ASSIGNMENT

Course Code : MS – 10Course Title : Organisational Design, Development and

ChangeAssignment Code : MS-10/TMA/SEM-I/2021Coverage : All Blocks

Q1. a) Briefly describe the factors which are essential for designing an
organization.

Ans.Factors to Consider in Organizational Design

Considering the Environment
Considerations of the external environment—including uncertainty, competition, and
resources—are key in determining organizational design.
Overview
Organizational design is dictated by a variety of factors, including the size of the company, the
diversity of the organization’s operations, and the environment in which it operates.
Considerations of the external environment are a key aspect of organizational design. The
environment in which an organization operates can be defined from a number of different
angles, each of which generates different structural and design strategies to remain competitive.
Complexity
Complexity theory postulates that organizations must adapt to uncertainty in their
environments. The complexity theory treats organizations and firms as collections of strategies
and structures that interact to achieve the highest efficiency within a given environment.
Therefore, companies in a highly uncertain environment must prioritize adaptability over a
more rigid and functional strategy. Alternatively, a fixed and specific approach to organizational
design will capture more value in a mature market, where variability and uncertainty are
limited.
Resource Dependence
Another perspective on organizational design is resource dependence theory—the study of how
external resources affect the behavior of the organization. Procuring external resources is
important in both the strategic and tactical management of any company. Resource-dependence
theory explores the implications regarding the optimal divisional structure of organizations,
recruitment of board members and employees, production strategies, contract structure,
external organizational links, and many other aspects of organizational strategy.
Competition
Another environmental factor that shapes organization design is competition. Higher levels of
competition require different organizational structures to offset competitors’ advantages while
emphasizing the company’s own strengths. A company that demonstrates strength in
differentiation relative to the competition benefits from implementing a divisional or matrix
strategy, which in turn allows the company to manage a wide variety of demographic-specific
products or services. Alternatively, a company that demonstrates a low-cost strength (producing
products cheaper than the competition) benefits from employing a structural or bureaucratic
strategy to streamline operations.
Identifying External Factors
In considering organizational design relative to the environment, managers may find it helpful
to employ two specific frameworks to identify external factors and internal strengths and
weaknesses:
 SWOT analysis : In this particular model, a company’s strengths and weaknesses are
assessed in the context of the opportunities and threats in the business environment. A
SWOT analysis enables a company to identify the ideal structure to maximize its internal
strengths while capturing external opportunities and avoiding threats.

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  Porter’s five-forces analysis: This analysis identifies factors of the industry’s competitive
environment that may substantially influence a company’s strategic design. The five
forces include power of buyers, power of suppliers,
rivalry (competition), substitutes , and barriers to entry (how difficult it is for new firms
to enter the industry). Understanding these varying forces gives the company an idea of
how adaptable or fixed the organizational structure should be to capture value.

Smaller, more agile companies tend to thrive better in uncertain or constantly changing
markets, while larger, more structured companies function best in consistent, predictable
environments. Understanding these tools and frameworks alongside the varying external forces
that act upon a business will allow companies to make strategic organizational decisions that
optimize their competitive strength.

Considering Company Size

The size and operational scale of a company is important to consider when identifying the ideal
organization structure.

Company Size and Organizational Structure

Organizational design can be defined narrowly as the strategic process of shaping the
organization’s structure and roles to create or optimize competitive capabilities in a given
market. This definition underscores why it is important for companies to identify the factors of
the organization that determine its ideal structure—most specifically the size, scope, and
operational initiatives of the company.

Company size plays a particularly important role in determining an organization’s ideal

structure: the larger the company, the greater the need for increased complexity and divisions to
achieve synergy. The organizational structure should be designed in ways that specifically
optimize the effort and input compared to output. Larger companies with a wider range of
operational initiatives require careful structural considerations to achieve this optimization.

Types of Organizational Structure

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Companies may adopt one of six organizational structures based upon company size and
diversity of scope of operations.

Pre-bureaucratic

Ideal for smaller companies, the pre-bureaucratic structure deliberately lacks standardized tasks
and strategic division of responsibility. Instead, this is an agile framework aimed at leveraging
employees in any and all roles to optimize competitiveness.

Bureaucratic

A bureaucratic framework functions well in large corporations with relatively complex

operational initiatives. This structure is rigid and mechanical, with strict subordination to
ensure consistency across varying business units.

Post-bureaucratic

This structure is a combination of bureaucratic and pre-bureaucratic, where individual

contribution and control are coupled with authority and structure. In this structure, consensus
is the driving force behind decision making and authority. Post-bureaucratic structure is better
suited to smaller or medium-sized organizations (such as nonprofits or community
organizations) where the importance of the decisions made outweighs the importance of
efficiency.

Functional

A functional structure focuses on developing highly efficient and specific divisions which
perform specialized tasks. This structure works well for large organizations pursuing economies
of scale, usually through production of a large quantity of homogeneous goods at the lowest
possible cost and highest possible speed. The downside of this structure is that each division is
generally autonomous, with limited communication across business functions.

Divisional

A divisional structure is also a framework best leveraged by larger companies; instead of

economies of scale, however, they are in pursuit of economies of scope. Economies of scope
simply means a high variance in product or service. As a result, different divisions will handle
different products or geographic locations/markets. For example, Disney may have a division
for TV shows, a division for movies, a division for theme parks, and a division for merchandise.

Matrix

A matrix structure is used by the largest companies with the highest level of complexity. This
structure combines functional and divisional concepts to create a product-specific and division-
specific organization. In the Disney example, the theme park division would also contain a
functional structure within it (i.e., theme park accounting, theme park sales, theme park
customer service, etc.).

Strategic Organizational Design

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Structure becomes more difficult to change as companies evolve; for this reason, understanding
which specific structure will function best within a given company environment is an important
early step for the management team. Smaller companies function best as pre-bureaucratic or
post-bureaucratic; the inherent adaptability and flexibility of the pre-bureaucratic structure is
particularly effective for small companies aspiring to expand. Larger companies, on the other
hand, achieve higher efficiency through functional, bureaucratic, divisional, and matrix
structures (depending on the scale, scope, and complexity of operations).

McDonald’s fast-food restaurants departmentalize varying elements of their operation to

optimize efficiency. This structure is divisional, meaning each specific company operation is
segmented (for example, operations, finance/accounting, marketing, etc.).

Considering Technology

Technology impacts organizational design and productivity by enhancing the efficiency of

communication and resource flow.

Organizational design can be defined narrowly as the strategic process of shaping an

organization’s structure and roles to create or optimize capabilities for competition in a given
market.

Technology is an important factor to consider in organizational design. Modern organizations

can be treated as complex and adaptive systems that include a mix of human and technological
interactions. Organizations can utilize technological tools to enhance productivity and to initiate
new and more efficient structural designs for the organization, thereby adding potential sources
of economic value and competitive advantage.

Technological Organizational Structures

An example of an organizational structure that has emerged from newer technological trends is
what some have called the “virtual organization,” which connects a network of organizations via
the internet. Over the internet, an organization with a small core can still operate globally as a
market leader in its niche. This can dramatically reduce costs and overhead, remove the
necessity for an expensive office building, and enable small, dynamic teams to travel and
conduct work wherever they are needed.

A similar organizational design that is heavily reliant upon technological capabilities is the
network structure. While the network structure existed prior to recent technologies (i.e.,
affordable communications via internet, cell phones, etc.), the existence of complex
telecommunications networks and logistics technologies has greatly increased the viability of
this structure.

Technology and Traditional Structures

Technology can also affect other longstanding elements of an organization. For example,
information systems allow managers to take a much more analytic view of their businesses than
before the advent of such systems. Managers can communicate and delegate much more

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effectively through using technologies such as email, calendars, online presentations, and other
virtual tools.

Technology has also impacted supply chain management —the management of a network of
interconnected businesses involved in the provision of product and service packages required by
the end customers in a supply chain. Supply chain management now has the capacity to track,
forecast, predict, and refine the outbound logistics, contributing to a wide variety of logistical
advantages (such as minimizing costs from warehousing, fuel, negative environmental impacts,
or packaging).

Technology simplifies the process of managing reports, collecting communications, and keeping
in touch, enabling management in more formal structures to take on more workers. Increases in
technology have essentially allowed organizations to scale up their companies through more
effective and efficient teams.

b) Briefly explain the difference between effectiveness and efficiency with

reference to an organisation, giving examples.

Ans.The points, given below describe the substantial differences between efficiency and
effectiveness:
1. The ability to produce maximum output with limited resources is known as Efficiency.
The level of the nearness of the actual result with planned result is Effectiveness.
2. Efficiency is ‘to do the things perfect’ while Effectiveness is ‘to do perfect things’.
3. Efficiency has a short run perspective. Conversely, the long run is the point of view of
Effectiveness.
4. Efficiency is yield-oriented. Unlike Effectiveness, which is result oriented.
5. Efficiency is to be maintained at the time of strategy implementation, whereas strategy
formulation requires Effectiveness.
6. Efficiency is measured in operations of the organisation, but Effectiveness of strategies is
measured which are made by the organisation.
7. Efficiency is the outcome of actual output upon given the number of inputs. On the other
hand, Effectiveness has a relationship with means and ends.

Q2. Describe different approaches to organizing and analyzing work and their
relevance inthe present day context.

Ans.I. The Ancient Approach The concept of organizing work was there even in ancient times.
For instance, the ancient Egyptians built their pyramids, the ancient Chinese built the Great
Wall of Chine, the Mesopotamians used to irrigate their land and wall their cities, and the
Romans built their roads, aqueducts and Hadrian’s Wall. All these man-made construction
required large amounts of human effort and therefore organizing i.e. planning, control and
coordination. The Chinese philosopher Mencius (372-289BC) wrote about the concept and the
advantages of the division of labor. Records reveal that the ancient Greeks understood the
advantages of, and practiced uniform work methods. They also employed work songs to develop
a rhythm in order to achieve a smooth, less fatiguing tempo and to improve productivity. The
division of labor was also recognized by Plato (427-347BC). He wrote in The Republic, ‘A man
whose work is confined to such limited task must necessarily excel at it’. However, work itself
was viewed by the ancient Greeks and the Romans, as demeaning / humiliating. Those who

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could afford to do so were treated as employed slaves. With the fall of the Roman Empire,
development was reduced; slavery being replaced by feudalism. In pre-Reformation Christian
Europe work was also seen as a burden. In this period, the mechanical clock was invented by
Heinrich Von Wych in Paris in 1370, and Guttenberg’s printing press was set up. The former
permitted accurate work measurement and the latter the ability to communicate by the printed
word. Indeed Guttenberg’s inspired creative thinking can be viewed as an early example of
method study. However, with the Reformation the Protestant ‘work ethic’ emerged based on
Luther’s glorification of work theory. Calvinism brought further consolidation to this principle
and with it the virtues of frugality and the honorable acquisition of wealth. Work was viewed in
society as respectable and idleness as awful.

II. The Approach during the Industrial Revolution Period The momentum for industrial
revolution was initiated in the seventeenth century. Agricultural methods had improved in
Europe. Technical advances were also being made, most notably in textile manufacturing, in the
eighteenth century with the invention of Hargreaves’s spinning jenny, Arkwright’s water frame
and Compton’s mule. The steam engine first developed in 1698 by Thomas savory, was
harnessed by James Watt. These factors, technological developments, expanding trade/markets,
growing populations created opportunities for merchants and entrepreneurs to invest in new
factories. This was the beginning of the Industrial Revolution. All these necessitated the
improvement in work methods, quality, and productivity of workers. With the emergence of the
factory system, Adam Smith, the Father of Economics advocated making work efficient by
means of specialization in the eighteenth century. He advocated dividing the work down into
simple tasks. He provided three advantages of the division of labour: the development of skills;
the saving of time; and the possibility of using specialized toAfter the War of Independence
there was a shortage of musket parts in the United States. Eli Whitney proposed the
manufacturing of muskets by means of using interchangeable parts. Records form the Soho Bell
Foundry in Chelsea, around the same time as Whitney, evince the use of production standards,
cost control, work study and incentives during the period.. In 1832, Charles Babbage, an
engineer, philosopher and researcher, examined the division of labor in his book On the
Economy of Machinery and Manufacturers. Babbage proposed, as an advantage of the division
of labor, that the amount of skill needed to take on a specialized task was only the skill necessary
to complete that task. He illustrated this concept by breaking down the manufacture of a pin,
into seven elements. The important inference for employers was that they need to pay for the
amount of skill necessary to complete each individual task. He advocated breaking down jobs
into elements and costing each element. In this manner, these developments foreshadow the
machine age, replacing traditional manual labor and improving productivity. Machines were
located near sources of power, first water later coal for steam. Large concentration of machines
were gathered in one place under one roof in the factories. Huge numbers of people came
together to operate these machines and in the delivery of the outputs from the factories. As a
result, the management functions of control, planning and coordination were required with
greater strength.. At the turn of the century, the problem of layout and method were studied by
Robert Owen. Owen through experimentation at the New Lanark Mills was successful in raising
the living conditions of his workers whilst reorganizing his mills on commercial principles.
Robert Owen is endorsed with being the first to identify fatigue and the work environment as
factors affecting the performance of factory workers.

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III. The Scientific Management Approach Frederick W. Taylor known as the father of scientific
management and modern industrial engineering. By experimenting with different designs of
shovel for use with different material (from ‘rice’ coal to ore) he was able to design shovels that
would permit the worker to shovel for the whole day. In so doing, he reduced the number of
people shoveling at the Bethlehem Steel Works from 500 to 140. This work, and his studies on
the handling of pig iron, greatly contributed to the analysis of work design and gave rise to
method study. In 1909, he published the book for which he is best known, Principles of
Scientific Management. Taylor’s impact has been so great because he developed a concept of
work design, work-measurement, production control and other functions, that completely
changed the nature of industry. Objectives of Scientific Management The four objectives of
management under scientific management are as follows: The development of a science for each
element of a man’s work to replace the older rule-of-thumb methods. The scientific selection,
training and development of workers instead of allowing them to choose their own tasks and
train themselves as best they could. The development of a spirit of hearty cooperation between
workers and management to ensure that work would be carried out in accordance with
scientifically devised procedures The division of work between workers and the management in
almost equal shares, each group taking over the work for which it is best fitted instead of the
former condition in which responsibility largely placed with the workers. His framework for
organization was: clear delineation of authority, responsibility, separation of planning from
operation, incentive schemes for workers, management by exception, and task specialization.
Assumptions of Scientific Management Two basic assumptions dominated Taylor’s approach to
the design of jobs. First Assumption (Management): Management is assumed to be more
effective than labor at devising methods for executing the work and then at planning and
organizing. By breaking the work down into simple elements: the training of workers is clearly
simplified workers are more easily substituted, one for another supervision is made easier as it
is apparent when workers are doing something that is not part of the specified task. Second
Assumption (Workers): Human beings are rational economic beings. The prime goal is assumed
to be monetary and consequently reward systems which relate pay levels to output are seen as
likely to result in maximum output. As such, humans will examine a situation and identify a
course of action likely to maximize their self interest and act accordingly. All that is required to
maximize output, from the organizations perspective, is to hire the right people, train them
properly and construct an appropriate reward system. If the work can be paced, a worker can
develop a natural rhythm and momentum. Principles of Scientific Management Three primary
principles of scientific management directly or indirectly relating to work design are: i. Taylor
assumed that it is possible to “gather all of the traditional knowledge which in the past the been
possessed by the workman and then classifying, tabulating, and reducing this knowledge to
rules, laws, and formulae which are immensely helpful to the workmen in doing their daily
work”. In this way the industrial engineer (and the manager) learns the best way for a job to be
performed. ii. The work of every individual employee “is fully planned out by the management at
least one day in advance… describing in detail the task which he is to accomplish as well as the
means to be used in doing the work” (p.39). If management understands the process by which
the work is done, it should be possible to plan out the work in the smallest detail before the
employee even show up. In this way the manager and engineer know exactly how the work will
be accomplished. iii. “The science which underlies each workman’s act is so great and amounts
to so much that the workman who is best suited to actually do the work is incapable (either

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through lack of education or through insufficient mental capacity) of understanding this
science” (p.41). If management understands the best, most efficient way for a job to be
accomplished, and if this is planned out in advance, no mental contribution is necessary from
the worker. The scientific management approach was exceedingly successful in the first half on
the 20th centu

IV. Fordism In the early 20th Century , Henry Ford dramatically established the concept of
relative surplus value by doing what at the time was considered impossible. He paid workers 4
or 5 times the ‘going rate’ (actually the bare minimum that could be screwed from the bosses),
yet still made a huge profit. By vastly increasing the production of relative surplus value through
the use of the assembly line, coupled with FW Taylor’s ‘Scientific Management’ of the work
process, he was able to vastly improve the productivity of his plants. Ford brought into existence
the concept of ‘mass worker’. Whereas before the capitalist had relied largely on skilled workers
to manage the production process, the mass worker was a new type. V. The Human Relations
Approach The human relations approach arose almost as a direct result of the harshness
imposed by supervisors who excessively used scientific management principles. An outgrowth of
the famous Hawthorne Studies conducted during 1924-33, the human relations approach de-
emphasized the technical components of a job and concerned itself with the impact of employee
social and psychological needs on productivity. Originally, the goals of the Hawthorne
investigators were to identify elements of the work environment which fostered productivity.
Surprisingly, the investigators discovered that the greatest impact on productivity was that of
the social interaction patterns of the workers rather than environmental conditions like lighting.
The significance of the findings to management are that: workers thought and acted not as
individuals but as a group; workers would sacrifice their self-interest in the fact of group
pressure; money is not the sole motivator. (This prompted Mayo to comment: “Factory
managers are going to someday realize that workers are not governed primarily by economic
motives.”) supervisors have significant influence on out

s. VI. The Socio Technical Systems Approach The socio technical systems approach to work
redesigns tasks in a manner that jointly optimizes the social and technical efficiency of work.
Beginning with studies on the introduction of new coal-mining technologies in 1949, the socio
technical systems approach to work design focused on small, self-regulating work groups. Later
it was found that such work arrangements could operate effectively only in an environment in
which bureaucracy was limited. Today’s trends towards lean and flat organizations, work teams,
and an empowered workforce are logical extensions of the sociotechnical philosophy of work
design. VII. Modern Approaches Modern concepts, are not entirely disparate to scientific
management and classical organization theory, but are evolved from earlier views and represent
modifications based on research and experience. In order to counter the weaknesses of the
earlier approaches discussed above that the behavioral science approach was adopted. Industrial
psychologists , although at first arrived at similar conclusions to the human relations movement,
based on their research concentrated on motivation of individuals .And industrial sociologists
looked at the behavior of formal and informal groups at work. In the period between 1951 and
1971, managers moderated their ‘logical’ approach to such things as job design and considered
such alternatives as participation, job-redesign, job enlargement and job enrichment. By the
mid1960s and 70s in Britain there was much puzzlement as to which theory to follow and much

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conflicting evidence from researchers. Goldthorpe (1969), for example, was to find that some
employees, although they disliked the work which involved repetitive tasks in their Coventry car
assembly plant, would put up with them for the money rather than move to more interesting
jobs and lower wages in plants nearby. Experiments at Philips at Eindhoven demonstrated that
although output initially mounted after enlarging the jobs in radio assembly, workers were
unhappy with their new jobs and responsibilities and many left. White (1973) also found that the
motivation of managers to work depended very much on two factors: the type of job that was
being performed and the age of the jobholder. These findings show the boundaries of
approaches such as those proposed by Herzberg and others that advocate a single ‘best way’ and
draw attention to the danger of viewing behavioral science as a provider of packaged solution.

Q3. Explain the concept and purpose of organizational diagnosis and discuss and
describe theelements that need to be reviewed for analyzing an organisation.

Ans.In some ways organisations, their structure and functioning can be compared to structure
and functioning of the human system. Just as an organism has several parts an organisation is
also structured with several subsystems. Effective functioning of the human sub-systems
depends on the effective functioning of all the constituent parts. When the human system is in
trouble it is either due to a problem in a part that could be located or due to problems that affect
the entire system. In any case when there is trouble the entire system gets affected. Just as a
doctor diagnoses the problem with the human system on the basis of the symptoms and analysis
of the system using some tests (standard tests like pulse rate, BP etc. as well as special tests) an
organisation facing problems could be diagnosed by an organisational specialist on the basis of
noticeable (visible) symptoms and using tests to bring out what is not evident. The only
difference is that the human organism normally functions as a whole as it has a single mind. An
organisation has several parts each having its own independent minds and they may not always
function in a fully unified way. So even when the top management think that there is a problem
other systems may not think so or vice versa. Organisation has several minds that is what adds
to the complexity of the organisation. Another parallel between the diagnosis of the human
being and an organisation is the need to go through a diagnostic check up periodically even if
there are no problems. Fitness tests are quite common for the human being. From the time a
child is born there are periodic check ups that are conducted which are used as diagnostic
instruments. The size, growth, activity level, heart rate etc. are all assessed. Even in the school it
is common to put a child through fitnetests. As the person grows into his forties he is advised to
get annual check ups done. Similarly an organisation can put itself through periodic check ups
or diagnostic exercises to assess its growth, dynamism, strengths, weaknesses etc. Thus
organisational diagnosis is an exercise attempted to make an analysis of the organisation, its
structure, subsystems and processes in order to identify the strengths and weaknesses of its
structural components and processes and use it as a base for developing plans to improve
and/or maximise the dynamism and effectiveness of the organisation. Organisational diagnosis
could be done as a periodic routine exercise like the case of periodic medical check up of an
individual or may be undertaken whenever there is a cognizable problem that is affecting the
functioning of an organisation. Just as in the case of the medical sciences there is a lot more
unknown about the human being and quite a few things cannot either be diagnosed or cured,

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management science also has gaps and quite a few problems of organisations are not easy to
diagnose or cure. But an equally good number of problems can be solved and the organisational
effectiveness improved if the diagnosis is done well by competent people.

Analysing the organisation, in terms of its components and their functioning is the first step in a
comprehensive diagnosis. Every organisation can be conceived as consisting of various
subsystems or parts. Effective functioning of each of these parts is essential for effective
functioning of the organisation. In addition the coordinated functioning of these subsystems
also contributes to organisational effectiveness. For making organisational diagnosis the
strengths, weaknesses and potential of each of the subsystems need to be examined. In addition
the various processes that contribute to the effective functioning of the organisation as a whole
need to be examined. As emphasized by Bechard “The development of a strategy for systematic
improvement of an organisation demands an examination of the present state of things. Such an
analysis usually looks at two broad areas. One is a diagnosis of the various subsystems that make
up the total organisation. These susystems may be natural “teams” such as top management, the
production department, or a research group; or they may be levels such as top management,
middle management or the work force. “The second area of diagnosis is the organisation
processes that are occurring. These include decision-making processes, communication pattern
and styles, relationships between interfacing groups, the management of conflict, the setting of
goals and planning methods”. Thus organisational analysis may either focus on the structural
aspects (subsystems, various components etc.) or on processes. The following is an illustrative
list of the various subsystems of an organisation and the processes which could form a focus of
diagnosis.

Organisational analysis may be done for different purposes. These include: 1) Enhancing the
general understanding of the functioning of organisations (i.e. educational or research
purposes.) (The direct beneficiary is the researcher or the analyst rather than the organisation).
Such a study may aim at enhancing the understanding of human behaviour through a study of it
in organisation, or to enhance the understanding of the society as reflected in organisational life.
2) Planning for growth and diversification An analysis or a diagostic study may be necessary for
planning growth, diversification, expansion etc. Organisational analysis may reveal the
strengths that could be used for growth and diversification, weak spots that need to be removed
in the new plans, the precautions to be taken, structural dimensions to be kept in mind etc.
Several insights may be provided on structure, people, systems, styles, technology etc. that have
implications for growth. 3) Improving Organisational Effectiveness or Planning General
Improvements Organisational Analysis may be used also for improving the general efficiency of
an organisation. On the basis of a diagnosis made out of the analysis action steps could be
initiated in terms of toning up administration, introducing new management systems and
processes, reduction of wasteful expenditure, introduction of time savers, change of personnel
policies to enhance employee motivation, restructuring of some parts, training, elimination of
unwanted structures and teasers, improvements in general health of the organisation etc. 4)
Organisational Problem Solving Whenever some subsystems departments, units etc. fall sick or
start creating problems a diagnosis may be undertaken with a view to identify the source of the
problem and take corrective action. A sick unit, a bottleneck, a communication block, a poor
performing department, frequently occurring conflict between two departments, repeated

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failures of a management system or an organisational process, a frequent violation of an
organisational norm, fall in discipline, reduction in output absenteeism, increase in conflicts etc.
can all lead to the need for an organisational diagnosis of a part of the organisatioin or the entire
organisation.

Organisations can be analysed with different perspectives in mind. The perspectives one takes
depends both on the purpose for which the analysis is being done and the professional
background of the people doing organisational analysis. The following perspectives could be
used for analysing organisations: 1) Economics Perspective 2) Political Science Perspective 3)
Sociology and Social Psychology Perspective 4) Management Perspective 5) Applied Behavioural
Science or OD Perspective Economic Analysis of Organisations The economic analysis focuses
primarily on the use of money, allocation of resources, distribution and consumption patterns,
pricing decisions etc.

The following is a sample of questions that are usually asked in the Economic Analysis of an
Organisations: How are the resources allocated? What is the market structure? (Is it
competitive, monopolistic, oligopolistic? etc.) What is the organisatioins market and its
characteristics? Are the products and services in the industry homogeneous or differentiated?
What is the nature of demand for organisation’s services? What is the cost of making the
product or service? How are the various elements in the process of making it related? Are there
substantial economics of scale? Economic analysis of organisations is particularly helpful for the
first three objectives mentioned earlier. It helps streamlining the organisational efficiency,
eliminating wastes, and gives insight while planning for growth, diversification etc. However,
when it comes to problems not all types of organisational problems can be answered by
economic analysis. Political Analysis Political analysis deals with the tactics and strategies
employed by the individuals and groups in the organisation as well as the organisation itself in
the quest for power. The following is a sample of questions asked in the analysis: Who is most
influential in the organisation? (individuals, groups, departments, etc.) What is the power base
of each of the categories of people in the organisation (Is it positioned based, competency based,
collectivity based like in unions, is it because of closeness to top executive or ruling party? Is it
due to the ability of the person to reward, hire and fire?) How is the power distributed among
individuals, groups and departments? What strategies do people use in influencing or
controlling each other? How is the power used? How much for orgnisational purposes? How
much for expanding one’s power base? etc. What are ideologies of different groups? What
implications do these have for organisational functioning? Is there congruence with
organisational goals? How much is there a commitment for organisational goals? Is
decentralisation functional or centralisation useful? What kinds of control are needed to
regulate the behaviour of people? Like Economic analysis, political analysis of organisations is
useful for understanding the organisation. Political analysis helps understanding many softer
and strategic dimensions of an organisation. However, it has limitations in providing guidelines
for the planning of growth and diversification of an organisation. It helps immensely in
understanding organisational dynamics. However, such an understanding may become
onesided unless it is enriched with other perspectives. Sociological and Social Psychology based
Analysis Sociological and social psychological perspective focuses on the social behaviour of
individuals and groups in the organisation. The formation ofnorms and values of the

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organisation, the process of socialisation, conflicts, strikes, protest behaviour etc. issues are
studied. The influence of the Society on the organisation is also focused. The following is a
sample of questions that are normally asked with sociological and social psychological
perspectives: What is the nature of the work force and different categories of employees? Where
do they come from and what personality, attitudes and values do they bring with them that
influence organisational functioning? What are the groups? What interests do they serve? What
binds them together? What are the formal and informal sources of socialisation? How are
people being socialised? How is this affecting the organisation? What structural forces ensure
stability and order in the functioning of the organisation? What causes disorder? What forces
contribute to change? What forces bind different groups/departments/units together? What is
the distribution of power and authority? What are the attitudes of people to work? What are the
attitudes of people to each other? Is there alienation? What seems to contribute to it if it is
there? How could it be reduced? How frequent are the strikes? What is the incedence of
absenteeism, accidents, alcoholism, indiscipline etc. phenomena? What seems to cause it? How
do members relate to each other outside work hours? How do their interactions affect their work
behaviour? Sociological and social psychological analysis helps in understanding organisations
for research and study purposes, for planning growth and expansion (especially location
decisions, recruitment, structural decisions, departmentation) and for organisational problem
solving. Professional Management Perspective in Organisational Analysis For a long time
management was not accepted as a separate discipline. With rise of management schools all
over the world a new class of people with professional management background and skills have
emerged. With the availability of a large number of professionally trained managers and
management scientists there is a professional management perspective that is emerging. This
perspective focuses on various management dimensions of organisational life. Each branch of
management can analyse a significant pay of organisation’s functioning. The branches normally
include Business Policy and Strategy Management, Production and Operations Management,
Personnel Management, Marketing Finance and Accounting, Organisational Structures and
Dynamics and Managerial Economics. The following are the sample questions that could be
asked with this perspective for organisational analysis: What are the strengths, weaknesses,
opportunities and threats facing the organisations with respect to its business and its
functioning? What are the business goals? Is there a long term plan? What are the strategic
consideration the organisation has in planning its business activities? Is the structure best
suited for its goals? What is the technology being used? Are better technologies available? What
are the problems in changing technology? How is the production planned? What is the capacity
utilisation? How could it be improved? How frequent are the break-downs? What is the level of
inventory? Are materials available on time? What is the rate of rejection of products? What is
the wastage? How could

Q4. Discuss and describe any two methods of organizations diagnosis and their
merits anddemerits.

Ans.With regard to the data collection methods there is no single method that is applicable to a
particular context. It may require a combination of methods to ensure appropriate mirrorins of
the complex reality of the organization. Therefore, an attempt ismade to present the process of

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organizational diagnosis whic:Ii reflects the targets for diagnosis, typical information desired
and common metliocls of obtaining the information.

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Communication patterns, styles and flows Who talks to whom, for how long, about what'? Who
initiates the interaction? Is it two-way or one-way? Is it top-down; down up; la.teral? Etc.
Communication flow and communication patternsIs colnmunication directed upward,
downward, or both? Are commu~iications filtered? Why? In what ways? Do communications
patterns 'fit" the nature of the jobs to be acco~nplished? What is the "climate" of
communication? What are the techniques of cornrnunication mostly used? Observations,
especially in meetings; questionnaires for large-sized samples; interviews and discussions with
group members - all these methods may be used to collect the desired information. Analysis of
videotaped sessions by all concerned i!; especially useful. As a cop at the traffic signal, a
conslultant could monitor/o$serve the communication process as it flows. Also leave a tracer
element and see how it travels through the communication process. Goal setting Setting task
objectives and determining criteria to measure accomplishment ofthe objectives at all
organizational levels. Do they set goals? How is this done? Who all participate in goal setting?
Do they possess the necessary skillsfor effective goal setting? Are they able to set long-range and
short-range objectives?Questionnaires, interviews and observation all afford ways ofassessing
goal-settingability of individuals and groups within the organization. Decision making, problem
solving, and action planning Evaluating alternatives and choosing an appropriate one and the
plan of action are integral and central functions for most organization members. This includes
getting the necessary information, establishing priorities, evaluating alternatives, and choosing

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one best alternative over all the others. Who makes decisions? Are they effective? Are all
available sources utilized? Are additional problem-solving skills needed? Are organization
members satisfied with the problem-solving and decision-making processes?--The way it is
done. Observation of problem-solving meetings at various organizational levels is particularly
valuable in diagnosing this process. Analysis ofvideotaped sessions by all concerned is especially
useful. Conflict resolution and management Conflicts-interpersonal, intra-personal, intragroup
and inter-group - frequently exists in organizations. Does the organization have effective ways of
dealing with these conflicts? Where does conflict exist? Who are the involved parties? How is it
being managed? What are the system norms for dealing with conflict? Does the reward system
promote conflict? Interviews, thirdparty observations and observation meetings are common
methods for diagnosing these processes. Managing interface relations Interfaces represent these
situations wherein two or more groups (sub-systems) face common problems or overlapping
responsibilities. This is I most often seen wlle~l members of two separate groups are
interdependently related in achieving an objective but have separate accountability. What is the
nature of the relations between two groups? Are goals clear? Is responsibility clear? What major
problems do the two groups face? What structural conditions promotefinhibit effective interface
management? Interviews, third-party observations, and observation of group meetings are
common methods for diagnosing these processes. Superior-subordinate relations Formal
hierarchical relations in organizations dictate that some people lead and others follow: these
situations are often a source of many organizational problems What are the extant leadership
styles? What problems arise between superiors and subordinates? Questionnaires can show
overall leadership climate and norms. interviews and questionnaires reveal the desired
leadership behaviours. Technological and engineering systems. All organizations rely on
multiple technologies - for production and operations, for information processing, for planning,
for marketing, etc., to produce goods and services. Are the technologies adequate for satisfactory
performance? What is the state of the art and how does the organization's technology compare
with that? Should any changes in technology be planned and implemented? Generally this is not
an area of expertise of the OD consultant. He or she must then seek help from "experts" either
inside or outside the orga~lizatio~l. Interviews and group discussions focussed on technology
are among the best ways to deterrn ine the adequacy of technological systems. Sometimes
outside experts conduct an audit and make recommendations; Internal auditors can also make
recommendations. Strategic management and long-range planning Monitoring the
environme3g adding and deleting "products"/processes, predicting future events, and making
decisions that affect the long-term viability of the organization is a necessity for the organization
to remain competitive and effective. Who is responsible for "looking ahead" and for making
long-range decision? Do they have adequate tools and support? Have recent long-range
decisions been effective? What is the nature of current and future environmental demands?
What are the unique strengths or core competencies of the organization? What are the threats
to the organization. Interviews of key policymakers, group discussions, and examination of
historical records give insight to this dime:nsion.

Q5. Explain the role of an OD intervention. Briefly discuss and describe T-Group
training asan OD intervention with an example.

Ans. Role of OD in Modern Organizations: 7 Steps to Implementing Change:

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1. Become the Driver of Change
OD professionals must take charge of internally-focused change initiatives. You are in the best
position to define and drive strategy for change−not senior leaders and not the project
management office. Sure, the project office can oversee the initiatives from a portfolio
perspective, and senior leaders should be part of strategic decision-making process. OD
professionals, however, are the ones with the knowledge of the overall organizational
effectiveness. You are the mechanics who make this complex machine run well.
Sadly, too many approaches to change are piecemeal. Someone decides it would be a good idea
to build strong customer focus in the Engineering Department, and an initiative is launched.
Another leader decides that Sales and Marketing need to be more integrated and an initiative is
launched.
Some OD professionals are so focused on interventions with teams and individual leaders that
they haven’t looked more broadly at what the organization as a whole needs as an intervention,
or at what changes need to be made at a more systemic level.
In the end, each individual initiative might have a benefit, but the benefit will be limited due to
little to no connection to the overall strategy (a customer-focused Engineering Department can
only do so much without other departments backing them up on the customer focus). Even
worse, initiatives can end up being at cross-purposes to one another.
2. Get Familiar with an Organizational Operating System
In order to create a basis for an effective internal change strategy, OD professionals should
always keep an eye on the organization as a whole. Like other complex machines, organizations
need an operating system (OS). An up-to-date OS is instrumental for creating an optimized
organization that is both efficient (the resources are aligned with functions) and effective
(people are aligned with the customer).
Operationalizing Your Matrix white paper
3. Create Your Long-Term and Short-Term Change Strategies
Taking the lead on strategy means thinking outside the OD department. You need to reach out
to all the key stakeholders and change agents in the organization and get them on board with the
strategy. You’ll need good influencing skills. You’ll also need a core design team that can help
you formulate the strategy and sell it to the rest of the organization.
At the design-team level, look at the longer-term vision of where you want the organization to be
in five years, then define your two-year strategy for change, taking into account what change the
organization is prepared to absorb in that timeframe.
Why two years? If you’re looking at changing systemic factors in the organization, those are big
initiatives and take time. You’ll need a two-year horizon to bring these types of changes to life.
Before you settle on your two-year plan, do an assessment of the current the state of the union.
Where are you now? And in that assessment, determine what appetite there is for change in
various areas. You need a strategy for change – how can you navigate the difficult journey of
shifting the organization onto a new path while creating the least amount of resistance?
Deciding which direction to go is the easy part of the strategy. Figuring out how to get there with
most of the people behind the idea, is what most organizations find truly challenging.
4. Define the Portfolio
As you know, you can’t implement a broad strategy. You have to break it down into specifics,
such as the first level of change that you are looking for. You need to be very strategic with the
portfolio definition, based on your assessment of adoptability of the two-year strategy.
You’ll be looking at creating a balanced enterprise portfolio, accurately scoping out the size of
each initiative, and aligning each one with the strategy. Each initiative should be a part of the
larger plan and so they are interdependent. Each one will affect one or more of the other
initiatives. Make sure they form a cohesive whole.
5. Grow Your Change Agents

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The next challenge is picking the best person to lead each initiative. The initiative lead needs to
be a change agent. One of their biggest jobs is to create a cohesive team made up of stakeholders
of the change and make converts out of them.
A collaborative project management approach is most effective in making sure organizational
changes stick. Despite its name, this approach is not just for project staff. Organizational
development professionals can manage their change initiatives as projects. Also, many of the
collaborative methods and skills are just as relevant to OD as they are to projects. You’ll need the
same tools to get buy-in from all of the stakeholders at the planning stage, to make decisions
collaboratively, or to guide teams to consensus.
6. Become the Sponsor of Change Initiatives
OD should take the role of the sponsor in the organizational change initiatives. As a sponsor of
these projects, you need to make sure the scope is accurate and clear from the beginning, and
the initiative leader has clear direction.
You are going to be successful if these initiative teams are successful, so you’re going to need to
monitor them and make sure they stay on the right track. No, you don’t have any control over
them, but you have plenty of influence. Check in with them regularly. Keep them focused on the
human aspects of the project. Make sure they conduct adoptability assessments and
communication planning.
Being a sponsor also means that you are who the team goes to for support, conflicts resolution,
and getting resources. You should have reviewed and signed off on their initiative plans, so you
know what work they will be doing.
Check in with the leaders and see if they need help. Keep them focused on the work and not on
fighting political battles. That’s your job. Give them lots of positive feedback and recognition.
Creating organizational change is hard work, as you well know, and they need as much
encouragement as they can get.
7. Tirelessly Promote Change
Finally, never stop selling the vision and the strategy. Have your own communication plan and
work it every day. Change is not easy, but it’s easier if you’re proactive and not reactive.
Proactive change is getting it right from the get-go and making people more and more
comfortable with the change as it is being built.

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