Management and Organisational Behaviour
7th Edition
PART 2
The
Organisational
Setting
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
Management and Organisational Behaviour
7th Edition
CHAPTER 4
The Nature of Organisations
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.2
Purpose of organisations
• Organisations exist in order to achieve their
aims & objectives and to provide satisfaction for
their members
• Organisations are structures of people
• Organisations are an integral part of society
operating in both public & private sectors
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.3
Defining organisations
Farnham & Horton define organisations as:
..social constructs created by groups in society to achieve
specific purposes by means of planned & co-ordinated
activities.
These activities involve using human resources to act in
association with other inanimate resources in order to
achieve the aims of the organisation.
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.4
Common factors in organisations
There are at least three common factors in any
organisation:
• People
• Objectives
• Structure
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.5
Figure 4.1
The nature of organisations
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.6
Approach to organisation theory that stresses the
common aspects of organisational life (Watson)
•
•
•
The importance of the creative, critical &
situation-defining characteristics of the
individuals within the organisation.
The varieties of interest and goal among the
individuals & groups in the organisation, & the
emphasis on conflict & political behaviour.
The interactions between the organisation &
general environment.
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.7
Formal organisations
Schein defines a formal organisation as….
… the planned, co-ordination of the activities of a
number of people for the achievement of some
common, explicit purpose or goal, through the
division of labour & function, & through a
hierarchy of authority & responsibility
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.8
Formal organisations
Formal organisations are:
•
•
•
•
Deliberately planned and created
Concerned with the co-ordination of activities
Hierarchically structured with stated objectives
Based on certain principles such as the
specification of tasks and defined relationships
of authority & responsibility
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.9
Figure 4.3
Basic components of an organisation
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.10
Basic components of an organisation
• Operational core – the direct performance of the
technical or productive operations and the carrying out
of actual task activities
• Operational support – concerned indirectly with the
technical or productive process but closely related to
the actual flow of operational work
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.11
Basic components of an organisation
• Organisational support – the provision of services for
the whole organisation, including the operational core
but usually outside the actual flow of operational work
• Top management – concerned with the broad
objectives and policy & strategic decision making
• Middle management – concerned with the coordination & integration of activities & providing links
with operational support staff
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.12
Private enterprise & public sector organisations
Private
Public sector
• Owned & financed by
individuals, partners, or
shareholders accountable
to their owners or
members.
• Created by government
• Main aim is of a
commercial nature such
as profit, return on capital
employed, market
standing or sales levels
• Do not generally have
profit as their goal but
have a political purpose
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.13
Characteristic features of
service organisations
• The consumer is a participant in the service process
• Services cannot be stored, they are time-perishable & if
they are not used they are likely to be wasted
• Services are less tangible & more difficult to explain or
communicate
Fitzsimmons & Sullivan
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.14
Characteristic features of
service organisations
• Benefits derived from services tend to be associated with
feelings or emotions
• Work activities are people-oriented
• Measurement of output is difficult & there is unlikely to
be a single, important criterion by which to measure
effective performance
Fitzsimmons & Sullivan
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.15
Table 4.1
Differences between products & services
Source: Reproduced with permission from John Macdonald, ‘Service Is Different’, The TQM Magazine, Vol. 6, No. 1, 1994, p.6.
http://www.emeraldinsight.com/tqm.htm
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.16
Table 4.1
Differences between products & services
Source: Reproduced with permission from John Macdonald, ‘Service Is Different’, The TQM Magazine, Vol. 6, No. 1, 1994, p.6.
http://www.emeraldinsight.com/tqm.htm
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.17
Table 4.1
Differences between products & services
Source: Reproduced with permission from John Macdonald, ‘Service Is Different’, The TQM Magazine, Vol. 6, No. 1, 1994, p.6.
http://www.emeraldinsight.com/tqm.htm
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.18
Table 4.1
Differences between products & services
Source: Reproduced with permission from John Macdonald, ‘Service Is Different’, The TQM Magazine, Vol. 6, No. 1, 1994, p.6.
http://www.emeraldinsight.com/tqm.htm
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.19
Types of organisational authority
• Traditional organisations - legitimised by custom and
long-standing beliefs in the natural right to rule
• Charismatic organisations – legitimised by belief in
the personal qualities of the leader
• Bureaucratic organisations – authority is based on
the law of formal rules & procedures and on impersonal
principles
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.20
Classifying organisations
by major purpose
•
•
•
•
•
Economic
Protective
Associative
Public service
Religious
•
•
•
•
Political
Educational
Military
Voluntary
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.21
Classifying organisations according
to main beneficiaries
• Mutual-benefit associations – the membership
• Business concerns – owners
• Service organisations – client group
• Commonweal organisations – public at large
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.22
Alternative classification – genotypic function
• Productive
• Maintenance
• Adaptive
• Managerial or political
Katz & Khan
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.23
Figure 4.4
The open systems model of organisations
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.24
Inputs
•
•
•
•
Company products
Factored products
Staff
Technology
• Management/sales/
technical expertise
• Finance
• Subcontractors
• Customers
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.25
Transformation process
• Comfortable & safe environment for customer
businesses
• Design of systems
• Selling of systems expertise
• Provision of quality service
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OHT 4.26
Transformation process
• Project management of customer order
• Site presence
• Innovation
• Internal & external communication
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OHT 4.27
Outputs
• Invoiced sales
• Satisfied and committed staff
• Reputation for excellence
• Installations that are fit for purpose
• Satisfied customers
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.28
Organisational goals
• Market leadership
• To be the best in field
• Growth
• To invest in our people
• Profitability
• To be professional
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.29
Measures of achievement
• Repeat business
• Staff appraisal
• Customer feedback
• Free of charge work
• Budgets
• Volume of work
• Margin performance
• Relationship with
stakeholders
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.30
Figure 4.6
Environmental influences on organisations
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.31
Organisations as socio technical systems
The sub systems of these organisations include:
•
•
•
•
•
Goals and values
Technical
Psychological
Structure
Managerial
Kast & Rosenzweig
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.32
Alternative sub systems
• Human / social
• Administrative / structural
• Informational / decision making
• Economic / technological
Hersey & Blanchard
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.33
Contingency models of organisations
• Adopts an if–then approach
• A number of situational factors influence
organisational performance
• If certain situational factors exist, then certain
organisational and managerial variables are most
appropriate
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.34
Technology
• The physical aspects of machines, equipment,
processes & work layout (machine technology)
involved in the transformation or conversion process
• The actual methods, systems & procedures involved
(knowledge technology) in carrying out the work of
the organisation & transforming or converting inputs
into outputs
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.35
Information technology
• Has prompted more procedures of work
• Has demanded new patterns of work organisation
• Affects the nature of individual jobs, formation &
structure or work groups
• Led a move away from large-scale, centralised
organisations to smaller working units
• Allows people to work more on their own
• Requires changes in the nature of supervision
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.36
The informal organisation
The informal organisation arises from:
• the interaction of people working in the organisation
• their psychological and social needs
• the development of groups with their own
relationships and norms of behaviour, irrespective of
those defined within the formal structure
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.37
Figure 4.9
The formal & informal organisation
Source: Reproduced with permission from Kenneth Lysons, ‘Organisational Analysis’, Supplement to the British Journal of
Administrative Management, no. 18, March/April 1997.
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.38
Figure 4.9
The formal organisation
Source: Reproduced with permission from Kenneth Lysons, ‘Organisational Analysis’, Supplement to the British Journal of
Administrative Management, no. 18, March/April 1997.
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.39
Figure 4.9
The informal organisation
Source: Reproduced with permission from Kenneth Lysons, ‘Organisational Analysis’, Supplement to the British Journal of
Administrative Management, no. 18, March/April 1997.
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.40
The formal organisation
• Organisation charts
• Production efficiency
• Spans of control
• Policies & procedures
• Job definitions &
descriptions
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.41
The informal organisation
• Personal animosities &
friendships
• Prestige & power
structures
• Grapevines
• Emotional feelings, needs
& desires
• Group norms &
sentiments
• Effective relationships
• Informal leaders
• Personal & group goals
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.42
Table 4.2
Comparing formal & informal organisations
Source: Adapted from J. L. Gray and F. A. Starke, Organizational Behavior: Concepts and Applications, Fourth edition, Merrill
Publishing Company, an imprint of Macmillan Publishing Company (1988), p.432. Reproduced with permission from Pearson
Education Inc., Upper Saddle River, NJ.
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.43
Table 4.2
Comparing formal & informal organisations
Source: Adapted from J. L. Gray and F. A. Starke, Organizational Behavior: Concepts and Applications, Fourth edition, Merrill
Publishing Company, an imprint of Macmillan Publishing Company (1988), p.432. Reproduced with permission from Pearson
Education Inc., Upper Saddle River, NJ.
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.44
Table 4.2
Comparing formal & informal organisations
Source: Adapted from J. L. Gray and F. A. Starke, Organizational Behavior: Concepts and Applications, Fourth edition, Merrill
Publishing Company, an imprint of Macmillan Publishing Company (1988), p.432. Reproduced with permission from Pearson
Education Inc., Upper Saddle River, NJ.
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.45
Organisations of the future
Organisations are living organisms that are constantly
evolving.
Ulrich suggests that with the changing and dynamic
contextual factors -
… the essence of organisations has shifted and will
continue to shift from focusing on structure to
capability.
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005
OHT 4.46
Rise of organisational democracy
There is a demand for alternative organisational
practices and a far reaching transformation has
already begun based on the idea that management
as a system fails to open the heart or free the spirit
The age of management is coming to an end and the
real push for the future is for more authentic human
relationships and the humanisation of organisations
as crucibles for personal growth and development
Cloke & Goldsmith
Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005