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outside independent firms by computer connections, which are used to operate as if all were a single organization; virtual corporations; boundaryless organization7.The Modular Structure: Outsourcing pieces of a product to outside firms; firm assembles product chunks, or modules, provided by outside contractors Contingency design: The process of fitting the organization to its environment Factors to consider when taking a contingency approach1.Environment- mechanistic vs. organic; every job is broken down into small steps and automateda.Mechanistic organizations: Authority is centralized, tasks and rules are clearly specified, and employees are closely supervised- McDonalds( Tom Burns and GM Stalker)b.Organic Organization: Authority is decentralized, there are fewer rules and procedures, and networks of employees are encouraged to cooperate and respond quickly to unexpected tasks. “loose,” good for companies that are always changing their products..cell phone companies2.Environment- differentiation vs. integration (Paul R. Lawrence and Jay W. Lorsch)a.Differentation: When forces push the organization apart; Tendency of parts of an organization to disperse and fragmentb.Integration: when forces pull the organization together; The tendency of the parts of an organization to draw together to achieve a common purpose3.Size: The larger the organization the more mechanistica.Organizational size: Usually measured by size of full-time employeesb.Large organizations = 2000 full time workers or morec.Large organizations have more rules/mechanisms
d.Conglomerate: Large company would do business in different, quite unrelated areas4.Technology : consists of all the tools and ideas for transforming materials, data, or labor (inputs) into goods or services (outputs)a.Joan Woodward classified firms according to technologyi.Small batch technology: Custom made products made by organic organizations; often the least complex technology goods are custom-made to customer specifications in small quantitiesii.Large batch Technology: Mass- produced products made by Mechanized organizations; mass production assembly line technologyiii.Continuous- process: Highly routinized products made by organic organizations; highly routinized technology in which machines do all the work5.Life cycle: 4 stagesa.The Birth stage: The nonbureaucratic stage; the stage in which the organization is createdb.The Youth stage: The organization is a prebureaucratic stage; a stage of growth and expansionc.The midlife stage: The organization becomes bureaucratic, a period of growth evolving into stabilityd.The Maturity stage: The organization becomes very bureaucratic, large, and mechanisticUnity of command: An employee should report to no more than one managerChapter 9Large companies such as google have found that “happy people are more productive” so they give their employees a lot more incentives. They have discovered that their biggest competitive advantage lies in its human resources—its people.