How can organizations ensure that scarce resources are allocated appropriately in a competitive environment?
Societies need some sort of economic system to organize the use of scarce resources for the production and distribution of goods and services companies provide to people and groups across the society. In a planned economic system, "government planners decide what and how much is to be produced and distributed by whom, when, to whom, and why" (Perreault and McCarthy, 2005, p. 13). Supply and demand do not cause a fluctuation in price with this type of economic system because the government sets the prices. This type of system is essential during times of war, weather conditions, or political instability.
The second type of economic system is the market-directed economic system. In this type of system consumers and producers of goods and services dictate the decision-making about resources used for the whole economy. Essentially, when consumers purchase certain goods and services the market is directed toward such consumers and will continue to produce these goods and services. "They decide what is to be produced and by whom--through their dollar 'votes'" (p. 13). Valuation of goods and services is dictated as to how important said goods and services are to consumers in the society. This system provides the greatest freedom of choice but the government also regulates this system through the regulation of interest rates and the supply of money.
What are the advantages and disadvantages of team-based, network-based, and boundary-less organizations? Give an example of a function or role in the organization that could be benefited by each of these three organizational structures.
Different types of organizational structures are emerging in response for the need of organizations to respond faster to changing business, economic, and social factors. The three types of organizations are the team-based organization, the network-based organization and the boundary-less organization.
The boundaryless organization provides benefits because of the flexibility of the organizational structure and the ability of members within the organization to conduct business with internal members of the organization and members external to the organization. This open system provides for informal business relationships, with people coming together in response to a need, problem, or opportunity. Technology has provided a method of eliminating the isolation of employees that was a model of the bureaucratic organization. A function that benefits from the boundary-less organization is the role of human resource management, as HR personnel need a flexible environment where they can communicate easily with those within the organization and those outside of the organization.
The team-based organization empowers employees, through training and advancement, to align with corporate goals through increased productivity, quality levels, service levels (internal and external customers), problem-solving and decision-making abilities, and rapid response to market demand. One such role that benefits from the team approach is the information technology helpdesk because members must make decisions, often with consulting upper management as to their decisions before implementing support or changes to the end user environment.
The network-based organization completes tasks and allows employees to communicate through virtual communication techniques. Organizations are able to create and leverage information, thus creating increased competitive advantage, through the use of knowledge workers. Self-managed teams are utilized in this structure, as opposed to the rule-based hierarchy. The organization is about the people and culture of the organization and not just technology and its usage. A role that would benefit from the network-based organization is the analysis of data in determining the direction the organization must take to maintain competitive advantage against a new entry into the marketplace.