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RESTRUCTURING ORGANIZATIONS

Members
Anjali Chourasia Kavish Mishra Nishiket Rajput Guranjan Singh Cheema Chandrakant .N Saptarshi Majumdar Babita Singh

WHAT IS RESTRUCTURING OF ORGANIZATION? Changing the old pattern of organisations structure due to changes in technology, increasing global competition and environment and reorganising the structural pattern in its best outcome

Three interventions

(A) Structural Design

(1) Functional Structure

President

VP Research

VP Manufacturing

VP Engineering

VP Marketing

VP Finance

VP Human Resources

ADVANTAGES

DISADVANTAGES

CONTINGENCIES

Promotes skill specialization Reduces duplication of scarce resources and uses resources full time Facilitates communication and performance

Emphasis routine tasks Fosters parochial perspectives Reduces communication and corporation Interdepartmental coordination Obscures accountability for overall outcome Stable and certain environment Small to medium size Routine technologies and interdependencies Goals of efficiency and technical quality

Exposes specialists to others within same speciality

(2) Divisional Structure


President

VP Product C

VP Product B

VP Product A

Manager sales

Manager manufacturing

Manager research

ADVANTAGES

DISADVANTAGES

CONTINGENCIES

Recognition sources of interdeparmental dependencies Fosters an orientation towards overall outcomes and clients Allows diversification and expansion

Unstable and uncertain environment Less use of skills and resources Limits career advancement Creates stress due to demands on people Large size Technological interdependencies across functions Goals of product specialization and innovation

Promotes delegation of authority and responsibility

(3) Matrix Structure


President

ADVANTAGES

DISADVANTAGES

CONTINGENCIES

Specialised knowledge Maintaining reservoirs of specialists Maintaining consistency between different department

Difficulties without support of top management Increased stress and difficulties Functioning without powers

Dual focus on unique product and technical specialization High information processing capacity Pressure for share resources

(4) Process Structure

ADVANTAGES

DISADVANTAGES

CONTINGENCIES

Longer process Focuses resources on customer satisfaction Large size Duplicates scarce resources Threat of middle managers and staff specialists Uncertain and changing environments Customer oriented goals

Adapt to environmental change rapidly


Reduces boundaries between departments

(5) Network Structure

ADVANTAGES

DISADVANTAGES

CONTINGENCIES

Highly flexible Focus on customer and market needs Permits rapid global expansion

Difficulties in autonomous organization

Highly complex Organisations of all sizes Worldwide operations

Sustaining benefits can be problematic


May give partners access to priorities

Downsizing
Reducing the size of the organisation by: Voluntary departures Early Retirement Natural attrition Redeployment Outsourcing Delayering

Steps in Downsizng
Clarify the Organisations Stategy (why does

the organisation want to do it?) Assess downsizing options and make relevant choices Implement changes

Implementing Changes
Top-down Identify and target specific areas of

inefficiency Any actions must be linked to organisation strategy Address the needs for both the survivors and those who leave Follow through with growth plans

Results of Downsizing
The final success of downsizing efforts depends on how effectively the intervention is applied. (Cummings and Worley, 1997)

Reengineering
Seeks to transform how organisations traditionally produce and deliver goods and services.

Reengineering
Prepare the organisation
Set new goals communicate why, what and how

Fundamentally rethink the way work gets

done
Identify ad analyse core business processes define key performance objectives design new processes

Designing new processes


Needs and wants of customers Simplify - combine or eliminate pick out the best in current practice Do not be constrained by the because we do Find the natural order Assume the work gets done right the first time Listen to the people who do the work

Restructure the organisation


Redesign structure Jobs become more multi-dimensional Controlling -> empowering Shift performance measures and

compensation from activities to results Adopt a flatter structure