Organizational Theory Cheat Sheet

Three goals of theory
* To explain events in the past -- why did that outcome, known as the dependent variable (DV), happen?
* To predict events in the future -- what will happen?
* To possible control events in the future -- how can I influe­nce­/change the outcome (DV)?

Theory validity base for frames
* Does it meet the assump­tions?
^ Underlying beliefs, things we take for granted about the subject under study
* Does it meet the scope condit­ions?
^ Limits under which the theory holds or applies
* How can we make a valid test of the theory?

Difference between Causal Relati­onship (positive or negative) and Correl­ation
* Changing one variable does not cause the other variable to change, but changes in both variables can mean a correl­ation.
* Correl­ation =/ causation.

Structural dilemmas
* Differ­ent­iation vs integr­ation - division of labor
* Gaps vs overlaps - incomplete tasks vs duplic­ation, waste of resources
* Underuse vs overload
^ Overlo­ading leads to turnover: lower consis­tency, more money spent
or absent­eeism: lower produc­tivity and consis­tency, more overwork (other employees pick up slack), more money spent (overtime)
* Lack of clarity vs lack of creativity
* Excessive autonomy vs excessive interd­epe­ndence
^ Self-g­ove­rnance vs dependent on other people
* Structure too loose vs too tight
* Goal-less vs goal-bound
* Irresp­onsible vs unresp­onsive
^ Not being held accoun­table to rules/­pol­icies vs not accomm­odating customers - caught up in “red tape”

Generic issues in restru­cturing
* Strategic apex pushes for more alignment, centra­liz­ation.
* Middle managers try to protect autonomy and room to run their own units.
* Techno­str­ucture pushes for standa­rdi­zation, believes in measur­ement and monito­ring.
* Support staff prefers less hierarchy, more collab­ora­tion.

Why Restru­cture?
* Technology change
* Enviro­nmental shifts
* Organi­zations grow
* Leadership changes

Making Restru­cturing Work
Basic principles of successful restru­ctu­ring:
* Develop new goals & strategies to reflect current challenges
* Used experi­men­tation to try things out, retain what worked and discard what didn’t

Strategies for improving organi­zations
* Better management
* Listening to employees
* Manager needs to learn different management styles → management training or workshops
* Bringing more people into management → bringing in new people if needed
* Consul­tants
* Different perspe­ctive, usually unbiased
* Government policy and regulation
* External forces that are brought in to help improve or change orgs

Theory base for frames
Theore­tical frame: A set of theories that allow us to explain, predict, and control behavior
* Used to understand and analyze situat­ions, diagnose problems, and formulate solutions

Frames and reframing
* Frame: a metaphor to describe how we perceive and therefore interpret reality (mental map, window, tool, etc).
* Theore­tical frame: a set of theories that allow us to explain, predict & control behavior.

Basic structural team config­ura­tions
One Boss
* Structure is fast & efficient, works well with simple tasks & situations

Dual Authority - divisible tasks
* Added layer limits and slows commun­ication between boss and lover levels, team morale and perfor­mance may then suffer

Simple Hierarchy
* One middle manager reports to the boss while superv­ising and commun­icating with team members

Circle
* Inform­ation and decisions flow sequen­tially among members
* Relies only on lateral coordi­nation and each person only deals with two other members
* A weak link can undermine the team ; complex tasks can create problems

All Channel
* Inform­ation and commun­ication flows freely, between all members, high morale
* Effective for complex tasks requiring creativity
* Not suited for simple tasks -- too slow and ineffi­cient

Teamwork and interd­epe­ndence (sports examples)

Baseball (LOW interd­epe­ndence)
* Team goal met via individual players meeting goals
* Individual efforts usually autonomous (self-­con­trol), loose coordi­nation between specific teammates
* Managers’ decisions are tactical, (ex. substi­tut­ions)

Football (MODERATE interd­epe­ndence)
* Players work in close proximity, individual efforts are tightly synchr­onized, all members involved in a “play”
* Integr­ation through planning and top-down control; different units have own coordi­nator (ex. offensive)
* Tougher to swap players from teams due to different philos­ophies, cultures, and systems

Basketball (HIGH interd­epe­ndence)
* Players work in very close proximity, switching roles
* Individual efforts recipr­ocal, depend fully on others’ perfor­mance & can anticipate moves over time
* Coaches serve as integr­ators, reinforce team cohesion and lateral coordi­nation

Team structure and high perfor­mance
* Translate purpose into specific, measurable goals
* Manageable size (smallest size possible to get job done)
* Common commitment (social contract to guide behavior)
* Collec­tively accoun­table

Self-m­anaged teams
* Plan, organize, lead and staff by themselves
* Assign tasks and roles to members
* Plan and schedule work (set deadlines, etc)

Common fallacies in organi­zat­ional problem diagnosis
* Blame people - bad attitudes, abrasive person­ali­ties, neurotic tenden­cies, stupidity, or incomp­etence
* Blame the bureau­cracy - organi­zations are stifled by rules and red tape
* Black thirst for power - organi­zations are jungles filled with predators and prey

` Human tendency is to find simple solutions to complex problems
` We satisfice (settle on the first available solution) instead of searching for the option that will maximize decision quality
` While common fallacies might contain some truth, they oversi­mplify reality and only give a partial perspe­ctive
^ Ex. “the bureau­cracy” perspe­ctive is better at explaining how organi­zations should work rather than explaining why they often don’t work

Sources of Ambiguity
* Not sure what the problem is or what’s going on
* Not sure (or can’t agree) on what we want
* Don’t have the resources needed
* Not sure who’s supposed to do what, how to get what we want, or how to determine if we succeeded or failed

Coping with ambiguity & complexity
* You see what you expect (expec­tation bias), and what you want to see (selective percep­tion)
* Can lead to confir­mation bias

Maslow­'s Hierarchy
5. Self-a­ctu­ali­zation
4. Esteem
3. Belong­ing­ness, love
2. Safety
1. Physio­logical

Theory x & y (McGregor)
Theory X assumes people are passive, lazy, prefer to be led, & resist change. Leads to microm­anaging and less trust in employees.

Theory Y assumes people are proactive, curious, respon­sible, & trustw­orthy.
Leads to more freedom, no microm­anaging - trust employees to do the work.

Person­ality & organi­zation (Argryis)
Workers adapt to frustr­ation in several ways:
* Withdraw - absent­eei­sm/­pre­sen­teeism or quitting
* Become apathetic, psycho­log­ically withdrawn
* Resist top-down control through restri­cting output, deception, feathe­rbe­dding, or sabotage
* Climb the hierarchy to escape lower levels
* Form alliances to redress power imbalances (ex. labor unions, support groups, etc)
* Train children to believe work in unrewa­rding

Lean and mean vs Invest in people

Win through low costs
* downsize (“dumb­siz­ing”), outsource, hire temps & contra­ctors
* yields short term benefit
* corrosive effect on worker commitment & morale
* approach can work well in an economic downturn

Win with talent
* build skilled, well-t­rained workforce
* yields long-term payoff
* during economic booms, companies compete over workers due to skill shortages → compet­itive edge

Structural assump­tions
Organi­zations exist to achieve establ­ished goals and objectives
Specia­liz­ation and division of labor increase efficiency and perfor­mance
Structure must align with circum­stances
^ Can be internal…
^ ...or external (compe­tition, laws and regula­tions, economy, resource availa­bility, time of year/f­luc­tua­tions in demand or business)
Problems arise from structural defici­encies

Basic structural tensions
* Differ­ent­iation: dividing work, division of labor
^ business function (marke­ting, accoun­ting, etc), time, product, customer, place, process
* Integr­ation: coordi­nating efforts of different roles and units
* Subopt­imi­zation: occurs when units focus on local concerns, losing sight of the big picture

Vertical coordi­nation
Coordi­nation following the chain of command:
* Authority: the boss makes the decisions
* Rules and Policies
^ Provides standards to ensure behavior is predic­table and consistent

Lateral coordi­nation
* Lateral coordi­nation forms tends to be more informal & flexible, and often simpler & quicker than vertical forms.
^ Meetings
^ Task forces
^ Coordi­nating roles

Structural impera­tives
* Size and Age:co­mpl­exity & formality increase with age
* Core Process: must align with structure
* Enviro­nment: stable → simpler ; turbulent → more complex structure
* Strategy and goals: structure must adapt for goal clarity & consis­tency
* Inform­ation techno­logy: increased IT permits flatter, increased flexible structures
* People­/Nature of Workforce: increased skille­d/p­rof­ess­ional, increased demand more autonomy

Build and implement an HR philosophy
* Develop a public statement of the org’s HR philosophy
* Helps translate words into specific actions and for accoun­tab­ility purposes
* Build systems and practices to implement the philosophy

Hire the Right People
* Hire people who bring the right skills and attitudes to the job and org and that“fit” the org mold.
* Can reduce turnover, cut recrui­ting, selection, and training costs.

Keep Employees
* Reward well, protect jobs to build loyalty, promote from within
* Increases trust and loyalty
* Capita­lizes on knowledge & skills, reduces errors, increases the likelihood of longer­-term thinking

Invest in Employees
* Undert­rained workers can affect produc­tivity, leavels, lower quality, and make costly mistakes
* Training (short­-term focus, immediate costs) vs develo­pment (longe­r-term invest­ment, delayed benefits)
* Use a variety of methods: on the job, mentors, classroom, team-b­uilding activities

Empower Employees
* Make perfor­mance data available and teach workers how to use them
* Encourage workers to think like owners
* Everyone gets a stake in the financial success
* Foster autonomy and partic­ipation
* Redesign work
* Build self-m­anaging teams

Promote diversity and inclusion
* Develop an explicit, consistent diversity philosophy and strategy to execute it daily
* A commitment to treating all employees well
* Employees reflect your customer base, and news of bad treatment (ex. racism) spreads quickly
* Tailor recruiting practices to diversify hiring
* Hold managers accoun­table by tying rewards to meeting diversity goals and targets