Organizational development

When senior managers adopt a service management orientation, they are adopting a vision for the organization. Such a vision provides a model toward which staff can work. Organizational change, however, is not instantaneous. Senior managers often make the mistake of thinking that announcing the organizational change is the same as making it happen.

There is no one best way to organize. Elements of an organizational design, such as scale, scope and structure, are highly dependent on strategic objective s. Over time, an organization will likely outgrow its design. There is the underlying problem of structural fit. Certain organizational designs fit while others do not. The design challenge is to identify and select among often distinct choices. Thus the problem becomes much more solvable when there is an understanding of the factors that generate fit and the trade-offs involved, such as control and coordination.

Case example 12: Organizational development

1. The global CIO of the Fortune 50 automotive company built an IT organization in an unusual manner. He hires divisional CIOs to correspond to business divisions: North America, Europe, Asia-Pacific, Latin America, Africa, the Middle East and finance. At the same time, he hires process information officers (PIOs) to work horizontally in different specialities across all divisions around the world: product development, supply chain management, production, customer experience and business service s (HR, legal and so on).
2. The IT organization for one of the most popular sports leagues in North America flourishes under a culture of speed and entrepreneurship. Sunday game results and media events often dictate service activities with short time frames. Service processes are minimally structured, with room for improvisation and adaptation.

What are these organizational structures called?

(Answer given later in this section)

When the organization performs well, the structure tends to drift towards a decentralized model where local managers possess greater autonomy (Figure 6.2). When problems persist, the tendency is to shift to a centralized model. This pendulum swing represents a lack of confidence in local decision making. Despite the extreme difficulties, there is a persistent belief that an organization is controlled from the top. But giving orders is not the same as being in control. There are no guarantees, however, that local managers will appreciate the impact of their decisions on the larger organization. Their decisions can be short-term and short-sighted. This wavering between centralized and decentralized management is attributed as the source of long-term organizational problems and has been described as, ‘the illusion of being in control’. How then, does an organization decide how to best manage its current organization and where to land along the design spectrum?

Figure 6.2 The centralized-decentralized spectrum

The process for major organizational change involves many event s and can be a matter of years rather than months. Leading this change is difficult and should not be reduced to quick or simple fixes. The ability to lead this change is an important competence for senior executives and managers. Understanding when a service strategy is too complicated and rigid is as important as any support process.

Дата добавления: 2015-11-14