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Questions and Answers
What is a major risk associated with the unitary structure (U-form) in large organizations?
What is a major risk associated with the unitary structure (U-form) in large organizations?
Which assumption about individuals in classical organization theories suggests that control is necessary within organizations?
Which assumption about individuals in classical organization theories suggests that control is necessary within organizations?
According to classical organization theory, which principle is emphasized as a method for managing efficiently?
According to classical organization theory, which principle is emphasized as a method for managing efficiently?
What is highlighted as a severe shortcoming of classical organization theories?
What is highlighted as a severe shortcoming of classical organization theories?
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What does the principle of 'division of labour' imply in classical organization theory?
What does the principle of 'division of labour' imply in classical organization theory?
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In the context of classical organization theories, what does the term 'functional differentiation' refer to?
In the context of classical organization theories, what does the term 'functional differentiation' refer to?
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Which assumption regarding organizations asserts that only efficiency is important, excluding irrational elements?
Which assumption regarding organizations asserts that only efficiency is important, excluding irrational elements?
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What is the main aim of organization theory according to classical perspectives?
What is the main aim of organization theory according to classical perspectives?
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What is the primary aim of the multidivisional structure (M-form)?
What is the primary aim of the multidivisional structure (M-form)?
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Which of the following is NOT a potential criterion for divisionalization in the M-form?
Which of the following is NOT a potential criterion for divisionalization in the M-form?
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What major dilemma is associated with the M-form structure?
What major dilemma is associated with the M-form structure?
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What is a key characteristic of the Matrix organization?
What is a key characteristic of the Matrix organization?
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Which of the following is a downside of the Matrix organization?
Which of the following is a downside of the Matrix organization?
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What challenge do organizations face regarding differentiation and integration?
What challenge do organizations face regarding differentiation and integration?
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Which strategy is NOT considered a mode of integration?
Which strategy is NOT considered a mode of integration?
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What is a potential reason large organizations undergo frequent re-organization?
What is a potential reason large organizations undergo frequent re-organization?
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What is a primary characteristic of bureaucracy as defined by Weber?
What is a primary characteristic of bureaucracy as defined by Weber?
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Which of the following is a key criticism of Taylor’s scientific management?
Which of the following is a key criticism of Taylor’s scientific management?
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Which form of authority does Weber consider as the 'purest' form of organization?
Which form of authority does Weber consider as the 'purest' form of organization?
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What was a fundamental principle of Fayol's administrative approach to management?
What was a fundamental principle of Fayol's administrative approach to management?
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What is one of the major drawbacks of bureaucratic organizations as suggested by critiques?
What is one of the major drawbacks of bureaucratic organizations as suggested by critiques?
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How does specialization contribute to efficiency in large organizations?
How does specialization contribute to efficiency in large organizations?
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Which structural evolution is characterized by overcoming the limitations of U-form and M-form organizations?
Which structural evolution is characterized by overcoming the limitations of U-form and M-form organizations?
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What was one of the critical aspects lacking in Fayol's principles of administrative management?
What was one of the critical aspects lacking in Fayol's principles of administrative management?
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What led to the perception of bureaucracy as inefficient?
What led to the perception of bureaucracy as inefficient?
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In what way did Weber view bureaucracy's impact on individuals within an organization?
In what way did Weber view bureaucracy's impact on individuals within an organization?
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Flashcards
Classical Organization Theory
Classical Organization Theory
Early attempts to understand large organizations, focusing on formal structure and authority.
Individual Assumptions (Classical)
Individual Assumptions (Classical)
Classical theory views individuals as potentially unreliable, needing control, unable to understand or take responsibility, and motivated solely by material incentives.
Organizational Assumptions (Classical)
Organizational Assumptions (Classical)
Classical theory assumes organizations need top-down coordination, prioritize efficiency, predictability, planning and division of labour through hierarchy.
U-Form Structure
U-Form Structure
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Division of Labour
Division of Labour
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Limits of U-Form
Limits of U-Form
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Hierarchy (Classical)
Hierarchy (Classical)
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Classical Theory Shortcomings
Classical Theory Shortcomings
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Bureaucracy
Bureaucracy
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Weber's Bureaucracy
Weber's Bureaucracy
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Scientific Management
Scientific Management
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Specialization
Specialization
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Fayol's Administrative Approach
Fayol's Administrative Approach
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U-form
U-form
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M-form
M-form
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Organizational Structure
Organizational Structure
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Critique of Bureaucracy
Critique of Bureaucracy
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Multidivisional Structure (M-form)
Multidivisional Structure (M-form)
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Matrix Organization
Matrix Organization
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Project Organization
Project Organization
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Differentiation (in organizational structure)
Differentiation (in organizational structure)
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Integration (in organizational structure)
Integration (in organizational structure)
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Vertical Integration
Vertical Integration
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Horizontal Integration
Horizontal Integration
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Study Notes
Basic Puzzle
- Organization design is crucial for task completion
- Traditional production relied on single individuals with all skills, limiting scale
- Modern technologies led to large-scale production, necessitating specialization and coordination
- Planning and execution roles evolved in larger organizations
Overview
- Early organizational theories (Weber, Taylor, Fayol) influenced organizational structuring
- Different organizational structures evolved (U-form, M-form)
- Classical theories have limitations, leading to new structures
- ABB's organizational evolution illustrates this
- Evolution and structure are context-dependent
Bureaucracy (1): Weber (1921)
- Max Weber, a German sociologist, developed important theories on organizations
- His work stemmed from society's rationalization, leading to bureaucratic principles
- Bureaucracy is a form of legal authority with rules, specified competencies, hierarchy and accountability for organizational efficiency.
Critique and Re-assessment of Bureaucracy
- Bureaucracy is efficient, but can also be rigid and inflexible
- Propagation of rules might create 'one-dimensional' individuals
- Rules and procedures may not always respond to changing situations and needs
Taylor's Scientific Management (1911)
- Taylor focused on optimizing labor processes, viewing organizations as machines requiring careful control
- Scientific management involved separating planning from execution, establishing measurable tasks, and focusing on worker efficiency using time-and-motion studies
- Specialization increases efficiency due to learning effects, and economies of scale
Fayol's Administrative Approach (1918)
- Fayol focused on the managerial processes, rather than the overall design
- Organizing is the core function and involves establishing structured organization structures
- Five Functions of Management (planning, organizing, commanding, coordinating, controlling) for efficient organizational procedures
Basic Assumptions of Classical Works in Organization Theory
- Individuals are inherently unreliable, requiring control
- Individuals lack organizational understanding and require direction from above.
- Individuals are primarily motivated by material rewards (money).
- Organizations are viewed as machines, and formal structure is a central element of operation
Emergence of the Large Corporation
- The unitary (U-form) structure emerged due to economies of scale and labor specialization
- Growing companies needed new structures (like functional differentiation) to manage complexity
- U-form structure can become complex with increasing size
Limits of the Unitary Structure
- U-form structure faces limitations due to complex systems and management's need for control.
- Interface issues (e.g., communication, responsibility) arise
- Administrative burden becomes overwhelming in large organizations, affecting efficiency
Multidivisional Structure (M-form)
- The M-form structure evolved to overcome U-form issues by creating semi-autonomous divisions
- Divisions allowed increased organizational flexibility
- Centralizing management allowed for greater control.
Alternative Design Choices for the M-form
- Different organizational alternatives include decentralized departments or the structure for independent firms
- The centralization of control in the CEO can reduce efficiency and produce problems within the organization
- Efforts to overcome M-form downsides led to alternative solutions such as matrix organizations and project-based structures
Organizational Structure in Practice: The Case of ABB
- ABB, a multinational company, demonstrates real-world adaptation to organizational structures.
- Acquisitions, mergers, and strategic reorganizations create an evolving organizational structure
- A change in structures often mirrors the changes in company strategy, goals, and markets
Solution: Integration
- Integration is crucial for successful processing tasks and enabling consistent functioning in an organization.
- Two forms of integration (vertical and horizontal) are required
- Successful integration balances differentiation and coordination.
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Description
Explore the evolution of organizational design from traditional individual skills to modern specialized roles. This quiz covers key theories by Weber, Taylor, and Fayol, along with different structures like U-form and M-form. Understand the importance of bureaucracy and its impact on modern organizations.