We continue part 3 of your textbook, Managing for Quality and Competitiveness, with chapter 7, Organization, Teamwork, and Communication. 1
One of the most important aspects of organizing a business is determining its organizational culture, a firm’s shared values, beliefs, traditions, philosophies, rules, and role models for behavior. Also called corporate culture, an organizational culture exists in every organization, regardless of size, organizational type, product, or profit objective. A firm’s culture may be expressed formally through its mission statement, codes of ethics, memos, manuals, and ceremonies, but it is more commonly expressed informally. Examples of informal expressions of culture include dress codes (or the lack thereof), work habits, extracurricular activities, and stories. Employees often learn the accepted standards through discussions with co-workers. 2
Organizational culture helps ensure that all members of a company share values and suggests rules for how to behave and deal with problems within the organization. 3
Structure is the arrangement or relationship of positions within an organization. Rarely is an organization, or any group of individuals working together, able to achieve common objectives without some form of structure, whether that structure is explicitly defined or only implied. Getting people to work together efficiently and coordinating the skills of diverse individuals require careful planning. Developing appropriate organizational structures is therefore a major challenge for managers in both large and small organizations. An organization’s structure develops when managers assign work tasks and activities to specific individuals or work groups and coordinate the diverse activities required to reach the firm’s objectives. 4
An organizational chart is a visual display of organizational structure, chain of command, and other relationships. 5
The best way to begin to understand how organizational structure develops is to consider the evolution of a new business such as a clothing store. At first, the business is a sole proprietorship in which the owner does everything—buys, prices, and displays the merchandise; does the accounting and tax records; and assists customers. As the business grows, the owner hires a salesperson and perhaps a merchandise buyer to help run the store. As the business continues to grow, the owner hires more salespeople. The growth and success of the business now require the owner to be away from the store frequently, meeting with suppliers, engaging in public relations, and attending trade shows. Thus, the owner must designate someone to manage the salespeople and maintain the accounting, payroll, and tax functions. If the owner decides to expand by opening more stores, still more managers will be needed.
- Spring '14