How organizations grow, and is there a life cycle of organizational growth?
What are some of the critical symptoms of ineffective organizational design, especially during organizational growth cycle? ow we can make
How can we make change possible in organizations?
Why do organizations grow?
- Business expectations ( organizational goals )
- Executive advancement
- Economic well-being and survival
What happens when organizations get larger?
- Formalization: rules, procedures, manuals
- Complexity: expansion of departments and positions
- Decentralization: decision-making authority
The Internal dynamics of growth
- Entrepreneurial Stage: Growth through creativity
crisis: Need for leadership
- Collectivity Stage: provision of clear direction
crisis: Need for delegation and control
- Formalization Stage: Addition of internal systems of coordination and control
crisis: Need to deal with red tape
- Elaboration Stage: Development of teamwork
crisis: Need for Revitalization
|Structure||Informal||Mostly informal, some procedures, e.g., budgets||Formal procedures, division of labor, specialties added||Teamwork within bureaucracy, small-company thinking|
|Products or services||Single product or service||Major product or service with variations||Line of products or services||Multiple product or services lines|
|Reward and control systems||Personal, paternalistic||Personal, contribution to success||Impersonal, formalized systems||Extensive, tailored to product and department|
|Innovation||By owner-manager||By employees and managers||By separate innovation group||By institutionalized R&D|
|Goal||Survival||Growth||Internal stability, market expansion||Reputation, complete organization|
|Top Management||Individualistic, entrepreneurial||Charismatic, direction-giving||Delegation with control||Team approach, attack bureaucracy|
What happens after the elaboration stage?
Creating new growth platforms
Firms could grow by creating New Growth Platforms on which they could build families of products, services, and businesses and extend their capabilities into multiple new domains.
Identifying firm’s hidden assets
Sustained growth can be achieved by leveraging hidden assets that are not utilized by the firm.
Growing through an organic process
For big multi-business companies, organic growth means changing the organizational structure with the objective of linking all critical activities across all of the businesses and maintaining a long-term perspective.
What are the symptoms of ineffective Design?
Organizational decision making is slow.
Organization is not responsive to changes in its environment.
There is too much conflict among various units within the organization.
If Organizational decision making slow?
Fostering Communication to improve decision-making
PROBLEM: Collaboration across units has all but disappeared
SOLUTION: Use informal networks to compensate for the limits of the formal structure; improve the flow of information.
If the organization is not responsive to changes in its environment?
Building Agility to improve responsiveness
PROBLEM: There’s a persistent failure to spot new developments and opportunities in the market; innovativeness has declined.
SOLUTION: Expose people to new aspects of their tasks and opportunities for collaboration; get them out of their silos.
If there is too much conflict among various units within the organization?
Breaking Up Entrenched Interests to resolve conflict
PROBLEM: Some groups doing critical work have trouble getting the resources they need; resources are concentrated in a few powerful groups.
SOLUTION: Change the dimensions along which resources are allocated; establish new performance measures.
What are the critical elements of managing change?
Rational Elements: Planning and Direction
Emotional Elements: Motivation and Energy
Situational Elements: Organization and work design
How does change occur?
Two critical thinking about change
– ANALYZE – THINK – CHANGE
– SEE – FEEL – CHANGE
How do you facilitate change?
Cultivate identity rather than consequence thinking
Consequences Model: when we are making decisions, we look at the cost and benefits of our choices and chose the one that maximizes our satisfaction (Failure focus)
Identity Model: When we are making decision, we ask ourselves three questions: Who am I? What kind of situation is this? What would someone like me do in this situation?
Fixed Mindset: We believe that our abilities are basically static.
Growth Mindset: We believe that abilities are like muscles – they can be developed by practice
People are incredibly sensitive to the environment and the culture (the norms and expectations) of the communities they are in.
Good habits are important because they allow behavior to happen without our rational side to tell us.
The Logic of Organizational Change
What looks like a people problem is often a situation problem – To change someone’s behavior, you first change that person’s situation
What looks like laziness is often exhaustion – When people try to change things, they are usually dealing with behaviors that have become automatic, and changing these behaviors requires more energy.
What looks like resistance is often a lack of clarity – When you ask people to change, you also need to explain how.