Larisa Harrison grimaced as she tossed her company’s latest quarterly earnings onto the desk. When sales at Virginia- based Millier Machine Parts & Services surged past the $10 million mark some time back, Larisa was certain the company was well positioned for steady growth. Today Millier, which provides precision machine parts and service to the domestic corrugated box and paperboard industry, still enjoys a dominant market share, but sales and profits are showing clear signs of stagnation. More than two decades ago, Larisa’s grandfather loaned her the money to start the business and then handed over the barn on what had been the family’s Shenandoah Valley farm to serve as her first factory. He had been a progressive thinker compared to many of his contemporaries who scoffed at the idea of a woman running a machine parts plant, and he saw no reason why a smart, ambitious 27-year-old woman couldn’t run anything she wanted to. His old-fashioned friends no longer scoffed when Larisa became one of the major employers in the local area. Today, Millier operates from a 50,000 square-foot factory located near I-81 just a few miles from that old family barn. The business allowed Larisa to realize what had once seemed an almost impossible goal: She was making a good living without having to leave her close-knit extended family and rural roots. She also felt a sense of satisfaction at employing about 150 people, many of them neighbors. They were among the most hard-working, loyal workers you’d find anywhere. However, many of her original employees were now nearing retirement. Replacing those skilled workers was going to be difficult, she realized from experience. The area’s brightest and best young people were much more likely to move away in search of employment than their parents had been. Those who remained behind just did not seem to have the work ethic Larisa had come to expect in her employees. Other problems were looming as well. Millier’s market share, once at a formidable 70 percent, was slipping fast, brought about not only by the emergence of new direct competitors but also by changes in the industry. The box and paperboard industry had never been particularly recession resistant, with demand fluctuating with manufacturing output. The rocky economy had hurt the whole industry, including Millier’s largest customers. Added to that, alternative shipping products, such as flexible plastic films and reusable plastic containers, were becoming more prevalent. It remained to be seen how much of a dent they would make in the demand for boxes and paperboard. Even more worrying, consolidation in the industry had wiped out hundreds of the smaller U.S. plants that Millier once served, with many of the survivors either opening overseas facilities or entering into joint ventures abroad. On the bright side, the emergence of Internet retail sales at Amazon and Walmart was increasing demand for card- board boxes among the survivors. The surviving manu- facturers were investing in higher quality machines from Germany that broke down less frequently, thus requiring fewer of Millier’s parts. Millier was clearly at a crossroads, and its managers were arguing about which direction the company should take. If Millier wanted to grow, business as usual wasn’t going to work. But no one could seem to agree on the best way to achieve growth. The marketing manager was pushing for moving into new products and services, per- haps even serving other industries, while the director of finance believed the plant needed to become more efficient, even lay off employees, and offer customers the lowest cost. Larisa cringed as she heard that statement because her focus was always on what was best for her employees. The finance director added that efficiency and profitability should be the key criteria by which Millier measured its performance, whereas the marketing manager vehemently argued that the company would be effective only if it focused on new customers and customer satisfaction in the changing industry environment, which would mean taking some financial risks. “We’ve already moved beyond corrugating machines to servicing other types of paper- board-making equipment. Why not become the all-round provider, serving any manufacturer that makes containers and packing materials, whether it’s paper, plastic, or what- ever?” It was truly an ambitious idea, but he was so fired up about it that he had investigated possible acquisitions and partnership opportunities. The finance director was livid. “If anyone is looking into mergers and acquisitions, it should be me, not the marketing manager,” she had shouted at the most recent managers’ meeting. Meanwhile, the vice president of manufacturing presented a plan for expanding market share by exporting parts globally, which set both the marketing manager and the finance director off. “Why haven’t we even heard about this before now?” the market- ing manager asked. “I’m not saying I disagree with it, but communication in this place is atrocious. I never even got a copy of the last finance report.” The director of finance quickly shot back with a charge that the marketing man- ager didn’t seem to care about profit and loss anyway so why should he need a copy of the report. As Larisa considered the chaos into which the most recent meeting had degenerated, she thought back to her days in graduate school and realized that organization design was part of the problem. Millier had succeeded for two decades with a loose, even haphazard structure, because everyone seemed focused on building the business. People simply did what needed to be done. However, the company had never been under threat before. “Perhaps we just aren’t as well organized as we need to be to handle the challenges Millier is facing,” she thought. As she watched the last shift workers walk to their cars, Larisa pulled out a report that a consultant friend had developed for her a few months ago. The report emphasized: • Millier rated very high on employee morale. • Millier was rated low on innovation and change. • The Millier culture emphasized production efficiency. • The Millier culture was not intensely focused on developing new customers. • Each department did its job well, but collaboration across departments was rated low to medium. • Price competition would probably intensify as the customer base grew smaller. • The industry would continue to change toward fewer paperboard machines and toward higher quality imported machines. Larisa scribbled a few notes on a pad: How should we decide what strategy to pursue? Who should have authority and responsibility for what? How do we improve communications? What criteria should we use to measure performance and ensure accountability? Larisa knew that as soon as she or her team could determine some answers, she would sleep at least a little better. Questions 1. The managers seem to agree on the overall goal of growth. Which of their strategies would you recommend Millier take as the most likely way to achieve growth? Explain. 2. Using Exhibit 2.9, Four Approaches to Effectiveness, which emphasis would you say each manager is expressing? 3. How do you think the managers should go about resolving their difference with regard to their strategies?
> How might “mission drift” hurt the performance of a social enterprise?
> Compare and contrast the two major “logics” that organization members might hold in a hybrid organization.
> Explain the concept of conscious capitalism. Do you think managers and companies that espouse this kind of shared value approach are more likely to behave in socially responsible ways?
> What is a hybrid organization? How does it differ from a typical nonprofit or profit-seeking organization?
> Do you believe it is possible for a global company to simultaneously achieve the goals of global efficiency and integration, national responsiveness and flexibility, and the worldwide transfer of knowledge and innovation? Discuss.
> They are the most treasured possessions; they line mantels and living room walls; they are the first items frantically sought by family members following fires or natural disasters. They are family photographs. Considering the popularity and demand for b
> Traditional values in Mexico support high power distance and a low tolerance for uncertainty. What would you predict about a company that opens a division in Mexico and tries to implement global teams characterized by shared power and authority and the l
> Name some of the elements that contribute to greater complexity for international organizations. How do organizations address this complexity? Do you think these elements apply to a company such as Spotify that wants to expand its music streaming service
> When would an organization consider using a matrix structure? How does the global matrix differ from the domestic matrix structure described in Chapter 3?
> What are some of the primary reasons a company decides to expand internationally? Identify a company in the news that has recently built a new overseas facility. Which of the three motivations for global expansion described in the chapter do you think be
> Do you think it makes sense for a transnational organization to have more than one headquarters? What might be some advantages associated with two head- quarters, each responsible for different things? Can you think of any drawbacks?
> Many American companies enter China through joint ventures with local firms, but China is succeeding in the United States primarily with a strategy of buying companies outright. What are some factors that might account for this difference?
> Why do you think the tension between a desire for global uniformity and local responsiveness is greater today than in the past?
> Compare the description of the transnational model in this chapter to the elements of organic versus mechanistic organization designs described in Chapter 1. Do you think the transnational model seems workable for a huge global firm? Discuss.
> Name some companies that you think could succeed today with a globalization strategy and explain why you selected those companies. How does the globalization strategy differ from a multi-domestic strategy?
> How does the desire for legitimacy result in organizations becoming more similar over time?
> The Aquarius Advertising Agency is a medium-sized firm that offered two basic services to its clients: customized plans for the content of an advertising campaign (e.g., slogans and layouts) and complete plans for media (e.g., radio, TV, newspapers, bill
> Do you believe that perceived legitimacy really motivates a large, powerful organization such as Walmart? Is acceptance by other people a motivation for individuals as well? Explain.
> Discuss how the process of variation, selection, and retention might help explain innovations that take place within an organization.
> The population-ecology perspective argues that it is healthy for society to have new organizations emerging and old organizations dying as the environment changes. Do you agree? Why would European countries pass laws to sustain traditional organizations
> Discuss how the adversarial versus partnership orientations work between you and other students in your course. Is there a sense of competition or collaboration for grades? Is it possible to develop true partnerships if your grade depends on the work of
> Many managers today were trained under assumptions of adversarial relationships with other companies. Do you think operating as adversaries is easier or more difficult than operating as partners with other companies? Discuss.
> Assume you are the manager of a small firm that is dependent on a large manufacturing customer that uses the resource-dependence perspective. Put yourself in the position of the small firm, and describe what actions you would take to survive and succeed.
> How do you feel about the prospect of becoming a manager and having to manage a set of relationships with other companies rather than just managing your own company? Discuss.
> How do mimetic forces differ from normative forces? Give an example of each.
> The concept of business ecosystems implies that organizations are more interdependent than ever before. From personal experience, do you agree? Explain.
> Assume you have been asked to calculate the ratio of staff employees to production employees in two organizations—one in a simple, stable environment and one in a complex, shifting environment. How would you expect these ratios to differ? Why?
> The first Holtzclaw Supermarkets store was started in 1977 by Sam Holtzclaw and his brother Bob. Both were veterans who wanted to run their own business, so they used their savings to start the small grocery store in Charlotte, North Carolina. The store
> Why do organizations become involved in inter-organizational relationships? Do these relationships affect an organization’s dependency? Explain.
> Compare an organic organization to a mechanistic organization. How does the environment influence organic and mechanistic designs?
> Do you think planning becomes more important or less important in a world where everything is changing fast and crises are a regular part of organizational life? Why?
> Describe differentiation and integration. In what type of environmental uncertainty do you think differentiation and integration would be greatest? Least?
> Discuss the importance of the international sector for an organization today compared to domestic sectors. What are some ways in which the international sector affects organizations in your city or community?
> Name some factors causing environmental complex- ity for a local organization of your choice, such as a restaurant or sporting goods store. How might this environmental complexity lead to organizational complexity? Explain.
> Which typically has the greatest impact on organizational uncertainty—environmental complexity or environmental dynamism? Why?
> Is changing the organization’s domain a feasible strategy for coping with a changing environment? Explain, using either Amazon or Walmart as an example.
> How would the task environment of a new Internet- based company compare to that of a large government agency? Discuss.
> Why do companies using a holacracy team structure have cultures that emphasize openness, employee empowerment, and responsibility? What do you think it would be like to work in a company with such a structure?
> Locals referred to it—affectionately or sarcastically—as the “Adding Museum.” Housed in the massive Romanesque-style former mansion of Horace and Margaret Addlington, the 100-year-old Addlington Gallery of Art had, by 2016, reached a tipping point of ins
> The manager of a consumer products firm said, “We use the brand manager position to train future executives.” Why do you think the brand manager position is considered a good training ground? Discuss.
> Why do you think the pressure of scarce resources across product lines causes managers to consider a matrix structure?
> As a manager, how would you create an organization with a high degree of relational coordination?
> When Burton Lee took over as plant manager for the Burlington division of a large manufacturing company, he saw the opportunity to transform the lowest performing unit as a pathway to his promotion into top management. Burton was aware of his reputation
> The Daily Tribune is the only daily newspaper serving a six-county region of eastern Tennessee. Even though its staff is small and it serves a region of mostly small towns and rural areas, the Tribune has won numerous awards for news coverage and photojo
> Hu-go. Hu-go. As Alissa Mason drove up the mountain through the rain, she turned up the volume on the radio to clear her mind. However, even the steady rhythm of the truck’s windshield wipers steered her mind back to the problem—Hu-go, Hu-go. Ten years e
> Harmon Davidson stared dejectedly at the departing figure of his management survey team leader. Their meeting had not gone well. Davidson had relayed to Al Pitcher complaints about his handling of the survey. Pitcher had responded with adamant denial and
> Jim Malesckowski remembered the call of two weeks ago as if he had just put down the telephone receiver: “I just read your analysis and I want you to get down to Mexico right away,” Jack Ripon, his boss and chief executive officer, had blurted in his ear
> Fabulous Footwear produces a line of women’s shoes that sell in the lower-price market for $27.99 to $29.99 per pair. Profits averaged 30 cents to 50 cents per pair 10 years ago, but according to the president and the controller, labor
> NASCAR fans expect their drivers to be smart, crafty, and calculating and, if need be, playing just this side of the rule book—in the garage and on the track. Loyal fans “know” their drivers and can easily picture themselves drinking a beer or spending a
> Curtis Simpson sat staring out the window of his office. What would he say to Tom Lawrence when they met this afternoon? Tom had clearly met the challenge Simpson set for him when he hired him as president of Midwest Controls, Inc. a little more than a y
> Bachmeyer Foods is a large distribution company with more than 5,000 employees and gross sales of more than $900 million (2017). The company purchases salty snack foods and liquor and distributes them to independent retail stores throughout the United St
> High-tech within the corporate world was developed, in part, on the notion of mobile strategy and convenience— the ability to communicate, work remotely and accomplish the same results; cutting the corporate and personal car- bon footprint by reducing co
> Hermitage Escalator Company is an independent division of a large international manufacturer that sells and provides maintenance of elevators and escalators. Hermitage was started by an entrepreneur living in Hermitage, Tennessee in 1954, just as the dem
> Fifty-year-old Paul Sandberg glanced up from his CNC (computer numerically controlled) turning machine to the computer control office above him on the 2nd floor of the workshop. A new program had been initiated that morn- ing and, despite earlier tests,
> The acetate department’s product consisted of about twenty different kinds of viscous liquid acetate used by another department to manufacture transparent film to be left clear or coated with photographic emulsion or iron oxide. Before
> Sitting in Maisson’s Restaurant, Janelle Mosley completely lost interest in her chef salad and now sat sipping her Pinot Grigio and watching with a combination of amusement and curiosity her rival, Jonathan Draper, “doing his own thing.” Seated across th
> Jenny Amaraneni is a social entrepreneur determined to build a social enterprise named SOLO Eyewear. Solo produces a line of hand-crafted sunglasses made from bamboo materials, with a portion of the funds from each pair sold donated to providing eye care
> David Javier was reviewing the consulting firm’s proposed changes in organization structure for Rhinebeck Industrial (RI). As Javier read the report, he wondered whether the changes recommended by the consultants would do more harm than
> Would you prefer to work in an organization with a tight or a loose culture (BookMark)? Explain why.
> What importance would you attribute to leadership statements and actions for influencing cultural values in an organization? Explain.
> Do you think strong subcultures would be a good thing for an organization? Why?
> How might the symbols apparent in a business college differ from symbols in a school of social work? If you have access to both types of schools, walk through them and record any differences you see.
> In which of the four cultures described in Exhibit 11.4 would you prefer to work? Why?
> Describe the four elements of the feedback control model. Which of these elements is more similar to behavior control? Outcome control?
> Many of the companies on Fortune magazine’s list of most admired companies are also on its list of most profitable ones. Some people say this proves that high social capital translates into profits. Other people suggest that high profitability is the pri
> How would you describe the major differences between a hierarchical philosophy of control and a decentralized philosophy of control? Which philosophy of control would be easier for a manager to implement? Discuss.
> How much do you think it is possible for an outsider to discern about the underlying cultural values of an organization by analyzing symbols, ceremonies, dress, or other observable aspects of culture, compared to an insider with several years of work exp
> Numerous large financial institutions, including Lehman Brothers and Merrill Lynch, experienced significant decline or dissolution in recent years. Which of the three causes of organizational decline described in the chapter seems to apply most clearly t
> At the age of 39, after working for nearly 15 years at a leading software company on the West Coast, Alex Schaaf and his soon-to-be-wife, Emily Rockwood, had cashed in their stock options, withdrawn all their savings, maxed out their credit cards, and st
> To better understand the importance of organization structure in your life, do the following assignment. Work with a partner or a small team to select one of the following situations to organize and to complete this exercise: • A copy and print shop • A
> Assume that you could design the perfect organization that reflected your values. What goals would receive priority in that organization? Rank order the list of goals below from 1 to 10 to reflect the goals you consider most important to least important
> Individually or in a small group of two, interview two employees who are in different organizations or who are in the same organization but in different parts and doing different jobs. Ask each person to answer the following questions on a four-point sca
> Think about how you typically handle a dispute with a team member, friend, or co-worker and then answer the following statements based on whether they are True or False for you. There are no right or wrong answers, so answer honestly. Scoring and Interpr
> Respond to each of the following statements based on how you have actually approached a difficult problem at school or work. Indicate whether each statement is True, Somewhat True, or False for you. Scoring and Interpretation: Sum questions 1-9 by giving
> In order to examine differences in the level of innovation encouragement in organizations, you will be asked to rate two organizations. The first should be an organization in which you have work experience, or your university. The second should be someon
> Individually read the measures and objectives below for a business firm. Make a check for each objective/measure item in the correct balanced score- card column. If you think an objective/measure fits into two balanced scorecard categories, write the num
> Think back to one of your most favorite and least favorite courses in school. How did the instructor assert control over you, other students, and the classroom in those courses? Write down your answers for the comparisons below. How were rules, standards
> The era of big data has arrived. Discussions of terabytes and petabytes that were reserved for supercomputing facilities just a few years ago are common today. Companies are recognizing the tremendous value in the data they create, and they want to capit
> You will be analyzing the work technology used in two different small businesses—a local cleaners and a local family restaurant. Your instructor will tell you whether to do this assignment as individuals or in a group. You must visit bo
> This exercise will help you better understand the concept of ethics and what it means to you. It probably will not happen right away, but soon enough in your duties as an organization manager, you will be confronted with a situation that will test the st
> ABC World News ran a special series called “Made in America.” In the opening program, correspondents David Muir and Sharyn Alfonsi removed all foreign-made products from a family’s Dallas, Texas, home
> 1. Divide into groups of three. Half the groups, on one side of the room, are “1s” and the other half are “2s.” 2. The 1s are Pharmacology; the 2s are Radiology. Read only your own role, not the other one. 3. Any students not in a negotiating group can b
> Below, list four organizations you somehow rely on in your daily life for some resource. Examples might be a restaurant, a clothing store, a university, your family, the post office, your wireless provider, an airline, a pizzeria that delivers, and your
> Can an organization be efficient without being effective? Can an inefficient organization still be an effective one? Explain your answers.
> A handful of companies on the Fortune 500 list are more than 100 years old, which is rare. What organizational characteristics do you think might explain 100-year longevity?
> Describe some ways in which the digitalization of business has influenced or affected an organization with which you are familiar, such as your college or university, a local retailer or restaurant, a volunteer organization, a club to which you belong, o
> What is one contingency factor that might help explain the poor performance of GE when Jeffrey Immelt was CEO? Explain.
> What is the difference between a task force and a team? Between liaison role and integrating role? Which of these provides the greatest amount of horizontal coordination?
> What are the primary differences in structure between a traditional, mechanistic organization designed for efficiency and a more flexible organic organization designed for learning?
> Large corporations tend to use different structures in different parts of the organization. Why would that be so?
> When is a functional structure preferable to a divisional structure?
> Describe the virtual network structure. What are the advantages and disadvantages of using this structure compared to performing all activities in-house within an organization?
> To what extent does the true structure of an organization appear on the organization chart? Explain.
> What are the similarities and differences between assessing effectiveness on the basis of competing values versus the strategic constituents approach? Explain.
> What are the advantages and disadvantages of the resource-based approach versus the goal approach for measuring organizational effectiveness?
> Suppose you have been asked to evaluate the effectiveness of the police department in a medium-sized community. Where would you begin, and how would you proceed? What effectiveness approach would you prefer?
> Do you believe mission statements and official goal statements provide an organization with genuine legitimacy in the external environment? When a company such as CVS (discussed in the chapter) makes a decision to stop selling cigarettes because that act
> Discuss the similarities and differences in the strategies described in Porter’s competitive strategies and Miles and Snow’s typology.
> What is the difference between a goal and a strategy as defined in the text? Identify both a goal and a strategy for a campus or community organization with which you are involved.
> What is a goal for the class for which you are reading this text? Who established this goal? Discuss how the goal affects your direction and motivation.
