Concluding Case

Chapter 8

Stanley Lynch Investment Group

The Stanley Lynch Investment Group is a large investment firm headquartered in New York. The firm has 12 major investment funds, Each with analysts operating  in a separate department. Along with knowledge of the financial markets and the businesses it analyzes, Stanley Lynch’s competitive advantage comes from its advanced and reliable computer systems. Thus an effectives information technology (IT) division is a strategic necessity, and the company’s chief information officer (CIO) hold a key role at the firm.

When the company hired J.T. Kundra as a manager of technology, he learned that the IT division at Stanley Lynch consists of 28 employees. most of whom specialize in serving the needs of a particular fund. the IT employees serving a fund operates as a distinct group, each of them led by a manager who supervises several employees (five employees report to J. T.).

He also learned that each group sets up its own computer system to store information about its projects. the problem with that arrangement quickly became evident. As ). T tried to direct his group’s work, he would ask for documentation of one program or another. Sometimes no one was sure where to find the documentation; it might turn out to be stored in an obscure place such as only on someone’s flash drive. other times he would quickly get three different responses from three different people with three different versions of the documentation. and if he was interested in another group’s project or a software program used in another department, getting information was next to impossible. he lacked the authority to ask employees in another group to drop what they were doing in order to hunt down information he needed.

J.T concluded that the entire IT division could serve the firm much better if all authorized people had easy access to the work that had already been done and the software the was available. The logical place to store that information was online. From experience at a previous company, he believed that the easiest way to compile the information would be to set up a shared web project called a wiki-an online document created through the collaboration of its users, who can look up or contribute information according to their knowledge and needs. The challenge would be how to get everyone to contribute, give that he had authority over so few of the IT workers.

J. T. started by working with his five employees to build a wiki offering basic information presented in a consistent format. then he met with two higher-level managers who report to the CIO He showed them the wiki and explained that fast access to information would improve the IT group’s quality and efficiency. he suggested that the managers require all the IT employees to put their documentation on the wiki, and he even persuaded them that this behavior should be measured for performance appraisals. this last tactic was especially significant because at an investment company, bonuses for meeting performance targets are a big part of employees’ compensation.

The It employees quickly came to appreciate that the wiki would help the perform better. When they visited it, they could see from the original information that it would be useful. Adoption of the wiki was swift, and before long, the IT employees came to think of it as one of their most important software systems.

Questions

1. Given an example of differentiation in Stanley Lynch’s organization structure and an example of integrations in this structure.

Answer: Example of differentiation in Stanley Lynch’s: that each group sets up its own computer system to store information about its projects. Sometimes no one was sure where to find the documentation; it might turn out to be stored in an obscure place such as only on someone’s flash drive. Example of integrations in this structure: would be to set up a shared web project called a wiki-an online document created through the collaboration of its users, who can look up or contribute information according to their knowledge and needs.

2. What role did authority play in the adoption of the wiki by the IT division at Stanley Lynch? 

Answer: The entire IT division could serve the firm much better if all authorized people had easy access to the work that had already been done and the software the was available. The logical place to store that information was online. The easiest way to compile the information. They could see from the original information that it would be useful. 

3. Describe how the IT division used coordination to achieve greater integration.

Answer: The IT division at Stanley Lynch consists of 28 employees. most of whom specialize in serving the needs of a particular fund. The IT employees serving a fund operates as a distinct group, each of them led by a manager who supervises several employees (five employees report to J. T.).

Chapter 9: Organizational Agility

Chapter 9

Organizational Agility

A. The Responsive Organization

Mechanistic Organization : is a form of organization that seeks to maximize internal efficiency.
Organic Structure : is an organizational from that emphasize flexibility.

B. Strategy And Organizational Agility

1)      Organizing Around Core Capabilities

A core competence gives value to customers, makes the company's products different from and better than those of competitors, and can be used in creating new products.

2)      Strategic Alliance

A strategic alliance is a formal relationship created with the purpose of joint pursuit of mutual goals. managers typically devote plenty of time to screening potential partners in financial terms. But for the Alliance to work, the partners also must consider one anothers areas of expertise and the incentives involved in the structure of the alliance.

3)      The Learning Organization

is an organization skilled at creating, acquiring, and transferring knowledge, and at modifying its behavior to reflect and insights.

4)      The High-Involvement Organization

In high-involvement organization, top management ensures that there is a consensus about the direction in which the business is heading. The leader seeks input from his or her top management team and from lower levels of the company.

C. Organizational Size And Agility

a)      The Case for Big
Size creates scale economics, that is, lower costs per unit of production. and size can offer specific advantages such as lower operating costs, greater purchasing power, and easier access to capital.

b)      The Case for Small
Small size may improve speed. A salesperson learns about a customer’s new challenge.

c)      Being Big and Small
Small is beautiful for unleashing energy and speed. But in buying and selling, sizes offers market power. The challenge then is to be both big and small to capitalize on advantages of each.

D. Customers And The Responsive Organization

a.       Customer Relationship Management
Customer Relationship Management is a multifaceted process, typically mediated by a set information technologies, that focuses on creating two-way exchanges with customers so that firms have an intimate knowledge of their needs, wants, and buying patterns.

b.      Total Quality and Six Sigma
Total quality management is a way of managing in which everyone is committed to continuous improvement of his or her part of the operation. In business, success depends of having high-quality products.

c.       ISO 9001
a series of quality standards developed by a committee working under the International for Stadarization to improvefe total quality in all business for the benefit of the producers  and consumers

d.      Re-engineering
often requires a fundamental change in the way the parts of the organization work together.

E. Technology and Organizational Agility

Types of technology configurations

1.      Small Batch Technlogies

2.      Large Batch Technologies

3.      Continuous Process Technologies

Organizing for Flexible Manufacturing 

1.    Computer Integrated Manufacturing

2.    Flexible Factories

3.    Lean Manufacturing.

F. Organizing for speed : Time based competition

TBC has several key organizational elements :

1.      Logistics 
The movement of the right goods in the right amount to the right place at the right time.

2.      Just in Time
A system that calls for sub assemblies and components to be manufactured in very small lots and delivered to the next stage of the production process just as they are needed.

3.      Concurrent Engineering
A design approach in which all relevant functions cooperate jointly and continually in a maximum effort aimed at producing high quality products that meet customer's needs.

Chapter 8

Review

ORGANIZATION STRUCTURE

A . Fundamentals Of Organization

Differentiation 

Differentiation is created through division of labor and job specialization .

Division of labor : The assignment of different tasks to different  people or groups. 

Specialization : A process in which different tasks to different individuals and units perform different tasks

Integration 

Achieved through structural mechanism that enhance collaboration and coordination. The degree to which differentiated work units work together and coordinate their efforts.

B. The Vertical Structure

Authority in Organizations

At the most fundamental level, the functioning of every organization depends on the use of authority, the legitimate right to make decisions and to tell other people what to do. In private business enterprises, the owners have ultimate authority.

Hierarchical Levels

The authority levels of the organizational pyramid. The keys responsibilities at this top level include corporate governance-a term describing the oversight of the firm by its executive staff and board of director.

Span of Control

is the number of subordinates who report directly to an executives or supervisor. the optimal span of control can maximizes effectiveness.

Delegation

is the assignment of authority and responsibility to a subordinate at a lower level. delegation is perhaps the most fundamental feature of management because it entails getting work done through others.

Decentralization

more decisions are made at lower level. Ideally, decision making occurs at the of the people who are most directly affected and have the most intimate knowledge about the problem.

C . The Horizontal Structure

The Functional Organization : Departmentalization around specialized activities such as production, marketing, human resources.

The Divisional Organization : Departmentalization that groups  unit around product, customer, or geographic regions.

The Matrix Organization : An organization composed of duel reporting relationship in which some employees report to two supervisor a functional manager and a divisional manager.

The Network Organization : A collection of independent, mostly single function firms that collaborate on a good or service.

D. Organizational Integration

Coordination by Standardization

Standardization is establishing common routines and procedure that apply uniformly to everyone. Standardization constrain actions and integrates various units by regulating what people do. To improve coordination, organizations may also rely on formalization-the presence of rules and regulations governing how people in the organization interact.

       

Coordination by Plan

Interdependent units are required to meets deadlines and objectives that contribute to a common goal. Interdependent units are free to modify and adapt their actions as long as they meet the deadlines and targets required for working with others.

       

Coordination by Mutual Adjustment

Units interact with one another to make accommodation to achieve flexible coordination. Particularly during crises, in which rules and procedures don't apply, mutual adjustment is likely to be the most effective approach to coordination.

       

Coordination and Communication

Huge amounts of organizations flow from the external environment to the organization and back to the environment. To function effectively, organizations need to develop structures for processing information