Presented as a report by J. B. Nangpuhan II (MPA student) for the class (Organizational Design) of Dr. S. K. Kim at CNU, Korea in 2010 (Fall semester).
SUMMARY
Key terms:
(division of labor, coordination, configurations, standardization, operators, managers, analysts, staff)
The structure of an organization can be defined simply as the sum total of the ways in which its labor is divided into distinct tasks and then its coordination is achieved among its tasks. Every human activity – from the making of pots to the placing of a man on the moon – gives two fundamental opposing requirements. First is the division of labor into various tasks to be performed and second is the coordination of these tasks to accomplish the activity. The elements of structure should be selected to achieve an internal consistency or harmony, as well as basic consistency with the organization’s situation – its size, its age, the kind of environment in which it functions, the technical system it uses, and so on. Indeed, these situational factors are often “chosen” no less than are the elements of structure themselves. The organization’s niche in its environment, how large it grows, the methods it uses to produce its products or services – all these are selected too. This leads us to the conclusion that both the design parameters and the situational factors should be clustered to create what we call configurations. In principle, there are a great number of configurations but in practice only few are effective for most organizations. The central theme of our book is that a limited number of these configurations explain most of the tendencies that drive effective organizations to structure themselves as they do. In other words, the design of an effective organizational structure – in fact, even the diagnosis of problems in many ineffective ones – seems to involve the consideration of only a few basic configurations. In this chapter, it introduces two concepts: description of basic mechanisms by which organizations achieve coordination, and description of organization itself, in terms of a set of interrelated parts.
A. Coordination in Fives
Five coordinating mechanisms seem to explain the fundamental ways in which organizations coordinate their work: mutual adjustment, direct supervision, standardization of work processes, standardization of work outputs, and standardization of worker skills. These should be considered the most basic elements of structure, the glue that holds the organization together.
1. Mutual adjustment – achieves the coordination of work by the simple process of informal communication. The control of the work rest in the hands of the operators themselves. As a simple coordinating mechanism, it is usually used in the very simplest organizations. However, it can also be used in the most complicated.
2. Direct supervision – achieves coordination by having one person take responsibility for the work of others, issuing instructions to them and monitoring their actions. It is usually used in bigger organizations.
3. Standardization of work processes – achieves when the contents of the work are specified or programmed.
4. Standardization of work outputs – achieves when the results of the work – for example, the dimensions of the product or the performance – are specified.
5. Standardization of work skills – achieves when the kind of training required to perform the work is specified. It is common for workers to be trained first before joining any organization. Standardization is achieved indirectly unlike work process and outputs.
These five coordinating mechanisms fall into a rough order. As organizational work becomes more complicated, the favored means of coordination seems to shift from mutual adjustment to direct supervision to standardization, preferably of work processes, otherwise of outputs, or else of skills, finally reverting back to mutual adjustment. The findings of Henri Fayol (1916) in his “principles of management” school concerned on formal authority popularized such words as unity of command (a subordinate should have only a single superior), scalar chain (direct line of command from chief executive to the successive superiors and from subordinates to the workers), and span of control (the number of subordinates reporting to a superior). Roethlisberger and Dickson’s “human relations” is concerned on informal structure where mutual adjustment is an important coordinating mechanism. These studies have demonstrated that formal and informal structures are intertwined and often indistinguishable.
B. The organization in Five Parts
1. The operating core – encompasses those members–the operators–who perform the basic work related directly to the production of products and services. In here, standardization is generally carried the furthest since it is considered the heart of the organization. Four primary functions of operating core are the following:
a. They secure the inputs for production;
b. They transform the inputs into outputs;
c. They distribute the outputs; and
d. They provide direct support to the input, transformation, and output functions
2. The strategic apex – encompasses those people charged with overall responsibility for the organization. The strategic apex ensures that the organization serves its mission in an effective way, and also that it serve the needs of those who control or otherwise have power over the organization such as its owners, government agencies, unions of the employees, pressure groups. Mutual adjustment is the favored mechanism for coordination among managers of the strategic apex. Three sets of duties of the strategic apex:
a. Direct supervision – managers (as well as those in the middle line) allocate resources, issue work orders, authorize major decisions, resolve conflicts, design and staff the organization, monitor employee performance, and motivate and reward employees;
b. Management of the organization’s boundary conflicts – managers take care of the organization’s relations with its environment including the customers, influential people, other organizations, etc.; and
c. Development of the organization’s strategy – since strategy is viewed as a mediating force between the organization and its environment, it is the duty of the managers to understand its environment so that strategies will be carried out responsive to the environment without being disruptive to the organization.
3. The middle line – encompasses those below the strategic apex having direct supervision over subordinates. The strategic apex is joined to the operating core by the chain of middle-line managers with formal authority. Functions of the middle-line managers:
a. They collects “feedback” information on the performance of their own unit and passes some of these up to the managers above them;
b. They intervenes in the flow of decisions;
c. They must maintain liaison contacts with other managers, analyst, support staffers, and outsiders whose work is independent with that of their own unit; and
d. They are concerned with formulating the strategy for their units that is in line to the overall strategy of the organization.
4. The technostructure – encompasses the analysts (and their supporting clerical staff) who serve the organization by affecting the work of others indirectly. In our book, technostructure are control analysts who focus their attention directly on the design and functioning of structure by standardization in the organization which is also called ‘institutionalization’. However, mutual adjustment is the favored working mechanism among analysts. Three types of control analysts:
a. Work-study analysts – such as industrial engineers who standardize work processes;
b. Planning and control analysts – such as long-range planners, quality control engineers, production schedulers, and accountants who standardize outputs; and
c. Personnel analysts – such as trainers and recruiters who standardize skills.
Technostructure’s influence to:
a. Lowest levels – standardization of operating work flow by scheduling production, carrying out time-and-method studies of the operator’s work, and instituting systems of quality control;
b. Middle levels – standardization of intellectual work of the organization and carry out operations research studies of informational tasks; and
c. Strategic apex – design strategic planning systems and develop financial systems to control the goals of major units.
5. The support staff – encompasses those that make up great number of units, all specialized, that exist to provide support to the organization outside its operating work flow. Although they are lumped together with the technostructure and labeled the “staff”, the support staffs are not preoccupied with standardization and they cannot be looked upon primarily as advice givers. The reason for an organization to provide its own support services is because the organization has absolute control over these services. Since many of the support services are highly specialized and rely on professional staff, standardization of skills may be the single most important coordinating mechanism.
‘Middle level’ refers to the middle line managers, the analysts, and the support staff. ‘Management’ refers to managers of the strategic apex and the middle line. ‘Staff’ is used to refer to technostructure and support staff and ‘line’ refers to those managers in the formal flow of authority from the strategic apex to the operating core.
In 1920s, technostructure began to emerge as shown in the work of Frederick Taylor named “scientific management” movement which saw the hiring of many work-study analysts. Also after the World War II, operations research and the advent of computer pushed for additional strategic planning and sophisticated financial controls, scientific research in a wide number of fields, industrial relations, public relations, and many more. Organizations have sought increasingly to bring these as well as the more traditional support functions such as maintenance and cafeteria within their boundaries. Thus the ellipses to the left and right of figure 1-3 in our book (page 18) have become great bulges in many organizations.
C. The Functioning of the Organization
1. The system of formal authority – flow of formal power down the hierarchy. Best described in an organizational chart or organigram (in French). Organigram represents the accurate picture of the division of labor showing what positions exist in the organization, how these are grouped into units, and how formal authority flows among them which in effect describing the use of direct supervision. Figure 1-4a in our book (page 20).
2. The system of regulated authority – it involves more on the standardization of production work, on commands and instructions, on feedback of information, on results back up (in a management information system or MIS), and on staff information and advice feeding into decision making from the sides. Figure 1-4b.
3. The system of informal communication – it emphasizes the role of mutual adjustment in coordination or the so-called “sociogram” – a map of who actually communicated with whom in a study of one municipal government (drawn from the work of Piffner and Sherwood, 1960). Formal authority and regulated authority disappears in this one. Figure 1-4c.
4. The system of work constellations – the people in the organization cluster into peer groups to get their work done. Each cluster deals with distinct decision appropriate to its own level in the hierarchy in contrast to the first two views and confusing to the third. Figure 1-4d.
5. The system of an ad hoc decision process – it involves the flow of one strategic decision, from beginning to end in a vastly simplified manner. Figure 1-4e.
These five views has no single correct functions by itself but each contains a grain of truth. As shown in Figure 1-5 (page 22), there is a true complexity of the functioning of the organization. The next chapters will discuss more in detail the structuring of organizations. As discussed, the five coordination mechanisms as the glue of structure, the five parts of the organization as the logo or theme diagram, and the five functions of the organization as base points. For advance information, in chapter 7, discussions will be centered on the following:
a. Simple structure – based on direct supervision, in which the strategic apex is the key part;
b. Machine bureaucracy – based on standardization of work processes, in which the technostructure is the key part;
c. Professional bureaucracy – based on standardization of skills, in which the operating core is the key part;
d. Divisionalized form – based on standardization of outputs, in which the middle line is the key part; and
e. Adhocracy – based on mutual adjustment, in which the support staff (sometimes with the operating core) is the key part.
Reference:
Mintzberg, H. (1983). Structure in Fives: Designing Effective Organizations. Upper Saddle River, NJ: Prentice-Hall, Inc. 1-23
A. Coordination in Fives
Five coordinating mechanisms seem to explain the fundamental ways in which organizations coordinate their work: mutual adjustment, direct supervision, standardization of work processes, standardization of work outputs, and standardization of worker skills. These should be considered the most basic elements of structure, the glue that holds the organization together.
1. Mutual adjustment – achieves the coordination of work by the simple process of informal communication. The control of the work rest in the hands of the operators themselves. As a simple coordinating mechanism, it is usually used in the very simplest organizations. However, it can also be used in the most complicated.
2. Direct supervision – achieves coordination by having one person take responsibility for the work of others, issuing instructions to them and monitoring their actions. It is usually used in bigger organizations.
3. Standardization of work processes – achieves when the contents of the work are specified or programmed.
4. Standardization of work outputs – achieves when the results of the work – for example, the dimensions of the product or the performance – are specified.
5. Standardization of work skills – achieves when the kind of training required to perform the work is specified. It is common for workers to be trained first before joining any organization. Standardization is achieved indirectly unlike work process and outputs.
These five coordinating mechanisms fall into a rough order. As organizational work becomes more complicated, the favored means of coordination seems to shift from mutual adjustment to direct supervision to standardization, preferably of work processes, otherwise of outputs, or else of skills, finally reverting back to mutual adjustment. The findings of Henri Fayol (1916) in his “principles of management” school concerned on formal authority popularized such words as unity of command (a subordinate should have only a single superior), scalar chain (direct line of command from chief executive to the successive superiors and from subordinates to the workers), and span of control (the number of subordinates reporting to a superior). Roethlisberger and Dickson’s “human relations” is concerned on informal structure where mutual adjustment is an important coordinating mechanism. These studies have demonstrated that formal and informal structures are intertwined and often indistinguishable.
B. The organization in Five Parts
1. The operating core – encompasses those members–the operators–who perform the basic work related directly to the production of products and services. In here, standardization is generally carried the furthest since it is considered the heart of the organization. Four primary functions of operating core are the following:
a. They secure the inputs for production;
b. They transform the inputs into outputs;
c. They distribute the outputs; and
d. They provide direct support to the input, transformation, and output functions
2. The strategic apex – encompasses those people charged with overall responsibility for the organization. The strategic apex ensures that the organization serves its mission in an effective way, and also that it serve the needs of those who control or otherwise have power over the organization such as its owners, government agencies, unions of the employees, pressure groups. Mutual adjustment is the favored mechanism for coordination among managers of the strategic apex. Three sets of duties of the strategic apex:
a. Direct supervision – managers (as well as those in the middle line) allocate resources, issue work orders, authorize major decisions, resolve conflicts, design and staff the organization, monitor employee performance, and motivate and reward employees;
b. Management of the organization’s boundary conflicts – managers take care of the organization’s relations with its environment including the customers, influential people, other organizations, etc.; and
c. Development of the organization’s strategy – since strategy is viewed as a mediating force between the organization and its environment, it is the duty of the managers to understand its environment so that strategies will be carried out responsive to the environment without being disruptive to the organization.
3. The middle line – encompasses those below the strategic apex having direct supervision over subordinates. The strategic apex is joined to the operating core by the chain of middle-line managers with formal authority. Functions of the middle-line managers:
a. They collects “feedback” information on the performance of their own unit and passes some of these up to the managers above them;
b. They intervenes in the flow of decisions;
c. They must maintain liaison contacts with other managers, analyst, support staffers, and outsiders whose work is independent with that of their own unit; and
d. They are concerned with formulating the strategy for their units that is in line to the overall strategy of the organization.
4. The technostructure – encompasses the analysts (and their supporting clerical staff) who serve the organization by affecting the work of others indirectly. In our book, technostructure are control analysts who focus their attention directly on the design and functioning of structure by standardization in the organization which is also called ‘institutionalization’. However, mutual adjustment is the favored working mechanism among analysts. Three types of control analysts:
a. Work-study analysts – such as industrial engineers who standardize work processes;
b. Planning and control analysts – such as long-range planners, quality control engineers, production schedulers, and accountants who standardize outputs; and
c. Personnel analysts – such as trainers and recruiters who standardize skills.
Technostructure’s influence to:
a. Lowest levels – standardization of operating work flow by scheduling production, carrying out time-and-method studies of the operator’s work, and instituting systems of quality control;
b. Middle levels – standardization of intellectual work of the organization and carry out operations research studies of informational tasks; and
c. Strategic apex – design strategic planning systems and develop financial systems to control the goals of major units.
5. The support staff – encompasses those that make up great number of units, all specialized, that exist to provide support to the organization outside its operating work flow. Although they are lumped together with the technostructure and labeled the “staff”, the support staffs are not preoccupied with standardization and they cannot be looked upon primarily as advice givers. The reason for an organization to provide its own support services is because the organization has absolute control over these services. Since many of the support services are highly specialized and rely on professional staff, standardization of skills may be the single most important coordinating mechanism.
‘Middle level’ refers to the middle line managers, the analysts, and the support staff. ‘Management’ refers to managers of the strategic apex and the middle line. ‘Staff’ is used to refer to technostructure and support staff and ‘line’ refers to those managers in the formal flow of authority from the strategic apex to the operating core.
In 1920s, technostructure began to emerge as shown in the work of Frederick Taylor named “scientific management” movement which saw the hiring of many work-study analysts. Also after the World War II, operations research and the advent of computer pushed for additional strategic planning and sophisticated financial controls, scientific research in a wide number of fields, industrial relations, public relations, and many more. Organizations have sought increasingly to bring these as well as the more traditional support functions such as maintenance and cafeteria within their boundaries. Thus the ellipses to the left and right of figure 1-3 in our book (page 18) have become great bulges in many organizations.
C. The Functioning of the Organization
1. The system of formal authority – flow of formal power down the hierarchy. Best described in an organizational chart or organigram (in French). Organigram represents the accurate picture of the division of labor showing what positions exist in the organization, how these are grouped into units, and how formal authority flows among them which in effect describing the use of direct supervision. Figure 1-4a in our book (page 20).
2. The system of regulated authority – it involves more on the standardization of production work, on commands and instructions, on feedback of information, on results back up (in a management information system or MIS), and on staff information and advice feeding into decision making from the sides. Figure 1-4b.
3. The system of informal communication – it emphasizes the role of mutual adjustment in coordination or the so-called “sociogram” – a map of who actually communicated with whom in a study of one municipal government (drawn from the work of Piffner and Sherwood, 1960). Formal authority and regulated authority disappears in this one. Figure 1-4c.
4. The system of work constellations – the people in the organization cluster into peer groups to get their work done. Each cluster deals with distinct decision appropriate to its own level in the hierarchy in contrast to the first two views and confusing to the third. Figure 1-4d.
5. The system of an ad hoc decision process – it involves the flow of one strategic decision, from beginning to end in a vastly simplified manner. Figure 1-4e.
These five views has no single correct functions by itself but each contains a grain of truth. As shown in Figure 1-5 (page 22), there is a true complexity of the functioning of the organization. The next chapters will discuss more in detail the structuring of organizations. As discussed, the five coordination mechanisms as the glue of structure, the five parts of the organization as the logo or theme diagram, and the five functions of the organization as base points. For advance information, in chapter 7, discussions will be centered on the following:
a. Simple structure – based on direct supervision, in which the strategic apex is the key part;
b. Machine bureaucracy – based on standardization of work processes, in which the technostructure is the key part;
c. Professional bureaucracy – based on standardization of skills, in which the operating core is the key part;
d. Divisionalized form – based on standardization of outputs, in which the middle line is the key part; and
e. Adhocracy – based on mutual adjustment, in which the support staff (sometimes with the operating core) is the key part.
Reference:
Mintzberg, H. (1983). Structure in Fives: Designing Effective Organizations. Upper Saddle River, NJ: Prentice-Hall, Inc. 1-23
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