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Organizational Design, Diagnosis, and Development

This session explores the relationship between technology and organizational structure, reviewing traditional concepts as well as contemporary views derived from advanced manufacturing technology and office technology.

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Organizational Design, Diagnosis, and Development

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  1. Organizational Design, Diagnosis, and Development Session 4 Technological considerations

  2. Objectives • To review traditional concepts of technology • To understand the relationship between technology and structure • To examine contemporary concepts of technology and their relationship to structure • To understand the role of technology in the process of organizational design

  3. Traditional Concepts of Technology • South Essex studies - Joan Woodward • Task typologies - Charles Perrow • Task interdependencies - James Thompson

  4. South Essex Studies • 100 manufacturing firms in South Essex • Data collected on: • Objectives of firm & background • Manufacturing processes • Organizational structures & processes • Organizational effectiveness (market share, profitability, general reputation, labor turnover, etc.)

  5. Modal Technology Types • Unit: Production is designed to meet individual customer requirements. (Custom tailor, prototype equipment) • Mass: Standardized production on an intermittent basis, such as an assembly line or large batch like a bakery. • Process: production on a continuous flow such as a chemical plant, oil refinery.

  6. Overall Findings • Technological imperative: Structure varied with technology type. Woodward came to believe technology determined structure • Mass is more mechanistic • Unit and process are more organic • Hierarchy increases from unit to mass to process

  7. Technical Complexity & Structure for Effective Firms Characteristics Levels of management Span of control Ratio of managers to personnel High Low Unit Mass Process

  8. Technical Complexity & Structure for Effective Firms High Characteristics Ratios: 1. direct to indirect labor, 2. Manual to administra-tive staff, 3. Wages & salaries to total cost Labor costs Low Unit Mass Process

  9. Technical Complexity & Structure for Effective Firms High Characteristics Span of supervisor control Separation of adminis- tration from operation Written communication Control & sanction pro- cedures Specialization between line & staff Low Unit Mass Process

  10. Technical Complexity & Structure for Effective Firms Characteristics Verbal communication Role ambiguity for jobs Organizational flexibility Skilled workers High Low Unit Mass Process

  11. Perrow’s Types of Technology Exceptions Problems Technological Type Few Easy to analyze Routine technology Difficult to analyze Craft technology Many Easy to analyze Engineering technology Difficult to analyze Non-routine technology

  12. Thompson’s Types of Technology Technology Type Task Interdependence Integration Mediating Pooled Standardization (banks) Long-linked Sequential Hierarchy of (assembly line) Authority Intensive Reciprocal Mutual (hospital) Adjustment

  13. Advanced Information Technology • The accumulation, storage, processing and transmission of data made possible by computers

  14. Advanced Information Technology • Advanced Manufacturing Technology • Computer Aided Design and Manufacturing • Computer Integrated Manufacturing • Office Technology • Word processing • Communication (e-mail, fax) • Data bases, spreadsheets • Information storage and retrieval

  15. Impact of Automation on Job Design • Manufacturing • Less skill on the shop floor • New jobs require skills in programming and electronics • Task lines blur between skill areas • Office technology • Initially some de-skilling • Ability to develop multiple skills in applications

  16. Impact of Automation on Organizational Structure • Manufacturing • Flatter, more flexible structures • Increased need for coordination • Functional structures may be counter-productive • Office Technology • Flatter • Decentralized

  17. Backwards & Forwards • Summing up: Today’s session considered both traditional views of the impact of technology on design (Woodward’s technological imperative, Perrow’s routineness of task and Thompson’s interdependencies) and contemporary views derived from Advanced Manufacturing Technology and Office Technology. • Looking ahead: Next time we begin our exploration organizational differentiation, integration, & size

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