CSIS 114 Lab 6: Organizational Culture and Structure

1. 0 CSIS 114 Lab 6:Organizational Culture and Structure

2. 0 Part 1:Organizational culture • Shared understandings, values & assumptions in an organization • Influences information systems • Siena and IBM example

3. 0 IBM’s culture • Lifetime employment (up until 1987 !) • Social interaction: Kingston Country Club • Conservative dress • Our computers are the best • Other companies make computers, too?

4. 0 Siena’s Culture • Men with brown robes: Franciscan influence. • ROTC. • Strong athletic program and alumni support. • Academics: Liberal arts. • Students: mostly regional, Irish/Italian.

5. 0 Culture Characteristics:low or high on scale • Innovation & Risk taking – encouraged? • Attention to detail – precision, analysis • Outcome orientation (vs process) • People orientation - consideration • Team organization – work activities • Aggressiveness - competitiveness • Stability – status quo

6. 0 Function of Culture • Distinguishes organization from others • Conveys sense of identity to members • Commitment to group rather than self • Enhance social system stability – guidelines for behavior • Encourages conformity (control) - rewards

7. 0 Creating and maintaining culture • Stories - history • Rituals • Language – jargon or slogans • Material symbols: dress codes, office space, furnishings, other perks, rewards system

8. 0 NASA Case

9. 0 Part 2:Organizational structures • Define organizational structure, and explain how they affect work processes and the implementation of information systems that should empower and support workers.

10. 0 Organizational Structureinfluences information flow Lines of communication • Formal • Informal : IT makes CEO more accessible. Relationships make business processes work. • Vertical (control) vs Horizontal (collaborative)

11. 0 Traditional Organizational Structure • Fig. 2.3

12. 0 Organizational StructureApproaches • Traditional – hierarchy • Industrial revolution and earlier • “command and control” • Rote work by unskilled staff • Flat • Project • Team • Multidimensional

13. 0 Example of Traditional Structure • Fig 2.4

14. 0 “Flat” Organizational Structure • Less middle managers • Less up/down (filtering) communication • Empowerment of staff – via IS • Faster action and Lower costs • EX: Insurance rep handles entire case • Cable TV help desk can make decisions and provide refunds/extras (up to certain amount) • Be careful about becoming too flat: sometimes managers can see the big picture or resolve longer-term problems.

15. 0 Project Organizational Structure • Fig 2.5

16. 0 DELL: Sales force structure changed to accommodate growth • Maintained double-digit sustained growth by market segmentation. • Each group has specific customers that they specialized in. • Each group was close-knit and entrepreneurial. • As sales grew, company split off more specialized groups- see next slide.

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18. 0 Team Organizational Structure • Work groups of various sizes • Temporary or permanent teams • Peer pressure to perform • Each member learns all functions of team • Team can even make budgetary and hire/fire decisions

19. 0 Gore’s innovative organization model (makers of Gore-Tex) • Split divisions when they reach > 150 people. • Research indicates that people don’t feel part of community that is too large. • EX: Shakers split “families” that are too large. • No managers, just “mentors” • Titles, offices don’t mean a thing.

20. 0 Multidimensional Organizational Structure • Fig 2.6

21. 0 Multidimensional (matrix) Organizational Structure • May incorporate several structures at the same time • Advantage: • ability to simultaneously stress both traditional corporate areas and important product lines • Two mentors • Flexibility to move people within functional area • Disadvantage: • multiple lines of authority

22. 0 Virtual Organizational Structure:diverse groups act as a single entity. • Employs business units in geographically or organizationally dispersed areas • Southwest airlines: Moms handle reservations at home • Contract out work to specialty shops • Can be permanent or temporary. • IS must support&coordinate virtual distributed organization. [e-mail, scheduling, videoconferencing, etc.] since workers mostly communicate electronically.

23. 0 Organizational innovation • Downsizing - “rightsizing” • Vertical Integration • own all phases of production • Horizontal Integration (conglomerates) • Going into other lines of business • Acquisitions and mergers • Keiretsu: Japan’s answer to conglomerates • Can be either vertical or horizontally integrated • Virtual Integration • Business Web value chains: act as one company. • EX: Dell and its suppliers. CISCO and manufacturers. • Partnerships / Cooperation • Outsourcing/off shoring

24. 0 Downsizing • Downsizing: “rightsizing” • cutting the number of employees by layoffs • or hiring freeze • or reorganization (sell off business units)

25. 0 Keiretsu Case

26. 0 Part 3: Outsourcing and offshoring(ch. 14 in O’Brien) • Outsourcing: contracting with outside company (within U.S. or not) • American Express hires IBM to manage servers, databases and helpdesk. • Other company may hire foreign nationals that may reside in U.S.

27. 0 When to outsource? • When you can cut costs. • Limited opportunity to distinguish competitively through the function. • When uninterrupted service is not critical. • When technical know-how can be maintained internally. • When existing IS function is ineffective or inferior. [Stair, p 523]

28. 0 Offshoring(ch. 14 in O’Brien) • Also known as: Off-shore outsourcing • More specific term than outsourcing. • Contract out to (or own) offshore company • GE, Texas Instruments have subsidiaries in India • Move sophisticated work to another country to take advantage of lower cost structures (finance, banking, call center, IT services: programming, system management). • Countries with innovative, educated in IT/engineering, English speaking, workers are successful. • Near-shoring to Canada: less cultural differences

29. 0 Off-Shoring projections • Gartner Inc. predicts that 40% of companies with revenue of more than $100 million will be trying out or using offshore services by the end of 2004. • Gartner also predicts that one in 20 IT jobs will head offshore by the end of 2004. • Cambridge, Mass.-based Forrester Research Inc. projects that more than 3 million U.S. white-collar jobs will be lost to offshore outsourcing during the next 10 years or so -- a half-million of them in IT.

30. 0 Off-shoring Case • Pro and Con analysis.