ORGANISATIONAL DESIGN

STRATEGY

Lecturer: Bekzat Musrepova, PhD Candidate

 AGENDA
1. What we know
2. What we do not know

(281 pages) (+100 pages) (+30 pages)

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1.WHAT WE KNOW

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 THE ORGANISATIONAL DESIGN IS…

• The design of division of labor and integration of effort (Puranam,

2018).

• Task division, task allocation, reward distribution, and information flows

(Puranamet al., 2014).

• Organizational design is deciding who does what when.

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 FACTORS AFFECTING
ORGANIZATION DESIGN

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 ORGANISATIONAL DESIGN
APPROACH
P
• Step 1 Goals and scope
• Step 2 Assessing strategy
Diagnosis

• Step 3 Analyzing the structure

• Step 4 Assessing process and people
• Step 5 Analyzing coordination, control, and incentives
• Step 6 Designing the architecture Design
• Step 7 Implementing the architecture Implementation

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AN ORGANIZATIONAL GOAL IS A DESIRED STATE OF AFFAIRS
THAT THE ORGANIZATION ATTEMPTS TO REACH.

A GOAL REPRESENTS A RESULT OR END POINT TOWARD WHICH

ORGANIZATIONAL EFFORTS ARE DIRECTED. THE CHOICE OF
GOALS AND STRATEGY INFLUENCES HOW THE ORGANIZATION
SHOULD BE DESIGNED.

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EFFECTIVENESS VS. EFFICIENCY

P = R _ C
Profit Revenue Cost

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 THE GOAL SPACE
Cost focus

LEGO Microsoft

Monopoly/ Biotechnology start-ups, 3M

Early start-up Focus on product and service
goals (volatile environment)

Revenue focus

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MISSION VS. OPERATIVE GOAL

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HOW MUCH VALUE DOES THE
ORGANISATION CREATE?

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VALUE FOR CUSTOMERS.
VALUE FOR EMPLOYEES.
VALUE FOR SUPPLIERS.

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The most customer
would pay for a
product or service

The least amount of

compensation
employee would accept

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Product quality
Product complements
Network effects

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 A STRATEGY IS A PLAN FOR INTERACTING WITH THE
COMPETITIVE ENVIRONMENT TO ACHIEVE ORGANIZATIONAL
GOALS.

SOME MANAGERS THINK OF GOALS AND STRATEGIES AS

INTERCHANGEABLE, BUT FOR OUR PURPOSES, GOALS DEFINE
WHERE THE ORGANIZATION WANTS TO GO AND STRATEGIES
DEFINE HOW IT WILL GET THERE.

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 A STRATEGY IS AN INTEGRATIVE SET OF
CHOICES THAT POSITIONS YOU ON A
PLAYING FIELD OF YOUR CHOICE IN A WAY
THAT YOU WIN.

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2. WHAT WE DO NOT KNOW

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STRATEGY ACHIEVEMENT

3 Lecture 4-5

Lecture 2
2

Lecture 2
1

(Reeves, Haanæs and Sinha, 2015)

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 STRATEGY PALETTE

Be viable

Be fast Be the orchestrator

Be big Be first

FLEXIBILITY/ SHAPEABLE

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 STRATEGY PALETTE Financial institutions
in crisis

• Textile retail • Software

• Semiconductors • Apps
• Pharma

• Utility Not industry specific

• Automobile
• O&G
• (mature)

FLEXIBILITY

(Reeves, Haanæs and Sinha, 2015)

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CLASSICAL STRATEGY

(Reeves, Haanæs and Sinha, 2015)

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CLASSICAL STRATEGY

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ADAPTIVE STRATEGY

(Reeves, Haanæs and Sinha, 2015)

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ADAPTIVE STRATEGY

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VISIONARY STRATEGY

(Reeves, Haanæs and Sinha, 2015)

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VISIONARY STRATEGY

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SHAPING STRATEGY

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SHAPING STRATEGY

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RENEWAL STRATEGY

Greiner's
Growth
Model

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 FORWARD LOOKING
MODELS FOR PREEMPTIVE STRATEGY

(Reeves, Haanæs and Sinha, 2015)

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STRATEGY ACHIEVEMENT

P
1

(Reeves, Haanæs and Sinha, 2015)

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STABLE VS TURBULENT PERIODS

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EXPLORATION VS. EXPLOITATION

Exploration is Exploitation is
the ability to the ability to
develop refine and
completely new improve current
activities that
instil variety activities to
into the firm reproduce
success

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 WHAT IS ORGANIZATIONAL
AMBIDEXTERITY?
We need these to occur simultaneously and to a good standard for the
organization to become ambidextrous

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Too much exploitation and we risk a
success trap: repeating the same
recipes, investing in the same
products, services, resources and
capabilities. This is addictive and is
associated with inertia.
Too much exploration and we risk a
failure trap: seeking novelty for its
own sake and waiting for the big hit
that may never come or fail, leading
to a cycle of yet more exploration
and risk-taking as the failure
triggers yet more search for novelty.
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 WHY DIFFICULT?
• Doing less of the same and
replacing it with new
things.
• Doing more of the same,
only better. • Uncertain: payoffs are
often unknown and risky
• Addictive: we know it => using resources to
works, making it better is experiment and discover
cheap, and it relies on
new things
streamlining and
efficiency.

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 HOW STRATEGIES AFFECT ORG. DESIGN?
Burton’s typology based on Miles and Snow

CISCO (acquisition)

LEGO

Microsoft

Start-up Biotechnology start-

ups, 3M

(Daft et. al, 2020)

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