Organizational Management and Structure

Introduction to Organizational Theory

• An organization is a collective entity that relies on collaboration to function effectively, with the primary goal of offering insights into organizational functioning and identifying strategies to enhance productivity and financial success.
• Organizational Theory encompasses principles that elucidate individual and group behavior within different organizational frameworks, including classical, neoclassical, and system theories.

Classical Organization Theory

• Emphasizes the importance of efficiency and productivity, with a focus on the organization as a machine.
• Based on the concept of planning of work to achieve efficiency, standardization, and simplification.
• Associated with high levels of job specialization and standardization.
• Developed by Frederick Taylor, who believed that scientific principles could be applied to the study of work to increase efficiency and productivity.

Structural Theory by Harry Mintzberg

• Organizations evolve to reach a certain form and shape (structure) that permits them to function in their surroundings.
• Structure is an adaptive mechanism that allows the organization to function in its environment.

Bureaucracy by Max Weber

• Describes the structure, organization, and operation of many efficient organizations.
• Characterized by a formal way of designing the organization in terms of division of labor, delegation of authority, and span of control.
• Seeks to improve organizational productivity by focusing on methods that managers can use to synchronize internal processes.

Administrative Management by Henri Fayol

• Aims to improve organizational productivity by focusing on managerial practices that drive efficiency.
• Seeks to heighten managerial performance instead of individual worker efficiency.
• Proposed the creation of work groups and functional departments within organizations.

Neo-Classical Theory

• Recognizes the importance of individual or group behavior and emphasizes human relations.
• Adds a personal or human element to the study of organization, considering the interrelationship between an organization's members.
• Introduces informal organization and emphasizes the individual, work group, and participative management.

Systems Approach

• Considers the organization as a system that adapts to changes in its environment.
• Focuses on the internal dynamics of an organization's structure and behavior.
• Adopts a multi-level and multi-dimensional approach, considering both macro and micro aspects.

Organizational Structure

• Refers to the way an organization arranges its positions and the relationships of authority and responsibility among them.
• Includes the division of labor, patterns of coordination, communication, workflow, and formal power that direct organizational activities.

Coordinating Mechanisms

• Informal communication: sharing information casually to coordinate tasks and create a common understanding.
• Formal hierarchy: officially assigning authority to individuals to direct work and allocate resources.
• Standardization: establishing consistent procedures and outputs to create predictability.

Components of the Structure in an Organization

• Complexity: degree to which activities within an organization are differentiated.
• Formalization: extent to which rules and procedures are standardized.
• Centralization and decentralization: degree to which decision-making is concentrated at the top levels or distributed among lower levels.### Organizational Structure and Types
• Organizational structure refers to the way an organization is organized and managed
• Types of organizational structures:
  • Tall/Hierarchical: many management levels, narrow span of control, and a long chain of command
    • Pros: clear lines of authority, opportunities for career advancement
    • Cons: slow decision-making, bureaucratic
  • Flat/Simple: few management levels, wide span of control, and a short chain of command
    • Pros: quick decision-making, empowered employees
    • Cons: poor decision-making, lack of supervision
  • Multidimensional/Divisional: organized by product, client, or geographic region
    • Pros: decentralization, growth opportunities, divided accountability
    • Cons: duplication of areas of expertise, inefficient use of resources
  • Mechanistic: narrow span of control, high formalization, and centralization
    • Pros: flexibility, responsiveness to environmental changes
    • Cons: rigid tasks, limited decision-making, and autonomy
  • Organic: wide span of control, decentralized decision-making, and low formalization
    • Pros: adaptation to change, empowerment, innovation
    • Cons: ambiguous roles, unclear responsibilities
  • Centralized: decision-making power resides at the top
    • Pros: uniformity, efficiency, and control
    • Cons: slow decision-making, limited individual autonomy
  • Decentralized: decision-making power distributed among lower levels
    • Pros: faster decision-making, empowerment, and adaptability
    • Cons: conflicts, duplication of efforts
  • Matrix: combines functional and product structures
    • Pros: deals with complex, creative projects, and adaptability
    • Cons: intragroup conflicts, costly maintenance
  • Project Task Force/Network: temporary, nontraditional organization for a specific project
    • Pros: specialized expertise, innovative, and flexible
    • Cons: conflicts, motivation challenges, and confidentiality concerns
  • Team Organization/Team Based: workers have defined jobs, collaborate, and share skills and resources
    • Pros: collaboration, empowerment, and flexibility
    • Cons: conflicts, inefficient use of resources

Organizational Change

• Types of organizational change:
  • Transformational Change: fundamental shifts in how an organization operates
    • Pros: radical, innovative, and growth-oriented
    • Cons: painful, resisted by employees
  • Incremental Change: small, targeted improvements to existing operations
    • Pros: efficient, less painful, and builds on existing systems
    • Cons: limited impact, may not address core issues
  • Remedial Change: corrections or improvements to existing systems
    • Pros: efficient, problem-solving, and simplicity
    • Cons: limited scope, may not address underlying issues
  • Developmental Change: building capabilities and introducing new systems and tools
    • Pros: growth-oriented, introduces new technologies, and improves efficiency
    • Cons: costly, time-consuming, and may disrupt existing operations
  • Process and System Change: adjustments to existing processes and systems
    • Pros: efficient, improves effectiveness, and introduces new technologies
    • Cons: limited scope, may not address underlying issues
  • Structural Change: reorganizing departments and teams to align with organizational goals
    • Pros: efficient, streamlines operations, and creates a cohesive team structure
    • Cons: painful, resisted by employees, and may lead to job losses
  • People and Culture Change: transforming an organization's culture, values, and behaviors
    • Pros: improves employee engagement, empowerment, and motivation
    • Cons: challenging, resisted by employees, and may require significant changes to policies and procedures### Organizational Change
• Types of organizational change:
  • Structural change: alters the organization's structure to improve efficiency and effectiveness
  • Merger and acquisition change: involves the merging or acquisition of two or more businesses
  • Downsizing change: reduces the size of the organization to cut costs and improve efficiency
  • De-merger change: splits an organization into two or more separate entities
  • Relocation change: involves the moving of an organization or parts of it to a new location
  • Rebranding change: modifies the organization's brand or public image to create a more compelling and attractive image

Motivation Theories from the West

• Maslow's Hierarchy of Needs: proposes that human needs are arranged in a hierarchy from physiological needs at the bottom to self-actualization at the top
• Herzberg's Motivation-Hygiene Theory: distinguishes between factors that cause job satisfaction (motivators) and those that prevent dissatisfaction (hygiene factors)

Motivation in the Filipino Context

• Filipino workers value job security, good pay, and opportunities for growth
• Intrinsic factors (challenge, learning, and growth, and enjoyment) remain more important than extrinsic factors (career advancement and money)
• Giving gifts to loved ones is a significant motivator for Filipino workers
• Filipino employees are motivated by the quality of relationship with co-workers and the sense of belonging to an organization

Employee Engagement

• Employee engagement is defined as the extent to which employees commit to their organization, work hard, and remain loyal
• Engaged employees show higher productivity, lower turnover, and reduced production costs
• Filipino workers value intangible rewards such as self-satisfaction, autonomy, and recognition

Implications for Filipino Worker Motivation

• Organizations should offer rewards that benefit employees and their families
• Design jobs that match employees' skills and capabilities to meet their job-related needs
• Implement HR initiatives that foster socialization and a sense of community to enhance organizational-related motivation