IX. Managerial Management

A. Introduction

A modern approach to organizational structure is building the entire organization as a series of teams. In this style of organizational structure, employee empowerment is critical for success. In effect, the workers within the team become self-managers and are responsible for the work design, work activity and performance.

Before managers leap onto the team concept, some cautions are in order. First, teams are inherently unstable. It requires managerial skill to keep teams focused on project and to reduce conflict. Second, team building takes time. There are a number of developmental steps that a team must progress through before any effective work can be realized. Third, change within the team is often dysfunctional. Changing team members will reset the team almost back to the first step. Topic 5.2 will deal with team management much more deeply. The team concept is a valid one, so long as the management realizes some of the unique aspects of this method of accomplishing work.

B. Total Quality Management (TQM)

TQM focuses on accomplishing high quality work through interdisciplinary teams or production teams. By empowering workers with decision making authority and molding them together by product or function, it is hoped to increase efficiency, reduce rework and waste, and to find better methods of accomplishing work.

Changing an organization over to a TQM basis is not easy. There is a large training cost involved with TQM implementation and changing a non-team-based corporate culture takes major management involvement. Workers that before only performed a task within a process must now become involved with the entire process and learn some statistical methods for monitoring production. Some incredible achievements have been reached with TQM, but only in situations where all levels of management understood the TQM process, top management actively supported the changes, and the workers were willing to enlarge their jobs.

In the most basic model of TQM there are three levels of teams. At the top is the Executive Steering Committee (ESC) which creates corporate vision, mission and goals. The ESC is a team that does the work normally the responsibility of the CEO in creating corporate direction. This is a permanent team.

The next team level is the Quality Management Board (QMB). These are permanent teams centered on critical processes within the organization. Their task is to implement the goals and vision of the ESC in their process. An information linkage is created between the ESC and QMB, normally a member of the ESC sits on a QMB to act as a liaison and information clarifier for the QMB.

The lowest level of the team structure are temporary groups called Process Action Teams (PATs). These temporary teams exist to gather data, examine and outline processes within an organization, and to be the "eyes and ears" of the QMB. As with the ESC/QMB connection, there is an informational linkage between the PAT and its parent QMB, normally a QMB member.

C. Matrix Organizations

A creation of the 1960s, this is a unique structure that cross-assigns specialists from their functional departments to projects. This created a dual chain of command. Workers looked to their project leader for work assignments, but their advancement and salary recommendations were still their functional manager's responsibility. While it worked well in some industries, it proved difficult in many and was considered unmanageable in most situations.

This failure was not due to the interdisciplinary team concept, but rather to the violation of the unity of command. Workers who worked hard for their project managers might not receive rewards from the functional manger that rewarded those workers who stayed in the function. This conflict primarily injured the workers and their morale. While greater communication between managers resolves much of this conflict, the communication often occurred after the problem surfaced, not before.

D. Project Structure

As a solution to the dual chain of command problem in the matrix structure, some organizations made the project a permanent assignment. This gave all the control over to the project manager. This removed the conflicts inherent in the matrix structure while still maintaining the benefits of a cross-functional team.

Because the functional manager no longer had control over his or her specialists, the entire functional structure lost its relevance and was scrapped. Now individual specialists move from project to project as one reaches completion. This structure is very familiar to anyone who has worked in the motion picture industry.

When a movie project starts, experts in every field are hired for the specific duration of the project. As their job is finished, they return to the labor pool awaiting another project. This keeps costs low for the movie studios (significantly smaller staff) and ensures that the most technically competent workers are hired for projects.

E. Autonomous Internal Units

These are structures with the organization that stand alone as separate business entities. They are responsible for their own products, customers, profits, and to meet the challenges of their competitors. There is no overall guidance from the parent corporation and these units are judged by the same performance indicators as an outside company would be.

 

Copyright Information
Title: Managerial Management (Lecture Notes)
Author: John Anderson  (Instructor)
University: National University
Course: MGT 409C- Principles of Management and Organization
Date: June 1, 2002 (Received)

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