ch 3 behavior in organizations
TRANSCRIPT
8/7/2019 ch 3 Behavior in Organizations
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Behavior in Organizations
8/7/2019 ch 3 Behavior in Organizations
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INFORMAL FACTORS THAT INFLUENCE
THE GOAL CONGRUENCEy External factors:
Work ethics ² set of attitude
Locality
Industry-specific norms and attitudes
y Internal factors:
Culture
Management style: MBWA v/s Written reports
Informal organization
Perception & communication:
Information transmission through formal and informal channels
Messages from different sources may conflict with one another
or may subject to different interpretations
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FORMAL CONTROL SYSTEM y Rules ² Formal Instruction & controls
Some rules are guides
Some rules are positive requirement that certain action betaken
Types of rules :
1.Physical control ² pass word, locker, security guard
2. Manuals ² written rules
3. System safeguard ² crossC
hecking, signature, countingcash, separating duties
4. Task control system ² Ensuring specified task are carried outefficiently & effectively
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Was
performance
satisfactory
Report
Actual Vs Plan
Responsibility
center
performance
BudgetingStrategic
planning
Other
informationRulesGoals &
Strategies
No
yes
Measurement
Feedback
Communication
Corrective
actionReviseRevise
Reward (feedback)
Formal Control Process
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TYPES OF ORGANIZATION
y Function structure
y Business unit structure
y Matrix structure
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Functional structure
Advantages :
Disadvantage :
Clarity about career path
Economies of scale within
function
Specialization
Coordination
In-depth skill development
Maintain power & prestigeof major function
Boredom & monotony
Poor decision making
Sub unit conflicts
Reduce coordination between the fun.
Responsibility for profit is at top level
Slow adaptation to changes in the
environment
No unambiguous way of determining
the effectiveness of the separatefunctional managers
Inadequate Structure for a firm with
diversified products & markets
Skilled higher level managers
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y Use of the functional structure:
It can be adopted by organization that are small or medium sized
but require a formal structure to coordinate their activity
It can not used by organization that are too large & where
coordination is difficult
E.x. Domino·s pizza
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Business unit structure
y Also called as division- responsible for all the functions
involved in producing & marketing a specified product line
Managers handle units as separate companies
Performance of managers is measured by profitability of the
unit
Headquarters reserve certain key prerogatives e.g. obtaining
and allocating funds
Headquarters establish company-wide policies
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y Advantages :
It provide training ground in General Management
Better decision related to New Product & Marketing
y Disadvantages:
Duplication of work
Dispute between functional specialist may be replaced by
disputes between business unit in a business unit organization
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Matrix structure
y ´Matrix organization means the combination of functioning & productpattern of departmentation in the same organizationµ
y Guideline for making matrix management effective:
Define the objective of the task or objective
Clarify the roles, Authority & Responsibility of Manager & Team Members
Ensure that influence is based upon the knowledge & information
Select experience manager for the project who can provide leadership
Install appropriate cost, time & quality control that report deviation fromstandard in a timely manner
Reward project & team manager fairly`
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Advantages:
y Oriented towards end result
y Professional identification is
maintainedy Pinpoint product profit
responsibility
y Oriented towards Decentralization
of decision
y Cost can be cut down by support
system like computer, software
Disadvantages:
y Conflicts in Organization Authority
exists
y
Possibility of Disunity of commandexists
y Higher cost because of additional
hierarchy of project manager &
their staff
y It encourage Group Decisionmaking
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y Use of matrix structure:
By the construction co. (Bridge), in Aerospace , in installation
of an electronic data processing system or in managementconsultancy firm where management expert work together tocomplete project
Matrix structure can be adopted when 3 condition exists:
1. There is high pressure from the environment that makes itessential to have a strong focus on both functional & divisionalaspect
2. The external environment of the organization is changing &
uncertain3. There is need for company to share resources
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� Implications for System Design:
Along with ease of control, business units have other criteria
also to run their businesses
Once management has decided that a given structure is best,
all things considered, system designer must take thatstructure as given
Business units require broader type of manager and
functional organizations provide benefit of economies of scale
System designer should exist to serve the system
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FUNCTIONS OF CONTROLLER
y Designing & operating information & control system
y Preparing financial statements
y Preparing & analyzing performance report, interpreting the
report
y Supervising internal audit & accounting control procedures
to ensure the validity of information, establishing adequate
safeguard against theft & fraud
y Developing personnel in the controller organization &
participating in the education of the management personnel
in matters relating to the controller function
³Controller means the Person who is responsible for designing & operating the
Management Control System´
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Relation to line organization
y Controllership function Is staff function
y Controller is responsible for design & operation of the
system which collect & report information, the use of this
information is responsibility of line managementy Implementation of policies is the duty of the line managers
y Controller play an important role in the preparation of
strategic plans & budgets
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Business unit controller
Dotted line Solid line
Corporate
controller
Business unit
managers
Business unitcontroller
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Corporate
controller
Business unit
managers
Business unit
controller
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Limitation : Business unit controller will
not provide complete information to the
business unit managers
Limitation :Business unit managers will
not considered business controller as a
trusted adviser