Chapter 1: introduction to organizations

1-What is Organization?

Any organization can be defined as legal and social entities that are goal- directed in a form of
structured and collected activities system that interacts with the external environment.
-Legal: any organization must document it is issuance, there is a legal instruction to take the shape
of organization
-Social: people inside the organization will interact with each other so the needing of social that
people coordinate and work each other and They work according to goals set to achieve this
specific goal.

2-Importance of Organizations.

a-Organizations bring together resources to achieve specific goals.

b- Organizations also produce goods and services that customers want at competitive prices.
c- Organizations facilitate innovative through many ways to produce and distribute desirable goods
and services more efficiently.
d- Use modern manufacturing and information technologies.
e- Adapt & influence to a changing environment.
f- create value for owners, customers, and employees.

3- Historical perspective of organizational theory.

1) Scientific management:

-is appeared in the beginning of 20th century by Frederick Taylor.

-The main idea of scientific management was systemization that aims to improve the efficiency of
procedures to have.
-He believed that if all labors perform to the ideal (optimal) way this will increase the activity of the
labor and organization as all.
-Frederick Taylor only concerned with specification of tasks & put some details about the task.
-focus on the bottom technique
2) Administrative theory:

-Henri Fayol (established another approach that evolved from technical processes to be
administrative processes.

-Henri Fayol focused on the administrative principles in the shape of management's hierarchical
pyramid structure that worked on the basis of top-down approach.
-Administrative principles focused on the design and functioning of the organization.
-Henri Fayol proposed fourteen principles of management, such as "each subordinate receives
orders from only one superior" (unity of command) and "similar activities in an organization should
be grouped together under one manager" (unity of direction).
-Fayol's principles focused on two broad concepts which are: coordination and specialization.
Coordination is based on a hierarchical pyramid structure in which people are connected to each
other, therefore, clarity is so important in the administrative structure.
-Specialization is focused on the way of grouping the organization's activities effectively in
departments. Both concepts: coordination and specialization are related to high degree of
formalization, which is one of the main broad lines of Henri Fayol.
-going around that we have an organization structure that identify that there is authority
transferred from manager to subordinate.

3-Bureaucracy theory:

-Weber is different from taylor and fayol as he introduce a boarder approach to organizations as he
stated that the understanding of the organizations and its structure would be result in a historical
context
-Max weber said the same as Fayol & Taylor but added a magic word called book keeping all tasks
must be recorded.
-According to Weber, public employee must perform based on superior' interests (managers) and
achieved his bureaucratically assigned role.

4) Human relations management (Elton Mayo)

Little concerns towards industrial psychology and human relations due to the importance of
scientific management in this time which was applied by most of organizations Results of these
studies at that time determined that positive treatment of employees enhanced their motivation
and productivity.
The consequences of these experiments directed to a revolution in worker treatment and the
groundwork for the following work examining treatment of workers like leadership, motivation,
and human resource management.

Put some psychological theories:

-How people deal with each other
-How personality affect in work

5) Contingency theory:

-can be defined as (one thing depends on other things, and for organizations to be effective, there
must be a "goodness of fit" between their structure and the conditions in their external
environment}.
-What implemented in one setting may not implement in another setting.

-There is no "one best way." this is what contingency theory can be defined.
-There is no one solution will be applied to problems. There is no one managerial style can be
applied for all organization.

4-Dimensions of organization design

a) structural dimensions

1-formalization:
is the scope to which an organization's policies, procedures, job descriptions, and rules are written
and clearly formulated.
Formalized structures are those in which there are many written rules and regulations.
Ex: all the interaction between manager& employees, employees with each other must be in
formal way.

2. Specialization:

is the extent to which organizational tasks are subdivided into separate jobs.
If specialization is high, each employee works only a narrow range of tasks.
If specialization is limited, employees work a wide range of tasks in their jobs. Specialization is
sometimes referred to as the division of labor.
Ex: each employ will have for specific number of tasks that will be done by him.
3. Hierarchy of authority:

identifies who reports to whom and the span of control for each manager. The hierarchy is
described by the vertical lines on an organization chart.
The hierarchy referred to span of control the number of employees reporting to supervisor. When
spans of control are narrow, the hierarchy can be shaped as tall.

4. Centralization:
identifies the hierarchical level that has authority to make a decision.
When decision making is retained only at the top level, the organization is centralized. When
decisions are delegated to lower organizational levels, it is decentralized.

Examples of organizational decisions that could be centralized or decentralized contain purchasing

equipment, establishing goals, selecting suppliers, determining prices.
hiring employees and deciding marketing strategies.
Ex: the only managers have the right to make decisions no subordinate have the authority to make
decisions
5. Professionalism:
is the level of formal education and training of employees. Professionalism is determined as high
when employees need long periods of training to have jobs in the organization.
Professionalism is generally assessed by the average number of years of education for employees
would have.
The ability of organization to have training, development& education its subordinates, so it is
measuring the degree of education& training for the employees.
6. Personnel ratios:
refer to the deployment of people to functions and departments Personnel ratios contain the
administrative ratio, the clerical ratio.
the professional staff ratio and the ratio of indirect to direct labor employees, A personnel ratio is
assed by dividing the number of employees in a classification by the total number of organization
employees.

b) contextual dimensions

1. Size: can be determined through the organization as a whole or through definite components,
such as a plant or division. Because organizations are social systems, size in most cases is
determined by the number of employees.
Other measures such as total sales or total assets also clarify magnitude, but they do not identify
the size of the human part of the
2. Organizational technology: describes the tools. techniques, and actions used to convert inputs
into outputs. It identifies how the organization fabricates the products and services it delivers for
customers and involves such things flexible manufacturing, advanced as information systems, and
the Internet. Turning to work according to digitalization and they must choose suitable people to
deal with this IT infrastructure

3. The environment: contains all elements outside the border of the organization.
Key elements involve the industry, government, customers, suppliers, and the financial
community.
The environmental elements that affect an organization the most are often other organization.

exceed the Border of organization. External: all factors that lay outside the border of organization..
4. The organization's goals and strategy: identify the purpose and competitive techniques that
establish it apart from other organizations.
A strategy is the plan of action that determines resource allocation and activities for reacting with
the environment and for attaining the organization's goals. The ability of organization to put
reasonable goals to achieve a higher marketplace.
5. An organization's culture: These main values and norms may affect ethical behavior,
commitment to employees, efficiency, or customer service.
The number of values, believes, and concepts that employees believed in along the work.

-Effectiveness: The organization can achieve its goal according to the plan the organization set.
-Efficiency: achieved its goal at minimum cost.

-Stake holders: anybody (Individual) that can get benefit from the organization.

5-Organization configuration.

1-Technical core: involves people who perform the basic work of the organization. This part
fabricates the product and service outputs of the organization.

This is where the primary transformation from inputs to outputs happens. The technical core is the
production department in a manufacturing firm.
2-Technical support: the technical support function assists the organization adjust to the
environment. Technical support employees such as engineers, researchers, and information
technology professionals examine the environment for problems.
Opportunities and technological developments.
Technical support is responsible for establishing innovations in the technical core, assisting the
organization change and adapt, supported activities which will be introduced to help in
development of the organization.
3-Administrative support: function is responsible for the efficient operation and upkeep of the
organization, involving its physical and human elements.
This involves human resource activities such as recruiting and hiring, creating compensation and
benefits, and employee training and development, as well maintenance activities such as cleaning
of buildings and service and repair of machines.
4- Middle Management: are responsible for cootdinating between top management and the
technical core, such as implementing rules and passing information up and down the hierarchy.

5- Top Management: is responsible for giving orders and giving direction to the entire organization
setting goals& policies, they have the complete authority.

5- Types of organization:

1)Entrepreneurial structure: Is typically a new, small size company or organization, technical core,
administrative support, Top Management.

2) Machine Bureaucracy: is very large, typically mature, and the technical core is often oriented to
mass production, it's any ordinary organization produce any ordinary product.
3) professional Bureaucracy: Is any organization periodically producing products new Ex: Appel.
Technical core, administrative support (because the differentiation in products will depend on the
teams at technical & administrative)
4) Diversified forms: Organizations with a diversified form are mature firms that are extremely
large and are subdivided into product or market groups. Ex: Universal. Then the BOD of universal
will be diversified into sub structure.

5) Adhocracy: complex rapidly changing environment & the design goal is frequent innovation and
satisfying continually changing needs. Ex: Samsung

6-chaos theory

The science of chaos theory indicates the relationships in a complex and changeable environment
especially external environment that change quickly
1-Efficient performance VERSUS. Learning organization:
Chaos theory: between all the changeable factors maybe you can get positive results, but this
result will be found according to a flexible structure (Horizontal).
-Efficient performance: any organization performance in a minimum cost.
-Learning organization: continual development & training.
2-Formal control VS. shared information:

-Formal control: we will find it at top management only.

-shared information: the horizontal structure will be found in the learning organization.
3-Competitive to collaborative strategy:
-People collaborate and work with each other at learning organization (horizontal).

-Competition between employees' effect efficient performance (vertical).

4-Rigid culture VERSUS. Adaptive culture:
-Rigid: (restricted) can't be change easily [ Efficient performance].
-Adaptive: (accept changes easily) [Learning organization].

Chapter 2: organizational environment

1-The nature of organizational Environment.

A -The Environment: is the set of pressures and forces surrounding an organization that have the
potential to affect the way it operates and its ability to acquire scarce resources.
B -Scarce resources- involve the raw materials and skilled employees the information it wants to
enhance its technology or decide on its competitive strategy and the support of outside
stakeholders, such as customers who buy its goods and services, and banks and financial
institutions that supply the capital that sustains it.
C- Forces in the environment that affect an organization's ability to secure these scarce resources
involve competition from rivals for customers, rapid changes in technology that might weaken its
competitive advantages and an increase in the price of important inputs that raises operating
costs.
D- An organization attempts to manage the forces in its environment to obtain the recourses
necessary to produce goods and services for customers.
E- The term organizational domain refers to specific range of goods and services that the
organization produces, and the customers and other stakeholders it serves.
F- An organization establishes its domain by deciding how to manage the forces in its environment
to maximize its ability to secure its important resources.
To obtain inputs, for example, an organization should decide which suppliers to deal with from the
range of possible suppliers and how to manage its relationships with its chosen suppliers.
G- specific environment are forces that directly affect an organization's ability to obtain resources.

a-The Specific Environment (internal environment):

-consists of forces from outside stakeholder groups that directly affect an organization's ability to
secure resources. like Customers, distributors, unions, competitors' suppliers and the government
are all important outside stakeholders that can influence and pressure organizations to act in
certain ways.
-Competition makes resources scarce and valuable because the greater the competition for
resources, the more difficult they are to obtain.
Competitors can be domestic or international. Each type has different implications for a company's
ability to obtain resources.
-Changes in the number and types of customers, and in customer tastes, are another force that
affects an organization.
An organization must have a strategy to manage its relationship with customers and attract their
support and the strategy must change over time as customer needs change.

-In the global environment, satisfying customer needs presents new challenges because customers
differ from country to country. An organization must be willing and able to tailor or customize its
products to suit the tastes and preferences of different consumers if it expects to attract their
business.

-Global supply chain management is the process of planning and controlling supply/distribution
activities such as acquiring and storing raw material, and semifinal products, controlling work in
process inventory, and moving finished goods from point of manufacture to point of sale as
efficiently as possible.

-An organization should make many choices concerning how to manage these activities to secure
most effectively a stable supply of inputs or dispose of its products in a timely manner.
-In the global environment, supplies of inputs can be obtained not just from domestic sources but
from any country in the world.

If large companies had not used outsourcing to lower the cost of their inputs by buying from
overseas suppliers, they would have lost their competitive advantage to overseas competitors that
did pursue outsourcing.
b-The General Environment (external environment)

-consists of forces that shape the specific environment and affect the ability of all organizations in
particular environment to obtain resources

-Economic forces, such as interest rates, the state of the economy, and an employment rate,
determine the level of demand for products and the price of inputs.
-organizations attempt to obtain their inputs or to manufacture their products in the country with
the lowest labor or raw-materials costs.

-Technological forces, such as the development of new production techniques and new
information-processing equipment, influence many aspects of organizations" operations. The use
of computerized manufacturing technology can increase productivity.
-Political ethical, and environmental forces influence government policy toward organizations and
their stakeholders.
-Demographic, cultural, and social values affect a country's attitudes toward both domestic and
overseas products and companies Customers.

2-Sources of Uncertainty in the Organizational Environment.

1) Environmental complexity: is a function of the strength. number, and interconnectedness of the

specific and general forces that an organization should manage.
-The greater the number, and the greater the differences between them, the more complex and
uncertain is the environment and the mare difficult to predict and control.
-The more complex an organization environment, the greater the uncertainty shout that
environment. Predicting and controlling the flow of resources becomes extremely difficult, and
problems associated with managing transactions with the environment increase.
2) Environmental dynamism: is a function of how much and how quickly forces in the specific and
general environments change over time and thus increase the uncertainty an organization faces.

-An environment is stable if forces affect the supply of resources in a predictable way. An
environment is unstable and dynamic if an organization cannot predict the way in which the forces
will change over time.
3) Environmental richness: is a function of the amount of resources available to support an
organization's domain.
In rich environments, uncertainty is low because resources are plentiful and so organizations need
not compete for them. In poor environments, uncertainty is high because resources are scarce, and
organizations do have to compete for them.
Environments may be poor for two reasons:
1- An organization is in a poor country or poor region of a country.
2- there is a high level of competition and organizations are fighting over available resources.

3-Resource Dependence Theory.

Organizations depend on their environment for the resources they need to survive and grow. The
supply of resources.
Thus, an organization must simultaneously manage two aspects of its resource dependence:

1- It should exert influence over other organizations so it can obtain resources.

2- it must respond to the needs and demands of the other organizations in its environment.

4-Interorganizational Strategies for Managing Resource Dependencies.

In the specific environment, two basic types of interdependencies cause uncertainty: symbiotic and
competitive.
1 Interdependencies are symbiotic when the outputs of one organization are inputs for another;
thus, symbiotic interdependencies generally exist between an organization and its suppliers and
distributors.
2- Competitive interdependencies: exist among organizations that for scarce inputs and outputs.

-Organizations can use various linkage mechanisms to control symbiotic and competitive
interdependences AND The use of these mechanisms, however, requires the actions and decisions
of the linked organizations to he coordinated.

1. Strategies for Managing Symbiotic Resource Interdependencies:

1) Developing a Good Reputation: The least formal, least direct way to manage symbiotic
interdependencies with suppliers and customers is to develop a reputation, a state in which an
organization is held in high regard and trusted by other parties because of its fair and honest
business practices.

2) Cooptation: is strategy that manages symbiotic interdependencies by neutralizing problematic

forces in the specific environment.
Cooptation is an important political tool. A common way to coopt problematic forces such as
customers, suppliers, or other important outside stakeholders is to bring them within the
organization.
3) A strategic alliance: is an agreement that commits two or more companies to share their
resources to develop joint new business opportunities.
Strategic alliances are becoming an increasingly common mechanism for managing symbiotic (and
competitive) interdependencies between companies inside one country or between countries.
The more formal an arrangement, the stronger and more prescribed the linkage and uncertainty
the tighter the control of the joint activities.
In general, as increases. organizations choose a more formal alliance to protect their access to
resources.
4) Long-term contracts: is usually to reduce costs by sharing resources or by sharing the risk of
research and development, marketing, construction, and other activities. Contracts are the least
formal type of alliance because no ties link the organizations apart from the agreement set forth in
the contract.
5) Networks: network structure is a cluster of different organizations whose actions are
coordinated by contracts and agreements rather than through a formal hierarchy of authority,
Members of a network work closely to support and complement one another's activities.
The alliance resulting from network is more formal than the alliance resulting from contract
because more ties link member organization and there greater formal.
6) Minority ownership: A more formal alliance emerges when organizations buy a minority
ownership stake in each other.
Ownership is a more formal linkage than contracts and network relationships.

Minority ownership makes organizations extremely interdependent, and that interdependence

forges strong cooperative bonds.
7) A joint venture: is a strategic alliance among two at more organizations that agree to establish
and share the ownership of a new business.
Joint ventures are the most formal of the strategic alliances because the participants are bound by
a formal legal agreement that spells out their mutual rights and responsibilities.
8) Merger and Takeover: The most formal strategy for managing take over a supplier or distributor
because now resource exchanges occur within one organization rather than between
organizations.

2. Strategies for Managing Competitive:

1) Resource Interdependencies: Organizations do not like competition.

Competition threatens the supply of scarce resources and increases the uncertainty of the specific
environment.
Intense competition can threaten the very survival of an organization as product prices fall to
attract customers and the environment becomes poorer.
The higher the level of competition, the more likely so companies in an industry are to be taken
over or to go bankrupt.
Ultimately, the organizational environment is controlled by the handful of the strongest companies
that now compete head-to-head for resources.
2) Collusion and Cartels: A collusion is a secret agreement among competitors to share information
for a deceitful or illegal purpose, such as keeping prices high. Organizations collude to reduce the
competitive uncertainty they experience.
A cartel is an association of firms that explicitly agree to coordinate their activities. Cartels and
collusion increase the stability and richness of an organization's environment and reduce the
complexity of relations among competitors.
3) Linkage Mechanisms: A more formal but still indirect way for competing organizations to
coordinate their activities is through a third- party linkage mechanism regulatory body that allows
organizations to share information and regulate the way they compete.
An example is a trade association, an organization that represents companies in the same industry
and enables competitors to meet share information, and informally allow them to monitor one
another's activities.
4) Strategic Alliances: can be used to manage not only symbiotic interdependencies but
competitive interdependencies.

Competitors can cooperate and form a joint venture to develop common technology that will save
them all a lot of money, even though they may be in competition for customers when their final
products hit the market.
5) Merger and Takeover: The ultimate weapon in an organization's armory for managing
problematic competitive (and symbiotic) interdependencies is to merge with, or take over, a
competing organization.
Mergers and takeovers can improve a company's competitive position by allowing the company to
strengthen and enlarge its domain and increase its can Ability to produce a wider range of products
to better serve more customers.
ultimately be bad for organizations themselves. In the long run, because of changes in technology,
cheap sources of labor, changes in government.
Nevertheless, cartels, collusion, and other anticompetitive practices

5-Transaction Cost Theory.

According to transaction cost theory: the goal of the organization is to minimize the costs of
exchanging resources in the environment and the costs of managing exchanges between people
inside the organization and it also arise when exchanging resources or information.

1) Sources of transaction costs:

a) Environmental uncertainty and bounded rationality:

The environment is characterized by considerable uncertainty and complexity.

People, however, have only a limited ability to process information and to understand the
environment surrounding them. Because of this limited ability, or bounded rationality, the higher
the level of uncertainty in an environment, the greater the difficulty of managing transactions
between organizations.
Environmental uncertainty may make the cost of negotiating, monitoring, and governing
agreements so high that organizations resort to more formal linkage as strategic alliances, minority
mechanisms such ownership, or even mergers to lower transaction costs.
b) Opportunism and small numbers:
Most people and organizations behave honestly and reputably most of the time, but some always
behave opportunistically that is, they cheat or otherwise attempt to exploit other forces or
stakeholders in the environment.

When an organization is dependent on one supplier or on a small number of trading partners, the
potential for opportunism is great.
c) Risk & specific assets:
Specific assets are investments in skills, machinery, knowledge, and information that create value
in one exchange relationship but have no value in any other exchange relationship.
An organization's decision to invest money to develop specific assets for a specific relationship with
another organization in its environment involves a high level of risk.
Once the investment is made, the organization is locked into it.

2) Transaction Costs and Linkage Mechanisms:

Transaction Costs and Linkage Mechanisms Organizations base their choice of interorganizational
linkage mechanisms on the level of transaction costs involved in an exchange relationship.
Transaction costs are low when these conditions exist:
1. Organizations are exchanging nonspecific goods and services.

2. Uncertainty is low.
3. There are many possible exchange partners.
Transaction costs increase when these conditions exist:
1. Organizations begin to exchange more specific goods and services.

2. Uncertainty increases.
3. The number of possible exchange partners falls.

3) Using Transaction Cost Theory to Choose an Interorganizational Strategy:

Transaction cost theory can help managers choose an interorganizational strategy by enabling
them to weigh the savings in transaction costs achieved from using a particular linkage mechanism
against the bureaucratic costs of operating the linkage mechanism.
-Managers deciding which strategy to pursue must take the following steps:
1. Locate the sources of transaction costs that may affect an exchange relationship and decide how
high the transaction costs are likely to be.
2. Estimate the transaction cost savings from using different linkage mechanism.
3. Estimate the bureaucratic costs of operating the linkage mechanism.
4. Choose the linkage mechanism that gives the most transaction cost savings at the lowest
bureaucratic cost (Managers must still negotiate, monitor, and govern exchanges between people
inside the organization).
 Chapter 3: fundamentals of organization structure

1-information sharing perspective on structure (vertical - horizontal)

Vertical:

-Vertical linkages are used to coordinate activities between top and bottom of the
organization, controlling the organization.
-Organizations may use any of structural devices to achieve vertical linkage.
-Hierarchal referral is a first vertical device illustrated by the vertical lines and This lines of the
organization chart act as a communication channel,

-The next linkage devise is rules and plans.

-Rules and procedures provide a standard information source enabling employees to be

coordinated without communicating directly with their managers.
-Plans also provide standing information for employees.
-The most widely used plan is the budget.
-Vertical information system is another strategy for increasing vertical information capacity.

-Vertical information system include written information, computer based communication

etc.
-These systems make communication up and down the hierarchy more efficient.
-Many top managers are considering strengthen their organization's linkages for vertical
information and control.

Horizontal:

-Horizontal communication overcomes barriers between departments and provides

opportunities for coordination among employees to achieve unity of effort and organizational
objectives.

-Horizontal linkage refers to communication and coordination horizontally across

departments.

-The following devices are structural alternatives that can improve horizontal coordination
and information flow:
• Information systems: Computerized information systems enable managers or frontline
workers to exchange information about problems, opportunities etc.
Some organizations also encourage employees to use company's information system to build
relationships to support on-going horizontal coordination across projects
-Direct Contact: between managers or employees affected by a problem.
One way to promote direct contact is to create a special liaison group.
-A Liaison person is located in one department but has the responsibility for communicating
and achieving coordination with another department.
When linkage involves several departments, a more complex device such as task force is
required which is a temporary committee composed of representatives from each horizontal
unit affected by a problem, and each member represent the interest of the department.
• Task forces: effective horizontal linkage device for temporary issue.
They s problems by direct horizontal coordination and reduce the information loag on the
vertical hierarchy.
• Full time Integrator: a stronger-horizontal linkage device is to create a full time position for
the purpose of coordination. The integrator does not report to one of the functional
departments being coordinated.
He or she exists outside the department and has the responsibility for coordinating several
departments.
He can be project manager, product manager etc. Integrators need excellent people skills.

They have a lot of responsibilities but little authority.

The integrator has to use persuasion to achieve coordination.
He or she spans the boundary between departments and must be able to get people
together, maintain their trust, and confront problems.
• Teams: tend to be the strongest horizontal linkage mechanism.
They are permanent task forces and often used in conjunction with a full time integrator.
A cross functional teams is the solution when activities among departments require strong
coordination.
Special projects team may be required for a large scale projects in organizations.
• A vertical team: it is made up of organizationally or geographically dispersed members who
are linked advances information and communication technologies.

2) Discuss functional structure.

-Activities are grouped together by common function from the bottom to top of the
organization.
-All human knowledge and skills with respect to specific activities are consolidated, providing
a valuable depth of knowledge for the organization.
-This structure is most effective when in depth expertise is critical in meeting organizational
goals, when the organization needs to be controlled through the vertical hierarchy, and when
efficiency is important.

3) Discuss divisional structure.

With this structure, division can be organized according to individual products, services,
major projects etc.
-It promotes flexibility and can adapt to the changes of the environment.

-It decentralizes the decision making because the lines of authority converge at a lower level
in hierarchy,
-It is excellent for achieving coordination across functional departments.
-It works well when organization no longer controlled through the traditional vertical
hierarchy, and when goals are oriented toward adaptation and change.
-It works best in the organizations that have multiple products or services and enough
personnel to staff separate functional units.
4) Discuss Geographic structure.

-Each region of country has its distinct tastes and needs.

-Each geographic unit includes all functions required to produce and market products or
services in that region.
-This structure focuses managers and employees on specific geographic regions and sales
targets.
-Employees identify with regional goals rather than with national goals.
-Horizontal coordination within a region is emphasized rather than linkage across regions.

5) Discuss Matrix structure.

-It can be used when both technical expertise and product innovation and change are
important for meeting organizational goals.
-It is often the answer when organizations find that the functional, divisional, and geographic
structure combined with horizontal linkage mechanism will not work.
-It is a strong form of linkage mechanism.
-The unique characteristics of it are that both product divisions and functional structures are
implemented at the same time.

6) Discuss Hybrid structure

-It combines characteristics of various approaches tailored to specific strategic needs.

-It tends to be used in rapidly changing environment.

-One type of hybrid that is often used to combine characteristics of functional and divisional
structures.
-A second type of hybrid that is increasingly used today is to combine characteristics of
functional, divisional, and horizontal structure.
-It is often preferred over the pure functional, horizontal, divisional or virtual network
structure because it can provide some advantages of each and overcome some of the
advantages.

7) Discuss applications of structural design.

Structural alignment:
-The most important decision that managers take about structural design is to find the
balance between vertical control and horizontal coordination.
 -Vertical control is associated with goals of efficiency and stability, while horizontal
coordination is associated with learning, innovation and flexibility.
-The functional structure is appropriate when the organization needs to be
coordinated through the vertical hierarchy. It uses task specialization and a strict chain
of command to gain efficient use of scarce resources.

-The horizontal structure is appropriate when the organization has the right need for
coordination among functions to achieve innovation and promote learning.
Symptoms of structural deficiency:
-Decision making is delayed or lacking in quality.
-Decision makers may be overloaded because the hierarchy funnels too many problems
and decisions to them.
-Delegation to lower levels may be insufficient.
-The organization does not respond innovatively to a changing environment because
departments are not coordinated horizontally.
-Employee performance declines and goals are not being met because structure doesn't
provide clear goals, responsibilities and mechanism for coordination.

Chapter 4: types and forms of organizational change

1) Define organizational change.

It is the process by which organizations move from their current or present state to some
desired future state to increase their effectiveness.

2) Discuss the targets of organizational change.

Human resources Organization's most important assets.

-Organizations must monitor their structure to know the most effective way of motivating
and organizing human resources to acquire and use their skills.

Kinds of change efforts directed at human resources are:

A. Investment in training and development.
B. Socializing employees into organizational culture.

21
C. Motivate a multicultural and diverse workforce.
D. Examine the way in which promotion and reward systems operate in a diverse workforce.
E. Improve organizational learning and decision making.

1- Functional resources
-As the environment changes, organizations often transfers resources to the functions where
the most value can be created.
-Organization can improve this value by changing structure, culture, and technology.

-Alternations in functional structure can help provide a setting in which people are motivated
to perform.
2 - Technological capabilities:

-Give an organization an enormous capacity to change itself to exploit market opportunities.

Similarly, improve the way services and goods are produced to increase their quality and
reliability is a crucial organizational capability.

Organization has to provide the context that allows it to translate its technological
competences into value for stakeholders, involving the redesign of organizational activities.
3- Organizational capabilities

-Organizational change often involves changing the relationship between people and
function to increase their ability to create value.

-Changes in structure and culture take place at all levels of the organization and include for
example changing work group relationships and change corporate culture.
-The four level at which change can take place are obviously interdependent; it is impossible
to change one without changing the other.

-Top management will be forces to re-evaluate its organizational structure and the
-way it integrates and coordinates its other functions to ensure that they support its new
functional resources.

3) Discuss forces for organizational change.

1-Competitive forces

-Organizations are striving to achieve a competitive advantage.

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-Competition is a force for change because unless an organization matches its competitors in
efficiency, quality, or its capability to innovate new or improved goods, it will not survive.

-Organizations must constantly adapt the latest technology to lead the dimensions of
efficiency or quality To lead on the dimension of innovation and obtain a technological
advantage, a company must possess skills in managing the process of innovation. Economic,
political, and global forces

-They affect organizations and compel them to change how and where they produce goods
and services.

-Economic and political unions among countries are becoming an increasingly important
force for change.

-No organization can afford to ignore the effects of global economic and political forces on its
activities.
2- Demographic and social forces

-Managing a diverse workforce is one of the biggest challenges to confront organizations in

the 2000s

-Changing in the composition of workforce and the increasing diversity of employees has
presented organizations with many challenges and opportunities.

3- Ethical forces

-Organizations take steps to promote ethical behaviours in the face of increasing

government, political, and social demands for more responsible and honest corporate
behaviour

-Many companies have created the position of ethical officer.

-Organizations are also trying to promote ethical behaviour by giving employees access to
important decision makers.

4) Discuss resistance to change.

1. Organization level resistance to change

-Power and conflict:

-When change causes power struggles and organizational conflict, an organization is likely to
resist it.

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-The conflict between the two functions will slow the process and perhaps prevent the
process of change from occurring at all.

-If powerful functions can prevent change, an organization will not change.

Differences in functional orientation:

-They are another impediment to change and a source of organizational inertia.

-Different divisions often see the source of problem differently because they see an issue
from their own point of view, increasing organizational inertia because the organization must
spend time and effort to secure agreement about the source of problem.
Mechanistic structure:

-It is characterized by a tall hierarchy, centralized decision making, and the standardization of
behaviour through rules and procedures.
They are most resistant to change.
It develops as an organization grows and is a principal source of inertia, especially in large
organizations..
Organizational culture:
-The values and norms in an organizational culture can be another source of resistance to
change.

-If organizational change disrupts taken for granted values and norms and forces people to
change what they do and how they do it, an organization's culture will cause resistance to
change.

2. Group Level resistance to change

-Much of an organization work is performed by groups, and several groups characteristics can
produce resistance to change.
-Many groups develop strong informal norms that specify appropriate and inappropriate
behaviors and govern the interactions between group members.
-Change disrupts group norms and the informal expectations that group members have of
one another, so group members may resist the change.

-Although some level of group cohesiveness promotes group performance, too much
cohesiveness may reduce performance because it suffocates the opportunities for the group
to change and adapt.

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3. Individual level resistance of change.

-People tend to resist change because they feel uncertain and insecure about what the
outcome will be.

-Absenteeism and turnover may increases and change takes place, and workers may come
uncooperative.
-When change takes place, workers tend to focus only on how it will affect them or their
division personally.

5) Discuss Lewins' force field theory of change.

The two sets, which are forces for change and resistance to change, of forces are always in
opposition in an organization.

-When the forces are balanced, the organization is in a state of inertia and doesn't change.

-To get an organization to change, manager must find a way to increase the forces to change
and reduce resistance to change.

6) Discuss Evolutionary change

1- Sociotechnical systems theory

-It is one of the first theories that proposed the importance of changing role and task or
technical relationships to increase organizational efficiency.

-The new technology promised impressive increases in organization efficiency, but after its
introduction, efficiency rose slowly and absenteeism among managers, which had always
been high.
2-Total Quality Management (TQM)
-It is an on-going effort by all of the organization's functions to find new ways to improve the
quality of goods and services.
-It signals a radical change in the way activities are organized.
-Once it is adapted by the organization, it leads to continual change.
-The emphasize in TQM is on the match between technical and social systems.

-Changing cross functional relationships to help improve quality is important.

3-Flexible workers and flexible work teams

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-Employees need to acquire and develop the skills to perform any of the tasks

necessary for assembling a range of finished products.

-Compensation is frequently tied to the number of different tasks that a person can perform.

-As the demand for components or finished products rises, the flexible workers can be
transferred to the task needed by the organization, so the organization can respond to
changes in its environment.

7) Discuss Revolutionary change.

1- Reengineering

-It refers to the process by which managers redesign how tasks are bundled into roles and
functions to improve organizational efficiency.

-Changes resulting from reengineering required managers to go back to the basics and pull
apart each step in the work process to identify a better way to coordinate and integrate the
activities necessary to provide customers with goods and services.

2- E- Engineering

-Refers to the company's attempt to use all kinds of information systems improve their
performance.

-Its importance is increasing as it changes the way a company organizes its value creation
functions and links them to improve its performance
3-Restructuring

-Refers to the process by which the managers change task and authority relationships and
redesign organizational structure and culture to improve organizational effectiveness.
4- Downsizing

-The process by which managers streamline the organizational hierarchy and lay off
managers and workers to reduce bureaucratic costs.

-Downsized organizations lack the creative middle managers who perform the vital tasks and
this may hurt them in the future.

8) Discuss Lewins' change in action.

1- Diagnosing the organization

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-It requires managers to recognize the existence of a problem that needs to be solved and
acknowledge that some type of change is needed to solve it.

-It can be a complex process. -Managers have to distinguish between causes and symptoms.

2-Determining the desired future state

-The managers have to identify where the organization needs to be.

-This step involves a difficult planning process as managers' work out various actions.

-It also involves what the organization's strategy and structure should be.

3- Implementing change
-The first step is that managers need to identify possible impediments to change that they
will encounter as they about to make change.

-The second step is deciding who will responsible for actually making the change and
controlling the change process.
-The third step is deciding which specific change strategy will most effectively change, and
freeze the organization.
-Top down change is implemented by managers at a high level in the organization.

-Top down change proceeds rapidly and forces employees to keep up with the pace of
change.

Bottom up change is implemented by employees at low levels in the organization and

gradually rises till it is felt through the organization.

Bottom up change facilitates unfreezing and increases the likelihood that employees will
retain the new behaviours they learn during the change process.
4- Evaluating the action
-It assesses the degree to which the changes have accomplished the desired objectives.

-With it, management decides whether more change is needed to reach the desired future
state or more effort is needed to refreeze the organization in its new state.

-The best way to evaluate the change process is to develop measure or criteria that allow
managers to assess whether the organization has reached its desired objectives.

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 Chapter 6: performance management

1- Definition of Performance Management.

Performance management can be defined as: a systematic process for improving

organizational performance by developing the performance of individuals and teams.
It is a means of getting better results from the organization, teams and individuals by
understanding and agreed framework of managing performance within an planned goals,
standards and competence requirements.
Processes exist for establishing shared understanding about what is to be achieved, and for
managing and developing people in a way that increases the probability that it will be
achieved in the short and longer term.

It is owned and driven by line management.

Other definitions are:

1- Performance management is: "The development of individuals with competence and

commitment, working towards the achievement of shared meaningful objectives within an
organization which supports end encourages their achievement'.
2-Performance management is the process of °Directing and supporting employees to work
as effectively and efficiently as possible in line with the needs of the organization".
3-Performance management is a strategic and integrated approach to delivering sustained
success to organizations by improving the performance of the people who work in them and
by developing the capabilities of teams and individual contributors.

2- Objectives of Performance management

1-The overall objective of performance management is to establish a high-performance

culture in which individuals the continuous and teams take responsibility for improvement of
business processes and for their own skills and contributions within a framework provided by
effective leadership.
2-Its key purpose is to focus people on doing the right things by achieving goal clarity.

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3-The aim is to develop the capacity of people to meet and exceed expectations and to
achieve their full potential to the benefit of themselves and the organization.
4-Empowering, motivating and rewarding employees to do their best.

5-Focusing employees' tasks on the right things and doing them right.
6-The alignment of personal/individual objectíves with team, department/divisional and
corporate plans.
7-The presentation of objectives with clearly defined goals/targets using measures, both soft
and numeric.
8-The monitoring of performance and tasking of continuous action as required.
9-All individuals being clear about what they need to achieve and expected standards, and
how that contributes to the overall success of the organization; receiving regular,

10-fair, accurate feedback and coaching to stretch and motivate them to achieve their best.
11-Systematic approach to organizational performance aligning individual accountabilities to
organizational targets and activity.
12-The process and behaviors by which managers manage the performance of their people to
deliver a high-achieving organization.

13-Maximizing the potential of individuals and teams to benefit themselves and the
organization, focusing On achievement of their objectives.

Concern of performance management

•Concern with outputs, outcomes, process and inputs.

Performance management IS concerned with outputs (the achievement of results) and

outcomes (the impact made on performance).
But it is also concerned with the processesrequired to achieve these results (competencies)
and the inputs in terms of capabilities (knowledge, skill andcompetence) expected from the
teams and individuals involved.
-Concern with planning.
Performance management is concerned with planning ahead to achieve future success. This
means defining expectations expressed as objectives and in business plans.

-Concern with measurement and review.

"If you can't measure it, you can't manage it.

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Performance management is concerned with the measurement of results and with reviewing
progress towards achieving objectives as a basis for action.
-Concern with continuous improvement.

Concern with continuous improvement is based on the belief that continually striving to
reach higher and higher standards in every part of the organization will provide a series of
incremental gains that will build superior performance.
-concern with continuous development.

performance management is concerned with creating failure in which organizational and

individual learning and development is a continuous process.
It provides means for the integration of learning and work so that everyone learns from the
successes and challenges inherent their day-to-day activities.

-Concern for communication.

Performance management is concerned with communication. This is done by creating a
climate in which a continuing dialogue between managers and the members of their teams
takes place to define expectations and share information on the organization's mission,
values, and objectives.

-Concern for stakeholders.

Performance management is concerned with satisfying the needs and expectations of all the
organization's stakeholders owners, management, employees, customers, suppliers and the
general public.

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