BMG 320/03
Organisational Theory and Design
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Unit 5
Managing Dynamic Processes
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5.1 Organizational Culture and Ethical Values
Culture is the set of values, norms, guiding beliefs and understandings that is shared by members of an organisation
Organisational culture exists at two levels – the visible artifacts and the observable behaviours
Visible artifacts – symbols, ceremonies, stories, dress code, physical settings
Observable behaviours – values, assumptions, beliefs, norms
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Managerial Ethics
Ethics are moral principles which help us to distinguish between right and wrong.
Managerial ethics are largely governed by moral values which act as powerful force, to regulate behaviour of individuals both inside and outside an organisation.
Ethical behaviour to are a large extent are guided by our values, education system, and rules prescribed by the society.
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Approaches to Social Responsibility (CSR)
According to Carrol (1991), the Corporate Social Responsibility include four approaches:
Economic – Be profitable
Legal – Obey the law
Ethical – Be ethical
Discretionary/philanthropic -Good corporate citizen.
5.2 Decision-Making Processes
Organisational decision making is defined as the process of identifying and solving problems.
Problem identification – monitoring organisational performance for shortcomings
Solution – alternate courses of action are considered and one alternative is selected and implemented.
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Decision-Making Process
The decision making process consists of seven stages:
Establishing Objectives
Identifying the Problem
Identifying Alternatives
Evaluating Alternatives
Choosing among Alternatives
Implementation of Alternatives
Learning from feedback
5.2 Decision-Making Processes
Decision-making can be done in two ways:
Rational approach
Bounded rationality approach
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Decision-making models
The Rational Model
It is more referred as the ‘classical model’ or economic man model’.
Decision makers have complete information of the situation.
Have a choice to select the best course of action among the alternatives.
Have a clear understanding of all the possible alternatives.
Applied to routine and repetitive problems .
Limited by the cognitive abilities of the person making the decision.
Decision-making models
Bounded Rationality Model
It is called as the ‘administrative model’ or ‘behavioural model’
The boundaries of decision making are limited by the cognitive capabilities at personal and organisational levels such as lack of information or resources.
Satisfice – Managers attempt to stop the decision making process when satisfactory alternatives are found.
5.3 Conflict, Power and Politics
What is conflict?
Conflict is a process whereby one party perceives that its interest are being opposed or negatively affected by another party
What causes conflict?
Incompatible goals
Differentiation
Task interdependence
Scarce resources
Ambitious rules
Communication problems
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5.3. Power and Politics
Power is the capacity to influence another person
The meaning of power
Power is important for managers because it grants them the ability to get things done through the mobilization of employees
Power sources
Legitimate power
Legitimate power is derived from the position a person holds in the organizational hierarchy.
Reward power
Reward power is derived when a person has control over benefits or rewards valued by another person.
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Coercive power
Coercive power is derived when a person has control over punishment or negative consequences over another person.
Expert power
Expert power is derived from the personal characterises (e.g. knowledge and skills) possessed by an individual that are valued by others.
Referent power
Referent power is derived when an individual is identified with and highly respected by others.
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Political strategies and tactics
Organizational politics is defined as any self-serving behaviour used for personal gain at the expense of another person or the organization.
Said another way, political behaviours are done with a self-centred motive, for personal gain despite other’s losses
Factors that trigger organizational politics
Scarce resources
Employees are more likely to play politics when resources are scarce. Employees compete with one another to safeguard these resources and maintain the status quo.
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2. Complex and ambiguous decisions
Employees are more likely to play politics when their manager is making a complex or ambiguous decision that affects them. Since employees are unable to predict the outcome of the manager’s decision, employees then attempt to influence the factors that shape the manager’s decision.
3. Organizational change
Employees usually experience discomfort and high levels of stress when their organization is going through a major change. Change creates uncertainly, and this increases political behaviour.
4. Tolerance of political activities
Employees are also more likely to play politics when they perceive top management to be tolerating and practicing it themselves.
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Ways to manage organizational politics
Introduce clear rules for scarce resources
Where possible, management should first and foremost provide adequate resources for its employees so they can perform the task well.
2. Effective organizational change practices
Organizations that go thought a major change, should not keep employees in the dark as to what should be expected from the change.
3. Suppress norms that support or tolerate self-serving behaviour
Employees are also more likely to play politics when they see top management tolerating and practicing it themselves.
4. Give employees more control over their own work
Managers should also give employees more control and autonomy over their work.
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Ways to manage organizational politics
5. Keep employees informed
Keeping employees out of the loop on important developments only escalate unnecessary fears
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5.4 Managing Organisational Change and Innovation
Lewin’s Force Field Model illustrates the change process that occur within organisations.
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Driving forces represent the forces that encourage the organisation to change. Forces such as the presence of a new competitor, changing workforce expectations or changes in rules and regulations or even technology can propel the organisation towards a new state
Restraining forces on the other hand are forces that resist the change. In other words, these are the forces that attempt to maintain the status quo.
Stability (i.e. no changes occur within the organisation) when both driving forces and restraining forces are in equilibrium. In other words, these forces are of equal strength, but in the opposite direction.
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Organisational innovation
Innovation is ‘the process of translating an idea or invention into goods or services that create value for customers’
The 7 phases of innovation
Phase 1:
Setting goals
Phase 2:
Cooperation
Phase 3:
Ideas combination
Phase 4:
Evaluation
Phase 5:
Testing
Phase 6:
Execution
Phase 7:
Assessment of lifecycle
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End of Slide
Thank you for your attention!
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