PACE-IT: CE 2.6 - Organization and People
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Career Management & Entrepreneurship exam study guide presentations by instructor Mary Keany, MSLIS, MSIS - PACE-IT (Progressive, Accelerated Certifications for Employment in Information Technology) "Funded by the Department of Labor, Employment and Training Administration, Grant #TC-23745-12-60-A-53" Learn more about the PACE-IT Online program: www.edcc.edu/pace-it
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PACE-IT: CE 2.6 - Organization and People
- 1. Organization and People CE 2.6: Organization and People Daniela Axinte and Mary Keany2015/2016
- 2. • Setting up the “right” organizational structure • Culture • HR issues • Role of the human resource department • Offshoring and outsourcing • Remote or home offices • Equal employment laws
- 3. • Hierarchical • Top down approach to management • Used by most large companies CEO Top Managers Middle Managers First Line Managers
- 4. Advantages • Can work for large organizations IF the number of middle management is kept in check • Works well for process- oriented organizations that require strict control and oversight (example: manufacturing) • Potentially, an easier coordination advantage Disadvantages • Information trickles from the top all the way down and often times gets distorted (intentional or not) • Slow to react to changes • Increased bureaucracy • Unhealthy competition for the top positions • Increased costs • Increased responsibilities at lower level and decreased authority
- 5. Flexible teams Organized by project Cross-functional Team members take turn be the leaders Used by high tech companies
- 6. Advantages • Nimble, flexible organization that can quickly adapt to changes • Revolving leadership = invested interest in succeeding • Bringing only the people who should be involved in the project without the “extra” personnel Disadvantages • Can lead to unhealthy competition for more permanent leadership • Same people who want to always lead • Enforce strict rotation of leaders • Depending on workload, employees can be part of more than one team • Enforce no more than 2 teams (preferably only one) at any given time
- 7. Operations and sourcing Human resources Accounting and finance (for large companies, they are separate functions) Sales Marketing R&D Product development IT
- 8. Business units can be Vertical markets (examples: health care, aerospace, IT) Type of customer (examples: corporate customers, consumers, small businesses, government) Product divisions (examples: specialty cookware, building products, industrial metals) Geography (examples: North America, Asia Pacific, Europe, Africa)
- 9. CEO North America Operations Human Resources Accounting Finance Marketing Sales R&D Product Development IT Asia Pacific Functions Europe Functions Africa Functions
- 10. Is a combination between functional, regional or business units or project base Most people have 1 functional manager 1 regional / business unit manager / product
- 11. CEO Corporate Managers Operations Human Resource s Accounting Finance Sales Marketing R&D Product Develop. IT Business Unit 1 Business Unit 2 Business Unit n
- 12. Combination of Core values Ceremony and rites Stories and language Commitment Trust Sets the tone for How the company behaves with others (how it treats its employees, vendors, partners, and shareholders) How environmentally and socially responsible the company is
- 13. To recruit and hire employees To provide training and professional development for employees To manage labor relations To manage pay and benefits To manage performance appraisal and feedback To enforce labor laws
- 14. Ensure that Outsourced vendors comply with international labor laws Short-term contractors have all the legal documentation Right to work in USA Tax identification, Licenses – if required
- 15. • Setting up the “right” organizational structure • Culture • HR issues • Role of the human resource department • Offshoring and outsourcing • Remote or home offices • Equal employment laws
- 16. This workforce solution was 100 percent funded by a $3 million grant awarded by the U.S. Department of Labor's Employment and Training Administration. The solution was created by the grantee and does not necessarily reflect the official position of the U.S. Department of Labor. The Department of Labor makes no guarantees, warranties, or assurances of any kind, express or implied, with respect to such information, including any information on linked sites and including, but not limited to, accuracy of the information or its completeness, timeliness, usefulness, adequacy, continued availability or ownership. Funded by the Department of Labor, Employment and Training Administration, Grant #TC-23745-12-60-A-53. PACE-IT is an equal opportunity employer/program and auxiliary aids and services are available upon request to individuals with disabilities. For those that are hearing impaired, a video phone is available at the Services for Students with Disabilities (SSD) office in Mountlake Terrace Hall 159. Check www.edcc.edu/ssd for office hours. Call 425.354.3113 on a video phone for more information about PACE-IT Program. For any additional special accommodation needed, call SSD office at 425.640.1814. Edmonds Community College does not discriminate on the basis of race; color; religion; national origin; sex; disability; sexual orientation; age; citizenship; marital or veteran status; or genetic information in its programs and activities.
Editor's Notes
- Culture and organizational structure are important aspects of an organization. You need to set them up correctly from the beginning in order to avoid potential problems later on.
- There are multiple types of organizational structures. A traditional organizational structure is a hierarchical one. Think of a pyramid with the CEO at the top and the lowest level employees at the bottom.
- A hierarchical structure is used in almost all large companies. It works for them because of the very large number of people and separate departments they need to manage. It also works best for process-based companies, such as manufacturing. These types of companies need to adhere to strict rules and a hierarchical organization facilitates enforcement of rules. It comes with a lot of disadvantages. It is slow to move due to the sequential way of decision execution. Therefore, it takes a long time to adapt to change. These companies usually react to market changes instead of triggering them, but when they move, they create huge movement due to their sheer size. They are also slow because the decisions are made up the chain. The lower level employees are not empowered to do anything without their superior’s approval, and the superior needs to get approval from his boss, who needs to get approval from her boss, and so on. This type of decision making encourages unhealthy competition amongst managers. To move up, managers need to beat their competition and these managers’ decisions are based on what moves THEM up the chain and NOT what’s the best for the company.
- Flat organizations are a somewhat recent concept. The company is organized by projects with cross-functional teams and not by departments. The team members take turns being the leaders. This type of organization works best for product development and software development companies.
- Flat organizations are nimble and product development is based on an agile method instead of the cascading method. These organizations move fast and can make course corrections easily without losing too much time or effort. The project-based approach also allows the company to assign only the necessary people to each project. One drawback can be a power struggle with more competitive individuals wanting to keep leadership roles permanently. However, that can be easily identified and remedied. Usually, these people don’t last very long in this type of environment. One issue to watch out for is overtaxing people with multiple projects at the same time. This can be remedied by keeping a constant watch on people’s workloads to ensure they don’t work beyond their limits.
- Most organizations have the functions listed on this slide. Smaller entities might have combined functions, for example, Sales and Marketing might be one department and R&D and product development might be another.
- Companies that are either large or have multiple products in multiple market segments, usually organize themselves into business units. They are separate P&L (Profit and Loss) units, responsible for managing themselves as independent small companies. They are responsible for designing, developing, marketing, selling, and servicing the product(s) they are responsible for. Business units can be by vertical market, by type of customer, by product type, or by geography.
- Here is a typical organizational chart for a business unit.
- Matrix organizations are a combination of functional, regional, or business units. In these situations, a person may have a functional manager and a separate manager based on the region/business/product. Microsoft and most very large organizations are set up like this, because they are very large (200,000 plus employees) and have multiple products in multiple market segments, which they sell globally. A simple, flat organizational structure would not work for them because they are too complex and large.
- Here is an example of a matrix organizational chart.
- Culture is another aspect to setting up your business correctly. You want to set up the culture that is right for you, while keeping in mind that your current and future employees might expect a certain type of culture for the type of business you have. A startup software company is expected to have a culture of inclusion, sharing, pushing the limits, and always innovating. You have to spend a considerable amount of time developing the culture. It can make your company a great place to work and allow you to attract future employees easily and keep current ones, or it can make your company a terrible place to work. Nobody wants to come into a toxic environment ran by politics and bureaucracy. Tony Hsieh, the CEO of Zappos, wrote a great book about the importance of setting the right culture from the beginning and the consequences of not doing so. The book is Delivering Happiness. It is a beneficial book to read before you set up your company’s culture. The right culture sets the standards of how employees interact with other employees, with business partners, with shareholder, and with vendors. It sets the tone on how much the company is involved in environmental and social issues, and what it does to positively contribute to these issues. Customers and potential employees alike are interested in the company’s position in these issues and what the company does. The right culture sets values by which the company will conduct its business. It sets the ceremonies and rites. For example, are you going to celebrate success and acknowledge employees’ contributions, or will you reward only the top management without acknowledging the people working at lower levels in the hierarchy? Do you use a formal, stiff language to communicate internally and externally? Do you say you are transparent but disclose nothing? Do you let employees know about major events the company is experiencing AFTER they passed, or do you involve them from the beginning. How do you promote your employees, based on merit or based on the politics they play? Do you create unnecessary processes just to control employees or do you empower them to take actions without asking for approval every step of the way? These are just some examples of issues to consider.
- A Human Resources Department also plays a role. They are responsible for recruiting, hiring, training employees. They also manage the labor relations, the pay and benefits programs for the company, and the performance appraisals and feedback. Additionally, they enforce labor laws, such as all employees are legally allowed to work in the countries where they were hired, that no child labor is allowed, and that all employees know about their rights and responsibilities under the local employment laws. There are federal (country-wide) laws and local laws (state, county, city).
- Depending on your business, you might have or want to offshore and/or outsource parts of the work. It’s not only finding workforce in other countries, but also brining workers from other countries to work in the U.S. on a temporary-basis. Outsourcing also refers to contracting with US-based contractors, consultants, and temporary workers. In either case, you need to make sure you respect all the labor laws.