Organization Design

Organization design refers to the way in which the building blocks of organization authority, responsibility, accountability, information, and rewards are arranged or rearranged to improve effectiveness and adaptive capacity. Managements Role in Organization Design Managements primary task is to maintain and improve performance of the organization. The activities of design are seen as the responsibilities of senior management; however, the most successful design appears to be those that have been built with input from a broad range of organizational members. When a new organization is formed, a new design will be created; however, the redesign of the organization is an ongoing process in which the design needs will change as the organizations needs change. When Should an Organizations Design be Rethought? The organization is experiencing severe problems. There is a change in the environment which directly influences internal policies. New programs or product lines are developed. There is a change in leadership.

Levels of Organization Design Designing a Position In designing individual job or position for any level within an organization, it is necessary to identify the breadth and scope of tasks that can be performed and the extent to which the work can be standardized. Designing a Work Group Often managers are placed in the position of creating task force or team to solve a complex problem in a short time frame. Designing a Cluster of Work Groups Redesigning a cluster of departments or units within an organization to form a division. It involves the most appropriate grouping of units to achieve coordination within the division. Designing and Redesigning a Total Organization The challenge at this level is enormous, and the amount of investment necessary to manage the redesign process is extensive.

 Paul Allaire said if you talk about change but dont change reward and recognition system, nothing changes Designing a Network A network of organization comprises those organizations that exist in a particular community or environment, which may be loosely o closely connected to achieve a common purpose or serve a common clientele. The objective is to ensure coordination of services and smoothness of client flow between organizations to maximize effectiveness. Designing a System Design decisions are even more complex, depending upon the purpose(s) of the system and the heterogeneity of the programs provided.

Systematic Assessment Before Design The Mission The mission have been established through a strategic planning process in which a wide range of stakeholders worked together to provide clear statement of the vision for the organization. It usually identifies what business the organization is in Environmental Assessment Organizational change is increasingly induced by external factors and that organizational adaptability is a result of key members making accommodations to changes in the environment. Environmental complexity assumes that both instabilities in the environment and the heterogeneity of components of the environment create uncertainties which results in different organization designs.

Organizational Assessment An important stage in preparing to redesign an organization is to identify the strengths and limitations of the organization. Human Resources Assessment The availability of individuals with appropriate knowledge and skills to carry out the mission of the organization is critical. Organization designs are influenced by the availability of critical human resource. Political Process Assessment Managers should understand the nature of the informal organizations that exist, who the key leaders are, and how this network can influence changes in organization design.

Designs for a Variety of Health Service Organizations Functional Design Labor is divided into departments specialized by functional area. The actual number of functional departments depends upon the size of organization. Useful when the organization has only few products or goals. Most appropriate when an organization is in a relative simple, stable environment in which there are few changes taking place and there are a limited number of other organizations with which the organization has contact.

Division Design Found in large academic medical centers that operate under condition of high environment uncertainty exacerbated by relationships with the medical schools and high technological complexity because of intensive research activities. Also found in pharmaceutical companies and health supplier organizations where a large variety of products and markets are involved. It is most appropriate for situations where clear divisions can be made within the organization and semiautonomous units can be created. Difficulties tend to occur in times of resource constraints, when priorities must be set at higher organizational levels.

Matrix Design Improve mechanisms of lateral coordination and information flow across the organization. Characterized by dual authority. Useful in highly specialized technological areas that focus on innovations.

New Evolving Designs Parallel design Developed as a mechanism for promoting quality of working life in organizations. Responsible for complex problem solving requiring participatory mechanisms.

 A means of managing and responding to changing internal and external conditions. Advantages include expansion of power, opportunity to affect the organizations decisions, the feeling being involved in organizational issues, and the potential for individual growth through broadening of the range of work activities.

Product Line or Program Design Product line management is defined as the placement of a person in charge of all aspects of a given product or group of products. It is a revenue and cost center, and the person in charge is responsible for all budgetary and financial responsibilities associated with the product. The person is also responsible for coordinating all the functional resources required to successfully manage the product line. Advantages include increase operational efficiencies and enhancing market shares.