RESTRUCTURING ORGANISATION

JOB ENRICHMENTSOCIO-TECHNICAL SYSTEM

Sapna Sharma(070) Kapila

Chaudhary(072) Megha Pnawar(104)

Restructuring Restructuring OrganisationOrganisation

Definition

According to Greenberg and Baron organisational restructuring refers to the “altering of size and basic configuration of the organisational chart”. It may involve downsizing that entails reducing the number of employees needed for the organisation to function effectively, or right sizing that includes adjusting the number of employees needed to work in newly designed organisations. It can also include outsourcing, wherein a company hires the

services of an outside firm to carry out its non-core business functions

The restructuring or reorganising of the organisation involves making strategic changes when the organisation faces environmental challenges. These organisational changes may take place during both good and bad times.

Bad time restructuring may involve retrenchment of workers, disposing of assets, divestment of business units and major capital borrowings.

Good times restructuring may involve changing the way in which the organisation is structured due to company expansion or diversification of products and customer profile

BENEFITS OF RESTRUCTURING

• Improved customer focus• Better service delivery to the customers• Optimisation of key skills• Creation of common delivery platforms• Elimination of duplication in business

structures• Extraction of operational synergies• Reduced system spend requirements • Creation of better career opportunities and

broader career paths for staff.

Objectives of Restructuring the Organisation

• Improve profits• Refocus efforts on changing markets and strategic directions• Incorporate new markets, products, services, and production

facilities• Accommodate new growth areas and opportunities• Enhance communication and cooperation within the

organisation• Redistribute management skills• Enhance customer service• Make better use of limited resources• Streamline operations and reduce costs• Focus effort by grouping related tasks into organisational

units, thus replacing duplication with synergy

Contingencies Influencing Structural Design

StructuralDesign

Environment

WorldwideOperations

Technology

OrganizationSize

OrganizationGoals

Functional Organization

VP Research VP Operations VP Hum anResources

VP M arketing VP Finance

President

The Functional Form

Advantages Disadvantages► Promotes skill

specialization

► Reduces duplication of scarce resources and uses resources full time

► Enhances career development for specialists within large departments

► Facilitates communication and performance because superiors share expertise with their subordinates

► Exposes specialists to others within same specialty

• Emphasizes routine tasks; encourages short time horizons

• Fosters parochial perspectives by managers and limits capacity for top-management positions

• Multiplies interdepartmental dependencies; increases coordination and scheduling difficulties

• Obscures accountability for overall results

The Divisional Organization

Chief FinancialOfficer

VP Research

Division M anagerAsia

VP Hum anResources

VP Operations VP Sales andM arketing

Division M anagerNorth Am erica

Division M anagerEurope

Chief ExecutiveOfficer

The Divisional Form

Advantages Disadvantages► Recognizes

interdepartmental interdependencies

► Fosters an orientation toward overall outcomes and clients

► Allows diversification and expansion of skills/training

► Ensures accountability by departmental managers and promotes delegation

► Heightens departmental cohesion and involvement in work

• May use skills and resource inefficiently

• Limits career advancement by specialists

• Impedes specialists’ exposure to others within same specialties

• Puts multiple-role demands upon people and creates stress

• May promote departmental objectives as opposed to overall organizational goals

The Matrix Organization

VP Finance VP Hum an Resources

Program M anagerAircraft

Program M anagerNavigation System s

Program M anagerSpace System s

Senior VPProgram s

VP Research VP Engineering VP M anufacturing VP M arketing

Senior VPOperations

PresidentCEO

The Matrix Organization

Advantages Disadvantages

► Makes specialized, functional knowledge available to all projects

► Use people flexibly► Maintains consistency by

forcing communication between managers

► Recognizes and provides mechanisms for dealing with legitimate, multiple sources of power

► Can adapt to environmental changes

• Can be difficult to implement

• Increases role ambiguity, stress, and anxiety

• Performance is lowered without power balancing between projects and functions

• Makes inconsistent demands and can promote conflict and short-term crisis orientation

• May reward political skills over technical skills

The Process-Based Structure

Developing New Products ProcessP rocess O w n er

C ross F u n c tion a l Team M em b ers

Acquiring and Filling Custom er Orders ProcessP rocess O w n er

C ross F u n c tion a l Team M em b ers

Supporting Custom er Usage ProcessP rocess O w n er

C ross F u n c tion a l Team M em b ers

Senior M anagem ent T eamC h a ir an d K ey S u p p ort P rocess O w n ers

Characteristics of Process-Based Structures

Processes drive structure Work adds value Teams are fundamental Customers define performance Teams are rewarded for performance Teams are tightly linked to suppliers and

customers Team members are well informed and

trained

The Process-Based Form

AdvantagesDisadvantages

► Focuses resources on customer satisfaction

► Improves speed and efficiency

► Adapts to environmental change rapidly

► Reduces boundaries between departments

► Increases ability to see total work flow

► Enhances employee involvement

► Lowers costs dues to overhead

• Can threaten middle managers and staff specialists

• Requires changes in command-and-control mindsets

• Duplicates scarce resources

• Requires new skills and knowledge to manage lateral relationships and teams

• May take longer to make decisions in teams

• Can be ineffective if wrong processes are identified

The Network Organization

BrokerOrganization

DesignerOrganizations

ProducerOrganizations

SupplierOrganizations

DistributorOrganizations

The Network Based Form

Advantages Disadvantages► Enables highly flexible

and adaptive responses

► Creates a “best of the best” firm to focus resources on customer and market needs

► Each organization can leverage a distinctive competency

► Permits rapid global response

► Can produce “synergistic” results

• Difficulty managing lateral relationships across autonomous organizations

• Difficulty motivating members to relinquish autonomy to join network

• Sustaining membership and benefits can be problematic

• May give partners access to proprietary knowledge and technology

Types of Networks

Internal Market Network

Vertical Market Network

Intermarket Network

Opportunity Network

The Downsizing Process

►Clarify the organization’s strategy►Assess downsizing options and make

relevant choices►Implement the changes►Address the needs of survivors and

those who leave►Follow through with growth plans

Downsize will response to

1.It is associated with mergers and acquisitions i.e integration of two organisatoins

2.It can result from organisation decline caused by loss of revenues.

3.It can occur when organisation implement one of the new structure describe above

4.It can result from strong conviction that organisation should be leaner and more flexible.

Downsizing Tactics

Tactic Characteristics Examples

Workforce Reduction

Reduces headcount Short-term focus Fosters transition

Attrition Retirement/buyout Layoffs

Organization

Redesign

Changes organization

Medium-term focus Fosters transition &

transformation

Eliminate functions, layers, products

Merge units Redesign tasks

Systemic

Changes culture Long-term focus Fosters

transformation

Change responsibilities

Foster continuous improvement

Downsizing is normal

The Reengineering Process

► Prepare the organization► Specify the organization’s strategy and

objectives► Fundamentally rethink the way work gets done

Identify and analyze core business processes Define performance objectives Design new processes

► Restructure the organization around the new business processes.

Characteristics of Reengineered Organizations

Work units change from functional departments to process teams

Jobs change from simple tasks to multidimensional work

People’s roles change from controlled to empowered The focus of performance measures and

compensation shifts from activities to results. Organization structures change from hierarchical to

flat Managers change from supervisors to coaches;

executives change from scorekeepers to leaders

JOB ENRICHMENT

DefinitionJob enrichment is a term given by Fedric herzberg. According to

him a few motivators are added to a job to make it more rewarding, challenging and interesting. According to herzberg the motivating factors enrich the job and improve performance.In other words we can say that job enrichment is a method of adding some motivating factors to an existing job to make it more interesting.

The motivating factors can be-a) Giving more freedom.b) Encouraging participation.c) Giving employees the freedom to select the method of working.d) Allowing employees to select the place at which they would like to   work.e) Allowing workers to select the tools that they require on the job.f) Allowing workers to decide the layout of plant or office.

Job enrichment gives lot of freedom to the employee but at the same time increases the responsibility. Some workers are power and responsibility hungry. Job enrichment satisfies the needs of the employees.

Features of Job Enrichment

► Nature of Job : Job enrichment is a vertical expansion of the job. The workers are given jobs, which require higher-level knowledge, skills and responsibilities. Job enrichment improves the quality of the job.

► Objective : The objective of Job enrichment is to make the job more lively and challenging. So, the job is a source of motivation for the workers.

► Positive Results : Job enrichment gives positive results if the workers are highly skilled. This is because workers are given opportunities to show initiative and innovation while doing their job.

► Direction and Control : Job enrichment encourages self-discipline. It does not believe in external direction and control.

Advantages of Job Enrichment

► Job enrichment is useful to both the workers and the organisation.

► The worker gets achievement, recognition and self-actualisation.

► The worker gets a sense of belonging to the organisation.

► The worker finds the job meaningful.

► Job enrichment reduces absenteeism, labour-turnover and grievances.

► It motivates the workers to give best performance.

Limitations of Job Enrichment

► In many cases, job enrichment does not give the expected results.

► It makes many changes in the job. So many workers oppose it.

► It has limited use for highly skilled managers and professionals. This is because their jobs are already challenging.

►The consent of workers is not taken before implementing job enrichment.

Herzberg’s Two-Factor Theory

First Dimension

► The first dimension, known as hygiene factors, involves the presence or absence of job dissatisfacters, such as wages, working environment, rules and regulations, and supervisors. When these factors are poor, work is dissatisfying and employees are not motivated. However, having positive hygiene factors does not cause employees to be motivated; it simply keeps them from being dissatisfied

Second Dimension► The second dimension of Herzberg's theory refers to

motivators, which are factors that satisfy higher-level needs such as recognition for doing a good job, achievement, and the opportunity for growth and responsibility. These motivators are what actually increase job satisfaction and performance. Job enrichment becomes an important strategy at this point because enriching employees' jobs can help meet some of their motivational needs. There are basically five areas that are believed to affect an individual employee's motivation and job performance: skill variety, task identity, task significance, autonomy, and feedback. Job enrichment seeks to find positive ways to address each of these areas and therefore improve employee motivation and personal satisfaction.

Job enrichment, as a managerial activity includes a three steps

technique1. Turn employees' effort into performance:► Ensuring that objectives are well-defined and understood by

everyone. The overall corporate mission statement should be communicated to all. Individual's goals should also be clear. Each employee should know exactly how he/she fits into the overall process and be aware of how important their contributions are to the organization and its customers.

► Providing adequate resources for each employee to perform well. This includes support functions like information technology, communication technology, and personnel training and development.

► Creating a supportive corporate culture. This includes peer support networks, supportive management, and removing elements that foster mistrust and politicking.

► Provide adequate recognition, appreciation, and other motivators.► Provide job variety. This can be done by job sharing or job rotation

programmes.

2. Link employees performance directly to reward:

► Clear definition of the reward is a must► Explanation of the link between performance and reward is

important► Make sure the employee gets the right reward if performs

well► If reward is not given, explanation is needed

3. Make sure the employee wants the reward. How to find out?

► Ask them► Use surveys( checklist, listing, questions)

Job Enrichment Principles

1) Formation of natural work units2) Establishment of worker-client

relationships3) Combining of tasks4) Vertical loading5) Opening of feedback channels

How to implement job enrichment?

► Vertical loading :- Allows staff to perform tasks at a range of different levels of responsibility. The key here is to reduce the gap between doing the job and controlling the job. An employee in a vertically loaded job has some of the responsibilities that management held previously.

► Formation of natural work teams :- These are small groups of workers that come together to plan how their work is best organized. The objective is to increase ownership of the task, which contributes to the meaningfulness of work.

► Establishment of customer relationships and employee ownership of the product :- As teams become more advanced, they will be able to meet with customers and focus on the customers’ needs, not the needs of their supervisors. Thre are three basic steps to achieve this:

1) the client must be identified2) the contact between the client and the worker needs to be established as

directly as possible3) criteria and procedures are needed by which the client can judge the quality

of the product and rely those judgements back to the worker. ► Employee receipt of direct feedback :-Helps employees to know whether

their performance is improving, staying at the same level or deteriorating.

Implementing a Job Enrichment Program

Find dissatisfactionDetermine what your people want before you beginGo to the sourceUse that info to build enrichment options

Consider job enrichment options you can provideFor significant changes establish “job enrichment task force”

Design and communicate your programIf making big changes, let people know what are you doing and whyWork to create work environment that includes participation and recognitionMonitor your efforts and evaluate

Key Points:► Job enrichment is a fundamental part of attracting,

motivating, and retaining talented people, particularly where work is repetitive or boring. To do it well, you need a great match between the way your jobs are designed and the skills and interests of the employees working for you.

► When your work assignments reflect a good level of skill variety, task identity, task significance, autonomy, and feedback, members of your team are likely be much more content, and much less stressed. Enriched jobs lead to more satisfied and motivated workers.

► Your responsibility is to figure out which combination of enrichment options will lead to increased performance and productivity.

SOCIO-TECHNICAL SYSTEM

Origin of socio-technical Origin of socio-technical systemsystem

► In the early 1950's In the early 1950's Eric TristEric Trist and the and the Tavistock Tavistock InstituteInstitute studied the English coal mining industry studied the English coal mining industry where where mechanization had actually decreased mechanization had actually decreased worker productivity.worker productivity.

► Trist proposed that manufacturing (and many Trist proposed that manufacturing (and many other) systems have both technical and other) systems have both technical and human/social aspects that are tightly bound and human/social aspects that are tightly bound and interconnected. interconnected.

► Moreover, it is the interconnections more than Moreover, it is the interconnections more than individual elements that determine system individual elements that determine system performance performance

Socio-technical systemSocio-technical system

► ““A socio-technical system is a system A socio-technical system is a system composed of technical and social composed of technical and social subsystems”.subsystems”.

► An example for this is a factory or also An example for this is a factory or also a hospital where people are organized, a hospital where people are organized, e.g. in social systems like teams or e.g. in social systems like teams or departments, to do work for which departments, to do work for which they use technical systems like they use technical systems like computers or x-ray machinescomputers or x-ray machines

Two sub systemsTwo sub systems

► The technical systemThe technical system includes machinery, includes machinery, processes, procedures and a physical arrangement. processes, procedures and a physical arrangement. We usually think of a factory in terms of its We usually think of a factory in terms of its

technical systemtechnical system ► The social systemThe social system includes people and their includes people and their

habitual attitudes, values, behavioral styles and habitual attitudes, values, behavioral styles and

relationships. It includes the reward systemrelationships. It includes the reward system

Need for joint optimizationNeed for joint optimization

► Joint optimizationJoint optimization is the goal of socio-Technical design. It is is the goal of socio-Technical design. It is the integration of the social requirements of people doing the the integration of the social requirements of people doing the work with technical requirements needed to keep the work work with technical requirements needed to keep the work system viable with regard to environment.system viable with regard to environment.

► For example, a manufacturing work cell that requires high For example, a manufacturing work cell that requires high teamwork will not produce in an environment of suspicion and teamwork will not produce in an environment of suspicion and command/control. A self-directed work team will be ineffective command/control. A self-directed work team will be ineffective when the layout of their area prevents communication or does when the layout of their area prevents communication or does not require cooperation. not require cooperation. The social and technical systems The social and technical systems

must integrate and assist one anothermust integrate and assist one another..

Technological systemTechnological system

►Aspects of technical systems that Aspects of technical systems that place demand on the social systemplace demand on the social system::

► Nature of material being worked onNature of material being worked on► Level of mechanization (or automation)Level of mechanization (or automation)► Units of operation and grouping of these units into Units of operation and grouping of these units into

production phasesproduction phases► Degree of centrality of different operationsDegree of centrality of different operations► Maintenance operationsMaintenance operations► Supply operationsSupply operations► Spatial layout of process over timeSpatial layout of process over time► Physical work settingPhysical work setting

The social systemThe social system

► work role that promote cooperation among workerswork role that promote cooperation among workers► Work roles organized to promote self responsibilityWork roles organized to promote self responsibility► Whether workers are made jointly responsible for how Whether workers are made jointly responsible for how

services are delivered or separately and unilaterally.services are delivered or separately and unilaterally.► The extend to which the key variances are The extend to which the key variances are

imported/exported or being controlled by employees imported/exported or being controlled by employees directly.directly.

► Simultaneous interdependencies among workers to Simultaneous interdependencies among workers to provide for task accomplishment in less time and provide for task accomplishment in less time and continuity in the face of individual failurecontinuity in the face of individual failure

Cont……Cont……

► How each workers role is experienced in terms of How each workers role is experienced in terms of attractiveness and perceptions of dependence, pay attractiveness and perceptions of dependence, pay equity, trust and isolation with regard to others.equity, trust and isolation with regard to others.

► The extend of coordination of task interdependence The extend of coordination of task interdependence in term of social relationin term of social relation

► The presence of formal over specification as well as The presence of formal over specification as well as under specificationunder specification

Three levels of analysisThree levels of analysis

► The socio-technical experience may be carried out The socio-technical experience may be carried out at any one of three broad levels, from micro to at any one of three broad levels, from micro to macro. Each level is interrelated and macro. Each level is interrelated and interconnected.interconnected.

► Primary work system Primary work system ► The whole organizational systemThe whole organizational system► The macro-social systemThe macro-social system

Primary work systemPrimary work system

-A set of activities that make up a functioning whole -A set of activities that make up a functioning whole in an identifiable and bounded subsystem of an in an identifiable and bounded subsystem of an organization.organization.

-The small work units or subsystems ensconced -The small work units or subsystems ensconced throughout the whole organization—such as a line throughout the whole organization—such as a line department or service unit.department or service unit.

-The most satisfying and efficient primary work -The most satisfying and efficient primary work system comprise small number of people that can system comprise small number of people that can perform a whole task while satisfying the social and perform a whole task while satisfying the social and psychological need of system members as well as psychological need of system members as well as organization needs.organization needs.

The Whole Organization The Whole Organization systemsystem

► Whole organization systems are larger enterprise-Whole organization systems are larger enterprise-wide systems consisting of several work unitswide systems consisting of several work units..

► It is at this level that goals are set that reflect It is at this level that goals are set that reflect organizational capabilities in conjunction with the organizational capabilities in conjunction with the

external environmentexternal environment..► The managers have potential power for aligning the The managers have potential power for aligning the

organizations structural arrangements and values.organizations structural arrangements and values.► By communication of purpose, knowledge and By communication of purpose, knowledge and

values among employees we can develop shared values among employees we can develop shared objectives,values,norms and feel of belonging.objectives,values,norms and feel of belonging.

The Macro-Social systemThe Macro-Social system

► macrosocial systems, embody community-wide macrosocial systems, embody community-wide systems and institutions operating within an systems and institutions operating within an

industry sectorindustry sector. . ► Organizations can best adapt to environmental Organizations can best adapt to environmental

turbulence by identifying shared ideals to guide turbulence by identifying shared ideals to guide them in fashioning new objectives and their goals.them in fashioning new objectives and their goals.

Principles of Socio technical Principles of Socio technical SystemsSystems

► CompatibilityCompatibility► Minimal critical specificationMinimal critical specification► Socio technical criterionSocio technical criterion► Multi functionalityMulti functionality► Boundary locationBoundary location► Information flowInformation flow► Support congruenceSupport congruence► Design and human valuesDesign and human values► IncompletionIncompletion

Cont…….Cont…….

► CompatibilityCompatibility – requires the process of system re-design to – requires the process of system re-design to be compatible with the desired organizational objectives. be compatible with the desired organizational objectives.

► Minimal Critical SpecificationMinimal Critical Specification – methods of working should – methods of working should be minimally predetermined for team members. be minimally predetermined for team members.

► Sociotechnical criterionSociotechnical criterion – involves identifying key – involves identifying key unanticipated events which critically affect outcomes. If they unanticipated events which critically affect outcomes. If they can’t be eliminated, they need to be handled at source.can’t be eliminated, they need to be handled at source.

► MultifunctionalityMultifunctionality – highly specialized jobs should be – highly specialized jobs should be avoided as specialism reduces flexibility. A more multi-skilled avoided as specialism reduces flexibility. A more multi-skilled approach is essential.approach is essential.

► Boundary locationBoundary location – boundaries can be drawn to group – boundaries can be drawn to group people and activities in terms of technology, territory or time.people and activities in terms of technology, territory or time.

Cont…..Cont…..

► Information flowInformation flow – those that need resources should have – those that need resources should have access and authority over them.access and authority over them.

► Support congruenceSupport congruence – systems of social support should – systems of social support should reinforce the desired organizational behaviours.reinforce the desired organizational behaviours.

► Design and human valuesDesign and human values – the objective of the – the objective of the organizational design should be to provide a high quality of organizational design should be to provide a high quality of work.work.

► IncompletionIncompletion – redesign should be an iterative process, not a – redesign should be an iterative process, not a “one off” change.“one off” change.

Steps in Data Collection and Steps in Data Collection and AnalysisAnalysis

► The methodology of sociotechnical analysis usually proceeds as follows:

► (1) Initial scanning. The aim, in this phase, is both to identify the main characteristics of the production system and its specific environment and to elucidate the main problems on which subsequent analyses must focus.

► The main ``outputs’’ of this phase are: ► the physical layout of the production system; a definition of the

organisational structure; ► the identification of the most important inputs and outputs of the

system ► and of the main processes of transformation; the aims of the system,

both the production and the social aims; ► the history and the relevant social aspects of the system; ► and, lastly, identification of the main variances.

2)Technological analysis2)Technological analysis

► In sciotechnical system ,technical analysis means inputs and In sciotechnical system ,technical analysis means inputs and outputs rather than tools equipments.outputs rather than tools equipments.

► identification of unit operations, that is, of the main phases in the production process; where possible the purpose of each unit operation should be specified in terms of its inputs, its transformations, and its outputs;

► identification of key process variances (which originate either from the materials or from the nature of the process of transformation as currently being carried out) and their interrelationships (by constructing variance matrixes).

3)Social analysis3)Social analysis

► The aim here is to analyse the main characteristics of the existing social system, in order both to understand

► how the network of roles contributes to checking on the previously identified variances

► and to evaluate each role in relation to the psychological needs of the workers.

Cont…Cont…

► 4)Analysis of external systems. Those which influence the system being analysed (for example, the maintenance system).

► 5)Work system design proposals. These are within the logic of the best fit between the technical sub-system and the social sub-system.

LimitationsLimitations

► The STS concept that we have discussed is only for bringing The STS concept that we have discussed is only for bringing improvement in the design and redesign of the workplace of a improvement in the design and redesign of the workplace of a ‘well defined linear system’ rather than the growing number ‘well defined linear system’ rather than the growing number of ill defined ‘non linear systems’of ill defined ‘non linear systems’

► Well defined system are characterized by programmed tasks Well defined system are characterized by programmed tasks that follow sequential conversion process of input to outputthat follow sequential conversion process of input to output

► Where as in non linear system it is difficult to separate Where as in non linear system it is difficult to separate different conversion process into well bounded entitiesdifferent conversion process into well bounded entities

► Another limitation is that iAnother limitation is that it provides clear advice on t provides clear advice on organisational change, such as changes in people and organisational change, such as changes in people and processes, but it does not tell you how to design the processes, but it does not tell you how to design the technology to support performance. Therefore, if you identify technology to support performance. Therefore, if you identify a number of change initiatives and one of them relates to new a number of change initiatives and one of them relates to new technology, it will not tell you what and how the technology technology, it will not tell you what and how the technology needs to work to drive performanceneeds to work to drive performance..