Daft OTAD 13e PPT Ch01

Chapter 1
Organizations and
Organization Theory
Chapter
1
Organization Theory and Design
Thirteenth Edition
Richard L. Daft
Daft, Organization Theory and Design, 13e. © 2021 Cengage. All Rights Reserved. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole or part.
Learning Objectives
1. Discuss current challenges that organizations face.
2. Describe the importance of organizations in society.
3. Describe how the structural dimensions of organizations are
shaped by contingencies organizations face.
4. Outline the evolution of organizational design.
5. Compare and contrast organic and mechanistic organization
designs, including the contingency factors typically
associated with each.
6. Explain the current trend toward bossless organization
design.
Daft, Organization Theory and Design, 13e. © 2021 Cengage. All Rights Reserved. May not be scanned, copied or 2
A Look Inside General Electric
• The Jack Welch Era 1981-2001
– The most phenomenal era in company history
• The Jeff Immelt Era 2001-2017
– Most analysts thought GE fell behind rather than moved ahead
• Events Since 2017
– GE hit rock bottom during late 2018 and early 2019
– CEOs John Flannery and Larry Culp
Organization Design in Action
• Current Challenges
– Globalization
– Intense competition
– Sustainability, the green movement, and ethics
– Speed and responsiveness
– Digital organizations and big data analytics
• Organization design provides tools to understand,
design, and manage organizations more successfully.
What is an Organization?
• Social entities that are goal-directed
• Designed as deliberately structured and
coordinated activity systems
• Linked to the external environment
The Organization is an Open System
Importance of Organizations (slide 1 of 2)
• Organizations
– Bring together resources to accomplish desired goals
– Produce goods and services efficiently
– Facilitate innovation
– Use modern manufacturing and information technologies
– Adapt to and influence a rapidly changing environment
– Accommodate challenges of diversity, ethics, and the motivation and
coordination of employees
– Create value for owners, customers, and employees
Importance of Organizations (slide 2 of 2)
Dimensions of
Organization Design
Structural Dimensions Contingency Factors
– Formalization – Size
– Specialization – Organizational technology
– Hierarchy of authority – Environment
– Complexity – Goals and strategy
– Centralization
– Culture
Interacting Structural Dimensions of
Design and Contingency Factors
Organization Chart
Differing Characteristics of Two
Organizations
Performance and
Effectiveness Outcomes
• Efficiency: Amount of resources used to
achieve the organization’s goals
• Effectiveness: The degree to which an
organization achieves its goals
• Stakeholder Approach: Balancing the needs of
groups within and outside of the organization
that have a stake in the organization’s
performance
The Evolution of Organization Theory
and Design
Historical perspectives provide insight into

how organization design and management
practices have varied over time in response
to changes in society.
Historical Perspectives
• Efficiency is Everything
– Scientific management: Scientifically determined jobs and management
practices improve efficiency and labor productivity.
• How to Get Organized
– Administrative principles: The design and functioning of the organization as a
whole
• Contributed to development of bureaucratic organizations
• What about People?
– Hawthorne Studies: Positive treatment of employees improves motivation and
productivity.
• Can Bureaucracies Be Flexible?
– 1980s: Corporate cultures valued lean staff, flexibility, learning, rapid response
to the customer, engaged employees, and quality products.
– Current day: Flexible organizational design approaches are still prevalent.
It All Depends: Key Contingencies
• Contingency: The correct organizational design approach is
contingent on the organization’s situation.
– Size
– Technology
– Environment
– Goals
– Strategy
– Organizational culture
The Contrast of Organic and
Mechanistic Designs
• Mechanistic: Organization design is machine-like,
with standard rules and procedures and a clear
hierarchy of authority
• Organic: Organization design is looser and free-
flowing, with a decentralized decision-making
authority
Depends upon:
– Centralized vs. decentralized structure
– Specialized tasks vs. empowered roles
– Formal vs. informal systems
– Vertical vs. horizontal communication
– Hierarchy of authority vs. collaborative teamwork
Organic and Mechanistic Designs
The Emerging Bossless Design Trend
• A few organizations have shifted to an extremely
organic, “bossless” design, with no job titles, no
seniority, and no managers or executives.
– People work together on an equal basis, and no one gives
or takes orders from others.
– Costs may be lower due to reduced overhead.
– Money must be invested in ongoing employee training and
development.
– The culture must engage employees and support the non-
hierarchical environment.
Framework for the Book
• Four levels of analysis characterize organizations:
– Individual
– Group (such as a department)
– Organization
– External environment (such as a community)
• Organizational behavior focuses on the individuals within
organizations.
• Organization theory and design analyzes the whole
organization as a unit.
Levels of Analysis in Organizations
Organizational Design Essentials (slide 1 of 3)
• Organization design provides tools to understand, design, and
manage organizations more successfully.
• Organizations are open systems that obtain inputs from the
environment, add value, and discharge products and services.
• Many types of organizations exist, such as for-profit and non-
profit.
• Structural dimensions and contingency factors provide labels
for measuring and analyzing an organization.
• Structural dimensions include formalization, specialization,
hierarchy of authority, complexity, and centralization.
• Contingency factors include size, organizational technology,
environment, goals and strategy, and culture.
• Various contingency factors will influence whether an
organization is more effective with a primarily mechanistic or
a primarily organic design.
• Current challenges require greater flexibility and
decentralization for most organizations.
• Some organizations have shifted to an extremely organic,
“bossless” design.
• Organization theory and design is a macro examination of
organizations because it analyzes the whole organization as a
unit.
• Most concepts in organization theory and design pertain to
the top- and middle-management levels of the organization.

Daft OTAD 13e PPT Ch01

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Daft OTAD 13e PPT Ch01

Uploaded by

Copyright:

Available Formats

Chapter 1

Historical perspectives provide insight into

You might also like