A Team-Based Organization

A TEAM-BASED ORGANIZATION

Implementing a team-based approach to organizational structure can empower employees and increase cooperation among different skills and disciplines. Based on the belief that organizational goals will be achieved not by individuals working together separately, but by groups of people who share responsibility for outcomes and who work efficiently and effectively in team?

o These processes require highly developed communication competencies from all team members.

o Team skills usually are divided into two categories

Task roles

Maintenance roles

Characteristics of Traditional Vs Team-based Organizations

Traditional

Individual command structures Manager controls

Vertical hierarchy Stability and uniformity One best way to organize Managers manage

Team-based

Collective structures Team monitors

Horizontal integration Change and flexibility Organization-specific Self-managing teams

Traditional vs. Best Place to Work Changes

To understand this we need to understand basic concept of organizational structure.

The Basics of Organizational Structure:

o Organizational structure defines how job tasks are formally divided, grouped, and coordinated. o The organization chart is a visual representation of this division, grouping, and coordination.

Organizational Structure: Organizational structure is the formal setup of task and authority relationships. Structure controls the coordination of activities and employee motivation to attain goals. Structure must be continually evaluated. Formal structure shows the intended configuration of positions, job duties, and the lines of authority among different parts of the enterprise.

Designing an Organization Structure: Organization design is the process by which leaders/managers select and manage aspects of organizational structure so that an organization can achieve its goals.

Basic Steps

o Leaders/Managers must decide how to divide the overall tasks of the organization into successively smaller jobs.

o Leaders/Managers must decide the basis by which to group the individual jobs.

o Leaders/Managers must decide the appropriate size of the group reporting to each supervisor o Leaders/Managers must distribute authority among the jobs.

Departmentalization:

Departmentalization is the bedrock of horizontal differentiation, which begins when one person assumes a functional task. As others assume specialized roles, a functional structure emerges, with people placed in groups based on common skills or common use of resources.

Span of Control

To avoid becoming too tall, an organization can increase the span of control, the number of subordinates a manager directly oversees. Different companies have different spans of control.

A manager’s span of control is limited to the number of subordinates that can be adequately supervised. An increase in subordinates exponentially increases the subordinate relationships to be managed. A manager with two subordinates manages three relationships, but a manager with three subordinates manages six. If the span of control becomes too wide, a manager loses control over subordinates.

Formalization:

The use of written rules and procedures to standardize operations is known as formalization. If formalization and standardization are extensive, there is no room for mutual adjustment. Employees are held accountable for following rules.

Centralization:

When top managers make decisions, authority is centralized. When lower-level managers make decisions, authority is decentralized.

Organizational Design Decisions:

Mechanistic Organization / Organic Organization
o Rigid and tightly controlled structure / o Highly flexible and adaptable structure
o / High specialization / o / Non-standardized jobs
o / Rigid departmentalization / o / Fluid team-based structure
o Narrow spans of control / o / Little direct supervision
o / High formalization / o / Minimal formal rules
o / Limited / information / network / o / Open communication network
(downward)
Mechanistic vs. Organic Models

Mechanistic structures influence people to behave in a predictable manner. Decision making is highly centralized and roles clearly defined.

Organic structures encourage flexibility and decentralize decision making. Roles are loosely defined. Employees perform many tasks and work with people from various functions.

Strategic planning assumes that the old structure may not work in the new realities. It demands the organization think in terms of new approaches to solving existing and potential issues.

Benefits of Teams in Organizations:

Enhanced Performance: Teams may take many forms, i.e. including improved productivity, quality, and customer service such the enhancements result from pooling individual efforts in new ways and continuously striving to improve for the benefit of the team.

Employee Benefits: Teams always provide the sense of self-control, human dignity, identification with work, and sense of self-worth and self-fulfillment for which current workers seem to strive.

Reduced Costs: Through empowered teams, an organization can reduce scrap, make fewer errors, file fewer worker compensation claims, and reduce absenteeism and turnover. They resulting in significant cost reductions.

Organizational Enhancements: Teams improvements in team results a move from a hierarchically based, directive culture to a team-based culture include increased innovation, creativity, and flexibility in the organization.

Research indicates team-based organizations generally outperform more hierarchically organized structures in terms of product and service output, less absenteeism, fewer industrial accidents, more worker flexibility, quality improvements, and overall employee job satisfaction.

Benefits of Team-based Organization:

Profitability and long term viability organization is increased due to its working as team based organization. Other benefits of team based organizations are listed bellow.

o Efficient Process

o Flexible Response to change

o Improve Effectiveness

o Reduce Cost

o Increase Innovation

o Customer Involvement

o Employee commitment

o Skill utilization

Checklist for Team Based Working/ Organization Implementation Plan:

o To what extent does the senior management team agree with the team based working philosophy?

o To what extent does the organization need team based working to achieve its goals?

o Are team based working practices already in place in some parts of the organization? If so, where?

o Where should we start? (Whole organization, one area, with well functioning teams?)

o How do we move on from where we are now?

o What major changes need to take place?

o What resources do we need?

Possible Pitfalls in the Introduction of Team Based Organization (TBO)

o Introducing teams regardless of need

o Introducing teams without changing systems

o Failing to train for TBO

o Not providing expert support

o Failure of communication within, with and between teams

o Failure to establish and support TBO objectives

Roles of a Leader in the Team-Based Organization

o Defining the team’s mission

o Building trust and inspiring teamwork

o Coaching team members and group members toward higher levels of performance

o Serving as a model of teamwork, including power sharing

o Facilitating and supporting team’s decisions

o Expanding the team’s capabilities

o Creating a team identity

o Emphasizing pride in being outstanding

o Anticipating and influencing change

o Inspiring the team toward higher levels of performance

o Enabling and empowering group members to accomplish their work

o Selecting team-oriented members

o Using technology that facilitates teamwork

Fostering Teamwork Through Organization Structure or Policy:

o Designing physical structures that facilitate communication

o Emphasizing Team recognition and rewards

Initiating ritual and ceremony.

DECISION MAKING

Decision Making and Decision Making Process:

A decision is a choice made from two or more alternatives. The decision-making process is recognizing and defining the nature of a decision situation, identifying alternatives, choosing the “best” alternative, and putting it into practice. An effective decision is one that optimizes some set of factors such as profits, sales, employee welfare, and market share. Managers make decisions about both problems and opportunities.

Problem Solving Vs Decision Making

o Problem solving: finding the root cause of a deviation (cause analysis)

o Decision making: choosing from alternative courses of action (choice analysis)

Problem solving ------Decision making

Categories of Decisions

• Technical

• Emotional

• Communication

• Budget

• Ethical

• Personnel

• Career

Relative Importance

Types of Decisions:

Programmed Decisions: A decision that is a fairly structured decision or recurs with some frequency or both. Example: Starting your car in the morning.

Non-programmed decisions: A decision that is relatively unstructured and occurs much less often than a programmed decision. Example: Choosing a vacation destination.

Intuitive decision making: Managers also regularly use their intuition. Intuitive decision making is a subconscious process of making decisions on the basis of experience and accumulated Judgment.

o Making decisions on the basis of gut feeling doesn’t necessarily happen independently of rational analysis; the two complement each other.

o Although intuitive decision making will not replace the rational decision-making process, it does play an important role in managerial decision making

Decision-Making Conditions

o Decision Making Under Certainty

A condition in which the decision maker knows with reasonable certainty what the alternatives are and what conditions are associated with each alternative. A situation in which a manager can make accurate decisions because all outcomes are known. Few managerial decisions are made under the condition of certainty.

o Decision Making Under Risk

o A condition in which the availability of each alternative and its potential payoffs and costs are all associated with risks.

o Decision Making Under Uncertainty

o A condition in which the decision maker does not know all the alternatives, the risks associated with each, or the consequences of each alternative. Uncertainty is a situation in which the decision maker is not certain and cannot even make reasonable probability estimates concerning outcomes of alternatives.

The choice of alternative is influenced by the limited amount of information available to the decision maker.

It’s also influenced by the psychological orientation of the decision maker

The Decision-Making Process:

Step 1: Identifying a problem. A problem is a discrepancy between an existing and a desired state of affairs. In order to identify a problem, you as a manager/leader should recognize and understand the three characteristics of problems:

o You must be aware of the problem. Be sure to identify the actual problem rather than a symptom of the problem.

o You must be under pressure to act. A true problem puts pressure on the manager to take action; a problem without pressure to act is a problem that can be postponed.

o You must have the authority or resources to act. When managers recognize a problem and are under pressure to take action but do not have necessary resources, they usually feel that unrealistic demands are being put upon them.

Step 2: / Identifying decision criteria. Decision criteria are criteria that define what is relevant in a
decision.
Step 3: / Allocating weights to the criteria. The criteria identified in Step 2 of the decision-making
process do not have equal importance, so the decision maker must assign a weight to each of the items

in order to give each item accurate priority in the decision.

Step 4: Developing alternatives. The decision maker must now identify viablealternatives that

could resolve the problem.

Step 5: Analyzing alternatives. Each of the alternatives must now be critically analyzed by evaluating it against the criteria established in Steps 2 and 3.

Step 6: Selecting an alternative. This step to select the best alternative from among those identified and assessed is critical. If criteria weights have been used, the decision maker simply selects the alternative that received the highest score in Step 5.

Step 7: Implementing the alternative. The selected alternative must be implemented by effectively communicating the decision to the individuals who will be affected by it and winning their commitment to the decision.

Step 8: Evaluating Results. This last step in the decision-making process assesses the result of the decision to determine whether or not the problem has been resolved.

Evaluating Alternatives in the Decision-Making Process
Quantitative and Qualitative Factors in Decision Making:
Quantitative Factors
o / Investment appraisal
o Break-even analysis
o / Market research
o / Sales forecasting
o / Critical path analysis
o / Decision trees

Qualitative Factors

o Stakeholder analysis

o HRM

o SWOT

The Classical Model of Decision Making: Classical model is based on economic conditions and considered to be normative. It relates to accomplishment of goals that are known and agreed upon. The classical model Strives for certainty by gathering complete information. This is also use as criteria for evaluating alternatives that are known.

Decision Making Behavior:

Behavior always varies person to person. People tend to adopt a particular decision making approach as a result of factors such as;

o Their own personality

o Their current mood

o The organisational culture

o The personality of the person/people they are dealing with

o The nature of the relationship they have with the people they are dealing with

o Time pressure and perceived level of stress

Being aware of these influences can result in better decision making, by adopting the best decision making approach for each situation.

Decision Making Approaches:

o Withdrawing: holding off making the decision.

o Smoothing: focusing on areas of agreement and ignoring areas of difference.

oCompromising: trying to come up with a decision that provides some degree of satisfaction for all parties.

o Confronting/problem solving: working through the issues.

o Forcing: executing a particular decision knowing agreement has not been reached.

What Kinds Of Decisions Do People Make In The Workplace? o Handling complex problems individually

o Handling complex problems as a team o Focusing effort

o Judging people

How to Make Better Decisions:

Increase Your Knowledge

o Ask questions.

Get experience.

o Use consultants.

o Do your research.

o Force yourself to recognize the facts when you see them (maintain your objectivity).

Use Your Intuition

o A cognitive process whereby a person instinctively makes a decision based on his or her accumulated knowledge and experience.

Weigh the Pros and Cons

o Quantify realities by sizing up your options, and taking into consideration the relative importance of each of your objectives.

Don’t Overstress the Finality of Your Decision

o Remember that few decisions are forever.

Make Sure the Timing Is Right

o Decisions always depend on the time.

Helpful Hints:

Don’t / Do
o / Make assumptions / o / Clearly identify the decision to be
o / Delay / made
o / Jump to conclusions / o Involve people qualified to help in the
o / Make uninformed decisions / decision making
o Favour one decision prior to gathering / o Identify the context of the decision (the
the facts and evaluating the alternatives / o / bigger picture)
o Allow only technical people to make / Identify all alternatives
the decisions / o / Assess each alternative
o Attempt to make a decision in isolation / o / Assess the risks
of the context / o Consider your “gut feel”
o Let emotion override objectivity / o Make the decision and stick to it

Roadblocks to Good Decision Making o Human Cognition

o Our mental ability to comprehend and understand something

o Human Perception

o Difficulty isolating problems

o Tend to think of only narrow range of possible solution

o Human Bias

o Tendency to shape responses based on stereotypes, memory, and current position

Decision-Making and Technology: In today’s completive world Information technology can also help and support the decision-making. Different decision making tools are available for manager and leaders to use in practical life.

Lecture 5