Baldwin 1e Ch14 PPT FINAL Accessible

Because learning changes everything.
Chapter 14
Organizational
Structure and Design
ORGANIZATIONAL BEHAVIOR
FIRST EDITION
Baldwin, Bommer, Rubin
Copyright 2021 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.
Learning Objectives
LO14.1: Explain the forces reshaping organizations.

LO14.2: Explain the key building blocks that differentiate
organizations.
LO14.3: Contrast mechanistic and organic structural models.
LO14.4: Describe the advantages and disadvantages of the
most common forms of organizational designs.
LO14.5: Explain the use of hybrid organizational structures.
LO14.6: Describe emerging organizational structures.
LO14.7: Apply the STAR model to diagnose gaps in
organizational design.
Copyright 2021 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC. 2
Designing Effective Organizations
Organizational Structure: a framework of roles defining who

reports to whom that shapes and encourages specific
employee behaviors.
Organizational Design: The process of aligning an

organization’s structure and other internal systems with the
organization’s goals and implementing any needed changes.
The Forces Reshaping Organizations
Trends affecting organizations:

• Executive teams leading teams.
• Managing Beyond the Organization.
• New rewards: Personalized, agile, and holistic.
• The move from careers to experiences.
• Employee well-being: A strategy and a responsibility.
• Technology keeping humans in the loop.
• The connected workplace.
Figure 14.1
Selected Trends Identified in Deloitte’s Global Survey of

11,000 Business Leaders
Source: Deloitte. (2018). Global Human Capital Trends.

Access the text alternative for slide images.
The Building Blocks that Differentiate Organizations 1
Six factors play a role in the appearance of almost every

organizational structure:
• Labor specialization
• Hierarchical Levels
• Chain of command
• Centralization
• Formalization
• Departmentalization
Labor Specialization: The degree to which people perform

the same, specific tasks.
Hierarchical Levels: How many hierarchies does the

company have (that is, distance between the chief executive
and average worker)?
Figure 14.2
Tall versus Flat Organizations
Chain of Command: The flow of authority between different

organizational members.
• Unity of Command: each person should have only one

direct supervisor.
Centralization: Degree to which decision-making authority is

concentrated in an organization.
Formalization: The degree to which work rules are written

and explicitly communicated.
Departmentalization: Groups people into an area or unit

within the overall organizational structure.
The Five Most Common Ways of Grouping Employees
Departmentalization by:
• Function: Groups people into a unit within the overall
organizational structure.
• Product: Groups people by the product on which they work.
• Geography: Groups people by geographic area.
• Process: Used when companies have a workflow with
defined steps.
• Hybrid: Combines multiple departmentalization types.
Mechanistic Versus Organic Structures 1
Mechanistic: Characterized by high specialization of labor,

large numbers of hierarchical levels, a clear chain of
command, high centralization, narrow spans of control, high
formalization, and strict departmentalization.
• Example: The military.
Mechanistic Versus Organic Structures 2
Organic: Have low specialization of labor, a flexible chain of

command, few hierarchical levels, wide spans of control, low
formalization, and relatively loose departmentalization.
• Example: Most start-up companies.
Traditional Organizational Structures 1
Functional Structures: Organize employees based upon the

tasks they perform for the organization and use functional
departmentalization.
• Allows for the development of specialized expertise.
• Could create a “silo” mindset.
Figure 14.3
Example of a Functional Structure
Traditional Organizational Structures 2
Divisional Structures: Organize people around one of the

forms of departmentalization mentioned earlier in this chapter
(that is, product, geography, process, and customer).
• Allows organization to better serve customer needs.
• Less efficient as people are not able to work together as
closely.
Hybrid Organizational Structures 1
Matrix Organizations: Combine functional structure and

divisional (usually product) structure.
• Takes advantage of scarce resources.
• Violates the unity of command by giving every employee
two managers instead of one.
Figure 14.4
A Typical Matrix Structure
Hybrid Organizational Structures 2
Flatarchy: A hybrid approach using a functional structure and

a relatively flat hierarchy, with a correspondingly wide span of
control.
• Encourages company-wide innovation.
• Confusion can be created by the large spans of control.
Emerging Organizational Structures
Boundaryless Organizations: Here, many of the boxes on an

organization’s chart are eliminated, and the people inside the
organization are expected to interact with their customers in
extremely flexible ways.
• Examples include organizations that are: Hollow, or
modular, or virtual, or networked.
Hollow Structures
These organize people based on the type of work they do.

However, hollow structures are an outsourcing approach
where organizations keep their essential, core tasks
internally, but outsource noncore tasks.
• Increases focus to core versus non-essential tasks.
• Loses control over potentially important jobs.
Modular Structures
These outsource components of a product, usually by

keeping a core part of it in-house and outsourcing noncore
portions.
• Results in reduced overhead, and an increased focus on
assembly rather than production.
• Lack of control over suppliers can influence the firm’s
pricing.
Virtual Organizations
An alliance in which companies form partnerships with others

—sometimes competitors– to cooperate and deliver a
product or service under an operating agreement.
• Are quick to responding at change.
• Requires frequent and intense communication.
Networked Organizations
Not actually a formal organizational structure. A

“soft structure” of informal relationships, networks, teams,
groups, and communities connected by the demands of the
task.
• Can quickly adapt to the needs of the environment.
• Not everyone comfortable working with so much
uncertainty.
Diagnosing Design Gaps with the STAR Model 1
Treats the organization as a network whose different design

aspects need to be aligned with and support each other.
Each part of the STAR Model represents a decision for

management to make about how it will ultimately influence
employee behavior.
Strategy: The set of actions and commitments designed to

gain a competitive advantage.
Structure: Based on the six, building blocks

(labor specialization, chain of command, centralization,
formalization, hierarchy, and departmentalization).
Process: The way in which work and information flow through

the organization.
Rewards: A well-designed rewards system serves to

encourage employee actions that help the organization
succeed in achieving its strategy.
People: Those who handle recruiting, selection, work

assignments, training, and development are aligned with the
other people in the organization.
• In the STAR model, people are a vital part of the formula for
success.
End of Main Content
Because learning changes everything. ®
www.mheducation.com
Copyright 2021 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

Baldwin 1e Ch14 PPT FINAL Accessible

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

Baldwin 1e Ch14 PPT FINAL Accessible

Uploaded by

Copyright:

Available Formats

Because learning changes everything.

LO14.1: Explain the forces reshaping organizations.

Organizational Structure: a framework of roles defining who

Organizational Design: The process of aligning an

Trends affecting organizations:

• Managing Beyond the Organization.

• New rewards: Personalized, agile, and holistic.

• The move from careers to experiences.

• Employee well-being: A strategy and a responsibility.

• Technology keeping humans in the loop.

• The connected workplace.

Selected Trends Identified in Deloitte’s Global Survey of

Source: Deloitte. (2018). Global Human Capital Trends.

Six factors play a role in the appearance of almost every

Labor Specialization: The degree to which people perform

Hierarchical Levels: How many hierarchies does the

Tall versus Flat Organizations

Access the text alternative for slide images.

Chain of Command: The flow of authority between different

• Unity of Command: each person should have only one

Centralization: Degree to which decision-making authority is

Formalization: The degree to which work rules are written

Departmentalization: Groups people into an area or unit

Mechanistic: Characterized by high specialization of labor,

Organic: Have low specialization of labor, a flexible chain of

Functional Structures: Organize employees based upon the

• Could create a “silo” mindset.

Example of a Functional Structure

Access the text alternative for slide images.

Divisional Structures: Organize people around one of the

Matrix Organizations: Combine functional structure and

A Typical Matrix Structure

Access the text alternative for slide images.

Flatarchy: A hybrid approach using a functional structure and

Boundaryless Organizations: Here, many of the boxes on an

These organize people based on the type of work they do.

These outsource components of a product, usually by

An alliance in which companies form partnerships with others

Not actually a formal organizational structure. A

Treats the organization as a network whose different design

Each part of the STAR Model represents a decision for

Strategy: The set of actions and commitments designed to

Structure: Based on the six, building blocks

Process: The way in which work and information flow through

Rewards: A well-designed rewards system serves to

People: Those who handle recruiting, selection, work

Because learning changes everything. ®

You might also like