Chapter 8

Organising: Organisational Culture,

Structure and Recruitment

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 To identify the four functions of
organizational culture.
 To identify and describe the 7
common elements of an organization.
 To identify the 8 types of
organizational structures and to
illustrate the structures.
 To differentiate the mechanistic and
organic organization.

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How an Organization’s Culture & Structure
Are used to Implement Strategy

 In Topic 4, Strategy: the large-scale

action plans that reflects the
organization’s vision and are used to
set direction for the organization.
 To implement a particular strategy,
managers must determine the right
kind of:
i. Organizational culture
ii. Organizational structure
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 What is an
Organizational Culture?
A system of shared beliefs and
values that develops within the
organization and guides the
behavior of its members.

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1. Invisible Level: 2. Visible Level:
Not seen by the  Observable
naked eye. culture
 Values  Manifestations of
 Beliefs culture:
 Assumptions  Symbols
 Stories
 Heroes
 Rites and rituals
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 Visible Level of Culture
 SYMBOL
 An object, act or quality, or
event that conveys meaning to
others. “Trophy”

 STORIES
 A narrative based on true
events, which is repeated – and
sometimes embellished upon –
to emphasize a particular value.

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 Visible Level of Culture
 HEROES
A person whose accomplishments
embody the values of the
organization.

 RITES & RITUALS

 Activities
and ceremonies, planned
and unplanned, that celebrate
important occasions and
accomplishments in the organization’s
life

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Example

 Blue, yellow and red, being the national colours reflect

the Malaysian identity of the institution.
 The letter 'A' in auspicious red gives it prominence,
suggesting distinction and excellence in the education
provided by UTAR. Red also signals success, prosperity
and protection from negative forces.
 The swing of the bold stroke signifies a 'yes', a mark of
enthusiastic approval and the right choice.
 The cascade of six lines, comprises the comprehensive
courses and wholesome components of education
 The seventh line, the tail of the backbone stroke,
represents the holistic aspect of education: character
development, community-building and healthy living.
Together, the holistic and the academic propel UTAR
into a future filled with great promise and unlimited
opportunities.
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What do these symbols /
logos mean?

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 The Audi symbol is four ceiling rings that
reflect the four manufacturers of Auto Union.
This Audi emblem signs the association of
the brand Audi with others: Horch, DKW,
Wanderer: the initial ring from at the left
side represents Audi, the next represents
DKW, the third is Horch, then the fourth ring
is Wanderer.

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 Suddenly, there she was: a 16th century
Norse woodcut of a twin-tailed mermaid, or
Siren. There was something about her – a
seductive mystery mixed with a nautical
theme that was exactly what the founders
were looking for. A logo was designed around
her, and our long relationship with the Siren
began.

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 BMW. BMW's logo is a tribute to the
company's history in aviation.
The logo shows a propeller in motion with
the blue part representing the sky. This is
due to the company's role of building
aircraft engines for the German military
during World War II.

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 The Importance of Culture
 Culture can powerfully shape an
organization’s long term success.
 There are 4 functions of organizational
culture we can consider:

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 Four Functions of Organizational
Culture
Organizational
Identity

Sense Making Organizational Collective

Device Culture Commitment

Social System
Stability

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Four Functions of Organizational
Culture
1. It gives members an organizational
identity
 Celebrate employees contributions, treat
employees like customers.

2. It facilitates collective commitment

 A company that employees are proud to be
part of.

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 Four Functions of Organizational
Culture
3. It promotes social-system stability
 Conflict and change management implemented
effectively; positive and reinforcing
environment.

4. It shapes behavior by helping

employees make sense of their
surroundings
 Helps understand why the organization does
what it does and how it intends to accomplish
its goals.
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 Revisited: The 3 types of
Organizations

• Organization: is a system of
consciously coordinated activities
or forces of two or more people.

Forprofit organizations
Nonprofit organizations
Mutual-benefit organizations

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 The Organization Chart
 Whatever the size or type of organization, it
can be represented in an organization chart.

 An organizational chart is a box-and-lines

illustration showing the formal lines of
authority and organization’s official
positions or work specializations.

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Example for The Organization Chart
a hospital
Board of
Directors

Strategic Chief Executive Legal Counsel

Planning Advisor Officer

Cost Containment
President Staff

Executive Executive
Administrative Medical Director
Director

Director of Director of Director of Director of Director of Chief

Nutrition & X-Ray & Physician
Personnel Admissions Food Laboratory Pharmacy
Services Services

Director of Director of Director of Director of

Patient & Accounting Surgery Outpatient
Public Services
Relations
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 Common Elements of Organizations:
“Four proposed by Edgar Schein”
1. Common purpose: means of unifying
(bring together) members.

2. Coordinated effort: working together for

common purpose.

3. Division of labor: work specialization for

greater efficiency.

4. Hierarchy of authority: the chain of

command.
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 More Common Elements of
Organizations
5. Span of control:
 Number of people reporting directly to a given
manager.
 Two kinds of spans of control,
narrow (or tall) and wide (or flat).

6. Authority, Responsibility, & Delegation:

 Authority: Rights gained in managerial position to
make decisions, give orders and utilize resources.
 Responsibility: Obligation to perform the tasks
assigned to you.
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 More Common Elements of
Organizations
6. Authority, Responsibility, & Delegation:
 Delegation: Process of assigning managerial
authority and responsibility to managers and
employees lower in the hierarchy.

7. Centralization versus Decentralization of

Authority:
 Centralized authority: Important decisions are
made by higher levels of managers.
 Decentralized authority: Important decisions are
made by middle level and supervisory level
managers.
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 Spans of Control: Wide & Narrow
Key:
T = Top manager
Narrow CEO M = Middle manager
F = First-line (supervisory) manager

T T T

M M M M M M M M M

F F F F F F F F F F F F F F

F F F F F F F F F F F F F

Wide CEO

M M M M M M M M M

F F F F F F F F F F F F F F

F F F F F F F F F F F F F
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 Eight Organizational Structures
1) Simple structure: for the small firm. “centralized”
2) Functional structure: grouping by similar work specialties.
3) Division structure: grouping by similarity of purpose.
4) Conglomerate structure: grouping by industry.
5) Hybrid structure: functional & divisional used within the
same organization.
6) Matrix structure: a grid of functional & divisional for two
chains of command.
7) Team-based structure: eliminating functional barriers to
solve problems.
8) Network structure: connecting a central core to outside
(independent) firms by computer connections.
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Simple Structure

There is only one

Owner
hierarchical level of
management beneath
the owner
Administrative
Assistant

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 Functional Structure
Structure for a
business President

Vice
Vice Vice Vice
President,
President, President, President,
Human
Marketing Finance Production
Resources

Chief
Structure for a Administrator
hospital

Chief of Director of Director of Director of

Medical Administrative Outpatient Nutrition &
Services Services Services Food Services

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 Divisional Structure
Product Divisional President
Structure

Motion Magazine & Internet

Music
Pictures & TV Book Products
Division
Division Division Division

Customer Divisional President

Structure

Consumer Mortgage Business Agriculture

Loans Loans Loans Loans

Geographic Divisional President

Structure

Western Northern Southern Eastern

Region Region Region Region
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 Conglomerate Structure

This resembles the

structure of the
Sunway Group
President

Housing
Retail Hospitality Healthcare Education
Development

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 Hybrid Structure
Product
Divisional
President
Structure

President President President President

Cadillac Buick Pontiac Chevrolet

Vice- Functional
Vice- Vice- Vice-
President, divisional
President, President, President,
Human structure
Production Marketing Finance
Resources

Geographical
Manager Manager Manager Manager divisional structure
Region I Region II Region III Region IV

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 Matrix Structure
Functional
President
Project Structure
structure
Vice Vice Vice Vice
President, President, President, President.
Engineering Finance Production Marketing
Project
Manager,
Taurus

Project
Manager,
Mustang
Subordinate
Project reports to
Manager, both Vice
Explorer President of
marketing &
Project
Manager, to project
Expedition
Manager for
Mustang
Example of Ford Motor Company (USA)
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 Team-Based Structure
Functional President
structure
Vice
Vice Vice Vice
President,
President, President, President,
Research &
Design Engineering Marketing
Development

Project Product Team Product Team Product Team

Manager, Manager, Manager,
Manufacturing Manufacturing Manufacturing
teams Light Trucks Sedans Sport Cars

Project

team
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 Network Structure
Design Components
Studio Assembly

Sweden Mexico, Asia

Core of
personal
computer
company
USA

Engineering Distribution
Company Company

Japan Canada
Accounting
& Finance

USA
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 Contingency Design

• Contingency Design: the process of

fitting the organization to its
environment.

“Mechanistic versus Organic”

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 Mechanistic Vs. Organic
 Mechanistic organizations:
authority is centralized,
tasks and rules are clearly
specified, and employees
are closely supervised.
 Bureaucratic & rigid.
 Example: McDonald’s: The
market demands for uniform
product quality, cleanliness and
fast services.

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Mechanistic Vs. Organic
 Organic organizations:
authority is decentralized,
there are fewer rules and
procedures, and networks of
employees are encouraged to
cooperate and respond
quickly to unexpected tasks.
 “Loose” structure.
 Example: Motorola company:
because need to adjust with the
technological change.
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 Mechanistic Vs. Organic
Mechanistic
Organic
Organizations
Organizations

Centralized hierarchy of Decentralized hierarchy of

authority authority
Many rules and procedures Few rules and procedures

Specialized tasks Shared tasks

Formalized communication Informal communication

Few teams or task forces Many teams of task forces

Narrow span of control, taller Wider span of control, flatter
structures structures
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Chapter 8
Kinicki, A., & Williams, B.K.
(2016). Management: A
practical introduction. (7th
ed.) New York: McGraw-Hill.

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 Chapter 9:
Human Resource Management:
Getting the Right People for
Managerial Success

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1. To discuss how to attract
qualified employees.
2. To differentiate the internal
and external recruitment.
3. To discuss the advantages and
disadvantages of internal and
external recruitment.

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 Recruitment:
How to Attract Qualified Employees

Recruiting: the process of locating and

attracting qualified applicants for jobs
open in the organization.

External recruiting:
Internal recruiting:
hiring from the
hiring from the inside
outside

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 Internal Recruitment
• Hiring from the Inside.
• Making people already employed by
the organization aware of the job
openings inside the organization.
• Examples:
• Using the organization’s website /
intranet
• Superior recommendation
• Office Memo
• Internal departmental advertising
• Bulletin boards
• Newsletters
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 Employees tend to be inspired to
greater effort and loyalty.
 The whole process of advertising,
interviewing, and so on is cheaper.
 There are fewer risks. Internal
candidates are already known and are
familiar with the organization.

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 DISADVANTAGES:
Internal Recruitment
 Restricts the competition for
positions and limits the pool of fresh
talent and viewpoints.
 It may encourage employees to
assume that longevity and seniority
will automatically result in
promotion.
 Whenever a job is filled, it creates a
vacancy elsewhere in the
organization.
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 External Recruitment
 Hiring from the Outside
 Attracting job applicants from outside
of the organization.
 Examples:
 Recruitment sites – JobStreet, JAC
 Recruitment agencies – Kelly Services,
Robert Walters
 Newspaper/Magazine Advertising
 Company website

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ADVANTAGES:
External Recruitment
 Applicants have specialized
knowledge and experience.
 Applicants have fresh viewpoints.

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DISADVANTAGES:
External Recruitment
 The recruitment process is longer
and more expensive.
 The risks are higher because the
persons hired are less well known.

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The process of developing an applicants’ pool for job
openings in an organization is called
A. hiring
B. recruitment
C. selection
D. retention

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 Chapter 9
 Kinicki, A., & Williams, B.K.
(2016). Management: A
practical introduction. (7th
ed.).New York: McGraw-Hill.

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