Organization Theories and Applications

Summary

This video discusses organizational management, focusing on theories and applications in organizational design. It covers traditional and modern design structures, such as simple, functional, divisional, team-based, matrix, and boundaryless designs. The strengths and weaknesses of each design are explored, including factors like flexibility, accountability, and challenges faced as organizations grow. The concept of delegation is also discussed, highlighting steps for effective delegation, its benefits in improving job performance and creativity, and potential drawbacks like overdependence and low self-confidence in managers.

Takeaways

• 📚 The session focuses on organizational management, specifically on theories and their application in organizational design.
• 🏛️ Organizational theories are classified into two categories: traditional and modern. Traditional refers to old-fashioned designs, while modern refers to contemporary designs.
• 🗂️ Traditional organizational design includes a simple structure with few departments and wide spans of control, often used by small or entrepreneurial ventures.
• ⚙️ Functional organizational design groups together people with similar tasks or specialties, promoting efficiency but possibly causing managers to lose sight of the overall organization's goals.
• 🏢 Divisional organizational design separates business units or divisions based on specific products, services, or geographical areas, which helps focus on results but increases duplication and costs.
• 👥 Team design involves the creation of work groups with different specialties, fostering empowerment but leading to pressure on team members to perform.
• 🔀 Matrix organizational design uses specialists from various departments for projects, creating flexibility but also complexity due to dual reporting lines.
• 🌍 Boundaryless organizational design allows for virtual teams, breaking traditional hierarchical barriers, but often struggles with communication and control.
• 📑 Delegation refers to assigning tasks to subordinates, giving them authority to act while maintaining overall accountability. It involves clear communication of goals and responsibilities.
• ✅ The advantages of delegation include preventing work overload, improving employee satisfaction, and increasing job performance. However, it may also cause laziness or dependence on others if not managed well.

Q & A

What are the two main classifications of organizational design theories discussed in the video?

The two main classifications of organizational design theories are traditional and modern. Traditional refers to old-fashioned methods, while modern refers to contemporary or new design theories.

What is a simple organizational design and its characteristics?

A simple organizational design has few departments, wide spans of control, many subordinates reporting to a manager, centralized authority, and little formalization of work. It is commonly used in entrepreneurial ventures.

What are the strengths and weaknesses of the simple organizational design?

Strengths include speed, flexibility, and cost-effectiveness. Weaknesses are that it's unsuitable as the organization grows, and it's risky because responsibilities are concentrated on one person, which can lead to issues if that person is unavailable.

What is functional departmentalization in organizational design?

Functional departmentalization groups people based on their similar or related specialties, such as separating departments for finance, marketing, or product lines. This structure improves efficiency in specialized areas.

What is a divisional organizational design and how does it work?

A divisional organizational design consists of separate business units or divisions, each responsible for their specific products or services. The parent corporation oversees these divisions, providing coordination and support.

What are the strengths and weaknesses of divisional organizational design?

The strengths include a focus on results because division managers are accountable for their units. However, weaknesses include duplication of activities and resources, which increases costs and reduces efficiency.

What is the team design in modern organizational structures?

In team design, the entire organization is made up of workgroups or teams that cross functional boundaries. Team members from different specializations collaborate, leading to greater empowerment and reduced barriers between functions.

What is matrix organizational design and how does it differ from team design?

Matrix organizational design involves employees from different departments working on projects temporarily under a project manager, while still reporting to their functional managers. This structure is typically used for short-term projects and differs from team design, where teams are more permanent.

What is boundaryless design in modern organizational theory?

Boundaryless design refers to an organizational structure that removes traditional hierarchical boundaries. An example is a virtual organization where employees and managers work remotely from different locations, with flexible communication.

What is delegation, and what are the steps in the delegation process?

Delegation involves assigning tasks to subordinates, giving them the authority to make decisions. The steps include defining the goal, selecting the right person, assigning responsibility, granting authority, providing resources and time, and regularly checking progress.