Unit 8: Organisation as a system
Introduction:
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Groups and teams fulfil a very important role in organisations.
Organisational goals are attained through the coordinated efforts of individuals, teams and
groups.
The organisation’s design and structure together with policies and procedures shape the
relationships amongst employees.
I-O psychologists and HR practitioners need to understand how groups and teams work in
order to assist them to develop and grow and ultimately assist organisations to be successful.
I-O goal: synergy in the organisation.
Viewing the organisation as a system:
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The organization is a living and open system consisting of interrelated groups, individuals,
processes, technology and other components.
The system has a social (individuals, groups and relationships) and a technical (tools,
processes and techniques) component
We distinguish between the macro (organisation), meso (group) and micro (individual)system.
In universities aspect where people fail a certain module, where does the problem lie?
Lecturer or student (individual level), organisation (meso-level), community (macro-level).
Change in one system causes a ripple effect that lead to changes in other systems.
The environment is also constantly fluctuating and changing.
Implications of this view for I-O psychologists:
 Members need to develop understanding of how the organisation works.
 How behaviours in one part affects behaviours in other parts.
 Any intervention should have maximum positive effect for the total system.
Figure 9.2 The organisation as an open system (NB!)
Organisational Design:
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Organisations need to decide how to group and connect people to meet its goals.
Organisational design should considers the nature, size, complexity and goals.
The end product is an organogram/ organisational chart.
Organograms indicate:
 Different tasks
 Responsibilities
 Workflow
 Authority
Organogram example:
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We can differentiate between two types of organisational design:
1. Traditional (Mechanistic):
 Bureaucratic
 Rigid
 Relies heavily on function and division
2. Contemporary/Modern (Organic):
 Fluid/ flexible (adapts easier to environmental changes)
 Fewer rules and procedures
 Decentralised decision making
Fundamental Characteristics of Organisational Structure:
1. Work specialisation/ division of labour
 The extent to which tasks are divided into jobs.
 High degree (many jobs with a specific task assigned to them) or low degree
(modern organisations encourage multi skilling and teamwork)
2. Standardisation
 Written procedures, job descriptions, rules and regulations that ensure that routine
jobs are performed uniformly and consistently.
3. Departmentalization
 Grouping of jobs into logical groups or departments
 Can be based on function, product, geography, process or customer type(figure 9.4)
4. Chain of command
 Who reports to whom.
5. Span of Control
 How many employees report to a supervisor.
 Narrow span of control (only a few employees report to a supervisor) vs wide span
of control (many employees report to a supervisor)
6. Centralisation and Decentralisation
 Where in the organisational hierarchy are decisions being made. (Centralised)
These decisions takes longer than decentralised decision making.
 Management makes all the decisions vs empowered employees.
Organisational Designs:
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Traditional organisational designs
 Simple organisational structure
 Bureaucracy
 Matrix structure
Contemporary organisational designs
 Virtual organisations
 Team based organisations.
Traditional Organisational Design:
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Simple organisational structure:
 Small and informal organisations
 Little or no departmentalisation, wide span of control and centralised decision
making
Bureaucracy
 Standardisation of work processes through policies, rules and uniform procedures
 Functional departments, centralised decision making, a clear chain of command and
a narrow span of control.
Matrix structure
 Combines functional and product departmentalisation (construction, advertising
agencies, hospitals, etc.)
 Dual lines of authority e.g. an engineer will report to senior manager of engineering
and to the project manager.
Contemporary Organisational designs:
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Virtual organization
 Small, core group or organisation that outsources major business functions to
outside individuals or groups.
 The different networking groups are connected via technology (e.g., internet)
Team based organisation (self-directed and cross functional teams)
 Self-directed Teams are made up of employees with diverse skills relevant to the task
or project. Ongoing training. Minimal supervision.
 Cross functional members across various levels and departments are brought
together to address mutual problems.