Online Custom «The Concept of Organizational Design» Essay Sample

The Concept of Organizational Design

The two articles reviewed in this paper touch on the subject of organizational effectiveness, although in different ways. While Sparrow and Cooper (2014) provide a historical perspective on organizational effectiveness theories throughout the 2nd part of the 20th century and up to modern days, Chiu and Liaw (2009) focus primarily on the issue of organizational slack and its influence on company performance and its effectiveness. Through the analysis of both articles, it is possible to define the views of authors on organizational design as well as on organizational effectiveness. This analysis draws a number of conclusions on how the two views are similar and what are their differences as well as defines the major advantages of each point of view.

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Sparrow and Cooper (2014) study the changes of perception of organizational effectiveness in different periods of time. They begin the research into the managerial thought and organizational analysis of the 1950s with the system model that emphasized the importance of proper interplay between such factors as flexibility, productivity, and absence of organizational strain (p. 4) for the success of an organization. From the goal-based organizational models the authors move to the people-based ones of later periods, which emphasize the role of leadership and management in organizations. For example, Sparrow and Cooper (2014) emphasize the role of talent management models in the organizational design of modernity. These models move beyond the appreciation of contributions made by one sole leader and rather focus on the performance of all employees. Therefore, through the overview of the changing effectiveness models this article provides an understanding of how perception of organization and organizational models were as well changing with time.

The authors further emphasize the value of human factor in company development by noting the importance of HR management in organizational effectiveness. Thus, the study of “changes in the structure of employment, job stbility and employment outcomes and quality of the employment relationship” (p.7) and implementation of its results in practice is able to influence organizational performance positively. Sparrow and Cooper (2014) in numerous situations underline the importance of employees (not only leadership and management) for the increase of company’s performance and effectiveness.

Sparrow and Cooper (2014) note that from the organizational design perspective, organizations were always limited by environments and were made to create effectiveness criteria based on “performance norms underpinned by essential values” (p. 6). And internal company values and ideologies had, therefore, to be adjusted to the environmental limitations.  Sparrow and Cooper (2014) also note that organizational designs constantly decrease their efficiency, thus require re-design from time to time. The authors even emphasize on the re-design of strategic organizational process, which is more global than the organizational design of individual business entities.

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Through the analysis of organizational slack and its influence on company effectiveness, Chiu and Liaw (2009) provide an understanding of different types of slack and how it can increase company productivity and performance. This research is of great significance because there were contrasting points of view, which emphasized very different types of influence that slack can have on company’s development. By conducting a thorough research, the authors conclude that the balance and optimization of slack lead to increased company performance. Moreover, they unexpectedly state that optimal slack is the one located near one of the extremes, while moderate slack does not provide significant performance increase.

What is more important for this analysis, the authors provide their understanding of company’s design and functioning. Chiu and Liaw (2009) see companies as organic entities, which require managers to organize and utilize resources that were naturally collected by a company. Of course, same as Sparrow and Cooper (2014), these two authors believe that external factors, such as available resources, have a significant influence on the company, but the process of company development is rather natural than man-made.

This is the one discrepancy between the two points of view on organizational design and development. Sparrow and Cooper (2014) believe that organization has to be adjusted to the changing external conditions from within, otherwise its effectiveness will decrease as organizational designs become less useful and wear down with time. Chiu and Liaw (2009), while believing in the importance of managerial activities in allocating resources within a company, see firms as natural creations, the change of which is at large facilitated by external environmental conditions. The task of managers is, therefore, introducing a change within the company while it naturally evolves. In fact, the issue of change is a common topic for both articles. It was developed by both groups of authors, but in slightly different way, which follows the peculiarities in the understanding of organizational design and performance. Both groups of authors note that companies have to be in line with external environments in order to be effective. Sparrow and Cooper (2014) maintain that people need to introduce global changes in organizational designs because current ones are losing their effectiveness. Chiu and Liaw (2009) do not accentuate a major change in organizational design, but rather note the importance of constant alignment of company’ performance with external factors.

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The two articles reviewed in this study focus on organizational effectiveness, explaining the authors’ understanding of organizational design. While Chiu and Liaw (2009) believe that organizations are natural to a large extent and managers are required for their adjustment, Sparrow and Cooper (2014) see companies as largely based on human factor and individual performance. Despite the differences, the two articles stress the importance of organizational change.

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