November 30, 2017

ORGANIZATIONAL DEVELOPMENT

The real challenge of organizational behavior and development lies in the opportunity to manage uncertainty, change, conflict, and other complexities of organizational life that we each experience as a participant in a contemporary organization.

As the new Chief Executive Officer (CEO) of a company, describe the organizational tools that you have available to you to attune your organization, such as the use of the contingency approach, content and process theories participative management, building effective groups, organizational structure, etc. Provide concrete examples of how you would use these organizational tools.

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Introduction

As the economy changes and markets shrink, companies have begun adopting strategies centered on boosting their current customer satisfaction rather than attracting new customers. This shift is based on the claim that it costs five to eight times as much to acquire new customers as retain old ones, which has motivated companies to begin benchmarking customer satisfaction more rigorously (eMarketer 2002). As the leader of an organization, a CEO is responsible for making sure that his or her leadership style and strategies adapt to these organizational complexities. This responsibility requires the CEO to be able to create positive working environments, which motivate employees to do their best. With the effective management of their human resources, the CEO could enable the organization to meet its customers’ increasing wants and needs. The universalist approach, contingency approach are the Organizational tools allow the CEO to successfully balance his or her focus internally and externally to ensure operational effectiveness and the longevity of the company.

The traditional approach to organizational design is most commonly known as the universalist approach. This approach is mainly bureaucratic and relies on several principles, which should be able to create systems that, theoretically, would be effective regardless of a given situation (Owen, 1987). However, in response to the constant flux of socioeconomic conditions, rapid changes in market conditions, and technological advancements, the universalist approach has been unable to evolve with the times. (Thomas 2009).

In contrast, the contingency approach enables leaders and managers to adapt based on a wide variety of circumstances. Following this approach, a CEO must be familiar with the forces of change before a design occurs, creating the most fitting responses to various situations. For instance, most approaches to conflict management fall on a continuum of fight or flight. Both extremes are inappropriate in a competitive environment in which most situations only appear to have win-lose outcomes. This outlook can lead to prolonged conflicts and negotiations. However, with the contingency approach, most reactions fall in between the extremes, so it becomes easier to manage conflicts. (Thomas 2009) Thomas used the contingency approach to diagnose conflicts and described five styles of conflict management.

1. Avoidance is a form of conflict management that falls on the flight end of the continuum. Managers usually employ this system when the costs of a solution outweigh its benefits.

2. Compromise implies splitting the difference or sacrificing in order to achieve a form of gain. Managers can apply this tool when the goal is essential or when the detriments of not compromising may lead to more disorder.

3. Competition is a desire to win at another’s expense. This is a win-lose power struggle in which another’s opinions and interests are of little concern.

4. Participative management involves workers in the decision-making process of a business through formal and informal methods. This process could involve formal publication assemblies or feedback surveys in which staff members inform managers of the ways decisions affect their work lives. The aim of this approach is to increase the value of the employees’ working life by having management be more receptive to their needs. This approach increases morale by creating an upsurge of efficiency, which also increases profits.

5. The last style of conflict management is building effective groups, which can function as self-managing units in an organization. Due to the variety of capabilities within a company, an operative group can deliver answers to possibly unversed populations (Peterson, 2012). To a CEO, the main advantage of this approach is tapping into the full potential of the workforce through collective efforts. However, some difficulties may arise with this method, such as toxic personalities and power struggles. (McGraw-Hill, 2002, 1994)

Besides organizational management, another important element of a company is organizational structure. There are two main organizational structures: mechanistic and organic. The mechanistic structure offers comparative steadiness and plasticity in the way it structures activities and workers. Ordinarily, this decision-making process is integrated into a unitary chain of command. According to O’Neil et al. (1997), employees in a mechanistic structure work within specific job functions and follow a formalized hierarchy of authority and communication. Most communication occurs in a vertical format in which a manager issues instructions and decisions. (Robert D. Cecil, William J. Rothwell – 2006)

A natural clean structure Makes managers able to modify the legal structure of the organization accordingly to the changing circumstances. With this format, performance is shared and harmonized. In order to advance acceptable organizational edifices, CEPs must explore the diverse arrangements of their organizations and study how to complement the organizational plans. As the current business climate changes quickly, the natural structure has been widely considered the most effective at adapting due to its flexibility of nature.

Conclusion

The constant pressure of organizational performance and growth depend on the ability of the CEO to handle uncertainty in the face of impending changes and struggles. Today’s marketplace requires organizations to be adaptable in order to outpace their competitors. One of their most important assets is the effective utilization of their human resources. Participative management, effective team building, and other initiatives have been effective in motivating employees to work towards organizational goals. In closing, to reap the full benefits of implementing these initiatives, the CEO must study the implications of policies and be receptive to the needs of employees. This way, CEOs can gain the full payback of executing these advantages and meet the needs and wants of their workforce and customers.