Final Exams Slides
BUS 3110 (Final 2021)
Background
• Final exams consist of 30 multiple choice questions and 10 nonmultiple choice questions
• Time allowed is 70 minutes (exams will be available over two days)
• I strongly encourage you to attempt the sample final exams
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Organizational Approaches for Societal
Benefit (slide 1 of 2)
Term
Description
Benefit
corporation
A legal for-profit entity whose charter includes legal responsibility
for positive social or environmental goals in addition to profitseeking goals.
B Corporation
An organization that has received a private certification issued by
B Lab, based on an 80-item assessment of accountability and
transparency in social and environmental performance. Often
used in locations where legal government chartering as a benefit
corporation is not available.
L3C – Low profit
limited liability
company
A legal structure used in a few states that allows for
investment in socially responsible enterprises that are for-profit.
Shared Value
Approach
Business practices that increase the competitiveness of a
company and at the same time contribute to positive economic
and social impact in the community.
3
Organizational Approaches for Societal
Benefit (slide 2 of 2)
Term
Description
Bottom of the
Corporate approach of expanding business by creating products
pyramid ventures or services to serve poorer populations.
Conscious
Capitalism
Concerned with social and environmental issues both at a local
and global level. Awareness of the impact of products and
services on people and the environment.
Social
Founding a profit-seeking new business venture with the goal of
Entrepreneurship tackling a specific societal problem while earning enough profit
to sustain the business.
Social Enterprise
An established hybrid business with the dual goals of addressing
a societal problem and making a profit.
4
Facing the Challenge
• Logics are the personal beliefs, values, and preferences of an
organization’s employees
• Within hybrid organizations, two main logics are usually at play
• Commercial logic: Sell products and services for economic gain or profit
• Social welfare logic: Sell products and services as a mechanism for meeting
societal needs
5
The Two Opposing Logics Embedded Within a
Hybrid Organization
6
Relationship Between the Rule of Law and
Ethical Standards
7
Corporate Social Responsibility (slide 2 of 2)
• Approaches and models that businesses adopt to organize their
socially responsible activities include:
•
•
•
•
•
The green movement and sustainability
The triple bottom line
Conscious capitalism
Stakeholder mapping
Serving the bottom of the pyramid (BOP)
8
The Triple Bottom Line
9
Major Stakeholder Groups and What They
Expect
10
Power and Organizations
• Power is the potential ability of one person or
department to influence other people
• When referring to the influence of a single person,
power can be categorized as either hard or soft:
• Individual hard power includes legitimate power, reward
power, and coercive power
• Personal soft power includes expert power and referent
power
• Organizational power is the result of structural
characteristics
11
Vertical Sources of Power
• Formal position is the legitimate power accrued to top positions
• Resources can be used as a tool for power
• Control of information, a primary business resource, can influence
how decisions are made
• Network centrality—being centrally located in the organization and
having access to critical information and people—provides more
effectiveness and influence
• Loyal and supportive managers help top executives achieve their
goals for the organization
12
Using Soft Power and Politics
• Managers can rely on “hard power” which stems from a person’s
position of authority
• Effective managers often use “soft power” which is based on personal
characteristics and building relationships
13
Power and Political Tactics in Organizations
Tactics for Increasing
the Power Base
1.
2.
3.
4.
Enter areas of high uncertainty.
Create dependencies.
Provide scarce resources.
Satisfy strategic contingencies.
Political Tactics for
Using Power
1. Build coalitions and expand
networks.
2. Assign loyal people to key
positions.
3. Control decision premises.
4. Enhance legitimacy and
expertise.
5. Make a direct appeal.
6. Create a higher purpose.
14
Negotiation Strategies
Win-Lose Strategy
1. Define the problem as a win-lose
situation.
2. Pursue own group’s outcomes.
3. Force the other group into submission.
4. Be deceitful, inaccurate, and
misleading in communicating the
group’s needs, goals, and proposals.
5. Use threats (to force submission).
6. Communicate strong commitment
(rigidity) regarding one’s position.
Win-Win Strategy
1. Define the conflict as a mutual
problem.
2. Pursue joint outcomes.
3. Find creative agreements that satisfy
both groups.
4. Be open, honest, and accurate in
communicating the group’s needs,
goals, and proposals.
5. Avoid threats (to reduce the other’s
defensiveness).
6. Communicate flexibility of position.
15
Tactics for Enhancing Collaboration
• Tactics for enhancing collaboration include:
1.
2.
3.
4.
5.
Create integration devices, such as labor-management teams
Use confrontation and negotiation
Schedule intergroup consultation, such as workplace mediation
Practice member rotation
Create shared mission and superordinate goals
16
Cognitive Biases
• Managers must be aware of their cognitive biases, or severe errors in
judgment that all humans are prone to and that typically lead to bad
choices, including:
•
•
•
•
•
•
•
Being influenced by initial impressions
Seeing what you want to see
Being influenced by emotions
Being overconfident
Escalating commitment
Fearing failure or loss
Being influenced by the group or groupthink
• Managers can avoid cognitive bias through evidence-based management
and the encouragement of dissent and diversity, including the assignment
of a devil’s advocate
17
Incremental Decision Model
• The incremental decision model emphasizes the structured sequence of
activities undertaken from problem discovery to problem solution
• Organizational choices are usually a series of small choices that combine to
produce a major decision
• Decision interrupts are barriers to decision making
• Organizations move through three decision phases:
• Identification Phase
• Development Phase
• Selection Phase
• Dynamic factors may force a decision making loop or cycle back to an
earlier stage
18
The Incremental Decision Model
19
Steps in the Rational Approach to Decision
Making
20
Garbage Can Model
• The garbage can model deals with the pattern or flow of multiple decisions
within whole organizations
• It was developed to explain the decision making in organized anarchy, the
highly uncertain conditions that some organizations experience as a result
of:
• Problematic preferences
• Unclear, poorly understood technology
• Turnover
• Decisions are made from streams of events—problems, potential solutions,
participants, or choice opportunities—instead of defined problems and
solutions
21
Consequences of the Garbage Can Model
1.
2.
3.
4.
Solutions may be proposed even when problems do not exist
Choices are made without solving problems
Problems may persist without being solved
A few problems are solved
22
Types of Decisions
• Organizational decision making is the process of identifying and
solving problems and has two stages:
• Problem identification
• Problem solution
• Programmed decisions are repetitive and well defined
• Nonprogrammed decisions are novel and poorly defined
23
The Bottom-Up Approach
• Many useful ideas come from the people who do the daily work of
serving the customers, fighting off the competition, and figuring out
how best to get their jobs done
• Companies can support innovation by implementing mechanisms,
systems, and processes that encourage a bottom-up flow of ideas and
by making sure they get heard and acted upon
• It is just as important to turn ideas into actions as it is to create them
24
The Ambidextrous Approach
• An ambidextrous approach
incorporates structures and
management processes that are
appropriate to both the creation
and the implementation of
innovation
25
Techniques for Encouraging Technology Change
• Switching structures create organic structures as needed for idea initiation
• Creative departments, including creative incubators, create changes for
adoption in other departments through research and development, engineering,
design, and systems analysis
• Venture teams, including skunkworks and new-venture funds, are like small
companies that are not constrained by organizational procedures and
bureaucracy
• Corporate intrapreneurship develops an internal entrepreneurial spirit,
philosophy, and structure that will produce a higher-than-average number of
innovations
26
The Strategic Role of Innovation
• Today’s organizations must keep themselves open to continuous
innovation not only to prosper, but to survive
• Organizations can respond to environmental shifts with:
• Episodic change
• Continuous change
• Disruptive change and innovation
• Disruptive innovation refers to (often) small product or service
innovations that end up completely replacing an existing product or
service technology
27
Feedback Control Model
• Feedback is used to determine
whether organizational
performance meets established
standards to help the
organization attain
• Systems for organizational
control consist of the four key
steps in a feedback control
model
28
Hierarchical and Decentralized Methods of
Control (slide 2 of 2)
Actions
(continued)
Hierarchical Control
Decentralized Control
Emphasizes extrinsic rewards (pay,
benefits, status).
Emphasizes extrinsic and intrinsic
rewards (meaningful work,
opportunities for growth).
Features rigid organizational culture
and distrust of cultural norms as
means of control.
Consequences
Features adaptive culture; culture
recognized as means for uniting
individual, team, and organizational
goals for overall control.
Employees follow instructions and do
just what they are told.
Employees take initiative and seek
responsibility.
Employees feel a sense of
indifference toward work.
Employees are actively engaged and
committed to their work.
Employee absenteeism and turnover
is high.
Employee turnover is low.
29
Culture and Performance
• Culture has a significant impact on organizational
performance
• Successful companies are those in which managers
are evaluated and rewarded for paying careful
attention to cultural values and business performance
• Such companies have high-performance cultures
30
Culture and Organization Design
• Cultures can be assessed along
many dimensions, such as:
• (1) the extent to which the
competitive environment requires
flexibility or stability
• (2) the extent to which the
organization’s strategic focus and
strength are internal or external
• Four categories of culture are
associated with these differences:
adaptability, achievement, clan,
and bureaucratic
31
Culture Strength and
Organizational Subcultures
• Culture strength is the degree of agreement among members of an
organization about specific values
• Subcultures reflect the common problems, goals, and experiences of
a team or department
• Subcultural differences can lead to conflicts between departments or
divisions
• Cultural conflicts can be particularly challenging in the case of
mergers and acquisitions
32
What is Culture?
• Culture is the set of values, norms, guiding beliefs, and
understandings that are shared by members of an organization
• It is taught to new members as the correct way to think, feel, and
behave
• Organizational culture exists at two levels:
• Visual artifacts and observable symbols
• Underlying values, assumptions, beliefs, and thought processes
33
Emergence and Purpose of Culture
• Culture provides sense of organizational identity
• It serves two critical functions in organizations:
• To integrate members so they know how to relate to one another
• To help organization adapt to external environment
• Internal integration: Members develop a collective identity and
understand how to work together effectively
• External adaptation: How the organization meets goals and deals
with outsiders
34
Organization Characteristics During Four
Stages of Life Cycle
1. Entrepreneurial
2. Collectivity
3. Formalization
4. Elaboration
Characteristic
Nonbureaucratic
Pre-bureaucratic
Bureaucratic
Very Bureaucratic
Structure
Informal, one-person
show
Mostly informal,
some procedures
Formal procedures, Teamwork within
division of labor, new bureaucracy, smallspecialties added
company thinking
Products or
services
Single product or
service
Major product or
service, with
variations
Line of products or
services
Multiple product or
service lines
Reward and
control systems
Personal, paternalistic
Personal,
contribution to
success
Impersonal,
formalized systems
Extensive, tailored to
product and
department
Innovation
By owner-manager
By employees and
managers
By separate
innovation group
By institutionalized
R&D department
Reputation,
complete
organization
Team approach,
attack bureaucracy
Goal
Survival
Growth
Internal stability,
market expansion
Top management
style
Individualistic,
entrepreneurial
Charismatic,
direction-giving
Delegation with
control
35
Organizational Life Cycle
36
Differences Between Large and Small
Organizations
37
Three Organizational Control Strategies
Type
Bureaucratic
Market
Clan
Requirements
Rules, standards, hierarchy, legitimate
authority
Prices, competition, exchange relationship
Tradition, shared values and beliefs, trust
38
Social Network Analysis
• Social network analysis (SNA) shows informal
relationships and network structures within an
organization
• There are three roles within a firm’s social network:
• Hubs are at the center of the network
• Peripheral players have the fewest connections and
operate on the network’s boundaries
• Brokers connect people across boundaries and subgroups
• Social network analysis offers clear delineation of
relationships through data, facts, and statistics
39
Big Data and Organization Structure
• There is no “one best way” to organize big data activity within an
enterprise
• Various structural options may work, depending on the size and type
of organization:
•
•
•
•
Outsourcing (including the use of data intermediaries)
Centralized
Balanced (or hybrid) design
Decentralized
40
Alternative Structures for Organizing Big Data
Analytics
41
Classification of Interdependence and
Management Implications
• Interdependence is the extent to
which departments depend on
each other for resources or
materials:
• Pooled interdependence: Low level of
interdependence (departments work
independently)
• Sequential interdependence: High
level of interdependence (department
A must perform correctly so that
department B performs correctly)
• Reciprocal interdependence: Highest
level of interdependence (department
A’s output is the input to department
B, and department B’s output is the
input back again to department A)
42
Core Service Technology
• Service technologies are different from manufacturing technologies
and require different organizational design
• Characteristics of service firms include:
•
•
•
•
Intangible output
Simultaneous production and consumption
Labor and knowledge intensive
High direct interaction between customer and employee
43
Core Organization Service Technology
44
Trend Toward Customized Services
• Service firms have always tended toward providing customized output
• Customer expectations of what constitutes good service are rising
• These expectations have required service firms to become more
efficient and to cut costs without sacrificing quality
45
Designing the Service Organization
• Boundary roles are used less in service firms than in manufacturing
firms
• A service firm’s greatest economies are achieved through
disaggregation into small units that are located close to customers
• Skills of technical core employees typically need to be higher
• Employees need knowledge, awareness, social and interpersonal skills
• Decision making is often decentralized
46
Framework for Department Technologies
47
Manufacturing Firms
• Three basic technology groups defined by Woodward:
• Group I: Small-batch and unit production
• Group II: Large-batch and mass production
• Group III: Continuous process production
48
Mass Customization
• Smart factories paved the way for mass customization (using massproduction technology to quickly and cost-effectively assemble
individualized goods for customers)
• Products of different sizes, types, and customer requirements freely
intermingle on the assembly line
• Smart factories allow plants to increase both batch size and product
flexibility at the same time
• High-level use of smart systems is referred to as computer-aided
craftsmanship
49
Woodward’s Classification Based on
System of Production
50