Gourav Singh

2017PGP054

Behavioral Science 2
The Importance of Organizational Design and Structure -Gill Corkindale

The article by Gill Corkindale conveys as organizational strategy changes, structures, functions and roles
should be realigned with the new objectives. A business owner can change the business strategy but
cannot afford to overlook this concept of realignment. If an organization cannot adapt its structure, it
could lose its market share to other companies who can adapt. Organization design and structure has
become so crucial that it dictates how people function in any business, thus directly affecting the
functioning of the company. Gill points out that if the organization structure is not working, then the
repercussions can be unnecessary ambiguity and confusion and often a lack of accountability therefore
breaking down co-ordination, decision making processes in the business. Gill has sited few of the activities
in an organization from her experiences which could lead to failure of efficient and effective working they
are assigning jobs to employees beyond their capacity, internal conflicts and politics, over-regulation
which leads to delay in launching new projects, making employees apply for their own job resulting in loss
of faith in the company, cultural clashes among different groups in the organization there are many more
issues which leads to organizational failure, these problems arise due to lack of proper communication
channel and grievance redressal system. Hence improving the communication at all levels should be given
importance. It is imperative for the managers or the CEOs of any company to search for the right
combination of its structure and design that would suit their company. A good structure and design will
lead to an improvement in communication, increase output and productivity of its employees and most
importantly make all the shareholders happy.

Solving the Rubiks Cube of Organizational Structure -Ron Ashkenas

Ron Ashkenas tries to explain that organizational design is a lot more complicated than one might think.
He notes how dysfunctional or outdated organizational designs can make it difficult for managers to
operate effectively. He cautions, though, about how it is important to avoid the temptation to reorganize
since this inevitably makes most organizational structures more complex and opaquewith multi-
dimensional matrix structures where decision-making is torturous and unclear; siloed functions that
underleverage peoples efforts; or serial reorganizations that create constant uncertainty.

He closes with three good questions any manager should ask before starting to initiate a reorganization
process for their business:

Is the problem the structure, or the way we are managing it?

Does the structure match our strategy?
Has our organization design been compromised by accommodating specific personalities?
 Good organizational design, for example, increasingly considers the intangibles the way the
organizational structure facilitates or impedes the flow of communication and information in all
directions across the organization; or the way organizational structures can facilitate or impede
innovation.
In an economic environment where there is so much uncertainty, the senior management of a
company might not know where the company should be going in three years. But your frontline
customer-facing people might. Having communication that goes bottom-up is just as important
as having communication that goes top-down.

The firm is considering whether to launch a new product line that will require building a
new facility. If the firm decides to build the new facility and the process is successful, Tata
Steel will have an additional profit of 100,000. If the process does not succeed, the
company will lose 150,000. The firm estimates that there is a 65% probability that the
process will be successful. There is also a probability that its competitor will launch the
new product. If the competitor firm launches the product and the firm does not launch it
then it will lead to a loss of 40,000 to the firm. If both the firm and its competitor launch
the new product it will lead to an additional profit of 20,000 to the firm. The probability
that the competitor will launch the product is 40%. Determine the optimum decision for
the firm.