Organizational Theory and Designs
CHAPTER 1: ORGANIZATIONS AND ORGANIZATIONAL EFFECTIVENESS
1
PART 1: LECTURE OUTLINES
CHAPTER 1 ORGANIZATIONS AND ORGANIZATIONAL EFFECTIVENESS
TEACHING OBJECTIVES
1. To define an organization and explain how it creates value in three stages: input, conversion, and output. (1.1) 2. To discuss why organizations exist and how they achieve goals collectively. (1.1) 3. To describe organizational theory, how organizations function, and relate to organizational structure, culture, and design. (1.2) 4. To show how organizational design helps a company gain a competitive advantage, deal with contingencies, manage diversity, increase efficiency, increase innovation, and effectively manage change. (1.2) 5. To illustrate the consequences of poor organizational design and loss of control over structure and culture. (1.2) 6. To discuss the three approaches of evaluating organizational effectiveness: external resource, internal
systems, and technical approach. (1.3)
7. To distinguish between official goals and operating goals. (1.3)
CHAPTER SUMMARY
This chapter discusses organizations, organizational theory, and the importance of organizational design. An organization is a tool for individuals or groups to accomplish goals. An organization creates value at three stages: input, conversion, and output. Organizations exist because people working together to produce goods and services create more value than those working alone. Organizations may exist to increase specialization and the division of labor, to use large-scale technology, to manage the external environment, to economize on transaction costs, and to exert power and control over employees. The components of organizational theory are structure, culture, and design and change. Organizational design helps a company gain a competitive advantage, deal with contingencies, manage diversity, increase efficiency, and increase innovation. Poor organizational design results in company decline, including layoffs and
1
PART 1: LECTURE OUTLINES
CHAPTER 1 ORGANIZATIONS AND ORGANIZATIONAL EFFECTIVENESS
TEACHING OBJECTIVES
1. To define an organization and explain how it creates value in three stages: input, conversion, and output. (1.1) 2. To discuss why organizations exist and how they achieve goals collectively. (1.1) 3. To describe organizational theory, how organizations function, and relate to organizational structure, culture, and design. (1.2) 4. To show how organizational design helps a company gain a competitive advantage, deal with contingencies, manage diversity, increase efficiency, increase innovation, and effectively manage change. (1.2) 5. To illustrate the consequences of poor organizational design and loss of control over structure and culture. (1.2) 6. To discuss the three approaches of evaluating organizational effectiveness: external resource, internal
systems, and technical approach. (1.3)
7. To distinguish between official goals and operating goals. (1.3)
CHAPTER SUMMARY
This chapter discusses organizations, organizational theory, and the importance of organizational design. An organization is a tool for individuals or groups to accomplish goals. An organization creates value at three stages: input, conversion, and output. Organizations exist because people working together to produce goods and services create more value than those working alone. Organizations may exist to increase specialization and the division of labor, to use large-scale technology, to manage the external environment, to economize on transaction costs, and to exert power and control over employees. The components of organizational theory are structure, culture, and design and change. Organizational design helps a company gain a competitive advantage, deal with contingencies, manage diversity, increase efficiency, and increase innovation. Poor organizational design results in company decline, including layoffs and