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Case Study 4: Boundaryless Organizations

Gerd Finger founder and CEO of Newskool was running into some management issues

and sought counsel from an Organizational Behavioral standpoint. The main areas addressed

include organizational structure and boundaryless organizations, organizational culture, human

resources and organizational socialization. Boundaryless organizations are organizations that are

not defined or limited by horizontal, vertical, or external boundaries imposed by a predetermined

structure. These organizations typically use modern forms of communications, such as, email,

phone, and other virtual methods rather than more traditional face-to-face communication. The

freedom to telecommute with international employees removes geographical barriers to

productivity and allows for schedule flexibility.

Three major issues I have identified are coordinating and managing Newskool’s complex

structure can become quite problematic. Secondly, the strong interdependency between

departments could be its downfall, that is, if one part of the network fails or breaks down the

entire system fails. Finally, no strong sense of loyalty towards the company would be maintained

due to outsourcing. For example, if the programmers in Kiev are offered better compensation

elsewhere Newskool stands to lose valued personnel. However, there are some advantages of

boundaryless organizations such as, by being a network structure, and by extension boundaryless

Newskool Grooves can boast of being lean and streamlined. Overhead is reduced and operating

efficiency is increased thus helping Newskool in being cost-competitive. New non-traditional

roles relating to coordinating business processes are created from this structure. Lastly,

boundaryless organizations are able to achieve greater integration and coordination as well as

adapt to environmental changes.

Culture is an aspect of every organization, which helps define the norms and types of

behavior that is acceptable and must be incorporated to maintain a particular standard. Culture
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affects and influences how people behave, think, and communicate. Different cultures have

different expectations, norms and values, which affect the way in which they may interpret

information. Newskools’ organizational culture is decentralized, and it is expected that cultural

issues will arise due to its dynamic work force. To be an effective organization that crosses

international boundaries a proper knowledge of cultural issues is important. (Robbins, 498)

In this boundaryless company, headquarters is in Berlin, Germany, structure outsourcing

company is in Kiev, Ukraine, and marketing in is Los Angeles, U.S.. There are many different

employees with different cultures working together to achieve organizational goals. Employees

are also diverse in values, personality, and work preferences, which are deep-level diversity.

Some cultural issues that are sensitive will rise in the workplace and create unpleasant things

among employees. Employees might not be working together well as they will have fighting in

the decision-making. Almost all employees are creative and like to accept challenges. Therefore,

in this similar personality and work preferences, they should be emphasized in working with

others as a team. Training for team building with different cultures people will be quite important.

Communication is a major issue in diverse cultures within an organization, and may result

in negative outcomes. One of the major issues faced is the interpretation of words that mean

different things to different people, word connotations and tone differences. With an increase in

communication via social networks we can see how this may influence or assist in the breakdown

of communication between international boundaries. Communication barriers may also occur

among a diverse work group where there is a lack of understanding and interpretation of cultural

differences.

Some cultures have different decision making styles, which are dependent on their values

and beliefs; this can lead to misunderstanding, slow decision making, failure to make a decision

or failure to implement a decision made. Considerations are made to cultural difference when
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dealing with ethics and conflict resolution, because it contributes to the way a person thinks or

acts. Conflict is sometimes as a result of a lack of communication and this can however be

reversed by establishing effective communication based on mutual cultural understanding. Ethical

behaviors are sometimes influenced public culture, by work environment and organizational

factors, where employee’s ethics are not compatible with the organizations; again the

implementation of programs to improve employees’ awareness of the different cultures they

interact with will play an integral role in curbing this issue.

The cohesiveness of work groups with respect to culture has its advantages as well its

disadvantages. Cohesiveness with in a group can only be strengthening through an understanding

of the organisation culture. Workplace satisfaction and behavior is sometimes affected by the

different cultures that may exist both ethnically and organizationally. (Robbins, 293) Due to

cultural influence employees view authority differently; some culture prefers structure and others

are comfortable making decision on their own. A negative corporate culture as well can affect an

employee's job satisfaction, where there is no comfort, no rewards or considerations or the

impacts that certain decision may have on the employee's welfare. Socially the individual culture

of an employee may also cause dissatisfaction when it is in conflict with the organizations.

(Robbins, 294) Understanding the employee’s social culture for example religion and values can

assist in the resolving this issue.

Gerd wishes to achieve a high level of creativity and independence within Newskools'

work environment, thus determining workforce satisfaction, an important variable would be to

make selections based on an individual's motivational level and personality types in accordance to

each area of the company. Employees need to feel a sense of accomplishment and purpose, by

breaking monotonous functions and redesigning jobs, by implementing job enrichment programs

and possible job rotation this can be achieved.

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Human resources focus on activities relating to employees. The activities include

recruiting, hiring of new employees and training of existing employees. Newskool Grooves hires

employees who are creative, and who will try to make the next thing happen, at the end Gerd

makes the final decision or selection of employees placing great emphasis on independent work

styles. Once you properly designed your selection system, you would develop competent

employees who will match their proposed job specification in the organization. Start with the

initial selection, which is a basic information applicant submit and it decides whether they meet

the basic qualifications for the job. Then move on to the substantial selection, which would

involve performance stimulation tests, which would determine whether employees could do the

job successfully. To determine job successfulness do work sample tests, which will accurately

assess an applicant’s ability to perform his job functions. (Robbins, 563-566)

Based on the Big Five Traits, the most suitable personalities would be that of persons. You

can hire employees who are creative, curious and artistically sensitive, since it would allow

workers to adapt to changes that are ever occurring in the organization especially when you want

to remain ahead of your competitors. It is important to have conscientious employees who are

responsible, dependable, persistent and organized. (Robbins, 142) You want that person who is

driven to performance without them having to bother you. You want to build trust with

employees. You have to have cooperation among all workers from supervisors to

regular employees. You want when employees called from Berlin to Los Angeles you want

someone who can make a decision or agreement without having to wait for board members.

When your employees call you, you can come to some agreement without them, having to start

any project all over again.

Performance is measured by a system called performance appraisals. Performance

appraisals is a formal, structured system of measuring and evaluating an employee’s job related
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behavior and outcomes to discover how and why the employee is presently performing on the job

and how the employee can perform more effectively in the future. (Robbins, 576) The marketing

department of Newskool Grooves is based in Los Angeles. The basic function of any marketing

department is interacting with a company’s external customers and generating revenue/sales for

the company. With this in mind we can determine that best performance appraisal method for

measuring the performance of the marketing team would be the 360° evaluation system. The 360°

evaluation, analyzes individuals’ performance from all sides—from their supervisor’s viewpoint,

from their subordinates’ viewpoint, from customers’ viewpoint (if applicable), from their peers’

viewpoint, and using their own self-evaluation. (Robbins, 577) The 360° evaluation would give

us an accurate, good analysis of individuals and their performance within the company.

The Kiev, Ukraine office is the second major functional silo of Newskool Grooves’

operations, here is where coding work is outsourced to highly skilled programmers. Programmers

requested clearly defined objectives and in order to carry out their work effectively and

efficiently. They wish to produce what is asked of them, the creativity aspect arises in figuring

out how to accomplish said task rather than thinking out of the box to come up with new

innovative ideas. Hence, the Management by Objectives (MBO) method is the most appropriate

option. MBO method is a process in which managers and employees jointly set objectives for the

employees, periodically evaluate performance, and reward according to the results. It is crucial

when setting up objectives/plans/goals they should be done using the SMART technique

(Specific, Measurable, Attainable, Relevant, and Time-based). (Robbins, 218-219) Programming

is a highly structured task, where there are clearly written rules that govern how it is done.

Therefore, the quality of a programmers work could be judged based on the quality of code they

produce hence the need for also using the graphic rating scale. On the other hand, Gerd wants to

promote creatively and out of the box thinking and using MBO, method would initiate the
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programmers thinking introspectively.

The headquarters of the multinational company Newskool Grooves is located in Berlin,

Germany, the brain, the nerve center, the pulse, the place where the magic happens. These are the

words used to describe the company’s headquarters, here is where new products are developed,

and the organizational strategy is established. We can conclude from observing the structure of

the Berlin office that employees work in project teams developing new innovative and

organizational strategies. Due to a close-knit teamwork environment the peer-reviews appraisal

system would work best, as well as MBO method described above based on the developmental

culture Gerd wishes to achieve. Peer-Reviews is the process of having team members rate each

other on a given set of performance or personal characteristics against a set of rating scales.

Establishing a socialization program will assist in maximizing employees creativity and

independence. Socialization is the process whereby employees adapt to an organization’s culture.

The implementation of socialization programs support improving the general satisfaction amongst

workers, it influences a higher level of creativity, and independence. (Robbins, 538)

Based on Newskool’s boundaryless organization and its ability to continuously re-invent

itself to increase productivity and maintain its competitiveness, the establishing of socialization

programs will assist the employees in maintaining these standards. In order to develop an

effective socialization program the company must first assess the following: (1) Whether or not

the employees have an understanding of the organizations culture. By determining this factor, the

company can implement a socialization program that will accurately portray the organizations

culture. (2) Analyzing the diverse work environment. This will assist in implementing a program

that improves communication. (3) Perform a Work Sample Test. (Robbins, 539-540) By

obtaining a better understanding of the employees’ efficiency and deficiencies with respect to

their job specifications a program can be implemented to provide and improve training and job
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compatibility.

Based on the function of each department, the expectations or output of each is different,

for instance the Kiev office in Ukraine writes code that produces programs based on what the

Berlin office decides on implementing. The creativity level necessary for executing such tasks

will mostly rely on how they execute their requests rather than developing new products, which is

the responsibility of the Berlin office to begin with. Thus, it isn't necessary for creativity levels to

be equal across all departments of the organization. Creativity is necessary for the marketing team

as well as the headquarters, because this is where new products are developed and where the

direction of the company is directed.

Based on our report it can be seen, that the understanding of an organizations culture,

behavior, and its human efficacy and effectiveness is important in determining, the negatives and

positives within the organization. The role of an organization is not always to create, develop or

manufacture a product, but to also be sensitive to its employee’s needs and wants and creating

clear communication channels. By using this report to find solutions and implementing them, this

company will be able to excel leaps and bounds into an organizational equilibrium of satisfaction

results and success.

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Works Cited

Robbins, Stephen P., and Timothy A. Judge. Organizational Behavior. 17th ed. Boston:
Pearson, 2017. Print.