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BUSN 495 Exam 2 - Chapter 10
Terms in this set (34)
Departmental (or functional) structure:
Organizes strategy critical activities into functional, product, geographic, process, or customer groups.
Multidivisional (or divisional) structure:
Organizes value chain activities involved in making a product or service available to consumers into a common (self-contained) division.
Allows for multiple reporting relationships among divisional heads and departmental heads
1) functional (or departmental)
2) multidivisional (or divisional)
3 types of organizational structures
specify dual reporting relationships for various value-creating building blocks
Centralized decision making
- Top executives retain authority for most strategic and operating decisions and keep a tight reign on business-unit heads, department heads, and the managers of key operating units;
- comparatively little discretionary authority is granted to front line supervisors and rank and file employees
Decentralized decision making
- Decision-making authority is pushed down to the lowest organizational level capable of making timely, informed, competent decisions
- Put adequate decision making authority in the hands of the people closest to and most familiar with the situation
authoritarian to decentralized
the trend is a shift from _______ to ________ structures stressing empowerment
Pros of decentralized decision making
Faster; Better service; People with most knowledge closest to decision; Allow intellectual personnel to job you hired them for
Cons of decentralized decision making
Inconsistencies; Lack of control; Difficulty holding people accountable; Have to institute incentives and controls
Pros of centralized decision making
Hold people accountable; Lead to certain efficiencies
Cons of centralized decision making
Slow; Lead to extensive amounts of turnover
should motivate employees to focus on what results must be achieved and not on simply performing their jobs
Monetary and nonmonetary incentives
reward systems should include both _________ and _______ incentives
Ways to make rewards work
- Make sure payoff is major when considering the whole package;
- Extended to all people,
- Objective and fair;
- Tie the incentives to performance or outcomes;
- Make sure the person can actually reach the goal;
- Want shortest time possible between action and the results
Common Nonmonetary Rewards used to enhance motivation
- Provide attractive perks and fringe benefits.
- Adopt promotion from within policies.
- Act on suggestions from employees.
- Create a work atmosphere where there is sincerity, caring, and mutual respect among all employees.
- Share information with employees about financial performance, strategy, operational measures, market conditions, and competitors' actions.
- Have attractive office spaces and facilities.
How to properly staff an organization
- Fill key managerial slots with people who are good at figuring out what needs to be done and skilled in "making it happen";
- Recruiting and retaining a capable workforce
Staffing an Organization
- building managerial talent
- recruiting and retaining a capable workforce
a company's internal work climate and is shaped by its core values, beliefs, and business principles
important because it influences its traditions, work practices and style of operating
•Is the firm's organizational DNA—its approach to people management.
•Is comprised of shared core values, beliefs, and business principles that are engrained in employee behaviors and attitudes.
•Defines its operating style—the chemistry of the firm's work environment ("how we do things around here").
Healthy and unhealthy
2 Types of corporate cultures
Healthy corporate cultures
high-performance and adaptive cultures
Unhealthy corporate cultures
- insular, inwardly focused
- unethical and greed driven;
- incompatible subcultures
High performance culture
Standout cultural traits:
•A "can-do" spirit.
•Pride in doing things right.
•A results-oriented work climate in which people go the extra mile to achieve performance targets.
Characteristics of High Performance Cultures
•A strong sense of involvement by all employees.
•An emphasis on individual initiative and creativity.
•Clear statement of performance expectations.
•Prompt addressing of critical issues.
•Constructive pressure to achieve good results.
well suited to fast-changing industries
as a company's strategy evolves, ______ is a definite ally in the strategy execution process
Characteristics of Adaptive Cultures
•Willingness to accept change and embrace challenge of introducing and executing new strategies.
•Internal entrepreneurship on the part of individuals and groups encouraged and rewarded.
•Adopting a proactive approach to identifying issues, evaluating the implications and options, and quickly moving ahead with workable solutions
Traits of Unhealthy Corporate Cultures
- Highly politicized internal environment:
•Issues are resolved on the basis of political clout
- Hostility to change:
•Avoid risks; experimentation and efforts to alter status quo are discouraged
- Insular, inwardly-focused "not-invented-here" mind-set:
•Personnel discount the need to look outside for best practices.
- Disregard for high ethical standards.
- Presence of incompatible, clashing subcultures.
Steps to change a Problem Culture
- Step 1: Identify facets of the present culture that are dysfunctional and impede good strategy execution.
- Step 2: Specify clearly what new actions, behaviors, and work practices should characterize the new culture.
- Step 3: Explain why the current culture poses problems and make a persuasive case for cultural reform.
- Step 4 : Follow with visible, forceful actions, both substantive and symbolic, to ingrain a new set of behaviors, practices, and norms.
Steps to change unhealthy corporate culture
1) Identify the problem
2) specify new actions
3) convince everyone in the organization that these new actions are better and
4) follow through with forceful actions
You need to have competent leadership at the top
In order to change unhealthy corporate culture _____
Talented managers who work well as a team
can produce organizational results that are dramatically better than what one or two star managers acting individually can achieve
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