COORDINATION AND ORGANIZATIONAL

DESIGN

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COORDINATION
The process of integrating the objectives and activities
of the separate units (departments or functional
areas)of an organization in order to achieve
organizational goals efficiently.
Without coordination, individuals and departments
would lose sight of their role within the organization.
They would begin to pursue their own specialized
interests, often at the expense of the larger
organizational goals

THE NEED FOR COORDINATION

Depends on the nature and communication
requirements of the tasks performed and the degree of
interdependence of the various units performing them.
Beneficial in non routine and unpredictable work, in
which factors in the environment is changing and
interdependence is high
Is significant in organization that sets high performance
objectives, productivity and efficiency

JAMES D. THOMPSON 3

VARIETIES OF
INTERDEPENDENCE IN ORGANIZATIONAL UNITS
Pooled interdependence- exists when organizational
units do not depend upon one another to carry out their
day-to-day work but to depend on the adequate
performance of each unit for ultimate survival (least)
Sequential interdependence- one organizational unit
must act before the next can. (greater)
Reciprocal interdependence- involves give and take
relationships between units (greatest)

LAWRENCE AND LORSCH

Specialization and division of work among units
increases the difficulty of achieving effective
coordination
Differentiation- complicates the task of effective
coordination of organizational activities
Misusing talent is a waste at best and dangerous at
worst

4 TYPES OF DIFFERENCES IN
ATTITUDE AND WORKING STYLE

LAWRENCE AND LORSCH

Differences in orientation toward particular goals

Differences in time orientation
Differences in interpersonal orientation
Differences in formality of structure

Integration-is used to designate the degree to which

members of various departments worked together in a
unified manner

APPROACHES TO ACHIEVING EFFECTIVE

COMMUNICATION

1. Basic management
techniques
a. Management hierarchy
b. Rules and procedures
c. Plans and goals

2. Increase coordination
potential
d. Vertical information
e. Lateral relationships
3. Reduce need for
coordination
f. Slack resources
g. Interdependent units

BASIC MANAGEMENT TECHNIQUES

Managerial hierarchy- the organizations chain of
command specifies relationships among its members
and the units they oversee, thereby facilitating the flow
of information and work between units
Rules and procedures- designed to handle routine
events before they arise
Plans and goals- assures that all units direct their
efforts toward the same broad targets.

INCREASING COORDINATION POTENTIAL

Vertical information systems- is the means by which data are transmitted up

and down the levels of the organization
Lateral relationships- Cutting across the chain of command, it permit
information to be exchanged and decisions to be made at the level where the
needed information actually exists.
Several kinds of lateral relationships
1. Direct contact
2. Boundary-spanning roles
3. Committees and task force
4. Integrating roles
5. Managerial linking
6. Matrix organization

WAYS OF
REDUCING THE NEED FOR COORDINATION
GALBRAITH

Creating slack resources- additional resources gives

unit leeway in meeting each others requirements
Creating independent units- units that can perform all
the necessary aspects of task internally.
Selecting the appropriate coordination mechanisms
-the key is to match the organizations capacity for
coordination with its needs for coordination

COMPARISON OF COORDINATING MECHANISMS

Mechanims

Complexity

1. Basic managerial Simple

techniques
2. Vertical
information
systems and
lateral
relationships

Complex

Cost

Information
processing capacity

Inexpensive

Low

Expensive

High

SPAN OF MANAGEMENT
The number of subordinates who report directly to a
given manager
Two major reasons why the choice of appropriate span is
important
1. SOM may affect the efficient utilization of managers
and the effective performance of subordinates
2. Presence of relationships between SOM throughout
the organization and organizational structure

SELECTING THE APPROPRIATE SPAN

Factors affecting the choice of span
1. Similarity of functions supervised
2. Geographic contiguity of functions supervised
3. Complexity of functions supervised
4. Direction and control needed by (capability) subordinates
5. Coordination required of the supervisor
6. Planning required of the supervisor
7. Organizational assistance received by the supervisor

ORGANIZATIONAL DESIGN
Organizational design/ structure or architecture- defines
how activities such as task allocation, coordination and
supervision are directed towards the achievement of
the organizational aims. It can also be considered the
viewing glass or perspective through which individuals
see their organization and its environment

EARLY APPROACHES TO ORGANIZATIONAL

DESIGN (WEBER,TAYLOR,FAYOL)
Weberian Bureaucracy theory- fundamentally domination
through knowledge as the most efficient and rational way of
organizing, it is the key part of the rational-legal authority.
Webers ideal bureaucracy is characterized by hierarchical
organization, delineated lines of authority in a fixed area of
activity, action taken on the basis of and recorded in written
rules, bureaucratic officials needs training, rules are
implemented by neutral officials and career advancement
depends on technical qualifications judged by organization, not
individuals.

FAYOL- FATHER OF THE MODERN OPERATIONAL

MANAGEMENT THEORY
Division of work,

Delegation of authority,

Discipline,

Chain of commands,

Congenial workplace,

Interrelation between individual interests and common

organizational goals,

Compensation package,

Centralization,

Scalar chains,

Order,

Equity,

DIFFERENCES BETWEEN FAYOL AND TAYLOR

Frederick Winslow Taylor developed Scientific Management. Taylor's
Scientific Management deals with the efficient organization of
production in the context of a competitive enterprise that is concerned
with controlling its production costs. Taylor's system of scientific
management is the cornerstone of classical theory
However, Fayol differed from Taylor in his focus. Taylor's main focus
was on the task, whereas Fayol was more concerned with
management. Fayol appears to have slightly more respect for the
worker than Taylor had, as evidenced by Fayol's proclamation that
workers may indeed be motivated by more than just money. Fayol also
argued for equity in the treatment of workers.

 According to Claude George (1968), a primary difference

between Fayol and Taylor was that Taylor viewed management
processes from the bottom up, while Fayol viewed it from the top
down. In Fayol's book General and Industrial Management,
Fayol wrote that; Taylor's approach differs from the one we have
outlined in that he examines the firm from the bottom up. He
starts with the most elemental units of activitythe workers'
actionsthen studies the effects of their actions on productivity,
devises new methods for making them more efficient, and
applies what he learns at lower levels to the hierarchy...

CRITICISMS OF THE CLASSICAL APPROACH

1. It neglects the human aspects of organization members, assuming
they are motivated only by economic concerns.
2. It does not suit rapidly changing and uncertain environments
3. It assumes that upper-level managers will be respected and obeyed
by subordinates because of their superior knowledge and skills
forgetting that as organization increases in size managers lose touch
of lower level.
4. As organizational procedures become more formalized and individual
become more specialized, means often become confused with ends.
5. Thompson Bureaupathology posits that the structure permits
conterproductive personal insecurities to flourish and some managers
try to protect their authority and position by aloof ritualistic behavior
preventing organization to meet its goals.

 Weber saw the Bureaucracy as the most efficient form

of organization but also pointed that it is a threat to
individual freedoms leading to a Polar

Night of

Icy Darkness in which ongoing rationalization

of human life traps individual in aforementioned

Iron

Cage of bureaucratic, rule-based, rational control.

NEOCLASSICAL APPROACH
Douglas McGregor- Motivational theory of X and Y
Theory x ('authoritarian management' style)
The average person dislikes work and will avoid it he/she can.
Therefore most people must be forced with the threat of
punishment to work towards organizational objectives.
The average person prefers to be directed; to avoid
responsibility; is relatively unambitious, and wants security above
all else.

NEOCLASSICAL APPROACH
Chris Argyris- Adult personality
Argyris believed that managers who treat people positively and
as responsible adults will achieve productivity. Mature workers
want additional responsibilities, variety of tasks, and the ability
to participate in decisions. He also came to the conclusion that
problems with employees are the result of mature personalities
managed using outdated practices.

NEOCLASSICAL APPROACH

Rensis Likert
Management systems
Exploitative authoritative (I)
Exploitative authoritative is rooted in classical theory. In this system,
managers tend to use threats, fear, and punishment to motivate their workers.
Managers at the top of the hierarchy make all of the decisions and are usually
unaware of the problems faced by those in the lower levels of the organization.
Decisions are imposed on subordinates, and motivation is characterized by
threats.[3] The orders issued from the top make up the goals for the
organization. As a result, workers tend to be hostile toward organizational goals
and may engage in behavior that is counter to those goal.

NEOCLASSICAL APPROACH

Benevolent authoritative (II)

Less controlling than the exploitative authoritative system, under this system motivation is
based on the potential for punishment and partially on rewards. The decision making area
is expanded by allowing lower-level employees to be involved in policy-making but is
limited by the framework given to them from upper-level management. Major policy
decisions are still left to those at the top, who have some awareness of the problems that
occur at lower levels. This creates mainly downward communication from supervisors to
employees with little upward communication, causing subordinates to be somewhat
suspicious of communication coming from the top. The managers at the top feel more
responsibility towards organizational goals than those employees at the bottom, who feel
very little responsibility. This contrast in feelings toward responsibility can result in a
conflict and negative attitudes with the organization's goals. Subordinates in this system
can become hostile towards each other because of the competition that is created
between them. Satisfaction among workers is low to moderately-low and productivity is
measured at fair to good.

NEOCLASSICAL APPROACH

Consultative system (III)

This theory is very closely related to the human-relations theory. Motivation of workers is
gained through rewards, occasional punishments, and very little involvement in making
decisions and goals. Lower-level employees, in this system, have the freedom to make
specific decisions that will affect their work. Upper-management still has control over
policies and general decisions that affect an organization. Managers will talk to their
subordinates about problems and action plans before they set organizational goals.
Communication in this system flows both downward and upward, though upward is more
limited. This promotes a more positive effect on employee relationships and allows them
to be more cooperative. Lower-level employees are seen as consultants to decisions that
were made and are more willing to accept them because of their involvement.
Satisfaction in this system improves from benevolent authoritative as does productivity.

NEOCLASSICAL APPROACH

Participative system (IV)

Likert argued that the participative system was the most effective form of management.
This system coincides with human-resources theory. This system promotes genuine
participation in making decisions and setting goals through free-flowing horizontal
communication and tapping into the creativity and skills of workers. Managers are fully
aware of the problems that go on in the lower-levels of the organization. All organizational
goals are accepted by everyone because they were set through group participation.
There is a high level of responsibility and accountability of the organizational goals in all
of the employees. Managers motivate employees through a system that produces
monetary awards and participation in goal setting. Satisfaction among employees is the
highest out of the four systems as is production.

CRITICISMS OF NEOCLASSICAL APPROACH

1. Share the classical assumption that there is one best way of
management
2. Theory x and y over simplify human motivation
3. The coordination of decentralized, fragmented groups to achieve
organizational goals maybe more difficult than the neoclassicists
suggest, particularly when the objectives of the lower level are
not consistent with the goals of upper level managers

CONTINGENCY APPROACHES TO
ORGANIZATIONAL DESIGN
A class of behavioral theory that claims that there is no
universal/ best way of managing an organization, instead, the
optimal course of action is contingent (dependent) upon the
internal and external situation.

VARIABLES AFFECTING THE ORGANIZATIONAL

STRUCTURE
Strategy and structure- A company's organizational structure
must support its strategy. Employees at all levels of the
company must be empowered to effectively complete the tasks
necessary to achieve organizational objectives, and company
structure can aid or hinder employees in their roles. Structure
can also dictate the means by which strategies are formed.
Bureaucratic companies tend to generate a majority of strategic
ideas at the top levels of management. Companies with flatter
structures, on the other hand, often involve a range of
employees in strategy sessions.

STRATEGY AND STRUCTURE: IMPACT OF

STRATEGY IN ORG STRUCTURE
1. Strategy determines organizational task, which are the ultimate
basis for the design of the organization
2. Strategy influences the choice of technology and the people
appropriate for the accomplishment of those tasks- and these, in
turn, influences structure
3. Strategy determines the specific environment within which the
organization will operate

EXTERNAL ENVIRONMENT AND STRUCTURE

Three types of environment
1. The stable environment
2. The changing environment
3. The turbulent environment
Two types of organizational system
4. Mechanistic- activities are broken down into separate special tasks.
(stable)
5. Organic- individuals are more likely to work in group setting than
alone. (turbulent)

TASKS AND TECHNOLOGY AND STRUCTURE

Tasks and technology affects structure because some structure
are more appropriate for a given technology and set of tasks
than the others. Joan Woodward postulates that technology
directly affects the structure of an organization. She found three
relationships that states:
1. The more complex the technology- the greater the number of
managers and management levels
2. The SOM of first-line managers increases from units to mass
production and and decreases from mass to process production
3. The greater the technological complexities of the firm, the larger
are the clerical and administrative staffs

PEOPLE AND STRUCTURE

Attitudes and values of members are related to the structure of
the organization. Organizational design is also influenced by
employees level of education, work involvement and other
characteristics
Categories of people in organization
1. Manager and structure- attitudes and values directly influence
the structure since the managers have the ultimate responsibility
for designing the organization
2. Employee and structure- the greater the demand of employees
for greater job satisfaction and participation is also likely to have
an effect on structure

ORGANIZATIONAL GROWTH, CHANGE AND

DECLINE
Organizational life cycle models assumes that organizations
develop in a predictable sequence of stages. Quinn and
Camerons integrative life-cycle model suggests that there are
four stages:
1. Entrepreneurial stage
2. Collectivity stage
3. Formalization and control stage
4. Structural elaboration and adaptation stage

PROBLEMS OF VERY RAPID GROWTH

Decisions need to be made faster

Individuals job demands expands faster
Large recruiting and training needs have to be met
Individuals must cope with constant changes
Financial and human resources are severely strained

SOLUTIONS

Careful screening and selectivity in hiring to obtain well qualified

workers who have the capacity for hard work and growth in
responsibility and who will require less training.
Use of team or matrix structure
Creation of an organizational philosophy or cultures that
emphasizes open communication, a shared vision of the
organizations future, and a sense that it cares
Projection of future staffing needs and ongoing planning and
monitoring to match human resources and organizational needs
Organizing and staffing
Sensitivity of the managers to the needs of the members and
toughness to deal with unpleasant problems when necessary

PERSPECTIVE OF ORGANIZATIONAL DECLINE

Decline as stagnation and cutbacks
Decline and personal stress
Decline as a cause of conflict
Structural response to decline- adaptation and
adjustments
Survival of the fittest