THE DESIGN OF

ORGANIZATIONS
Neema Merlin Rodrigues
120917001
M Tech Engineering Management

OPENING CASE
Leader of Engineering industries of India
Organizational Redesigns in L & T: Group into 9 business

verticals independent companies with internal boards

Not separate legal entities, headed by de facto chief executives
Decision-making closer to the business units
Run as autonomous units
Decentralization of power
Too big in size, too many business directions, too diversified

The Design of Organizations

28-Mar-13

OPENING CASE

One of the 3 leading IT firms of India

Tough challenges from their competitors
Two joint-CEOs steered through tough phase
Organizational Redesigns at Wipro : Redefined 3 SBUs
Replaced 2 existing Joint CEOs with single CEO
Simpler, leaner structure
Centered on customer, designed for swift, faultless execution &
single-point accountability

The Design of Organizations

28-Mar-13

OPENING CASE
Business situation
highly dynamic
Tough decisions may
be needed

The Design of Organizations

28-Mar-13

INTRODUCTION
Proper MoT requires an organizational structure capable of

fostering innovation & ensuring the effective use of technological

assets
Take advantage of technological progress for competitive advantage
Modern organizations flexible, agile, be able to make swift decisions
& take quick actions & customer-oriented
Traditional Multilayered vertical organizations to shallower
horizontal integrated structures
Requires vision, teamwork & overall sensitivity to people issues

The Design of Organizations

28-Mar-13

THE
VERTICAL
ORGANIZATIO
N
Clear division of
authority & responsibility

Suitable for privately

owned small enterprises

Where specialization is
not an important factor
for success
Line Organization
The Design of Organizations

28-Mar-13

Line & Functional Staff Organization

The Design of Organizations

28-Mar-13

THE MATRIX
ORGANIZATION
Supervisor may have authority in & a relationship with more than

one system
Exists where there is need for a combination of functional
departments & different products
Design for multiproduct, multifunction company
Evolves in stages starting as a task force or venture team, then
permanent team and to full blown project
Challenging, costly & difficult to implement
Provides more flexibility & team effort

The Design of Organizations

28-Mar-13

Matrix Organization
The Design of Organizations

28-Mar-13

Matrix Organization for Multinational Company

The Design of Organizations

28-Mar-13

10

THE HORIZONTAL ORGANIZATION

Work done by multidisciplinary teams organized around
core processes, not around functions
Entire organization flat with few layers & is lead by a
President & a skeleton group of senior executives who
support functions
Lean with few layers of management
Empowers the employees
AT & T Network Systems Division, Eastman Kodak, Xerox,
GE of Organizations
The Design
28-Mar-13
11

The Horizontal Corporation

The Design of Organizations

28-Mar-13

12

Organizational Design & Changing Environments

High-Tech
Complex Tech
Uncertainty
Dynamic Environment
Network Design
Horizontal Organizations
Matrix Design
Low-Tech
Simple-Tech
Stable Environment

Vertical Organization
Uniform Products
Known Markets

The Design of Organizations

Diverse Products
New Markets
28-Mar-13

13

MODELS FOR MODERN CORPORATION

The Design of Organizations

28-Mar-13

14

PROJECT-BASED
ORGANIZATIONS
Team-based organization, Project portfolio management or

Enterprisewide project management

Build around projects & teams
Enable firms to execute better, learn faster & be more
flexible
Requires a total redesign of the entire organization
Provides the ability to dynamically form & dismantle teams
as needed

The Design of Organizations

28-Mar-13

15

PROJECT-BASED
ORGANIZATIONS

The Design of Organizations

28-Mar-13

16

ORGANIZATIONS
IMPLEMENTING SIX SIGMA
Adopted roles within the organization:

Champions facilitate the leadership, implementation

& deployment
Sponsors provide resources
Process owners responsible for the processes being
improved
Master Black Belts Serve as mentors for Black Belts
Black Belts Lead Six Sigma projects, requires about 4
weeks of training
The Design
of Organizations

Yellow/Green
belts Serve on improvement teams28-Mar-13
under 17a
Black Belt, requires about 2 weeks of training

PROJECT-BASED
ORGANIZATIONS
Produce better results
provide greater flexibility
Make more responsive to changes in technology &
markets

The Design of Organizations

28-Mar-13

18

ORGANIZATIONS OF THE
FUTURE

Command-and-control organization
The Design of Organizations

Information-based organization
28-Mar-13

19

ORGANIZATIONS OF THE
FUTURE

Supply-chain of Automotive Manufacturers

The Design of Organizations

28-Mar-13

20

NEW TRENDS IN ORGANIZATIONAL

STRUCTURE ADAPTIVE ORGANIZATIONS

The Design of Organizations

28-Mar-13

21

ORGANIZING FOR
TECHNOLOGY PLANNING

The Design of Organizations

28-Mar-13

22

ORGANIZING FOR R&D & NEW

VENTURES

The Design of Organizations

28-Mar-13

23

REMOVING ORGANIZATIONAL
BARRIERS

The Design of Organizations

28-Mar-13

24

The Design of Organizations

28-Mar-13

25

The Design of Organizations

28-Mar-13

26