Organization Structure and Strategy PDF

Organization Structure and Strategy The Work of Alfred D. Chandler and The work of Larry Greiner The Work of Alfred D. Chandler: Strategy and Structure In Large Industrial Enterprises Alfred D. Chandler Jr.'s seminal work, Strategy and Structure: Chapters in the History of the American Indust...

Organization Structure and Strategy The Work of Alfred D. Chandler and The work of Larry Greiner The Work of Alfred D. Chandler: Strategy and Structure In Large Industrial Enterprises Alfred D. Chandler Jr.'s seminal work, Strategy and Structure: Chapters in the History of the American Industrial Enterprise, is a cornerstone of business history. Published in 1962, it has had a profound and enduring influence on management theory and practice. Key Themes and Contributions Chandler's book explores the relationship between corporate strategy and organizational structure, arguing that these two elements are inextricably linked and must be aligned for successful business performance. His analysis is based on a detailed study of the largest industrial enterprises in the United States during the late 19th and early 20th centuries.  Strategy and Structure Co-Evolution: Chandler posits that as businesses grow and expand, their strategies become more complex. To effectively implement these strategies, companies must adapt their organizational structures. This co-evolution of strategy and structure is a central theme of the book. The "Visible Hand": Chandler introduces the concept of the "visible hand" to describe the role of professional managers in large corporations. These managers, he argues, play a crucial role in coordinating the activities of the firm and ensuring its long-term success. The Rise of the Multidivisional Structure: The book examines the emergence of the multidivisional structure as a dominant form of organization in large American corporations. This structure, characterized by decentralized decision-making and a focus on product-based divisions, was a key factor in the success of many companies during the 20th century. Impact and Legacy Influence on Management Theory: Chandler's work has had a profound impact on management theory, particularly in the areas of strategic management and organizational design. His emphasis on the importance of aligning strategy and structure has become a central principle of modern business thinking. Historical Significance: Strategy and Structure is a valuable historical resource, providing insights into the evolution of American industry and the role of large corporations in shaping the nation's economy. Enduring Relevance: While the book was published over 60 years ago, its insights remain relevant today. The principles outlined by Chandler continue to inform the strategic decisions of businesses around the world. In conclusion, Alfred D. Chandler's Strategy and Structure is a landmark work in the field of business history. Its exploration of the relationship between strategy and structure has had a lasting impact on management theory and practice. The book's insights continue to be relevant today, making it a valuable resource for students, scholars, and business professionals alike. The work of Larry Greiner: Strategy, Structure and Organization Growth Larry Greiner, a renowned management scholar, developed a model to explain the stages of organizational growth and the challenges associated with each stage. His theory, often referred to as Greiner's Growth Model, outlines five phases of growth, each characterized by a dominant style of management and a subsequent crisis. Five Phases of Greiner’s Growth  1. Growth Through Creativity All businesses start from a spark of an idea, one that is fostered and developed over time. It’s a truly creative stage of a company’s life as they attempt to develop a new product or service, pull together a team, a route to customers, and get that sometimes elusive ‘product-market fit’. There are some common traits of companies at this stage: They are small, responsive and agile They are creative and working to find their product-market fit They’re informally structured with strong communication between teams 2. Growth Through Direction At this point in a company’s life the owner/founders begin to hire managers, releasing some of the control of the resources and direction of the business. This is normally a ‘growing up’ period of a company’s life, when processes become slightly more formal, departments may be developed, and a culture is set within the business. That’s not to say the founders/owners aren’t still actively involved, they are indeed ultimately running the company, but it’s a collaboration of managers that drive the direction. A company can be considered in the Growth Through Direction phase if: 1. They have recently hired managers as the team grows 2. Decisions are no longer solely made by the founder/owners 3. Processes have started to be created within the company (e.g. HR, operations) 4. A culture is embedded within the company 5. Things are getting bigger and more complicated! 3. Growth Through Delegation The Delegation phase of growth occurs when key staff members are given accountability and responsibility to deliver in areas where they are better equipped to than the manager. At this point in a company life there will be specialist employees, focused on specific roles. Delegating jobs to more specialist, skilled employees means you’ll get a better result, with the added benefit that the executive team have time to focus on the market data, their strategic decisions, and business planning. A company may be in this phase if: Specialist skilled employees are increasingly being hired Accountability for key tasks is shared down the company Leadership teams spend less time doing jobs they aren’t good at or don’t like 4. Growth Through Coordination This is now a mature stage of growth, one that focuses on the company core competencies and all departments working in line with each other to output a product or service. Growth comes from the whole business being greater than the sum of its parts. A company may be in this phase if: They are mature in a marketplace Teams work with each other internally for the best outcome There are set processes and functions within the business Workflows and communication tools are present within the business Roles and responsibilities are clearly defined 5. Growth Through Collaboration The final stage of growth in this model is deemed to be Collaboration. This is an evolution of Coordination, one where all parts of the company work together in a trusted, effective manner. Systems are simplified for efficiency, learning and development is prominent, and all aspects of the business contribute towards ways to continue success. A company may be in this phase if: They are a mature company There is a positive culture around problem solving There’s little ‘red tape’ Reward is shared on the basis of team performance Processes are simple and teamwork is good Employees feel they can contribute ideas for growth Everyone knows how they impact the company with the work they do Key Takeaways from Greiner's Model: Growth is a cyclical process: Organizations go through a series of stages as they grow, each with its own challenges and opportunities. Management style must evolve: As organizations grow, the dominant management style must adapt to meet the changing needs of the business. Crises are inevitable: Growth crises are a natural part of the organizational life cycle. Successfully navigating these crises is essential for long-term success. Greiner's theory has been widely applied in both academic and business settings. It provides a valuable framework for understanding the challenges and opportunities associated with organizational growth and development. Thank you www.reallygreatsite.com  References Chandler, Alfred D. Jr. (1962). Strategy and Structure: Chapters in the History of the American Industrial Enterprise. Cambridge, MA: MIT Press. 1 Greiner, Larry E. (1972). "Evolution and Revolution as Organizations Grow." Harvard Business Review, 50(4), 73-82. https://getlucidity.com/strategy-resources/guide-to-greiners-growth- model/