MODULE 1 (6 Hours) Organization:

Nature & Scope Definitions overview of various components & structure,

Organization theory
Evolution of Organization theory, Organizational Theories images of Organization.

Organizational Effectiveness
Definition importance & approaches to organizational Effectiveness the goal attainment approach the system approach the strategic approach

THE DAILY NEWS

www.dailynews.com

THE WORLDS FAVOURITE NEWSPAPER

- Since 1879

Todays agenda---Organization

Its all about working together

ORGANISATION

Organisation
Basic Definition Basically, an organization is a group of people intentionally organized to accomplish an overall, common goal or set of goals. Business organizations can range in size from two people to tens of thousands.

What are Organizations?

DEFINED: 1) social entities 2) goal-directed 3) deliberately structured and coordinated activity systems 4) linked to external environment

Clark (1972) stated that Organisation design is concerned with making decisions about the forms of coordination , control & motivation that best fit the enterprise

Types of Organizations
The types of organization can be based on a number of factors such as function, purpose, or primary beneficiary.

Types of Organizations
Small / Large Manufacturing / Service Domestic / Multinational For-profit / Not-forprofit

Types of Organization Mutual Benefit associations (trade unions, political parties) Business organizations Service Organizations (hospitals, educational systems) Commonweal Organizations (army, police force, post offices)

Primary Beneficiary Members Owners/Shareholders Clients/ Public in direct contact Public at large

Lets discuss the basic classification..

1. Closed Systems
Organization is the one that is self-sufficient and its operations are not influenced by external influences like competition, economy, suppliers or external resources. However such autonomous entities that are isolated from outside ideally do not exists. Ex: Government funded initiatives like space and defense organizations which are not much influenced by changes in Govt. or economy.

2.

Open Systems
An open system interacts with and adapts to the environment by consuming resources and exporting product and services to it. Issues involved are more complex due to interdependence of various elements. Ex: Bank take deposits, convert these deposits into loans & other investments, use the resulting profits for their maintenance

An Open System
Environment

People Raw materials Information Financial resources

Input

Transformation Process
Production, maintenance, adoption, management

Output

Products and Services

Source: Organization Theory and Design, Richard L. Daft

How Does an Organization Create Value?

Value creation takes place at three stages: input, conversion, and output Each stage is affected by the environment in which the organization operates Environment the set of forces and conditions that operate beyond an organizations boundaries but affect its ability to acquire and use resources to create value

Importance of Organizations
Bring together resources to achieve desired goals and outcomes. Produce goods and services efficiently. Facilitate innovation. Use of modern manufacturing and information technologies. Adapt to and influence a changing environment. Create value for owners, customers and employees. Accommodate ongoing challenges of diversity, ethics, social responsibility, and the motivation and coordination of employees. Adapt to and influence a changing Environment and Globalization

Tasks

Part of total reality

Structure
Strategy Systems Procedures , etc
Not tangible& informal Motives

Culture
Perception Relationships Feelings Values Politics

Components of Organization
Mission and Objectives Input Process Output Outcome Feedback Boundary/Environment

 Mission
The purpose or reason for the organization's existence. It tells what the company is providing to society.

Objectives
End results of planned activity. They state what to be accomplished by when and should be quantified if possible.

Process
The inputs of the organization transformed to obtain the desired output. Includes functions of planning, organizing, communicating, interacting, working, etc. which combine to form organizational strategies.

Output
Goods/services produced by transforming the inputs in order to meet the objectives of the organization.

 Outcome
The impact that the output has in fulfilling the objectives of the organization

Feedback
The organization has to obtain feedback to determine how its strategies have fared in achieving its objectives and goals for purpose of remedial or corrective actions, if necessary

Boundary
Each organization has a boundary which differentiates it from others and determines the internal and external environments

Environment
The external environment is anything outside the boundary of the organizationtechnology, political, social, demography or the economy-all of which influence the performance of the organization.

 Organizational design: the process by which managers select and manage aspects of structure and culture so that an organization can control the activities necessary to achieve its goals dealing with external factors.

Organizational design
Is there a best way to organize?
NO!!! All ways of organizing are not equally effective The organizational structure will depend on:
The task structure The environmental conditions
Resource availability Task deadlines

 Organization design is all about intimately concerned with the way in which decision making is centralized, shared or delegated & with the way the enterprise is governed.

IBM
Good example of how failing to change organizational design can be fatal When IBM introduced the System/360 mainframe, they created a bureaucratic structure to manage the complexity However, the bureaucracy ran amok
Too many meetings and decisions delayed Did not take advantage of technology it created All committee members has to agree to decisions

IBM
New IBM today Rather than trying to sell PCs, they tapped into the goldmine of selling electronic business services services, hardware, software and know-how that can address any IT dilemma New network organizational design dropped the old bureaucratic model

 Structural Dimensions of Organization design Organization structure division of labor, standardization, horizontal Differentiation, Departmentalization; Vertical Differentiation, Span of Control, Centralization, Formalization, Implication of High Formalization, Flexibility.

 Contextual Dimensions : Influence of: Environment, Strategy, Size & Technology, Power & Politics on Structure,