Organizational Design
Key Concepts of Organizational Design
University of Phoenix
Key Concepts of Organizational Design
This paper will provide key concepts of organization design. It will describe the five best design choices and also will provide information regarding some common organizational structures. An organization will have to continuously look at the design and structure it uses to ensure that it is going to establish its goals and vision.
Importance of Organizational Design Choices
Organizational Design will allow an organization to improve itself. With organizational design, employee satisfaction is improved, customer satisfaction is improved, financial performance is improved and a competitive edge is gained. In order for an organization to have innovative success the best design choices are hierarchy, integration, control, formalization, and authority.
Hierarchy
According to Jones (2004), “Hierarchy is the classification of people according to authority and rank” (p. 101). With a hierarchy, individuals at the top level have more authority and rank. Each level down form the highest rank is under the control of the higher rank. A hierarchy provides an organization with structure. An organization can structure itself by vertical differentiation or horizontal differentiation. According to Jones (2004), “ Vertical differentiation is the way an organization designs its hierarchy of authority and creates reporting relationships to link organizational roles and subunits, horizontal differentiation is the way an organization groups organizational task into roles and roles into subunits” (p. 102). Employees are able to become more specialized with horizontal differentiation. Vertical differentiation allows for chain of authority. It gives more control to the organization.
Integration
According to Jones (2004), “Integration is the process of coordinating various task, functions, and divisions so that they work together and not at cross-purposes “(p. 104).
University of Phoenix
Key Concepts of Organizational Design
This paper will provide key concepts of organization design. It will describe the five best design choices and also will provide information regarding some common organizational structures. An organization will have to continuously look at the design and structure it uses to ensure that it is going to establish its goals and vision.
Importance of Organizational Design Choices
Organizational Design will allow an organization to improve itself. With organizational design, employee satisfaction is improved, customer satisfaction is improved, financial performance is improved and a competitive edge is gained. In order for an organization to have innovative success the best design choices are hierarchy, integration, control, formalization, and authority.
Hierarchy
According to Jones (2004), “Hierarchy is the classification of people according to authority and rank” (p. 101). With a hierarchy, individuals at the top level have more authority and rank. Each level down form the highest rank is under the control of the higher rank. A hierarchy provides an organization with structure. An organization can structure itself by vertical differentiation or horizontal differentiation. According to Jones (2004), “ Vertical differentiation is the way an organization designs its hierarchy of authority and creates reporting relationships to link organizational roles and subunits, horizontal differentiation is the way an organization groups organizational task into roles and roles into subunits” (p. 102). Employees are able to become more specialized with horizontal differentiation. Vertical differentiation allows for chain of authority. It gives more control to the organization.
Integration
According to Jones (2004), “Integration is the process of coordinating various task, functions, and divisions so that they work together and not at cross-purposes “(p. 104).
References: Davila, T., Epstein, M., and Shelton, R. (2006). Making innovation work: How to manage it, measure it, and profit from it. Retrieved from the University of Phoenix eBook Collection. Jones, G. (2004). Organizational theory, design, and change. Retrieved from the University of Phoenix eBook Collection Miles, R., and Snow, C. (2003). Organizational Strategy, Structure, and Process. Tucker, R. (2001). Innovation: The new core competency. Strategy & Leadership, Retrieved on November 24, 2009 from Emerald database.