Chapter 6 Director role ControllingLeading

1
Chapter 6 Director role Controlling------------
-----------------Leading

• Visioning
• Sustain status quo-----Stretch for ideal
  future
• Setting goals Non rationalized
  -----Rationalized
• Organizing Hierarchical-------------Lateral

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Competency 1--Visioning

• Visioning Sustain status quo-------------------
  Stretch for an ideal future
• Vision formulation Static------------------
  Dynamic
• Vision encompassing Leader only-------------Lead
  er followers
• Initial framing Detailed structured
  ---------Broad emergent
• Vision content Constrained-------Encompassing
• Case for change Defuse---------------------------
  -Clear
• Goals Incremental change-----Ideal
  discontinuous
• Focus appeal Rational /necessary
  --------------------------------------------Emotiv
  e/shared view of possibilities

3
Competency 1--Visioning

• Communicating the vision Constrained------
  Encompassing
• Organizational philosophy Defuse core ideology
  -----------------------------------------------Cle
  ar encompassing of values
• Tactical actions Limited operational
  --------------------------------------------------
  ----------------------------Program of
  implementation
• Ownership Leader-----------------------
  -Leader followers
• Challenge testing Limited to few
  --------------------------------------------------
  ----------------------Extensive broadly shared
• Participation Imposed---------------------Solici
  ted involved
• The vision of PeopleSoft
• Duffied--Before the fall his 8 values
• Duffied--After the fall
• The vision of Craig Conwaythe new CEO
  (intensity, accountability competitiveness)

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Competency 2 --Setting goals Non
rationalized -----------------Rationalized

• Organizational climate Non
  supportive-------------Supportive
• Setting goals Imposed
  -------------------------Joint/MBO
• Goal escalation Supervisor
  defined ------Ranking of performance
• Goal dynamics Stable/ridged
  goals --------Shifting w/ conditions
• Goal alignment (vertically horizontally)
• Among levels Segmented--------------------------
  -----Aligned
• Laterally Segmented---------------------
  -----------Aligned
• Within groups Segmented------------------------
  ------Aligned

5
Competency 2-- Setting goals measuring
performance Unrationalized ---------------------
Rationalized

• Level specificity of goals Low/defuse---------
  ---------------------High/specific
• Priority of multiple goals Unweighted------------
  --------------------Weighted
• Action plans
  General/defuse--------------------------Detailed/
  clear
• Organizational climate Non
  supportive----------------------------Supportive
• Organizational policies Incongruent w/ goals
  ---------------------Congruent
• Setting goals Supervisor----------------------
  --------------Joint/MBO
• Goal dynamics Stable/ridged
  goals------------Shifting w/conditions
• Goal escalation Supervisor defined---------Rank
  ing of performance
• Goal alignment (vertically horizontally)
  Segmented--------------------------Aligned
• Among levels Segmented------------------------
  --------------Aligned
• Laterally Segmented-------------------
  -------------------Aligned
• Within groups Segmented----------------------
  ----------------Aligned

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Setting goals measuring performance
Unrationalized ---------------------Rationalized

• Measuring performance Impressionistic/qualitativ
  e ------------------------------------------------
  --------------------Objective/quantitative
  evaluation
• Part of performance evaluation Non
  integrated-------------Integrated
• Feedback on performance Ad
  hoc--------------------Systematic
• Linkage of goals w/ rewards
  Unlinked---------------Directly linked
• Monitoring of progress Superior
  evaluation----------Joint evaluation

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Competency 3Organizing Hierarchical------------
-------Lateral

• Departmentation Functional---Divisional-------Mat
  rix
• Span of control Narrow------------------------
  ---Broad
• Unity of command Scalar principle
  --------------------------------------------------
  -------------------------Diffusely defined
  hierarchy
• Org. culture Hierarchy----------------------A
  dhocracy
• Stability/control ----------------------------Adap
  tability/discretion
• Internal/integration ------------------------Exte
  rnal/differentiation

8
Alternative approaches to design
9
Organizational structural relationships

• Design options (organization structure)
• Organizational processes
• Organizational culture
• Performance

10
Organizational Goals

• Formal coordination integration, unity of
  direction consistency of decisions
• Within departments
• Between departments
• Among organizations in the value chain
• Assign responsibility establish accountability
• Consistency w/ incentive programs
• Support customer responsiveness/adaptability

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Two Factors Influencing Structure

• The environment The faster the environment
  changes, the more problems face managers.
• Structure must be more flexible when
  environmental change is rapid.
• Usually need to divisionalize decentralize
  authority.
• Strategy Different strategies require the use of
  different structures.
• A differentiation strategy needs a flexible
  structure
• Low cost may need a more formal structure to
  standardize decisions impose constraints to
  limit expenditures.

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Organizing Structural arrangements

• Departmentation
• Functional-----------Divisionalization-----------M
  atrix
• Functional--structuring groups by specialty e.g.
  marketing, finance, engineering, . . .
• Divisionalizationcreating autonomous units (e.g.
  grouping functional specialties into product or
  geographic divisions)
• Matrixcombination of functional /
  divisionalization usually by projects /programs

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Functional Structure
Figure 8.3
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Divisional Structures

• A division is a grouping of functions working
  together to produce a product or service.
• Divisions create smaller, manageable parts of a
  firm.
• A division has marketing, finance, and other
  functions.
• Functional managers report to divisional managers
  who then report to corporate management.
• Divisions develop a business-level strategy to
  compete
• Product structure divisions created according to
  the type of product or service.
• Geographic structure divisions based on the area
  of a country or world served.
• Market structure divisions based on the types of
  customers served.

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Product Structure
Figure 8.4 a
16
Geographic Structure
Figure 8.4 b
17
Market Structure
Figure 8.4 c
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Matrix structure

• Managers group people by function and product
  teams simultaneously.
• Results in a complex network of reporting
  relationships.
• Very flexible and can respond rapidly to change.
• Each employee has two bosses
• Functional manager may give different
  directions than product manager
• Employee must reconcile the conflicting demands

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Matrix Structure
CEO
Functional Managers
Figure 8.7 a
Sales
Design
Production
Product team A
Team Managers
Product team B
Product Team
Product team C
two boss employee
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Organizational relationshipsHierarchical---------
----Lateral

• Span of Management Narrow --------------------Bro
  ad
• Delegation/Empowerment Limited (centralization)---
  -------------------------------------Extensive
  (decentralization)
• Org. culture Hierarchy---------------------Ad
  hocracy
• Stability/control ----------------Adaptability/dis
  cretion
• Internal/integration ---------External/differenti
  ation

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Formal Coordinating Functions

• Positional authority the right to make to make
  decisions and use resources.
• Hierarchy of authority describes the relative
  authority each manager has from top to bottom.
• Line authority managers in the direct chain of
  command for production of goods or services.
  Example Sales
• Staff authority managers in positions that
  give advice to line managers. Example Legal
• Span of Control refers to the number of workers
  a manager manages

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Span of controlTall vs. Flat Organizations

• Tall structures have many levels of authority
  relative to the organizations size.
• Communication As levels in the hierarchy
  increase, vertical lateral communication gets
  difficult.
• Communications can become garbled as it is
  transmitted through the firm.
• Decision lags. The extra levels result in more
  time being taken to implement decisions.
• Flat structures have few levels but wide spans of
  control.
• Intended to improve communications but can lead
  to overworked managers and queuing of decisions.

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Integrating Mechanisms

• Direct contact get managers from different
  divisions or functions together to solve mutual
  problems.
• Liaison Roles one manager in each area is
  responsible for communication with other areas.
• Task Forces temporary committees formed across
  divisions to solve a specific problem.
• Cross-functional teams works much like a
  permanent task force that deals with recurring
  problems.
• Matrix structure already contains many
  integrating mechanisms.

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Organizational culture structural arrangements

• Alternative perspectives on culture
• Structure (along with leadership other factors)
  shapes culture
• Culture shapes structure, leadership other
  factors
• Culture and structure ( other variables) exert
  an interdependent influence on each other
• Managing organizational changeCongruence of
  structure, leadership, staffing culture

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Congruency of culture environment

• Org. types Adhocracy ----Clan----Market--------Hi
  erarchy
• Congruency of culture (org. types) with the
  environment
• Type of culture,
• Congruence (monolithic vs. pluralistic)
• Relative strength
• Discrepancies between current ideal future
  state
• Nature of the environment (stable/few demands
  --------------------------------------------------
  turbulent/intense demands)

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Competing goals typology
flexibility vs. control /discretion
Flexibility

• Human Relations Emphasis (Clan)
• Primary Goal human resource
• group development
• Subgoals cohesion, morale, training,
• participation, identification (we)
• Supportive leadership

Open Systems Emphasis (Adhocracy) Primary Goal
growth, resource
acquisition Subgoals flexibility, adaptation,
external evaluation
F O C U S

Internal integration
External differentiation

• Internal Process Emphasis
• (administrative model) (Hierarchy)
• Primary Goal stability control to
• support efficiency
• Subgoals information management,
• communication
• Technical, risk adverse leadership

• Rational Goal Emphasis (Market)
• external orientation e.g. competition
• Primary Goal productivity, efficiency,
• profit
• Subgoals planning, goal setting,
• Strategy
• Directive, goal focused, instrumental
• leadership

Control