Organizational Learning

Transcription

1 Organizational Learning M. En C. Eduardo Bustos Farías 1

2 Outline Creating a Learning Organization Defining Organizational Learning and a Learning Organization Building an Organization s Learning Capability Leadership is the Foundation of a Learning Organization Unlearning the Organization M. En C. Eduardo Bustos Farías 2

3 Learning Organization Learning Organization proactively creates, acquires, and transfers knowledge throughout the organization M. En C. Eduardo Bustos Farías 3

4 Internal structure and processes Building an Organization s Learning Capability Facilitating factors Customer satisfaction Sales growth An organization s learning capability Learning mode Organizational performance Profitability Culture and experience M. En C. Eduardo Bustos Farías 4

5 Factors That Facilitate Organizational Learning Scanning imperative Performance gap Concern for measurement Experimental mindset Climate of openness Continuous education Operational variety Multiple advocates Involved leadership Systems perspective M. En C. Eduardo Bustos Farías 5

6 Skills and Best Practices: Becoming a Teacher-Learner 1. Become actively involved in teaching and learning. 2. Demonstrate that you care about your coworkers well-being. 3. Develop relationships with as many people from different backgrounds, experience, and organizational positions as possible. 4. Reflect on what you have learned from a given situation. 5. Listen to others and try to learn something from social interactions with others. M. En C. Eduardo Bustos Farías 6

7 Creating a Learning Organization Single-Loop Learning Errors are corrected using past routines and present policies. Double-Loop Learning Errors are corrected by modifying the organization s objectives, policies, and standard routines. M. En C. Eduardo Bustos Farías 7

8 Creating a Learning Organization Fundamental Problems in in Traditional Organizations: Fragmentation based on on specialization. Overemphasis on on competition. Reactiveness that that misdirects attention to to problem-solving rather than than creation. M. En C. Eduardo Bustos Farías 8

9 Managing a Learning Organization Establish a strategy Managing Learning Redesign the the organization s structure Reshape the the organization s s culture M. En C. Eduardo Bustos Farías 9

10 Designing Effective Organizations M. En C. Eduardo Bustos Farías 10

11 Outline Organizations: Definition and Dimensions What is an Organization Organization Charts Modern Organizational Systems Needed: Open-System Thinking Organizations as Biological Systems Organizations as Cognitive Systems Striving for Organizational Effectiveness Generic Effectiveness Criteria Mixing Effectiveness Criteria M. En C. Eduardo Bustos Farías 11

12 Outline (continued) The Contingency Approach to Designing Organizations Mechanic versus Organic Organizations New-Style versus Old-Style Organizations Virtual Organizations M. En C. Eduardo Bustos Farías 12

13 Characteristics Common to All Organizations Hierarchy of authority Coordination of effort Division of labor Common goal M. En C. Eduardo Bustos Farías 13

14 Sample Organization Chart for a Hospital Board of Directors Strategic Planning Advisor Chief Executive Officer President Legal Counsel Cost- Containment Staff Executive Administrative Director Executive Medical Director M. En C. Eduardo Bustos Farías 14

15 Sample Organization Chart for a Hospital (continued) Executive Administrative Staff Executive Medical Director Dir. Of Human esources Dir. Of Patient & Public Relations Dir. Of Nutrition & Food Services Dir. X-Ray & Lab Services Dir. Of Out- Patient Services Chief Physician Dir. Of Admissions Dir. Of Accounting Dir. Of Surgery Dir. Of Pharmacy M. En C. Eduardo Bustos Farías 15

16 Evolution of Organizational Metaphors Closed System: A self-sufficient entity, closed to the surrounding environment. (For example, a battery-powered clock.) Open system: Open system: Depends on constant interaction with the surrounding environment for survival. (For example, the human body.) M. En C. Eduardo Bustos Farías 16

17 The Organization as an Open System: The Biological Metaphor Inputs -Material -Human effort Interdependent Subsystems -Money -Information - Managerial subsystem - Goals and values subsystem -Technical subsystem - Psychosocial subsystem - Structural subsystem Outputs - Products - Services - Human Satisfaction - Organizational survival and growth - Social benefit Feedback M. En C. Eduardo Bustos Farías 17

18 Generic Organizational- Effectiveness Criteria No single approach to the evaluation of effectiveness is appropriate in all circumstances or for all organization types. Goal accomplishment Resource acquisition Internal processes Strategic constituencies satisfaction M. En C. Eduardo Bustos Farías 18

19 Toward Healthy Organizations M Scott Peck, the physician who wrote the best-seller, The Road Less Traveled, offers this ethical view: A healthy organization, Peck says, is one that has a genuine sense of community: It s a place where people are emotionally present with one another, and aren t afraid to talk about fears and disappointments - because that s what allows us to care for one another. It s a place where there is authentic communication, a willingness to be vulnerable, a commitment to speaking frankly and respectfully - and a commitment not to walk away when the going gets tough. For class discussion: Using this quote as a standard, what is your experience with healthy or unhealthy organizations? Why is organizational health a major quality-of-life issue today? M. En C. Eduardo Bustos Farías 19

20 Burns and Stalker s s Mechanistic and Organic Organizations Mechanistic organizations: Rigid bureaucracies with strict rules, narrowly defined tasks, and top-down communication. (Tend toward centralized decisionmaking.) Organic organizations Organic organizations: Flexible networks of multitalented individuals who perform a variety of tasks. (Tend toward decentralized decision making.) M. En C. Eduardo Bustos Farías 20

21 Mechanistic or Organic? What is your personal experience with working mechanistic and/or organic organizations? Which do you prefer? Why? Can the trend toward organic organizations be taken too far? Over the years, there has been a gradual pendulum swing between centralization and decentralization, with each coming into and going out of favor from time to time. Why has it been so hard to strike the right balance? M. En C. Eduardo Bustos Farías 21

22 The Shape of Tomorrow s Organizations New Old * Dynamic, learning * Stable * Information rich * Information is scarce * Global * Local * Small and large * Large * Product/customer oriented * Functional * Skills oriented * Job oriented * Team oriented * Individual oriented * Involvement oriented * Command/control oriented * Lateral/networked * Hierarchical * Customer oriented * Job requirements oriented M. En C. Eduardo Bustos Farías 22

23 Ways to Assess Organizational Effectiveness Goal Accomplishment Resource Acquisition Internal Processes Strategic Constituencies Satisfaction M. En C. Eduardo Bustos Farías 23

24 Early-Warning Signs of Decline 1) Excess personnel 2) Tolerance of incompetence 3) Cumbersome administrative procedures 4) Disproportionate staff power 5) Replacement of substance with form 6) Scarcity of clear goals and decision benchmarks 7) Fear of embarrassment and conflict M. En C. Eduardo Bustos Farías 24

25 Early-Warning Signs of Decline Cont. 8) Loss of effective communication 9) Outdated organizational structure 10) Increased scapegoating by leaders 11) Resistance to change 12) Low morale 13) Special interest groups are more vocal 14) Decreased innovation M. En C. Eduardo Bustos Farías 25

26 The Effect of Technology on Structure The more the technology requires interdependence between individuals and/or groups, the greater the need for coordination As technology moves from routine to nonroutine, subunits adopt less formalized and centralized structures M. En C. Eduardo Bustos Farías 26

27 Organizational Size and Performance: Research Insights Larger organizations tended to be more productive There were no positive relationships between organizational size and efficiency, suggesting the absence of net economy of scale effects There were zero to slightly negative relationships between subunit size and productivity and efficiency According to a more recent study, turnover was not related to organizational size M. En C. Eduardo Bustos Farías 27

28 Relationship Between Strategic Choice and Organizational Structure Organizational objectives Environmental constraints Strategic decisions made by dominant coalition Organizational Strategies Target markets Capital Organizational structure Organizational effectiveness sources/uses Decision maker s personal beliefs, attitudes, values, and ethics Human resources Technology Total quality management Corrective action M. En C. Eduardo Bustos Farías 28

29 What Is Organizational Organizational Structure Structure? How job tasks are formally divided, grouped, and coordinated. Key Key Elements: Elements: Work Work specialization Departmentalization Chain Chain of of command command Span Span of of control control Centralization and and decentralization Formalization M. En C. Eduardo Bustos Farías 29

30 What Is Organizational Structure? (cont d) Work Specialization The degree to which tasks in the organization are subdivided into separate jobs. Division Division of of labor: labor: Makes Makes efficient efficient use use of of employee employee skills skills Increases Increases employee employee skills skills through through repetition repetition Less Less between-job downtime downtime increases increases productivity Specialized training training is is more more efficient. efficient. Allows Allows use use of of specialized equipment. M. En C. Eduardo Bustos Farías 30

31 What Is Organizational Structure? (cont d) Departmentalization The basis by which jobs are grouped together. Grouping Activities By: By: Function Product Geography Process Customer M. En C. Eduardo Bustos Farías 31

32 Authority What Is Organizational Structure? (cont d) The rights inherent in a managerial position to give orders and to expect the orders to be obeyed. Chain of Command The unbroken line of authority that extends from the top of the organization to the lowest echelon and clarifies who reports to whom. Unity of Command A subordinate should have only one superior to whom he or she is directly responsible. M. En C. Eduardo Bustos Farías 32

33 What Is Organizational Structure? (cont d) Span of Control The number of subordinates a manager can efficiently and effectively direct. Concept: Concept: Wider Wider spans spans of of management increase increase organizational efficiency. efficiency. Narrow Narrow Span Span Drawbacks: Expense Expense of of additional additional layers layers of of management. Increased Increased complexity complexity of of vertical vertical communication. Encouragement of of overly overly tight tight supervision and and discouragement of of employee employee autonomy. autonomy. M. En C. Eduardo Bustos Farías 33

34 What Is Organizational Structure? (cont d) Centralization The degree to which decision making is concentrated at a single point in the organization. Decentralization The degree to which decision making is spread throughout the organization. Formalization The degree to which jobs within the organization are standardized. M. En C. Eduardo Bustos Farías 34

35 Common Organization Designs Simple Structure A structure characterized by a low degree of departmentalization, wide spans of control, authority centralized in a single person, and little formalization. M. En C. Eduardo Bustos Farías 35

36 Common Organization Designs (cont d) Bureaucracy A structure of highly operating routine tasks achieved through specialization, very formalized rules and regulations, tasks that are grouped into functional departments, centralized authority, narrow spans of control, and decision making that follows the chain of command. M. En C. Eduardo Bustos Farías 36

37 The Bureaucracy Strengths Functional economies of scale Minimum duplication of personnel and equipment Enhanced communication Centralized decision making Weaknesses Subunit conflicts with organizational goals Obsessive concern with rules and regulations Lack of employee discretion to deal with problems M. En C. Eduardo Bustos Farías 37

38 Common Organization Matrix Structure Designs (cont d) A structure that creates dual lines of authority and combines functional and product departmentalization. Key Key Elements: + Gains Gains the the advantages of of functional functional and and product product departmentalization while while avoiding avoiding their their weaknesses. + Facilitates Facilitates coordination of of complex complex and and interdependent activities. activities. Breaks Breaks down down unity-of-command concept. concept. M. En C. Eduardo Bustos Farías 38

39 New Design Options Team Structure The use of teams as the central device to coordinate work activities. Characteristics: Breaks Breaks down down departmental barriers. barriers. Decentralizes decision decision making making to to the the team team level. level. Requires Requires employees employees to to be be generalists generalists as as well well as as specialists. Creates Creates a a flexible flexible bureaucracy. M. En C. Eduardo Bustos Farías 39

40 New Design Options (cont d) Virtual Organization A small, core organization that outsources its major business functions. Highly centralized with little or no departmentalization. Concepts: Advantage: Provides Provides maximum maximum flexibility flexibility while while concentrating on on what what the the organization does does best. best. Disadvantage: Reduced Reduced control control over over key key parts parts of of the the business. business. M. En C. Eduardo Bustos Farías 40

41 New Design Options (cont d) Boundaryless Organization An organization that seeks to eliminate the chain of command, have limitless spans of control, and replace departments with empowered teams. T-form Concepts: Eliminate Eliminate vertical vertical (hierarchical) and and horizontal horizontal (departmental) internal internal boundaries. Breakdown external external barriers barriers to to customers customers and and suppliers. suppliers. M. En C. Eduardo Bustos Farías 41

42 Why Do Structures Differ? Mechanistic Model A structure characterized by extensive departmentalization, high formalization, a limited information network, and centralization. Organic Model A structure that is flat, uses cross-hierarchical and cross-functional teams, has low formalization, possesses a comprehensive information network, and relies on participative decision making. M. En C. Eduardo Bustos Farías 42

43 Why Do Structures Differ? Strategy Innovation Strategy A strategy that emphasizes the introduction of major new products and services. Cost-minimization Strategy A strategy that emphasizes tight cost controls, avoidance of unnecessary innovation or marketing expenses, and price cutting. Imitation Strategy A strategy that seeks to move into new products or new markets only after their viability has already been proven. M. En C. Eduardo Bustos Farías 43

44 Why Do Structures Differ? Size Size How the size of an organization affects its structure. As an organization grows larger, it becomes more mechanistic. Characteristics of of large large organizations: More More specialization More More vertical vertical levels levels More More rules rules and and regulations M. En C. Eduardo Bustos Farías 44

45 Technology Why Do Structures Differ? Technology How an organization transfers its inputs into outputs. Characteristics of of routineness (standardized or or customized) in in activities: activities: Routine Routine technologies are are associated associated with with tall, tall, departmentalized structures structures and and formalization in in organizations. Routine Routine technologies lead lead to to centralization when when formalization is is low. low. Nonroutine technologies are are associated associated with with delegated delegated decision decision authority. authority. M. En C. Eduardo Bustos Farías 45

46 Why Do Structures Differ? Environment Environment Institutions or forces outside the organization that potentially affect the organization s performance. Key Key Dimensions- Capacity: Capacity: the the degree degree to to which which an an environment can can support support growth. growth. Volatility: Volatility: the the degree degree of of instability instability in in the the environment. Complexity: the the degree degree of of heterogeneity and and concentration among among environmental elements. elements. M. En C. Eduardo Bustos Farías 46

47 Bureaucracy Is Dead Characteristics of Bureaucracies Specialization Why Bureaucracy Survives Large size prevails. Environmental turbulence can be largely managed. Formalization Departmentalization Centralization Narrow spans of control Standardization achieved through hiring people who have undergone extensive educational training. Technology maintains control. Adherence to a chain of command. M. En C. Eduardo Bustos Farías 47

48 Organizational Designs and Employee Behavior Research Research Findings: Findings: Work Work specialization contributes to to higher higher employee employee productivity, but but it it reduces reduces job job satisfaction. The The benefits benefits of of specialization have have decreased decreased rapidly rapidly as as employees employees seek seek more more intrinsically rewarding rewarding jobs. jobs. The The effect effect of of span span of of control control on on employee employee performance is is contingent contingent upon upon individual individual differences and and abilities, abilities, task task structures, structures, and and other other organizational factors. factors. Participative decision decision making making in in decentralized organizations is is positively positively related related to to job job satisfaction. M. En C. Eduardo Bustos Farías 48