MGT501, Module 1, Case
Organizational Structure and the Affect on Its Members
In today’s business economy, it is extremely important for companies and businesses to have a management structure, or organizational design, that optimizes the company’s valuable resources. As companies compete in the free market system of Capitalism throughout the global economy, the need for a successful organizational structure becomes extremely important to gain advantage in the competitive market. Businesses and organizations require an organizational design which allows them to compete in the global economy with a high degree of effectiveness and efficiency. Trained and qualified employees are one of the most important assets that companies and organizations have to accomplish company tasks and goals and ultimately have the largest impact on the success or failure of the business or organization. The organizational structure or design of an organization or business has a direct affect or influence on the way that its members communicate, coordinate, make decisions, and how productive they are. The organizational structure may also lead to employee mental health issues such as depression and anxiety, according to C.S. Spell and T.J. Arnold, and the annual cost of lost productivity, increased absenteeism, and turnover because of mental illness to U.S. businesses has been estimated at $44 billion. For this reason, it is necessary for businesses and organizations to analyze and evaluate the effect or influence that the organizational design has on its employees. Organizational Justice
Organizational justice is the study of people’s perceptions of justice within an organization. There are three specific types of organizational justice which will be discussed. Distributive justice is the perception of fairness in outcomes, such as equity, equality, and needs. Procedural justice is the perception of fairness of the methods or procedures used. Examples of procedural justice are decision criteria, the amount of voice employees have, or control over processes. Interactional justice is based on the perceived fairness of interpersonal treatment received, the amount of sensitivity given to those involved, dignity and respect, and the nature of explanations given. In one particular study by, C.S. Spell & T.J. Arnold (2007), hypothesized that organizational structure will moderate the negative relationship between procedural justice climate and both individual depression, and anxiety, beyond the direct effect of individual-level justice perceptions. In a highly mechanistic structure, the negative relationship of procedural justice climate will be strengthened. One the other hand, within a highly organic structure, the negative relationship of interactional justice climate will be strengthened. The findings of their study, provides the important evidence needed to prove that individual employee mental health is related to characteristics of the work groups justice climate (C.S. Spell & T.J. Arnold, 2007). The justice climate can be defined in many different ways. According to (Liam & Rupp, 2005), justice climate is defined as “group and organization-level justice perceptions.” This means, the way that people within the organization perceive the justices or injustices that occur within organizations. Most members within an organization desire the greatest amount of justice within the work environment and the least amount of injustice. Examples of justices within an organization are rewards, promotions, or appropriate justice for employee behavior. Injustices within organizations are things viewed negatively by members, which are unfair, unjust, wrong, unethical, or immoral. These negative injustices demote employee or member moral and cause undo mental stress. With this information in mind, it is important for organizational executives to know and understand how the structure of the...