; many of the ideas and theories used today emerged
in the 1960’s and 1970’s. While other fields of management such as leadership, groups and teams,
and organization design continue to develop; substantive theoretical developments focusing on work
motivation have not kept pace (Steers, Mowday & Shapiro, 2004, p.383; Latham & Pinder, 2005,
p.507). Motivational theories can be useful, however, they do not explain what motivates a particular
group or a particular 3 individual (Lundberg, Gudmundson & Andersson, 2009, p.891) Furthermore,
more research on motivation and goal-setting is needed to establish how previous research in these
areas applies to work settings (Kanfer, 2012, p.468). Ordóñez et al. (2009, p.14), argue for a new
generation of goal-setting research that identifies both positive and negative effects of goal-setting.
While theoretical developments on work motivation may have declined in recent years, the world of
work has changed dramatically: companies are both downsizing and expanding, often at the same
time in different divisions and levels of the hierarchy (Steers et al., 2004, p.383). The question of
whether to use centralized control has been a debated topic in management literature (Zábojník,
2002, p.2). In spite of its importance, the multiunit organization on the other hand, has received little
academic attention; while the multidivisional firm is commonly described in organization literature,
multiunit firms are often not mentioned (Garvin & Levesque, 2008, p.108). Locke and Latham (2004,
p.392), argues that the level of centralization and decentralization has motivational consequences,
and therefore they argue motivational theories should be further researched in connection to
organizational structure. Research in motivation tend to be rather general, and should therefore be
put into more specific contexts (Deci & Ryan, 2012, p.86) In this research we therefore want to
explore it from a multiunit organizational perspective, since that organizational structure have
received relatively little academic attention. We want to look at sales organizations with close
customer contact, as we believe their motivation to be important. Because motivation theories
needs to be researched in new contexts, we find it interesting to see how centralized goal-setting
works in combination with multiunit organizations, which have a decentralized organizational
structure with centralized control.

3.1 Organizational structure 3.1.1 Centralization and Decentralization Organizations are shaped by
different hierarchical structures where people on different levels in the organization has the
authority or not to take own decisions (Heide, Johansson & Simonsson 2005, p.80; 83). A managerial
hierarchy is common in business organizations and the organizational structure is formed depending
on the environment and type of industry the organization is operating in (Alonso, Dessein &
Matouschek, 2008, p.145). The structure is also formed based on the size of the firm, the
geographical location and dispersion and the competition in the market (Siggelkow & Levinthal,
2003, pp.650-651). A centralized organization is an organization where the decisions are made from
the top whereas a decentralized organization is characterized by decision-making lower in the
organization (Siggelkow & Levinthal, 2003, p.651). What is important with the type of organizational
structure is the difference in how decisions regarding strategies and goal-setting are formed and how
they are transferred to the employees (Siggelkow & Levinthal, 2003, p.651). Researchers argue for a
positive relationship between the degree of participation and outcomes such as motivation and
performance (Black & Gregersen, 1997, p.862). The issue of centralization versus decentralization is a
debated subject in organizational design (Kates & Galbraith, 2007, p.142). The positive effects of
centralization is (1) when the activities in an organization are the same such as having standardized
products and services, centralized decisions will support commonality (2) the management can send
out clear signals such as rules and directives to the employees which benefits both employees and
also customers because they know what to expect from the company (Kates & Galbraith, 2007,
pp.154-155). The downsides of a centralized organization is that it can harm motivation if there is a
low level of participation, it can have some negative effects on innovation and it can reduce the
flexibility and own sense of responsibility for the employees (Locke & Latham, 2004, p.392; Sherman
& Smith, 1984, p.883; Jacobsen & Thorsvik, 2008, p.92). Furthermore, centralized decisionmaking
sometimes reduces the individuals’ sense of responsibility due to the low level of influence on their
particular work situation (Jacobsen & Thorsvik, 2008, p.92). In addition, the organizational structure
can have motivational consequences depending on the level of centralization and decentralization of
the company (Locke & Latham, 2004, p.392). In industries where there is a lot of competition, the
importance of having decision making close to the customer becomes more important in order to
have the ability to meet the customers’ needs when units are dispersed over the country (Karlöf,
2012, p.76). 11 3.1.2 Multiunit Organizations With the progress in areas such as communication and
transportation, geographically dispersed organizational forms have emerged (Sorenson & Baum,
2003, p.5). Possibly the most obvious of these organizational forms would be the multiunit
organization: an organization that operates in distinct geographic markets, and often coordinates and
standardizes their activities (Greve & Baum, 2001, p.1). A multiunit company is often a geographically
dispersed organization with standardized units like hotels, stores, or insurance companies, which can
be categorized into regions and units where the different levels has its own set of managers (Garvin
& Levesque, 2008, p.108). The organizational headquarters make strategic decisions, policies and
budgeting that steers the direction of the organization. The organization often has to own these units
in order for them to coordinate activities and have standardized pricing across units (Kalnins &
Chung, 2001, p.32). The headquarter of the organization are often facing decisions regarding for
example performance targets, and annual budget, while the different levels of managers are
responsible to meet certain financial or performance targets set by the organizational headquarter
(Garvin & Levesque, 2008, pp.108-109). Multiunit organizations have become common in the service
industry, from drug stores, to apparel and the banking industry (Ingram & Baum, 1997, p.69; Garvin
& Levesque, 2008, p.108). It is important to not mix-up the multiunit organizational structure with
the multidivisional structure. The latter also has units but the units are often production units that
focus on different products or parts of products (Mintzberg, 1983, p.216). This structure is often used
to reach distinct markets and to take advantage of the ability to use diversification (Mintzberg, 1983,
p.225). The multiunit organization on the other hand, focuses on standardized products and services
and has different units in order to be close to the customers. Figure 1. The structure of a multiunit
organization 12 Mintzberg writes about the same type of organization as we refer to as a multiunit
organization, although he mentions it as Carbon-copy bureaucracy. He describes it as an organization
that is geographically dispersed with identical products or services, such as retail stores or post
offices, where the organization often centralize decision making at the center of the firm (Mintzberg,
1983, p.226). Each division can be seen as a replica; providing the same type of products or services
in geographically dispersed markets (Mintzberg, 1983, p.227). Furthermore, the multiunit
organizations has a structure that is more towards a decentralized structure with decisions close to
the customer (Mintzberg, 1983, p.217), but that uses central control that concerns performance
control to measure profit and results such as quantitative sales targets (Mintzberg, 1983, pp.226-
227). This structure is sometimes seen as a decentralized structure with centralized characteristics
because a multiunit organization still requires control from the top of the organization down to the
unit levels (Mintzberg, 1983, p.217). The structure often requires performance control systems to
measure profit, results and growth (Mintzberg, 1983, p.217). Furthermore, in order for a multiunit to
work well, it is important that the organization has a standardized output such as the same product
range or the same set of services. Each unit in this structure is provided with goals set by the center
of the organization but is in control of their own day-to-day activities. The goals must be operational
and it shall be easy to measure performance in a quantitative way in order for the organization to be
one organization and not seen as many individual firms (Mintzberg, 1983, p.219). The organizational
structure of the multiunit organization possesses unique capabilities as well as challenges. The
organization must satisfy its employees at the same time as satisfying the shareholders, who are
interested in the performance of the organization. While the activities are dispersed, there is still a
common system for control and communication (Greve, 2003, p.111). Employees with customer
contact, such as in sales organizations, can sometimes be seen as stuck-in-the-middle between
meeting productivity targets, external quality goals, while fulfilling the needs of their customers (Yee,
Yeung & Cheng et al., 2008, p.653). In order for the organization to provide a high level of service
quality, the employees also need to be motivated. Organizations, in for example in retail banking,
with customer contact should focus on improving employee motivation in order to have a high level
of service quality (Yee et al., 2008, p.662). Therefore, the organizations have to find the right balance
between local adjustment and standardization of the units. Multiunit firms compete across markets
and can choose to implement a global or a more local strategy (Greve, 2003, p.111). In a competitive
market it becomes more important to be close to the customer (Karlöf, 2012, p.76), which multiunit
organizations have the ability to be. However, challenges of execution do not only apply to stores,
banks and restaurants; they occur whenever an organization develop strategies centrally and
implement them locally which is the common case in multiunit organizations (Garvin & Levesque,
2008, p.116). Multiunit firms try to outline clear roles and responsibilities of field managers who are
all working on the same problems and dispersing responsibilities to all levels of management; in that
sense the multiunit organizations are very different from traditional bureaucratic firms (Garvin &
Levesque, 2008, p.109). Garvin & Levesque (2008, p.110) writes that lower level managers in
multiunit organizations are often evaluated based on financial targets, and other operational
activities, such as goals regarding employee satisfaction, and customer-service. However, those
managers generally do not have much to say when setting those targets. Meanwhile, they are
responsible for 13 undertakings such as motivation of employees, and follow-through of key activities
(Garvin & Levesque, 2008, p.109). It has not been established what effect banking organizations
management practices to reach their goals have on employees’ motivation and job performance
(Kakkos & Trivellas, 2011, p.410). Better corporate performance can be achieved by having motivated
employees (Nohria, Groysberg & Lee 2008, p.1) and the degree to which employees are motivated to
perform the task is dependent on factors such as involvement, commitment and previous
performance (van Riel, Berens & Dijkstra 2009, p.1201). 3.2 Intrinsic and extrinsic motivation In the
modern economy, a motivated workforce is often believed to be the trademark of competitive
advantage (Steers et al., 2004, p.383). Individuals’ motivation varies both in the amount and the
orientation of motivation (Deci & Ryan, 2000, p.54). Orientation in this context refers to the
individuals underlying attitudes and goals that act as the basis of action (Deci & Ryan, 2000, p.54).
Motivation can according to Alvesson & Kärreman (2007, p.258), be categorized into intrinsic and
extrinsic motivation. When people are intrinsically motivated by a task, they will get involved for the
enjoyment and challenge of conducting the task itself. Some researchers define intrinsic motivation
as a task being interesting, while others connect it to the satisfaction an individual receives from task
engagement (Deci & Ryan, 2000, p.56). Extrinsic motivation, on the other hand, is external to the
individual and can involve positive as well as negative rewards or consequences (Alvesson &
Kärreman, 2007, p.360). This type of motivation makes an individual try to reach a reward or avoid a
punishment (Amabile, 1998, p.79). An organization that uses centralized goal-setting, and have low
involvement in the goal-setting process, can trigger extrinsic motivation by the use of for example
rewards (Sachau, 2007, p.390). In addition, a high degree of centralization and standardization can
reduce the flexibility and autonomy and increase control, which may result in a decreased level of
intrinsic motivation (Sherman & Smith, 1984, p.883). In a multiunit organization it is common to set
quantitative goals from the center of the organization down to the lower levels in order to control
the outspread workforce in the different units (Fu et al., 2009, p.278). Intrinsic motivation can decline
when an employee has the self-perception that his or her behavior is under external rather than
internal control (Wiersma, 1992, p.103). Activities that creates intrinsic motivation is said to be
activities that in itself are rewarding, such as fulfilling a customer’s needs (Deci & Ryan, 2000, p.57).
When people work out of satisfaction and enjoyment of the task itself, rather than by external
pressure, they will be more creative (Amabile, 1998, pp.78-80). One advantage for organizations is
that intrinsic motivation can increase simply by small changes in the organizational environment
(Amabile, 1998, pp.78-80). Previous studies have shown a relationship between positive feedback
and intrinsic motivation (Harackiewicz, 1979, p.1361). Furthermore, a self-directed environment that
encourages the individual to take own decisions and the feeling of being challenged given that the
individual have the skills to complete the challenge enhance intrinsic motivation (Deci & Ryan, 2000,
p.59; Woodruffe, 2006, p.29). Centralized decision-making can sometimes reduce an individual’s
sense of responsibility due to the low level of influence on their particular work situation (Jacobsen &
Thorsvik, 2008, p.92). Studies have shown that deadlines (Amabile, DeJong & Lepper 1976, p.96),
directives and pressure for competition can reduce intrinsic motivation (Reeve, & Deci, 1996, pp.31-
32). 14 Because this case study is conducted at one organization in Sweden, we believe it to be
important to acknowledge that motivation may differ between countries and cultures. According to
Casserlöv, Swedes seems to be motivated to a large extent by intrinsic motivation; they are expected
to have an interest and an inner motivation for their job. In the Swedish work environment
employees often get to work independently, and are trusted with a lot of responsibilities (Casserlöv,
2012, p.50). Different management theories, for example theories of motivation, reflect the cultural
environment of the author (Hofstede, 1980, p.50). Universal policies of for example financial
incentives and promotions may work fairly different in different countries (Hofstede, 1980, p.62). In
Sweden, work is often believed to become more intrinsically interesting when emphasis is put on
wholesome interpersonal relationships rather than individual competition (Hofstede, 1980, p.56).
Competition can be harmful on intrinsic motivation (Reeve & Deci, 1996, pp.31-32), but it can on the
other hand trigger extrinsic motivation. We believe that this could impact how employees feel about
centralized goal-setting, since employees in Sweden are used to a self-directed environment and are
often towards intrinsically motivated. 3.3 Content Theories Motivation theories can sometimes be
categorized into content theory and process theory (Bassett & Lloyd, 2005, p.930). Content theories
describe what motivates people at work (Analoui, 2000, p.324). These theories look at which factors
that initiate and preserve a certain behavior, such as needs to fulfill (Hedegaard Hein, 2012, p.17).
Further, the content theories identify the work itself and incentives as factors that are important for
job satisfaction and motivation (Analoui, 2000, p.324). In order to answer our research question we,
first need to identify what employees are motivated of and how the working environment and
conditions contribute to work motivation. 3.3.1 McGregor’s X and Y theory In 1960, researcher
McGregor developed the X and Y theory that is commonly used as a motivation theory (Carson, 2005,
pp.450-451). The theory is used to describe two different views on human working motivation based
on different management practices. Theory X assumes that the average human dislikes work and
wishes to avoid responsibility (McGregor, 1960, pp.33-34). In addition to that, the theory believes
that because humans do not like to work, they need to be controlled and directed (McGregor, 1960,
pp.33-34). Theory X hold a more classical view upon management and the “carrot and stick” theory
of motivation goes relatively well along with it (McGregor, 1960, p.41). While McGregor recognizes
that Theory X gives some explanation to human working behavior, he also believes that there are
many observable phenomena, which are inconsistent with this view of human behavior (McGregor,
1960, p.35). Theory Y on the other hand holds other assumptions; human beings do not inherently
dislike work but rather that work can be a source of satisfaction; it assumes that people can work
towards objectives if they are committed to them, and only not by being controlled or threatened by
punishment (McGregor, 1960, p.47). Theory Y view humans, as being motivated by high growth
needs and does not assumes that humans lack ambition or avoids responsibility (McGregor, 1960,
p.47). Theory X provides 15 management with an easy solution for poor organizational performance
while Theory Y implies that if there is poor performance it is because of the managements methods
of organization and control (McGregor, 1960, p.48). Furthermore McGregor (1960, p.245) thinks that
it is important that managers abandon assumptions as limited as in Theory X. Managers with Theory
X assumptions most often have low rate of participative decision-making, as in hierarchical
organizations with centralized decision-making (Russ, 2011, p.829). This means that they believe that
employees want to be directed and that they do not like own responsibility. Theory X managers
assume that the employees are not motivated to be involved in decision-making at the workplace
(Russ, 2011, p.829). This is in line with centralized decision-making and centralized goalsetting
because the employees is provided with assigned goals that they cannot affect. On the other hand,
Theory Y managers are more likely to involve employees in participative decision making because
they believe that employees will be self-directed if they are committed to the objectives and goals
(Russ, 2011, p.829). Whether the organization uses “carrots and sticks”, or if they attempt to
motivate employees more intrinsically by Theory Y, we want to know how the employees’ feelings
about it and if they consider it to be motivating or not. If motivated as assumed in Theory Y, that
people work out of task satisfaction it is more in line with theories about intrinsic motivation. Theory
X on the other hand assumes that people are more extrinsically motivated; they respond to control,
and incentives. Multiunit organizations often uses both centralized goal-setting which corresponds to
Theory X and decentralized decision making which is more in line with Theory Y in order to control
the unanimity of the organization. 3.3.2 Herzberg’s dual-factor theory According to Herzberg et al.,
(1997, pp.113-114) there are two types of needs for individuals: (1) Hygiene factors, which is largely
extrinsic and (2) Motivator factors, which are more intrinsic. The hygiene factors are more extrinsic
factors and can be under the control of the supervisor or someone other than the employee, also
referred to as connected to job context (DeShields, Kara & Kaynak, 2002, p.132). On the other hand,
the motivator factors are intrinsic and part of job content and are largely administered by the
employee such as responsibility; motivation factors are needed to motivate an employee to higher
performance (DeShields et al., 2002, p.132). Hygiene factors refer to job context features such as
rewards, job security and working conditions. On the other hand, motivator factors are connected to
job content where recognition, responsibility and challenge are some of the factors (Herzberg,
Mausner & Bloch Snyderman 1993, p.114). These factors associated with job content are intrinsic,
and thereby unique to individuals (Herzberg et al., 1993, p.xiii). Further research argues that
satisfaction is based on recognition and personal growth which then leads to motivation (Bassett-
Jones & Lloyd, 2005, p.934). The intrinsic motivators are seen as the main cause of motivation and
satisfaction (Herzberg, 1987, p.113). In a multiunit structure the units often has performance targets
but operates almost as individual business (Mintzberg, 1983, p.217), this makes it possible for the
employees to feel responsible over their day-to-day business which is connected to the motivational
factors. Some of the factors of this theory are controlled centrally in the organization, such as
company policies, while others, like task and recognition, are influenced more 16 locally as in the
multiunit organizational structure. The hygiene factors on the other hand, does not create
satisfaction and motivation at work, but needs to be fulfilled in order for an employee to not be
unhappy (Herzberg et al., 1997, p.113). The hygiene factors do not directly provide job satisfaction
and motivation; instead they provide neutral feelings about the job environment (Soliman, 1970,
p.455). If motivators does not exist, an employee will not necessarily be dissatisfied, however, the
employee will not be motivated either. Figure 2. Table of Herzberg’s dual-factor theory from
Hedegaard Hein, 2012, p.138. The dual-factor theory has been debated in motivation and
management studies because of Herzberg’s methodology of the study and the inconsistent use of
terms, however there is still a valuable foundation in the theory (Sachau, 2007, pp.377-378). Sachau
(2007, p.390) argues that organizations should focus on psychological growth such as responsibility
to increase the level of intrinsic motivation among employees. Goalsetting can have an impact both
on the motivational factors and the hygiene factors, and therefore we find Herzberg’s theory useful
for us in this study. Goal-setting can affect several of Herzberg’s factors, such as self-realization,
achievement, and salary. For example self-realization can be affected in a negative way if the
employee does not reach a goal and by that lower his or her confidence to perform. Hygiene factors
can also be affected by goal-setting because rewards are often connected to achieving a goal or doing
a good result. Furthermore, organizations use of monetary rewards to motivate employees will
trigger extrinsic motivation but it will not make the employees interested in their jobs and the task
they are performing (Sachau, 2007, p.390). The use of hygiene factors in management is widely used
through different types of incentives and bonuses, even though the use of only hygiene factors for
motivation is not enough (Hedegaard Hein, 2012, p.146). We will look at both hygiene and
motivational factors in this study, because goal-setting and the effects of it can have an impact on
both of them. 17 3.4 Process theories Process theories describes how employees are motivated and
tries to explain how and why the individual is encouraged to act in a certain way (Hedegaard Hein,
2012, p.17). Process theories further concern how internal factors results in different behaviors
(Bassett- Jones & Lloyd, 2005, p.930). This category of theories is dealing with the interaction
between different variables that influence behavior, such as incentives, perception and needs
(Analoui, 2000, p.324). We therefore believe them to become of good use in our study when we
want to put together a framework of theories from which we can analyze our findings. 3.4.1
Expectancy theory Vroom (1964, p.29) tries to answer the question “why do people work?” by
concluding that the likelihood that people will work increases under two conditions: they need to
have the opportunity to work, and they must prefer to work over not working. Just like us, Vroom
was interested in the motivational aspect of this question, and he thereby developed the expectancy
theory. Vroom (1964, p.17) describes expectancy as an employee’s “ momentary belief concerning
the likelihood that a particular act will be followed by a particular outcome”. Valence is the
employee’s anticipated satisfaction from an outcome (Vroom, 1964, p.15). Valence and expectancy
both have to be present for someone to perform an act. The model can be summarized as follows;
The Valence of an outcome X, times the employee’s expectancy that act Y will be followed by
outcome X, equals the force to perform act Y (Vroom, 1964, p.27). Vroom sees his models as a point
of departure that needs to be adjusted to better incorporate the complexity of human behavior
(Vroom, 1964, p.287). The expectancy theory can be seen as a complement to theories about needs
and what is motivational (Jacobsen & Thorsvik, 2008, p.264). Needs alone are not motivational
according to this theory. The expectancy theory holds that the individual has to have a strong desire
for the expected reward, as it can be when someone is extrinsically motivated (Amabile, 1998, p.79).
Furthermore, the individual has to believe in the correlation between the effort they make and the
reward (Jacobsen & Thorsvik, 2008, p.265). That, to believe that the result one is striving for will
actually result in the desired reward is referred to as expectation (Jacobsen & Thorsvik, 2008, p.265).
A person must believe that achieving the result will also lead to the reward, and he or she will
thereby be motivated. In order to increase performance of the employees through a reward system,
an organization should strengthen the connection between the result and the desired reward. An
employee can want to reach an external reward because he or she is extrinsically motivated,
however a reward can also be feedback or recognition which corresponds to individuals being
intrinsically motivated (Alvesson & Kärreman, 2007, p.360; Harackiewicz, 1979, p.1361). Figure 3.
Vroom’s Expectancy Theory. 18 Vroom’s expectancy theory has sometimes been criticized for
assuming that human beings always act rationally which is not always the case (Hedegaard Hein,
2012, p.176). In spite of the criticism, the theory has turned out to have a practical value; it is
common for leaders to tell their staff to expect a certain result by using systematical incentives
(Hedegaard Hein, 2012, p.177). Managers that are more towards the Theory X assume that
incentives such as pay and bonuses are something that employees need and in order to be motivated
and to perform, employees will also try to avoid disincentives such as threats (Russ, 2011, p.825).
This is also connected to extrinsic motivation where employees are in some ways motivated by
external rewards and consequences (Alvesson & Kärreman, 2007, p.360). One theory that is related
Vroom’s expectancy theory is the self-efficacy theory. The self-efficacy theory takes people’s
confidence in their abilities into consideration. Like stated earlier, expectancy is an individual’s belief
that an action will lead to a certain outcome. An efficacy expectation is the belief that one can
successfully complete the action necessary to generate the desired outcome. According to Bandura
(1977, p.193) how much an individual trust in his or her own effectiveness is affecting whether he or
she will even attempt to handle with a given task or situation. Self-efficacy has an impact on which
activities someone decides to undertake, but also on how long one will attempt at succeeding with
the activity when obstacles occur; the more perceived selfefficacy, the more efforts one will put into
the activity (Bandura, 1977, p.193). Important to point out with this theory is that expectancy alone
will not give the wanted performance if the abilities are missing (Bandura, 1977, pp.193-194). People
will attempt to work with situations that they believe are within their self-perceived skills, but they
will try to sidestep situations that they believe to exceed their abilities (Bandura, 1977, p.203). We
believe that in terms of goals, this means that people with high self-efficacy will try more to achieve a
difficult goal than those with lower selfefficacy. This reflects how intrinsically motivated employee
will probably act, because they are motivated by challenging activities and the ability to take own
decisions given that the individual have the skills to complete the challenge (Deci & Ryan, 2000, p.59;
Woodruffe, 2006, p.29). 3.4.2 Locke’s goal-setting theory Goals continue to be an important part of
theories of motivation (Klein, Wesson, Hollenbeck & Alge 1999, p.885). Many researchers has used
Locke’s goal setting theory in order to examine goal setting and motivation among employees (Fu et
al., 2009, p.277). Even though the theory dates back as far as the 1960’s, the theory is ranked very
high by organizational behavior scholars, and highly valuated in the list of motivation theories (Miner,
2003, p.252). Research on goal-setting has developed after Locke’s (1968) seminal work where new
insights about the motivating effect of goal setting on performance is one of the most replicable
findings in the research area (Locke et al., 1981, p.145). Locke’s goal-setting theory has received
recognition theoretically as well as practically (Hedegaard Hein, 2012, p.177). The theory has for
example gained popularity among sales researchers in the sense of exploring the effect of goal-
setting on performance (Fu et al., 2009, p.278), and therefore we find it useful for our study. 19 Goals
must be challenging and clear There are some criteria that needs to be fulfilled in order for a goal to
be effective. The first is that the goal shall be challenging in order for an employee to be willing to
strive for it. The lowest level of effort occurs when the goal is set too low or too high (Locke, 1968,
pp.168-169). Goals must also be clear and whenever possible have a deadline connected to when the
goal shall be fulfilled (Locke & Latham, 1979, p.77). Individuals that are provided with specific higher
goals perform at a significant higher level than individuals that are provided with a so-called “trying
to do your best” goal (Locke, 1968, p.169). For example a goal could be stated as “sell 25 credit cards
this week” rather than “sell as much as you can”. A “do your best” goal is not specific in its nature but
encourages people to try their best to reach their goal (Locke, 1968, p.169). We believe that “do your
best goals” is more related to the Theory Y approach to management, where employees are trusted
to work without being controlled, whereas Theory X believes that employees will not work without
control and incentives. A limitation of a vague goal, such as to “do your best”, is that it is difficult to
measure and evaluate the performance both for the individual himself/herself and for the manager
(Latham & Locke, 2006, p.332). In a review on the effects of goal-setting, Locke et al (1981, p.125)
found that in 90% of the studies between 1969-1980, specific and challenging goals resulted in higher
performance than when no goals, or so-called “do your best” goals were used
Individuals must accept the goal and receive feedback Individuals must accept the goal in order to
work hard for it; therefore, there is a risk that an assigned goal that is too difficult will be rejected
(Locke, 1968, p.168). Latham & Locke (1979, p.80) argue that goal acceptance does not have to
include incentives; participation in goal-setting and clear instructions for the goal can increase the
purpose of the goal, and thereby make the employee accept it. We believe that clear instructions can
stimulate intrinsic motivation, if the goals are well explained to the employees, if they see the
purpose of the goal and are therefore willing to work towards it. In addition, research has found that
goal setting is the most effective when feedback is involved and where the manager provides support
(Locke et al., 1981, pp.145-146). Positive feedback increases the employee’s self-confidence and if
the employee knows that he or she will receive feedback, he or she will be more motivated to
perform a task (Latham & Locke, 1979, p.72). Moreover, it is important that the feedback is clear and
specific in order for the employee to be able to evaluate himself/herself and develop his or her skills
(Latham & Locke, 1979, p.79). 20 Individuals must feel committed to the goal Employees must be
committed to the goals in order for them to be effective (Locke et al., 1981, p.131; Locke & Latham,
1990, p.125). If employees are committed to the goal, the probability of giving more effort increases
and the strategy to attain the goal might change for the better (Latham & Locke, 2006, p.332). Goal-
setting is mainly a motivational mechanism, however, the motivational effect on goal-setting can be
lost when there is no goal commitment (Locke et al., 1981, p.131). Furthermore, in order to achieve
goal-commitment, managers are important in order to convince the employees that the goal is
important and realistic (Locke & Latham, 1991, p.219). Competition is a way to increase a person’s
effort to perform a task and it also encourages individuals to be committed to the goals that they
might abandon due to difficulty. Since competition can trigger extrinsic motivation, we believe that
goal-setting is one way to encourage employees. Moreover, praise and reproof affects the motivation
of employees (Locke, 1968, pp.178-180). Effects of goal-setting Performance targets affect behavior
in two ways; first of all, they improve motivation by giving employees goals to strive for, and
secondly, it allows the employees to measure their own performance (Merchant & Van der Stede,
2007, p.30). When people perform well and attain goals, they transfer the satisfied feeling to the
task, meaning that they are more motivated to perform it again and take on new challenges (Latham
& Locke, 2006, p.333). In addition, goal-setting can have an effect on motivation at work since a goal
provides a purpose and acts as a driving force (Latham & Locke, 2006, p.333). The downsides with
goal-setting is that it can be viewed as a threat instead of a challenge and that it can increase a
person’s stress if they are too challenging (Latham & Locke, 2006, pp.335-337). Another drawback of
goal-setting in an organization is that the focus can shift from quality to quantity depending of the
focus of the organization (Latham, 2004, p.129). The result of goal-setting is commonly a higher self
efficacy and it also has an effect on the feeling of contributing and being purposeful (Latham & Locke,
2006, p.333). Goal-setting can have both positive and negative effects on employee motivation
(Ordóñez et al., 2009, p.11). While goal setting can have a positive effect on extrinsic motivation, the
downside is that it can sometimes have a negative impact on intrinsic motivation (Ordóñez et al.,
2009, p.11). Goal-setting can also be seen as mechanistic and experienced as meaningless and
dehumanizing (Jinks & Dexter, 2012, p.104). Hedegaard Hein (2012, p.184) believes that there are
pitfalls with the goal-setting theory; used in the wrong way it can create more problems than
solutions. One problem is that when an employee does not achieve the goal they can become
unmotivated and dissatisfied; they might also try to take shortcuts to achieve them, which can
damage the quality of the results (Hedegaard Hein, 2012, p.184). There is also a risk that employees’
focus becomes too narrow and that they ignore other responsibilities that are not specified by goals
(Hedegaard Hein, 2012, p.184). Other authors however believe that how a goal-directed behavior is
pursued determines the outcome; the outcomes are more positive, such as higher quality
performance, when the behavior is autonomously regulated rather than controlled (Deci & Ryan,
2000, p.244). 21 Participation in Goal-Setting The effectiveness of assigned goals compared to
participatively set goals in achieving goal commitment and increasing subordinates performance has
been debated (Locke & Latham, 1991, p.218). In a decentralized organization, which is characterized
by decision-making lower in the organization (Siggelkow & Levinthal, 2003, p.651), we believe it to be
easier for employees to participate in goal-setting since they are closer to the decisions. Research has
shown that participation in goal-setting has a positive effect on motivation, however, there is a
disagreement in the matter (Merchant & Van Der Stede, 2007, p.240; Ordóñez et al., 2009, p.11).
Some researchers claim that goals work best if they are participatively set (Vroom, 1964, p.267;
Merchant & Van Der Stede, 2007, p.240), and that goals should be realistic but challenging to the
individual (Fu et al., 2009, p.278; Locke et al., 1981, p.145). Locke and Latham have different criteria
when it comes to how goals shall be formed, such as not being too high or too low. However, we
believe these criteria to be considered vague because of expressions such as “too high” or “too low”
can have different meanings for different individuals. In any case, it would be an argument for
participation in goal-setting in order to determine each individual’s limit of what is high enough.
Participation in goal-setting is sometimes seen as a necessity for successfully achieving the goals and
some believe that it can reduce some of the weaknesses of goal-setting (Rombach, 1991, pp.26-27).
Participation in goal-setting has an effect on motivation; employee participation motivates better job
performance (Vroom, 1964, p.267). Others disagree however, Herzberg et al (1997, p.128) believes
that the supposed success of participation is unclear, and that it will not restore a passion for work.
Some authors have another perspectives to participation and believe that employees who participate
in goal-setting are more likely to be committed to the goals because they understand the purpose of
them (Merchant & Van der Stede, 2007, p.340). Furthermore, participation increases the
understanding of the goals and it also helps developing the process towards attaining the goals
(Merchant & Van der Stede, 2007, p.340). Other researchers however, believe that it is not only the
goal itself that is important; it is also how it is explained to employees for them to accept it (van Riel
et al., 2009, p.1201). When a clear explanation of the goal is set, there is a higher chance of success
than if the goal is not explained at all. Providing employees with challenging goals that are clear
increases the motivation and performance, because the employees feel a sense of trust from the
managerial side (van Riel et al., 2009, pp.1200-1201). Researchers argue that a participatively set
goal and an assigned goal affects the motivation of an individual in a similar manner if the goal is well
explained; if the goal is assigned and not well explained it affects the performance negatively
compared to a participatively set goal (Lee & Feng, 2011, p.280). An explanation about the details of
the goal convinces the employees that the goal is worth striving for and that it is attainable (van Riel
et al., 2009, pp.1201-1202). If this were to be true, whether the employee participated or if goals
were assigned would not be that important, as long as the goal was well explained and the employee
wanted to strive for it. 22 3.5 SMART Goals SMART (Specific, Measurable, Achievable, Realistic, Time-
bound) goals are commonly mentioned in management, as a description of how effective goals and
objectives should be framed (Bloisi et al., 2007, p.85; Chamberlin, 2011, p.22; Macleod, 2012, p.70).
However, there are different opinions of which words to use for effective goal setting (Chamberlin,
2011, p.22). The original description is that goals and objectives must be Specific, Measurable,
Achievable, Realistic and Time-bound (SMART) but now these words are challenged with other words
that have different meanings (Rubin, 2002, pp.26-27). Chamberlin (2011, pp.23-25) argues that
achievable shall be attainable and realistic must be changed to relevant because realistic is
connected to the word real and relevant is more connected to what is in line with the organization
that sets the goals. Time-lined will instead be trackable in order to see the progress an employee is
making and thereby have effective goals. Some also adds two words so effective goals shall be
SMARTER, adding engaging and rewarding to extend goal-setting further in order to have motivated
employees (MacLeod, 2012, pp.70-71). The goal-setting process requires effort from the managers in
order to avoid misunderstandings, frustration and confusion among the employees (Bloisi et al.,
2007, pp.245-246). Organizations require a certain amount of control in order to meet financial
targets and goal-setting is a commonly used control system. In sales organizations it is often common
to use sales targets in order to control the employees’ performance, these targets are often set in the
center of the organization and later on distributed down to individuals. According to the description
above about how effective goals shall be framed it is important for the organization to be able to set
goals that fulfills the criteria to each employee in order for the employee to accept the goal and
motivated to work towards it. There are basic conditions for goals to be motivating; the employees
have to accept the goals, and decide to try to achieve them (Jacobsen & Thorsvik, 2008, p.283). In
order to set goals that are motivating the employees, according to Jacobsen & Thorsvik (2008, p.283)
organizations have to fulfill certain criteria: first of all, as mentioned earlier goals have to be adjusted
to fit individual or the group. At the same time, multiunit organizations need to have a form of
central control over the units and their performance targets (Garvin & Levesque, 2008, pp.108-109).
The goals should also be realistic and challenging to the individual or group just as in SMART goals,
and therefore be adjusted to fit their levels of skills as well as their confidence (Jacobsen & Thorsvik,
2008, p.283). Other external factors that could affect the ability of the group to complete the goals
should also be taken into consideration. The second criterion is to overcome resistance against the
goals and have the employees accepting them. Certain techniques such as coaching and training,
employee participation in decision-making, or the use of rewards can be used to overcome resistance
against goals. 23 It is easier for an organization to evaluate the results when goals are specific and
when they can be measured in quantitative ways, such as money earned, number of customers, or
how many projects that have been executed. These types of goals are easy to communicate
throughout an organization, and are easy to understand. However, when too much focus are put on
the quantitative goals they might become counterproductive to the organizational overall goals
(Jacobsen & Thorsvik, 2008, p.62) Figure 4. Our figure of the relationship between goal-setting and
motivation. 24 3.6 Summary of theoretical framework The theories we have used as a basis of our
research are put together in figure 5 below. This model will be the foundation for us when analyzing
the empirical data. The multiunit organizational structure is the umbrella of the model since we are
looking at assigned goals effect on motivation in these organizations. The goal-setting theories on the
right side of the model will influence the study from the beginning to the end through the design and
characteristics of the goals. We will then look at theories on intrinsic and extrinsic motivation, as well
as McGregor’s X and Y theory and Herzberg’s Dual-factor theory, because in order to find out how
assigned goals affect motivation, it is important to first investigate whether the employees’ working
environment have the conditions for them to be motivated and also for us to understand what they
are motivated of. After the preconditions have been established we will look more into how the
centralized goals affect motivation. To help us with that we will use Vroom’s Expectancy theory,
Bandura’s Self-efficacy theory, as well as goal-setting theories. Figure 5. Our model of the theoretical
framework 25 4. Practical methodology This chapter will display the practical methodIndividuals
must accept the goal and receive feedback Individuals must accept the goal in order to work hard for
it; therefore, there is a risk that an assigned goal that is too difficult will be rejected (Locke, 1968,
p.168). Latham & Locke (1979, p.80) argue that goal acceptance does not have to include incentives;
participation in goal-setting and clear instructions for the goal can increase the purpose of the goal,
and thereby make the employee accept it. We believe that clear instructions can stimulate intrinsic
motivation, if the goals are well explained to the employees, if they see the purpose of the goal and
are therefore willing to work towards it. In addition, research has found that goal setting is the most
effective when feedback is involved and where the manager provides support (Locke et al., 1981,
pp.145-146). Positive feedback increases the employee’s self-confidence and if the employee knows
that he or she will receive feedback, he or she will be more motivated to perform a task (Latham &
Locke, 1979, p.72). Moreover, it is important that the feedback is clear and specific in order for the
employee to be able to evaluate himself/herself and develop his or her skills (Latham & Locke, 1979,
p.79). 20 Individuals must feel committed to the goal Employees must be committed to the goals in
order for them to be effective (Locke et al., 1981, p.131; Locke & Latham, 1990, p.125). If employees
are committed to the goal, the probability of giving more effort increases and the strategy to attain
the goal might change for the better (Latham & Locke, 2006, p.332). Goal-setting is mainly a
motivational mechanism, however, the motivational effect on goal-setting can be lost when there is
no goal commitment (Locke et al., 1981, p.131). Furthermore, in order to achieve goal-commitment,
managers are important in order to convince the employees that the goal is important and realistic
(Locke & Latham, 1991, p.219). Competition is a way to increase a person’s effort to perform a task
and it also encourages individuals to be committed to the goals that they might abandon due to
difficulty. Since competition can trigger extrinsic motivation, we believe that goal-setting is one way
to encourage employees. Moreover, praise and reproof affects the motivation of employees (Locke,
1968, pp.178-180). Effects of goal-setting Performance targets affect behavior in two ways; first of all,
they improve motivation by giving employees goals to strive for, and secondly, it allows the
employees to measure their own performance (Merchant & Van der Stede, 2007, p.30). When
people perform well and attain goals, they transfer the satisfied feeling to the task, meaning that
they are more motivated to perform it again and take on new challenges (Latham & Locke, 2006,
p.333). In addition, goal-setting can have an effect on motivation at work since a goal provides a
purpose and acts as a driving force (Latham & Locke, 2006, p.333). The downsides with goal-setting is
that it can be viewed as a threat instead of a challenge and that it can increase a person’s stress if
they are too challenging (Latham & Locke, 2006, pp.335-337). Another drawback of goal-setting in an
organization is that the focus can shift from quality to quantity depending of the focus of the
organization (Latham, 2004, p.129). The result of goal-setting is commonly a higher self efficacy and it
also has an effect on the feeling of contributing and being purposeful (Latham & Locke, 2006, p.333).
Goal-setting can have both positive and negative effects on employee motivation (Ordóñez et al.,
2009, p.11). While goal setting can have a positive effect on extrinsic motivation, the downside is that
it can sometimes have a negative impact on intrinsic motivation (Ordóñez et al., 2009, p.11). Goal-
setting can also be seen as mechanistic and experienced as meaningless and dehumanizing (Jinks &
Dexter, 2012, p.104). Hedegaard Hein (2012, p.184) believes that there are pitfalls with the goal-
setting theory; used in the wrong way it can create more problems than solutions. One problem is
that when an employee does not achieve the goal they can become unmotivated and dissatisfied;
they might also try to take shortcuts to achieve them, which can damage the quality of the results
(Hedegaard Hein, 2012, p.184). There is also a risk that employees’ focus becomes too narrow and
that they ignore other responsibilities that are not specified by goals (Hedegaard Hein, 2012, p.184).
Other authors however believe that how a goal-directed behavior is pursued determines the
outcome; the outcomes are more positive, such as higher quality performance, when the behavior is
autonomously regulated rather than controlled (Deci & Ryan, 2000, p.244). 21 Participation in Goal-
Setting The effectiveness of assigned goals compared to participatively set goals in achieving goal
commitment and increasing subordinates performance has been debated (Locke & Latham, 1991,
p.218). In a decentralized organization, which is characterized by decision-making lower in the
organization (Siggelkow & Levinthal, 2003, p.651), we believe it to be easier for employees to
participate in goal-setting since they are closer to the decisions. Research has shown that
participation in goal-setting has a positive effect on motivation, however, there is a disagreement in
the matter (Merchant & Van Der Stede, 2007, p.240; Ordóñez et al., 2009, p.11). Some researchers
claim that goals work best if they are participatively set (Vroom, 1964, p.267; Merchant & Van Der
Stede, 2007, p.240), and that goals should be realistic but challenging to the individual (Fu et al.,
2009, p.278; Locke et al., 1981, p.145). Locke and Latham have different criteria when it comes to
how goals shall be formed, such as not being too high or too low. However, we believe these criteria
to be considered vague because of expressions such as “too high” or “too low” can have different
meanings for different individuals. In any case, it would be an argument for participation in goal-
setting in order to determine each individual’s limit of what is high enough. Participation in goal-
setting is sometimes seen as a necessity for successfully achieving the goals and some believe that it
can reduce some of the weaknesses of goal-setting (Rombach, 1991, pp.26-27). Participation in goal-
setting has an effect on motivation; employee participation motivates better job performance
(Vroom, 1964, p.267). Others disagree however, Herzberg et al (1997, p.128) believes that the
supposed success of participation is unclear, and that it will not restore a passion for work. Some
authors have another perspectives to participation and believe that employees who participate in
goal-setting are more likely to be committed to the goals because they understand the purpose of
them (Merchant & Van der Stede, 2007, p.340). Furthermore, participation increases the
understanding of the goals and it also helps developing the process towards attaining the goals
(Merchant & Van der Stede, 2007, p.340). Other researchers however, believe that it is not only the
goal itself that is important; it is also how it is explained to employees for them to accept it (van Riel
et al., 2009, p.1201). When a clear explanation of the goal is set, there is a higher chance of success
than if the goal is not explained at all. Providing employees with challenging goals that are clear
increases the motivation and performance, because the employees feel a sense of trust from the
managerial side (van Riel et al., 2009, pp.1200-1201). Researchers argue that a participatively set
goal and an assigned goal affects the motivation of an individual in a similar manner if the goal is well
explained; if the goal is assigned and not well explained it affects the performance negatively
compared to a participatively set goal (Lee & Feng, 2011, p.280). An explanation about the details of
the goal convinces the employees that the goal is worth striving for and that it is attainable (van Riel
et al., 2009, pp.1201-1202). If this were to be true, whether the employee participated or if goals
were assigned would not be that important, as long as the goal was well explained and the employee
wanted to strive for it. 22 3.5 SMART Goals SMART (Specific, Measurable, Achievable, Realistic, Time-
bound) goals are commonly mentioned in management, as a description of how effective goals and
objectives should be framed (Bloisi et al., 2007, p.85; Chamberlin, 2011, p.22; Macleod, 2012, p.70).
However, there are different opinions of which words to use for effective goal setting (Chamberlin,
2011, p.22). The original description is that goals and objectives must be Specific, Measurable,
Achievable, Realistic and Time-bound (SMART) but now these words are challenged with other words
that have different meanings (Rubin, 2002, pp.26-27). Chamberlin (2011, pp.23-25) argues that
achievable shall be attainable and realistic must be changed to relevant because realistic is
connected to the word real and relevant is more connected to what is in line with the organization
that sets the goals. Time-lined will instead be trackable in order to see the progress an employee is
making and thereby have effective goals. Some also adds two words so effective goals shall be
SMARTER, adding engaging and rewarding to extend goal-setting further in order to have motivated
employees (MacLeod, 2012, pp.70-71). The goal-setting process requires effort from the managers in
order to avoid misunderstandings, frustration and confusion among the employees (Bloisi et al.,
2007, pp.245-246). Organizations require a certain amount of control in order to meet financial
targets and goal-setting is a commonly used control system. In sales organizations it is often common
to use sales targets in order to control the employees’ performance, these targets are often set in the
center of the organization and later on distributed down to individuals. According to the description
above about how effective goals shall be framed it is important for the organization to be able to set
goals that fulfills the criteria to each employee in order for the employee to accept the goal and
motivated to work towards it. There are basic conditions for goals to be motivating; the employees
have to accept the goals, and decide to try to achieve them (Jacobsen & Thorsvik, 2008, p.283). In
order to set goals that are motivating the employees, according to Jacobsen & Thorsvik (2008, p.283)
organizations have to fulfill certain criteria: first of all, as mentioned earlier goals have to be adjusted
to fit individual or the group. At the same time, multiunit organizations need to have a form of
central control over the units and their performance targets (Garvin & Levesque, 2008, pp.108-109).
The goals should also be realistic and challenging to the individual or group just as in SMART goals,
and therefore be adjusted to fit their levels of skills as well as their confidence (Jacobsen & Thorsvik,
2008, p.283). Other external factors that could affect the ability of the group to complete the goals
should also be taken into consideration. The second criterion is to overcome resistance against the
goals and have the employees accepting them. Certain techniques such as coaching and training,
employee participation in decision-making, or the use of rewards can be used to overcome resistance
against goals. 23 It is easier for an organization to evaluate the results when goals are specific and
when they can be measured in quantitative ways, such as money earned, number of customers, or
how many projects that have been executed. These types of goals are easy to communicate
throughout an organization, and are easy to understand. However, when too much focus are put on
the quantitative goals they might become counterproductive to the organizational overall goals
(Jacobsen & Thorsvik, 2008, p.62) Figure 4. Our figure of the relationship between goal-setting and
motivation. 24 3.6 Summary of theoretical framework The theories we have used as a basis of our
research are put together in figure 5 below. This model will be the foundation for us when analyzing
the empirical data. The multiunit organizational structure is the umbrella of the model since we are
looking at assigned goals effect on motivation in these organizations. The goal-setting theories on the
right side of the model will influence the study from the beginning to the end through the design and
characteristics of the goals. We will then look at theories on intrinsic and extrinsic motivation, as well
as McGregor’s X and Y theory and Herzberg’s Dual-factor theory, because in order to find out how
assigned goals affect motivation, it is important to first investigate whether the employees’ working
environment have the conditions for them to be motivated and also for us to understand what they
are motivated of. After the preconditions have been established we will look more into how the
centralized goals affect motivation. To help us with that we will use Vroom’s Expectancy theory,
Bandura’s Self-efficacy theory, as well as goal-setting theories. Figure 5. Our model of the theoretical
framework 25 4. Practical methodology This chapter will display the practical methodIndividuals
must accept the goal and receive feedback Individuals must accept the goal in order to work hard for
it; therefore, there is a risk that an assigned goal that is too difficult will be rejected (Locke, 1968,
p.168). Latham & Locke (1979, p.80) argue that goal acceptance does not have to include incentives;
participation in goal-setting and clear instructions for the goal can increase the purpose of the goal,
and thereby make the employee accept it. We believe that clear instructions can stimulate intrinsic
motivation, if the goals are well explained to the employees, if they see the purpose of the goal and
are therefore willing to work towards it. In addition, research has found that goal setting is the most
effective when feedback is involved and where the manager provides support (Locke et al., 1981,
pp.145-146). Positive feedback increases the employee’s self-confidence and if the employee knows
that he or she will receive feedback, he or she will be more motivated to perform a task (Latham &
Locke, 1979, p.72). Moreover, it is important that the feedback is clear and specific in order for the
employee to be able to evaluate himself/herself and develop his or her skills (Latham & Locke, 1979,
p.79). 20 Individuals must feel committed to the goal Employees must be committed to the goals in
order for them to be effective (Locke et al., 1981, p.131; Locke & Latham, 1990, p.125). If employees
are committed to the goal, the probability of giving more effort increases and the strategy to attain
the goal might change for the better (Latham & Locke, 2006, p.332). Goal-setting is mainly a
motivational mechanism, however, the motivational effect on goal-setting can be lost when there is
no goal commitment (Locke et al., 1981, p.131). Furthermore, in order to achieve goal-commitment,
managers are important in order to convince the employees that the goal is important and realistic
(Locke & Latham, 1991, p.219). Competition is a way to increase a person’s effort to perform a task
and it also encourages individuals to be committed to the goals that they might abandon due to
difficulty. Since competition can trigger extrinsic motivation, we believe that goal-setting is one way
to encourage employees. Moreover, praise and reproof affects the motivation of employees (Locke,
1968, pp.178-180). Effects of goal-setting Performance targets affect behavior in two ways; first of all,
they improve motivation by giving employees goals to strive for, and secondly, it allows the
employees to measure their own performance (Merchant & Van der Stede, 2007, p.30). When
people perform well and attain goals, they transfer the satisfied feeling to the task, meaning that
they are more motivated to perform it again and take on new challenges (Latham & Locke, 2006,
p.333). In addition, goal-setting can have an effect on motivation at work since a goal provides a
purpose and acts as a driving force (Latham & Locke, 2006, p.333). The downsides with goal-setting is
that it can be viewed as a threat instead of a challenge and that it can increase a person’s stress if
they are too challenging (Latham & Locke, 2006, pp.335-337). Another drawback of goal-setting in an
organization is that the focus can shift from quality to quantity depending of the focus of the
organization (Latham, 2004, p.129). The result of goal-setting is commonly a higher self efficacy and it
also has an effect on the feeling of contributing and being purposeful (Latham & Locke, 2006, p.333).
Goal-setting can have both positive and negative effects on employee motivation (Ordóñez et al.,
2009, p.11). While goal setting can have a positive effect on extrinsic motivation, the downside is that
it can sometimes have a negative impact on intrinsic motivation (Ordóñez et al., 2009, p.11). Goal-
setting can also be seen as mechanistic and experienced as meaningless and dehumanizing (Jinks &
Dexter, 2012, p.104). Hedegaard Hein (2012, p.184) believes that there are pitfalls with the goal-
setting theory; used in the wrong way it can create more problems than solutions. One problem is
that when an employee does not achieve the goal they can become unmotivated and dissatisfied;
they might also try to take shortcuts to achieve them, which can damage the quality of the results
(Hedegaard Hein, 2012, p.184). There is also a risk that employees’ focus becomes too narrow and
that they ignore other responsibilities that are not specified by goals (Hedegaard Hein, 2012, p.184).
Other authors however believe that how a goal-directed behavior is pursued determines the
outcome; the outcomes are more positive, such as higher quality performance, when the behavior is
autonomously regulated rather than controlled (Deci & Ryan, 2000, p.244). 21 Participation in Goal-
Setting The effectiveness of assigned goals compared to participatively set goals in achieving goal
commitment and increasing subordinates performance has been debated (Locke & Latham, 1991,
p.218). In a decentralized organization, which is characterized by decision-making lower in the
organization (Siggelkow & Levinthal, 2003, p.651), we believe it to be easier for employees to
participate in goal-setting since they are closer to the decisions. Research has shown that
participation in goal-setting has a positive effect on motivation, however, there is a disagreement in
the matter (Merchant & Van Der Stede, 2007, p.240; Ordóñez et al., 2009, p.11). Some researchers
claim that goals work best if they are participatively set (Vroom, 1964, p.267; Merchant & Van Der
Stede, 2007, p.240), and that goals should be realistic but challenging to the individual (Fu et al.,
2009, p.278; Locke et al., 1981, p.145). Locke and Latham have different criteria when it comes to
how goals shall be formed, such as not being too high or too low. However, we believe these criteria
to be considered vague because of expressions such as “too high” or “too low” can have different
meanings for different individuals. In any case, it would be an argument for participation in goal-
setting in order to determine each individual’s limit of what is high enough. Participation in goal-
setting is sometimes seen as a necessity for successfully achieving the goals and some believe that it
can reduce some of the weaknesses of goal-setting (Rombach, 1991, pp.26-27). Participation in goal-
setting has an effect on motivation; employee participation motivates better job performance
(Vroom, 1964, p.267). Others disagree however, Herzberg et al (1997, p.128) believes that the
supposed success of participation is unclear, and that it will not restore a passion for work. Some
authors have another perspectives to participation and believe that employees who participate in
goal-setting are more likely to be committed to the goals because they understand the purpose of
them (Merchant & Van der Stede, 2007, p.340). Furthermore, participation increases the
understanding of the goals and it also helps developing the process towards attaining the goals
(Merchant & Van der Stede, 2007, p.340). Other researchers however, believe that it is not only the
goal itself that is important; it is also how it is explained to employees for them to accept it (van Riel
et al., 2009, p.1201). When a clear explanation of the goal is set, there is a higher chance of success
than if the goal is not explained at all. Providing employees with challenging goals that are clear
increases the motivation and performance, because the employees feel a sense of trust from the
managerial side (van Riel et al., 2009, pp.1200-1201). Researchers argue that a participatively set
goal and an assigned goal affects the motivation of an individual in a similar manner if the goal is well
explained; if the goal is assigned and not well explained it affects the performance negatively
compared to a participatively set goal (Lee & Feng, 2011, p.280). An explanation about the details of
the goal convinces the employees that the goal is worth striving for and that it is attainable (van Riel
et al., 2009, pp.1201-1202). If this were to be true, whether the employee participated or if goals
were assigned would not be that important, as long as the goal was well explained and the employee
wanted to strive for it. 22 3.5 SMART Goals SMART (Specific, Measurable, Achievable, Realistic, Time-
bound) goals are commonly mentioned in management, as a description of how effective goals and
objectives should be framed (Bloisi et al., 2007, p.85; Chamberlin, 2011, p.22; Macleod, 2012, p.70).
However, there are different opinions of which words to use for effective goal setting (Chamberlin,
2011, p.22). The original description is that goals and objectives must be Specific, Measurable,
Achievable, Realistic and Time-bound (SMART) but now these words are challenged with other words
that have different meanings (Rubin, 2002, pp.26-27). Chamberlin (2011, pp.23-25) argues that
achievable shall be attainable and realistic must be changed to relevant because realistic is
connected to the word real and relevant is more connected to what is in line with the organization
that sets the goals. Time-lined will instead be trackable in order to see the progress an employee is
making and thereby have effective goals. Some also adds two words so effective goals shall be
SMARTER, adding engaging and rewarding to extend goal-setting further in order to have motivated
employees (MacLeod, 2012, pp.70-71). The goal-setting process requires effort from the managers in
order to avoid misunderstandings, frustration and confusion among the employees (Bloisi et al.,
2007, pp.245-246). Organizations require a certain amount of control in order to meet financial
targets and goal-setting is a commonly used control system. In sales organizations it is often common
to use sales targets in order to control the employees’ performance, these targets are often set in the
center of the organization and later on distributed down to individuals. According to the description
above about how effective goals shall be framed it is important for the organization to be able to set
goals that fulfills the criteria to each employee in order for the employee to accept the goal and
motivated to work towards it. There are basic conditions for goals to be motivating; the employees
have to accept the goals, and decide to try to achieve them (Jacobsen & Thorsvik, 2008, p.283). In
order to set goals that are motivating the employees, according to Jacobsen & Thorsvik (2008, p.283)
organizations have to fulfill certain criteria: first of all, as mentioned earlier goals have to be adjusted
to fit individual or the group. At the same time, multiunit organizations need to have a form of
central control over the units and their performance targets (Garvin & Levesque, 2008, pp.108-109).
The goals should also be realistic and challenging to the individual or group just as in SMART goals,
and therefore be adjusted to fit their levels of skills as well as their confidence (Jacobsen & Thorsvik,
2008, p.283). Other external factors that could affect the ability of the group to complete the goals
should also be taken into consideration. The second criterion is to overcome resistance against the
goals and have the employees accepting them. Certain techniques such as coaching and training,
employee participation in decision-making, or the use of rewards can be used to overcome resistance
against goals. 23 It is easier for an organization to evaluate the results when goals are specific and
when they can be measured in quantitative ways, such as money earned, number of customers, or
how many projects that have been executed. These types of goals are easy to communicate
throughout an organization, and are easy to understand. However, when too much focus are put on
the quantitative goals they might become counterproductive to the organizational overall goals
(Jacobsen & Thorsvik, 2008, p.62) Figure 4. Our figure of the relationship between goal-setting and
motivation. 24 3.6 Summary of theoretical framework The theories we have used as a basis of our
research are put together in figure 5 below. This model will be the foundation for us when analyzing
the empirical data. The multiunit organizational structure is the umbrella of the model since we are
looking at assigned goals effect on motivation in these organizations. The goal-setting theories on the
right side of the model will influence the study from the beginning to the end through the design and
characteristics of the goals. We will then look at theories on intrinsic and extrinsic motivation, as well
as McGregor’s X and Y theory and Herzberg’s Dual-factor theory, because in order to find out how
assigned goals affect motivation, it is important to first investigate whether the employees’ working
environment have the conditions for them to be motivated and also for us to understand what they
are motivated of. After the preconditions have been established we will look more into how the
centralized goals affect motivation. To help us with that we will use Vroom’s Expectancy theory,
Bandura’s Self-efficacy theory, as well as goal-setting theories. Figure 5. Our model of the theoretical
framework 25 4. Practical methodology This chapter will display the practical methodIndividuals
must accept the goal and receive feedback Individuals must accept the goal in order to work hard for
it; therefore, there is a risk that an assigned goal that is too difficult will be rejected (Locke, 1968,
p.168). Latham & Locke (1979, p.80) argue that goal acceptance does not have to include incentives;
participation in goal-setting and clear instructions for the goal can increase the purpose of the goal,
and thereby make the employee accept it. We believe that clear instructions can stimulate intrinsic
motivation, if the goals are well explained to the employees, if they see the purpose of the goal and
are therefore willing to work towards it. In addition, research has found that goal setting is the most
effective when feedback is involved and where the manager provides support (Locke et al., 1981,
pp.145-146). Positive feedback increases the employee’s self-confidence and if the employee knows
that he or she will receive feedback, he or she will be more motivated to perform a task (Latham &
Locke, 1979, p.72). Moreover, it is important that the feedback is clear and specific in order for the
employee to be able to evaluate himself/herself and develop his or her skills (Latham & Locke, 1979,
p.79). 20 Individuals must feel committed to the goal Employees must be committed to the goals in
order for them to be effective (Locke et al., 1981, p.131; Locke & Latham, 1990, p.125). If employees
are committed to the goal, the probability of giving more effort increases and the strategy to attain
the goal might change for the better (Latham & Locke, 2006, p.332). Goal-setting is mainly a
motivational mechanism, however, the motivational effect on goal-setting can be lost when there is
no goal commitment (Locke et al., 1981, p.131). Furthermore, in order to achieve goal-commitment,
managers are important in order to convince the employees that the goal is important and realistic
(Locke & Latham, 1991, p.219). Competition is a way to increase a person’s effort to perform a task
and it also encourages individuals to be committed to the goals that they might abandon due to
difficulty. Since competition can trigger extrinsic motivation, we believe that goal-setting is one way
to encourage employees. Moreover, praise and reproof affects the motivation of employees (Locke,
1968, pp.178-180). Effects of goal-setting Performance targets affect behavior in two ways; first of all,
they improve motivation by giving employees goals to strive for, and secondly, it allows the
employees to measure their own performance (Merchant & Van der Stede, 2007, p.30). When
people perform well and attain goals, they transfer the satisfied feeling to the task, meaning that
they are more motivated to perform it again and take on new challenges (Latham & Locke, 2006,
p.333). In addition, goal-setting can have an effect on motivation at work since a goal provides a
purpose and acts as a driving force (Latham & Locke, 2006, p.333). The downsides with goal-setting is
that it can be viewed as a threat instead of a challenge and that it can increase a person’s stress if
they are too challenging (Latham & Locke, 2006, pp.335-337). Another drawback of goal-setting in an
organization is that the focus can shift from quality to quantity depending of the focus of the
organization (Latham, 2004, p.129). The result of goal-setting is commonly a higher self efficacy and it
also has an effect on the feeling of contributing and being purposeful (Latham & Locke, 2006, p.333).
Goal-setting can have both positive and negative effects on employee motivation (Ordóñez et al.,
2009, p.11). While goal setting can have a positive effect on extrinsic motivation, the downside is that
it can sometimes have a negative impact on intrinsic motivation (Ordóñez et al., 2009, p.11). Goal-
setting can also be seen as mechanistic and experienced as meaningless and dehumanizing (Jinks &
Dexter, 2012, p.104). Hedegaard Hein (2012, p.184) believes that there are pitfalls with the goal-
setting theory; used in the wrong way it can create more problems than solutions. One problem is
that when an employee does not achieve the goal they can become unmotivated and dissatisfied;
they might also try to take shortcuts to achieve them, which can damage the quality of the results
(Hedegaard Hein, 2012, p.184). There is also a risk that employees’ focus becomes too narrow and
that they ignore other responsibilities that are not specified by goals (Hedegaard Hein, 2012, p.184).
Other authors however believe that how a goal-directed behavior is pursued determines the
outcome; the outcomes are more positive, such as higher quality performance, when the behavior is
autonomously regulated rather than controlled (Deci & Ryan, 2000, p.244). 21 Participation in Goal-
Setting The effectiveness of assigned goals compared to participatively set goals in achieving goal
commitment and increasing subordinates performance has been debated (Locke & Latham, 1991,
p.218). In a decentralized organization, which is characterized by decision-making lower in the
organization (Siggelkow & Levinthal, 2003, p.651), we believe it to be easier for employees to
participate in goal-setting since they are closer to the decisions. Research has shown that
participation in goal-setting has a positive effect on motivation, however, there is a disagreement in
the matter (Merchant & Van Der Stede, 2007, p.240; Ordóñez et al., 2009, p.11). Some researchers
claim that goals work best if they are participatively set (Vroom, 1964, p.267; Merchant & Van Der
Stede, 2007, p.240), and that goals should be realistic but challenging to the individual (Fu et al.,
2009, p.278; Locke et al., 1981, p.145). Locke and Latham have different criteria when it comes to
how goals shall be formed, such as not being too high or too low. However, we believe these criteria
to be considered vague because of expressions such as “too high” or “too low” can have different
meanings for different individuals. In any case, it would be an argument for participation in goal-
setting in order to determine each individual’s limit of what is high enough. Participation in goal-
setting is sometimes seen as a necessity for successfully achieving the goals and some believe that it
can reduce some of the weaknesses of goal-setting (Rombach, 1991, pp.26-27). Participation in goal-
setting has an effect on motivation; employee participation motivates better job performance
(Vroom, 1964, p.267). Others disagree however, Herzberg et al (1997, p.128) believes that the
supposed success of participation is unclear, and that it will not restore a passion for work. Some
authors have another perspectives to participation and believe that employees who participate in
goal-setting are more likely to be committed to the goals because they understand the purpose of
them (Merchant & Van der Stede, 2007, p.340). Furthermore, participation increases the
understanding of the goals and it also helps developing the process towards attaining the goals
(Merchant & Van der Stede, 2007, p.340). Other researchers however, believe that it is not only the
goal itself that is important; it is also how it is explained to employees for them to accept it (van Riel
et al., 2009, p.1201). When a clear explanation of the goal is set, there is a higher chance of success
than if the goal is not explained at all. Providing employees with challenging goals that are clear
increases the motivation and performance, because the employees feel a sense of trust from the
managerial side (van Riel et al., 2009, pp.1200-1201). Researchers argue that a participatively set
goal and an assigned goal affects the motivation of an individual in a similar manner if the goal is well
explained; if the goal is assigned and not well explained it affects the performance negatively
compared to a participatively set goal (Lee & Feng, 2011, p.280). An explanation about the details of
the goal convinces the employees that the goal is worth striving for and that it is attainable (van Riel
et al., 2009, pp.1201-1202). If this were to be true, whether the employee participated or if goals
were assigned would not be that important, as long as the goal was well explained and the employee
wanted to strive for it. 22 3.5 SMART Goals SMART (Specific, Measurable, Achievable, Realistic, Time-
bound) goals are commonly mentioned in management, as a description of how effective goals and
objectives should be framed (Bloisi et al., 2007, p.85; Chamberlin, 2011, p.22; Macleod, 2012, p.70).
However, there are different opinions of which words to use for effective goal setting (Chamberlin,
2011, p.22). The original description is that goals and objectives must be Specific, Measurable,
Achievable, Realistic and Time-bound (SMART) but now these words are challenged with other words
that have different meanings (Rubin, 2002, pp.26-27). Chamberlin (2011, pp.23-25) argues that
achievable shall be attainable and realistic must be changed to relevant because realistic is
connected to the word real and relevant is more connected to what is in line with the organization
that sets the goals. Time-lined will instead be trackable in order to see the progress an employee is
making and thereby have effective goals. Some also adds two words so effective goals shall be
SMARTER, adding engaging and rewarding to extend goal-setting further in order to have motivated
employees (MacLeod, 2012, pp.70-71). The goal-setting process requires effort from the managers in
order to avoid misunderstandings, frustration and confusion among the employees (Bloisi et al.,
2007, pp.245-246). Organizations require a certain amount of control in order to meet financial
targets and goal-setting is a commonly used control system. In sales organizations it is often common
to use sales targets in order to control the employees’ performance, these targets are often set in the
center of the organization and later on distributed down to individuals. According to the description
above about how effective goals shall be framed it is important for the organization to be able to set
goals that fulfills the criteria to each employee in order for the employee to accept the goal and
motivated to work towards it. There are basic conditions for goals to be motivating; the employees
have to accept the goals, and decide to try to achieve them (Jacobsen & Thorsvik, 2008, p.283). In
order to set goals that are motivating the employees, according to Jacobsen & Thorsvik (2008, p.283)
organizations have to fulfill certain criteria: first of all, as mentioned earlier goals have to be adjusted
to fit individual or the group. At the same time, multiunit organizations need to have a form of
central control over the units and their performance targets (Garvin & Levesque, 2008, pp.108-109).
The goals should also be realistic and challenging to the individual or group just as in SMART goals,
and therefore be adjusted to fit their levels of skills as well as their confidence (Jacobsen & Thorsvik,
2008, p.283). Other external factors that could affect the ability of the group to complete the goals
should also be taken into consideration. The second criterion is to overcome resistance against the
goals and have the employees accepting them. Certain techniques such as coaching and training,
employee participation in decision-making, or the use of rewards can be used to overcome resistance
against goals. 23 It is easier for an organization to evaluate the results when goals are specific and
when they can be measured in quantitative ways, such as money earned, number of customers, or
how many projects that have been executed. These types of goals are easy to communicate
throughout an organization, and are easy to understand. However, when too much focus are put on
the quantitative goals they might become counterproductive to the organizational overall goals
(Jacobsen & Thorsvik, 2008, p.62) Figure 4. Our figure of the relationship between goal-setting and
motivation. 24 3.6 Summary of theoretical framework The theories we have used as a basis of our
research are put together in figure 5 below. This model will be the foundation for us when analyzing
the empirical data. The multiunit organizational structure is the umbrella of the model since we are
looking at assigned goals effect on motivation in these organizations. The goal-setting theories on the
right side of the model will influence the study from the beginning to the end through the design and
characteristics of the goals. We will then look at theories on intrinsic and extrinsic motivation, as well
as McGregor’s X and Y theory and Herzberg’s Dual-factor theory, because in order to find out how
assigned goals affect motivation, it is important to first investigate whether the employees’ working
environment have the conditions for them to be motivated and also for us to understand what they
are motivated of. After the preconditions have been established we will look more into how the
centralized goals affect motivation. To help us with that we will use Vroom’s Expectancy theory,
Bandura’s Self-efficacy theory, as well as goal-setting theories. Figure 5. Our model of the theoretical
framework 25 4. Practical methodology This chapter will display the practical methodIndividuals
must accept the goal and receive feedback Individuals must accept the goal in order to work hard for
it; therefore, there is a risk that an assigned goal that is too difficult will be rejected (Locke, 1968,
p.168). Latham & Locke (1979, p.80) argue that goal acceptance does not have to include incentives;
participation in goal-setting and clear instructions for the goal can increase the purpose of the goal,
and thereby make the employee accept it. We believe that clear instructions can stimulate intrinsic
motivation, if the goals are well explained to the employees, if they see the purpose of the goal and
are therefore willing to work towards it. In addition, research has found that goal setting is the most
effective when feedback is involved and where the manager provides support (Locke et al., 1981,
pp.145-146). Positive feedback increases the employee’s self-confidence and if the employee knows
that he or she will receive feedback, he or she will be more motivated to perform a task (Latham &
Locke, 1979, p.72). Moreover, it is important that the feedback is clear and specific in order for the
employee to be able to evaluate himself/herself and develop his or her skills (Latham & Locke, 1979,
p.79). 20 Individuals must feel committed to the goal Employees must be committed to the goals in
order for them to be effective (Locke et al., 1981, p.131; Locke & Latham, 1990, p.125). If employees
are committed to the goal, the probability of giving more effort increases and the strategy to attain
the goal might change for the better (Latham & Locke, 2006, p.332). Goal-setting is mainly a
motivational mechanism, however, the motivational effect on goal-setting can be lost when there is
no goal commitment (Locke et al., 1981, p.131). Furthermore, in order to achieve goal-commitment,
managers are important in order to convince the employees that the goal is important and realistic
(Locke & Latham, 1991, p.219). Competition is a way to increase a person’s effort to perform a task
and it also encourages individuals to be committed to the goals that they might abandon due to
difficulty. Since competition can trigger extrinsic motivation, we believe that goal-setting is one way
to encourage employees. Moreover, praise and reproof affects the motivation of employees (Locke,
1968, pp.178-180). Effects of goal-setting Performance targets affect behavior in two ways; first of all,
they improve motivation by giving employees goals to strive for, and secondly, it allows the
employees to measure their own performance (Merchant & Van der Stede, 2007, p.30). When
people perform well and attain goals, they transfer the satisfied feeling to the task, meaning that
they are more motivated to perform it again and take on new challenges (Latham & Locke, 2006,
p.333). In addition, goal-setting can have an effect on motivation at work since a goal provides a
purpose and acts as a driving force (Latham & Locke, 2006, p.333). The downsides with goal-setting is
that it can be viewed as a threat instead of a challenge and that it can increase a person’s stress if
they are too challenging (Latham & Locke, 2006, pp.335-337). Another drawback of goal-setting in an
organization is that the focus can shift from quality to quantity depending of the focus of the
organization (Latham, 2004, p.129). The result of goal-setting is commonly a higher self efficacy and it
also has an effect on the feeling of contributing and being purposeful (Latham & Locke, 2006, p.333).
Goal-setting can have both positive and negative effects on employee motivation (Ordóñez et al.,
2009, p.11). While goal setting can have a positive effect on extrinsic motivation, the downside is that
it can sometimes have a negative impact on intrinsic motivation (Ordóñez et al., 2009, p.11). Goal-
setting can also be seen as mechanistic and experienced as meaningless and dehumanizing (Jinks &
Dexter, 2012, p.104). Hedegaard Hein (2012, p.184) believes that there are pitfalls with the goal-
setting theory; used in the wrong way it can create more problems than solutions. One problem is
that when an employee does not achieve the goal they can become unmotivated and dissatisfied;
they might also try to take shortcuts to achieve them, which can damage the quality of the results
(Hedegaard Hein, 2012, p.184). There is also a risk that employees’ focus becomes too narrow and
that they ignore other responsibilities that are not specified by goals (Hedegaard Hein, 2012, p.184).
Other authors however believe that how a goal-directed behavior is pursued determines the
outcome; the outcomes are more positive, such as higher quality performance, when the behavior is
autonomously regulated rather than controlled (Deci & Ryan, 2000, p.244). 21 Participation in Goal-
Setting The effectiveness of assigned goals compared to participatively set goals in achieving goal
commitment and increasing subordinates performance has been debated (Locke & Latham, 1991,
p.218). In a decentralized organization, which is characterized by decision-making lower in the
organization (Siggelkow & Levinthal, 2003, p.651), we believe it to be easier for employees to
participate in goal-setting since they are closer to the decisions. Research has shown that
participation in goal-setting has a positive effect on motivation, however, there is a disagreement in
the matter (Merchant & Van Der Stede, 2007, p.240; Ordóñez et al., 2009, p.11). Some researchers
claim that goals work best if they are participatively set (Vroom, 1964, p.267; Merchant & Van Der
Stede, 2007, p.240), and that goals should be realistic but challenging to the individual (Fu et al.,
2009, p.278; Locke et al., 1981, p.145). Locke and Latham have different criteria when it comes to
how goals shall be formed, such as not being too high or too low. However, we believe these criteria
to be considered vague because of expressions such as “too high” or “too low” can have different
meanings for different individuals. In any case, it would be an argument for participation in goal-
setting in order to determine each individual’s limit of what is high enough. Participation in goal-
setting is sometimes seen as a necessity for successfully achieving the goals and some believe that it
can reduce some of the weaknesses of goal-setting (Rombach, 1991, pp.26-27). Participation in goal-
setting has an effect on motivation; employee participation motivates better job performance
(Vroom, 1964, p.267). Others disagree however, Herzberg et al (1997, p.128) believes that the
supposed success of participation is unclear, and that it will not restore a passion for work. Some
authors have another perspectives to participation and believe that employees who participate in
goal-setting are more likely to be committed to the goals because they understand the purpose of
them (Merchant & Van der Stede, 2007, p.340). Furthermore, participation increases the
understanding of the goals and it also helps developing the process towards attaining the goals
(Merchant & Van der Stede, 2007, p.340). Other researchers however, believe that it is not only the
goal itself that is important; it is also how it is explained to employees for them to accept it (van Riel
et al., 2009, p.1201). When a clear explanation of the goal is set, there is a higher chance of success
than if the goal is not explained at all. Providing employees with challenging goals that are clear
increases the motivation and performance, because the employees feel a sense of trust from the
managerial side (van Riel et al., 2009, pp.1200-1201). Researchers argue that a participatively set
goal and an assigned goal affects the motivation of an individual in a similar manner if the goal is well
explained; if the goal is assigned and not well explained it affects the performance negatively
compared to a participatively set goal (Lee & Feng, 2011, p.280). An explanation about the details of
the goal convinces the employees that the goal is worth striving for and that it is attainable (van Riel
et al., 2009, pp.1201-1202). If this were to be true, whether the employee participated or if goals
were assigned would not be that important, as long as the goal was well explained and the employee
wanted to strive for it. 22 3.5 SMART Goals SMART (Specific, Measurable, Achievable, Realistic, Time-
bound) goals are commonly mentioned in management, as a description of how effective goals and
objectives should be framed (Bloisi et al., 2007, p.85; Chamberlin, 2011, p.22; Macleod, 2012, p.70).
However, there are different opinions of which words to use for effective goal setting (Chamberlin,
2011, p.22). The original description is that goals and objectives must be Specific, Measurable,
Achievable, Realistic and Time-bound (SMART) but now these words are challenged with other words
that have different meanings (Rubin, 2002, pp.26-27). Chamberlin (2011, pp.23-25) argues that
achievable shall be attainable and realistic must be changed to relevant because realistic is
connected to the word real and relevant is more connected to what is in line with the organization
that sets the goals. Time-lined will instead be trackable in order to see the progress an employee is
making and thereby have effective goals. Some also adds two words so effective goals shall be
SMARTER, adding engaging and rewarding to extend goal-setting further in order to have motivated
employees (MacLeod, 2012, pp.70-71). The goal-setting process requires effort from the managers in
order to avoid misunderstandings, frustration and confusion among the employees (Bloisi et al.,
2007, pp.245-246). Organizations require a certain amount of control in order to meet financial
targets and goal-setting is a commonly used control system. In sales organizations it is often common
to use sales targets in order to control the employees’ performance, these targets are often set in the
center of the organization and later on distributed down to individuals. According to the description
above about how effective goals shall be framed it is important for the organization to be able to set
goals that fulfills the criteria to each employee in order for the employee to accept the goal and
motivated to work towards it. There are basic conditions for goals to be motivating; the employees
have to accept the goals, and decide to try to achieve them (Jacobsen & Thorsvik, 2008, p.283). In
order to set goals that are motivating the employees, according to Jacobsen & Thorsvik (2008, p.283)
organizations have to fulfill certain criteria: first of all, as mentioned earlier goals have to be adjusted
to fit individual or the group. At the same time, multiunit organizations need to have a form of
central control over the units and their performance targets (Garvin & Levesque, 2008, pp.108-109).
The goals should also be realistic and challenging to the individual or group just as in SMART goals,
and therefore be adjusted to fit their levels of skills as well as their confidence (Jacobsen & Thorsvik,
2008, p.283). Other external factors that could affect the ability of the group to complete the goals
should also be taken into consideration. The second criterion is to overcome resistance against the
goals and have the employees accepting them. Certain techniques such as coaching and training,
employee participation in decision-making, or the use of rewards can be used to overcome resistance
against goals. 23 It is easier for an organization to evaluate the results when goals are specific and
when they can be measured in quantitative ways, such as money earned, number of customers, or
how many projects that have been executed. These types of goals are easy to communicate
throughout an organization, and are easy to understand. However, when too much focus are put on
the quantitative goals they might become counterproductive to the organizational overall goals
(Jacobsen & Thorsvik, 2008, p.62) Figure 4. Our figure of the relationship between goal-setting and
motivation. 24 3.6 Summary of theoretical framework The theories we have used as a basis of our
research are put together in figure 5 below. This model will be the foundation for us when analyzing
the empirical data. The multiunit organizational structure is the umbrella of the model since we are
looking at assigned goals effect on motivation in these organizations. The goal-setting theories on the
right side of the model will influence the study from the beginning to the end through the design and
characteristics of the goals. We will then look at theories on intrinsic and extrinsic motivation, as well
as McGregor’s X and Y theory and Herzberg’s Dual-factor theory, because in order to find out how
assigned goals affect motivation, it is important to first investigate whether the employees’ working
environment have the conditions for them to be motivated and also for us to understand what they
are motivated of. After the preconditions have been established we will look more into how the
centralized goals affect motivation. To help us with that we will use Vroom’s Expectancy theory,
Bandura’s Self-efficacy theory, as well as goal-setting theories. Figure 5. Our model of the theoretical
framework 25 4. Practical methodology This chapter will display the practical method

file:///D:/Documents/Desktop/FULLTEXT01.pdf

Decentralization is a type of organizational structure in which decision-making responsibilities is

delegated to the low levels managers and employees. Decentralization gives more power and
autonomy to lower level staff to make decisions. A decentralized structure shows more control and a
bottom-to-top flow of ideas, comments and decisions. Under decentralization, all members can act
more quickly to make a decisions and solve problems and control the situation. Decentralization
offers several advantages for those organizations, which aim to have competitive strategies. Actually
structure of an organization should follow the strategy of the organization. If the organization follows
innovation strategy, the organizational structure must be organic. It requires losing structure, low
formalization, low specialization, and more decentralization (Robbins, Judge, & Breward, 2003). In
the following, we will discuss regarding decentralization from management and employees’
perspective. From the management perspective we can mention to the relieving the responsibilities,
more efficient decision-making, ease of expansion, facilitates growth, better control, flexibility,
human resource development, work specialization and high levels of decision. Decentralizing takes
some of the responsibilities from the managers and gives to the lower levels in the organization.
When managers allow others to decide for daily operation within an organization, may spend more
time on more serious issues, such as planning for developing organization or meeting with significant
customers, focusing on strategy and high level decisions. Employees can make a decision and react
quickly to situations where quick decision and action can mean the difference between gaining and
losing a customer. Decentralisation enables the employees to perform by their maximum potential,
as well as promotes a sense of competition among them, which motives them towards growth of the
enterprise too. Decentralization can facilitate the process of expansion for a growing business.
Through decentralization all members can react more quickly to the particular needs of the area as
an independent party. Under strong decentralization structure employees may improve their
personal sources such as self- efficacy or self-esteem and more important innovative abilities. In
order to stay competitive in today’s complex market, organizations must show immediate reaction
and make a decision very quickly. This requires a complete flexible system. A decentralized system
creates a flexible environment for lower levels managers and employees to interpret different
conditions and make suitable and timely decisions and build competitive strategies. Through
decentralization, the top managers’ excessive workload will decrease, Decentralization Supervisor
Support Idea Realization Idea Promotion Idea Generation Innovative Behaviour Electronic copy
available at: https://ssrn.com/abstract=3337656 Mahlagha Darvishmotevali 34 which help them to
save their time and focus on core and important issues, making appropriate programs and providing
strategic direction for general important decisions, innovation, growth, and further development.
Decentralized system provides opportunities for employees at each level to develop their skills and
expertise, as well as top level managers and executives become aware regarding the actual potential
and capacity of the lower level employees and managers, and can better delegate duties on them.
Empowering employees, develops initiative among employees, develops managerial talent for the
future, quick decision making, and facilitate effective marketing are some example resulting of
decentralization from employees’ perspective. Under a perfect decentralized structure, employees
can improve their skills by handling different duties independently. This can enhance their
information, knowledge, and experiences at all levels. It also provides qualified manpower for
fulfilling the top positions through promotions. Employees can be more empowered by having more
autonomy to react in special situation and make appropriate decisions, and giving them a sense of
importance, as well as allows them to use of their knowledge, abilities and experience to gain and
implement their own ideas and strategies. Decentralisation helps the managers at the lower levels to
take all those decisions, which are for the betterment of organization on their own and to develop
solutions for solving the various problems they face. This helps in enhancing confidence and self-
reliance among the employees. Decentralization promotes independent and fast decision making
process by employees as they are constantly touch with all activities within an organization and
directly contact with customers. In decentralized organization all members from top to down are
sharing the decision making powers. They have different levels of autonomy and delegation.
Delegation and freedom of action promote team working among employees. In this condition
employees and managers may complete each other as a team towards achieving organizational
goals. Decentralized structure allows employees to work in terms of their decision and they are
directly responsible for their actions within an organization, they are thus more cautious what to do.
Managers’ effort to make organization more flexible, active and responsive has opened a recent
trend toward decentralized decision making by lower- level managers, who are closer to the action
and generally have more detailed information about different issues within an organization.
Literature Review and Hypothesis Development Innovative Behavior The significant role of
innovation for organizational achievement and success is strongly accepted. Innovative behavior is
explained as introduction and application of novel opinions, products, processes, and procedures to
an individual’s job roles, work units, or organizations. Scott and Bruce (1994) defined employees’
innovative behaviors as the generation, promotion, and execution of new and valuable ideas.
Innovative behavior can be conducted either by a member or groups of members within the
organization. The terms creativity and innovation are largely used interchangeably in different
studies, and the distinction between these two concepts may be more one of emphasis rather than
substance (West & Farr, 1990). However, a consensus regarding the terms' definitions has recently
emerged; creativity is related to the production of new and practical ideas (Mumford, Electronic copy
available at: https://ssrn.com/abstract=3337656 35 International Journal of Organizational
Leadership 8(2019) Scott, Gaddis, & Strange, 2002), whereas innovation is concerned with the
production or adoption of valuable ideas and implementation of ideas (Kanter, 1988). Innovation is
the process of redesigning of a product or process from outside the organization. Researchers who
are working on innovation topic have explicitly accepted that idea generation is just one step of a
multistep process on which different social factors are influential (Kanter, 1988). Based on this view,
employees’ innovation starts with issue or problems recognition as well as idea generation or
solutions, either new or adapted. During the second step of this process, innovative employees seek
sponsorship for ideas and try to create an alliance of supporters and fans for this idea. Eventually, in
the next (third) step of the process, the employees complete their novel ideas by generating models
that can be seen, touched, feasible or experienced, and subsequently be diffused or mass-produced
(Kanter, 1988). Therefore, innovation is considered to be a multi-step process, with different variety
activities and behaviors at each step. Since innovation is featured by permanent activities rather than
discrete, sequential steps (Schroeder, Van de Ven, Scudder, & Polley, 1989), employees can be
expected to be involved in every combination of these stages at any time. Decentralization According
to the business dictionary, decentralization is described as a transfer of decisionmaking power and
the assignment of accountability and responsibility for results. It is accompanied by the delegation of
commensurate authority to individuals or units at all levels of an organization, even those far
removed from headquarters or other centers of power. Decentralization is a broad concept, as it is
the extent to which authority is delegated from one level or one unit of the organization to another
(Mosley & Pietri, 2014). Decentralization will cause a delegation of power downwards, to the regular
employees (Kralewski, 2012). Decentralization is described as a shift in the responsibility for planning,
management, and the raising and allocation of resources from central management to semi-
autonomous authorities, functional authorities or voluntary organizations (Rondinelli & Nellis, 1986).
Decentralization can be described in similar dimensions to centralization, by proposing two
approaches to decentralization, which are vertical degradation and horizontal diffusion. The first
approach of vertical degradation happens when authority is transferred from one level of
organization, typically from higher levels to lower levels. The second approach of decentralization
refers to horizontal diffusion, which explains the movement of authority from the centre, such as
central management, to the periphery, such as the supervision sectors. A number of studies have
been conducted to examine vertical degradation in substantive policy fields such as health and
welfare reform (Grodzins & Elazar, 1974; Jennings & Ewalt, 1999; Tolbert & Zucker, 1983).
Administrative decentralization is another type of decentralization which refers to the redistribution
of power, responsibility and fiscal resources to provide public services between different levels of an
organization. Administrative decentralization involves the full or partial transfer of an array of
functional responsibilities to the lower levels, such as supervisors and frontline managers. There are
three main types of administrative decentralization - deconcentration, delegation and devolution –
each of which has different characteristics. Electronic copy available at:
https://ssrn.com/abstract=3337656 Mahlagha Darvishmotevali 36 Decentralization and Innovative
Behavior Empirical studies to assess the effect of decentralization on outcomes such as economic
growth, innovation, or governance and corruption have shown mixed results (Garman, Haggard, &
Willis, 2001; Martinez-Vazquez, 2003; Rodríguez-Pose & Ezcurra, 2011; Taylor, 2007). Are service
industries with decentralized management oriented more effective at developing long-term
innovation than companies with centralized management? Ritzen and Soete (2011) claimed that the
decentralization of innovation policy, if properly managed, can stimulate healthy competition which
in turn can improve aggregate innovation performance. Liu, Martineau, Chen, Zhan, and Tang (2006)
examined the role of decentralization to improve the human resource management in health
departments. The results demonstrated that decentralization can give better control to the health
service managers to manage their employees. In some cases, it may lead to improved human
resources outcomes and eventually, better health services. Madanoglu, Altinay, and Wang (2016)
investigated the impact of family involvement on entrepreneurial behaviors via decentralization. The
results contributed to entrepreneurship literature by providing a clear explanation of how a decision-
making mechanism such as decentralization impacts innovation. The findings demonstrated that
decentralization is a significant antecedent of innovation and the risk-taking process. Lee et al. (2016)
attempted to provide a better understanding of open innovation within the context of
decentralization by examining 2,811 projects. The analysis results revealed that the decentralization
of decision-making encourages both inbound and outbound open innovation. In this paper, it is
proposed that decentralization affords companies significant opportunities. Decentralization helps in
innovation in that it allows employees with different skills and different thoughts to bring together
different products and technologies to satisfy the unmet needs of patients or customers. Thus: H1:
Decentralization positively impacts the innovative behavior among employees. Supervisor Support A
supervisor is defined as an individual who is in the first-line management to control and regulate
employees in their works. Supervisors monitor employees’ performance of delegated responsibilities
and tasks. Supervisors affect hiring, punishing, rewarding, changing, and other activities which are
associated with employees. Supervisors give organizational instructions to employees and are
responsible for the operations, productivity, and overall performance of a group of employees.
Supervisor as a manager-like role has an important and significant effect in developing positive and
safety attitudes, work training, up-to-date working methods and strategies, and identifying
unpleasant actions in the workplace (Miedema, 2015). Supervisors provide a supportive relationship,
which create resources such as sharing information, emotional empathy/sympathy or
tangible/intangible cooperation and assistance (House, 2003). Supervisors have very significant role
to create a safe workplace for employees, since they are close to the actual work being done and can
identify and solve employees’ safety and security concerns. House (2003) argued that supervisory
support is divided into four sources: Task support, relation support, evaluation support, and
informational support. Task support refers to the preparation equipment, latest technology, money,
time and environmental modification. Relation support are those kind of support relating to the
esteem, trust, affection, interest, Electronic copy available at: https://ssrn.com/abstract=3337656 37
International Journal of Organizational Leadership 8(2019) listening. Evaluation support refers to the
verification, affirmation, feedback, fair comparison. The informational support refers to the advice,
suggestions, and guidance. Supervisors through these four main sources of support are able to
enhance employees’ capacity to cope with any problems and stress in the workplace. Supervisor
Support as a Moderator On the other hand, significant issues can be observed in the process of
supervision in decentralized structures. Supervisors are responsible for monitoring the quality of the
services and assessing employee’s needs. In accordance with the significant role of leadership
(Redmond, Mumford, & Teach, 1993), supervisor’s support has been shown to be an effective
antecedent of employees’ innovative behavior and creativity (Mumford, Scott, Gaddis, & Strange,
2002; Rosing, Frese, & Bausch, 2011). According to the Leader - Member Exchange (LMX) theory
(Dienesch & Liden, 1986), the relationship between leaders and members in an organization
develops over time through a series of observations, try-outs, interactions and conversations. When
a manager or supervisor is close to the employees, they will consider each other "in-group";
however, the other employees will become "out-group". When supervisors and employees have
closer relationships, employees will tend to demonstrate better performance and creativity (Graen,
Novak, & Sommerkamp, 1982). Studies show that "in-group" members are generally 20% more
efficient in terms of job performance and 50% more satisfied with their jobs than "out-group"
members (Mayfield & Mayfield, 1998). Alvesson and Sveningsson (2003) emphasized the important
role of supervisors by demonstrating that leaders are pivotal in determining the direction and overall
guidelines for organizational performance, because innovative ideas require leadership in the form of
advocates. The results show that middle managers play the role of ‘knowledge-transfer agents’
(Richards & Duxbury, 2014) by establishing a context that facilitates individual knowledge acquisition
and sharing. In such a context, employees would be encouraged to accumulate, use or even extend
their knowledge for the purpose of improving processes and innovation. In a decentralized
organization, middle and lower levels of management make broader, more important decisions
about their units (Mosley & Pietri, 2014). Bos-Nehles et al. (2017) in a comprehensive qualitative
research study, showed the power and ability of publicsector supervisors to lead and encourage
employees in innovative behaviors. On the downside, implementation failures and the shortage of
essential innovation projects seem to be the consequences of loosely coupled bottom-up and top-
down innovation projects and decentralization that need situational leadership, which stress network
activities and lobbying with public managers. Organizations’ managers and supervisors can positively
influence employees’ motivation, satisfaction, and can create a positive atmosphere, which
encourages innovative behavior among employees (Damanpour & Schneider, 2009). In the present
study, it is hypothesized that in decentralized systems, frontline managers and supervisors have
more ability to interpret organization policies, make daily operational decisions, implement effective
training processes and assert their influence within the organization. This can be beneficial and
effective for motivating employees to increase their job performance. Thus: Electronic copy available
at: https://ssrn.com/abstract=3337656 Mahlagha Darvishmotevali 38 H2: Supervisor support
moderates the positive impact of decentralization on innovative behavior. Method

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