Thesis Statement
This presentation will address the overall organizational
design and work structures for a German video
games manufacturing company that wishes to set
up its business in the United States also. This
paper will also highlight the cross-cultural challenges
that such a company is likely to face in its U.S.
operations.
Analysis
The German firm Software Ease has to choose and
implement structures that best arrange resources
to serve its needs. It also has to approach this
objective keeping the contingency issues before
it. And finally within the scope of our topic
the issues involved in sub-system designs too
are to be taken into account.
At the outset it will be advisable to make a survey
of the different organizational designs that are
available for Software Ease to choose from.
ORGANIZATIONAL DESIGNS
1.0 Bureaucratic models (classical view of bureaucracy)
At one extreme are the ‘Bureaucracies’
that are based on logic, order and legitimate
use of formal authority. Such organizations are
characterized by attributes such as the following:
clear-cut division of labor
strict hierarchy of authority
formal rules and procedures
promotions based on competency
2.0 Mechanistic designs
The next category of organizational design comprises
what are known as mechanistic designs. These organizations
have the following characteristics:
highly bureaucratic
more centralized authority
many rules and procedures
precise division of labor
narrow spans of control
formal means of coordination
few teams and task forces
specialized tasks
3.0 Adaptive designs
Another category of organizational models is known
as the adaptive designs. These are more open and
less formal in their orientation as compared to
the bureaucratic model. These have the following
essential features:
operate with minimum bureaucratic features
encourage worker empowerment
based on team and network structures
operate with organic designs
decentralized
many teams and task forces
shared tasks
4.0 CONTINGENCY FACTORS
After the survey of available organizational designs
it is necessary to mention the contingency factors
that may influence the organization design initially
or subsequently. The contingency factors are outlined
below:
4.1Environmental factors
Certain The environment here is stable and predictable
Uncertain The environment here is more dynamic
and less
predictable
4.2 Strategy
Stable strategy Stable strategy is supported by
bureaucratic
organizations using mechanistic designs
Growth oriented strategy Such strategy is supported
by Adaptive organizations using organic designs
Technology Combination of knowledge, equipment
and
work methods used to transform resource inputs
into organization inputs
Managing business Downsizing
simultaneous structures that is combined mechanistic
and organic designs
4.3 people a good organization design needs supportive
structure
it also needs a good ‘fit” between
organization and people
5.0 SUB-SYSTEMS and DESIGNS Differentiation degree
of difference between internal components of the
organization
–sources of differences
•time orientation
•objectives
•interpersonal orientation
•formal structure
Having completed a brief overview of the theory
it is now possible to apply the same to the specific
example of Software Ease, which is planning to
make an entry in the U.S. market
If someone was to ask ten individuals if they
preferred an environment with less controls or
one having more controls, nine out of the ten
would say they prefer the environment with lesser
controls.
This is because it is human nature to resist monitoring
or control or in common language someone watching
over their shoulders. Yet control is a vital tool
of management. It would rank at par, if not higher,
than other management functions such as planning,
organizing, coordinating and directing. So within
organizational design the element of control occupies
a vitally important position notwithstanding the
human resistance or preference. In the absence
of proper and appropriate levels of controls the
efficiency is likely to suffer adversely. The
results could cost the business dearly in a competitive
environment and losses may be incurred. This in
turn would hurt the investors and their withdrawal
from the business scene could result in a loss
of jobs.
The management theory says that ‘environment’
determines when the bureaucratic organization
is recommended. Now it is known that Software
Ease is a German entity and making an entry in
the U.S. market. It is all the more important
for a foreign firm playing on a foreign turf to
be double cautious. It cannot afford, at least
initially, to go for the adaptive or organic design
because that would entail decentralization, wider
spans of controls, fewer rules, and informal coordination.
This would be a recipe for disaster and is therefore
highly inadvisable.
This is not to mean that worker participation
is to be altogether eliminated. Rather the participation
is to be routed through formal channels. For instance,
if any worker has any idea for better inventory
storage methods or knowledge of a better source
of supply of raw materials or manpower the workers
is to be encouraged to approach his/her supervisor
or manager to discuss such initiatives.
Although the mechanistic design is recommended
for larger organizations and for those organizations
which have reached maturity stage, this design
is recommended for Software Ease because it is
new player and will need to find its feet first
before it can afford to be bold in its choice
for organizational design .
The work force may be educated and informed as
to the background and need for strict hierarchy
of authority, formal rules and procedures and
promotions based on competency. It can also be
explained that as the business grows and subject
to market forces remaining stable there would
be changes in the organization design to accommodate
greater degree of flexibility permitting higher
employee empowerment and participation.
Software Ease will face challenges in the cross-cultural
organization in the USA. To begin with there is
the language issue.
This is though not insurmountable. The key German
managers may be inducted in a crash course in
the English language and the American executives
may be similarly asked to take a course in the
German language. Overcoming the language barrier
would be a big achievement in the successful integration
of the US operations in the overall operations
of Software Ease. Then again bi-linguists may
be hired in both countries for immediate translations
needs for documents as well as speech. There should
be regular exchange programs, familiarization
visits and cross training. This will foster closer
cooperation and understanding. As far as is possible,
and subject to official regulations( like minimum
wage levels etc.) the salary and wage structure
should not be at too great a variance. The rank
and file staff should be shown documentary films
of the life style, culture, eating habits, sports
and leisure preferences of the other country.
That will eliminate any sense of alienation. Top
management is charged with the responsibility
to take various initiatives to foster a family-like
atmosphere.
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