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Saturday, July 31, 2010

Top Ten Management on Stakeholders: An Overview of Who Has a Real Stake in The Operations of Organizations

StakeholderImage via Wikipedia
This overview of stakeholders was prepared by Whitney Varnado while a Business Administration major in the College of Business at Southeastern Louisiana University.

Introduction


Stakeholders are any constituencies in an organization’s environment that are affected by the organization’s decisions and actions. These groups have a stake in or are significantly influenced by what the organization does and these groups can influence the organization. Some of the most common stakeholders, both internal and external groups, that an organization might have to deal with include: customers, social and political action groups, competitors, trade and industry associations, governments, media, suppliers, communities, shareholders, unions, and employees.

The Idea in a Nutshell

Managers should care about managing stakeholder relationships because doing so can lead to desirable organizational outcomes, such as improved predictability of environmental changes, more successful innovations, greater degree of trust among stakeholders, and greater organizational flexibility to reduce the impact of change. It affects organizational performance because managers of high-performing companies tend to consider the interests of all major stakeholder groups as they make decisions. Another reason for managing external stakeholder relationships is that it’s the “right” thing to do because an organization depends on these external groups as sources of inputs and as outlets for outputs. Managers should consider their interests as they make decisions.

Managers can manage stakeholder relationships identifying the organization’s stakeholders. Groups that are likely to be influenced by and to influence organizational decisions are the organization’s stakeholders. They need to determine what particular interests or concerns the stakeholders might have. They need to decide how critical each stakeholder is to the organization’s decisions and actions. The very idea of a stakeholder, a group that has a “stake” in what the organization does, means that it is important. Some stakeholders are more critical to the organization’s decisions and actions than others. The final step is to determine how to manage the external stakeholder relationships. This decision depends on how critical an external stakeholder is to the organization and how uncertain the environment is. The more critical the stakeholder and the more uncertain the environment, the more that managers need to rely on establishing explicit stakeholder partnerships rather than just acknowledging their existence.


The Top Ten Things You Need to Know About Stakeholders

1. The stakeholder concept was first used in 1963. It was first used in an internal memorandum at the Standford Research institute. The theory was later developed and championed by R. Edward Freeman in the 1980s.

2. In the last decades of the 20th century, the word “stakeholder” has become more commonly used to mean a person or organization that has a legitimate interest in a project or entity. In discussing the decision-making process for institutions the concept has been broadened to include everyone with an interest (or “stake”) in what the entity does.


3. Post, Preston, Sachs (2002), in their theory called Stakeholder view, use the following definition of the term “stakeholder”: “The stakeholders in a corporation are the individuals and constituencies that contribute, either voluntarily or involuntarily, to its wealth-creating capacity and activities, and that are therefore its potential beneficiaries and/or risk bearers.” This definition differs from the older definition of the term stakeholder in Stakeholder theory that also includes competitors as stakeholders of a corporation.

4. Robert Phillips provides a moral foundation for stakeholder theory in Stakeholder Theory and Organizational Ethics. There he defends a “principle of stakeholder fairness” based on the work of John Rawls, as well as a distinction between normatively and derivatively legitimate stakeholders.

5. The word “stakeholder” has been listed as one of the top ten classic jargon terms used by English councils, and as such alarms or confuses ordinary people is best avoided. It is recognized as jargon by the UK government, and defined as such by the Learning and Skills Council.

6. There are two major elements to Stakeholder Management. These two major elements are Stakeholder Analysis and Stakeholder Planning.

7. Stakeholder Analysis is the technique used to identify the key people who have to be won over. There are three steps of Stakeholder Analysis: Identifying your stakeholders, prioritizing your stakeholders, and understanding your key stakeholders.

8. By using a stakeholder-based approach you can use opinions of the most powerful stakeholders to shape your projects at an early stage. Not only does this make it more likely that they will support you, their input can also improve the quality of your project. Gaining support from powerful stakeholders can help you to win more resources; this makes it more likely that your projects will be successful.

9. By communicating with stakeholders early and often, you can ensure that they know what you are doing and fully understand the benefits of your project – this means they can support you actively when necessary. You can anticipate what people’s reaction to your project may be, and build into your plan the actions that will win people’s support.

10. Stakeholders matter because projects are much larger, take longer, cost more, and involve much greater technological risk – and so, much more risk budgets and schedules – than ever before. Secondly, there are far more kinds of stakeholders involved than meet the eye. Thirdly, it only takes one determined and disgruntled stakeholder to throw a spanner right into the heart of a project.


The Video Lounge


This video explains what a stakeholder is and who the main stakeholders are in the VET sector. It also explains why it is important to include stakeholders in what we do as trainers and assessors.




This video explains stakeholder management. David Butter discusses one of the many issues facing business and other organizations in today’s marketplace.



My Take

I think the concept of Stakeholders is still relevant today. We are faced with internal and external decisions and opportunities in our daily lives as well as in the business world. Managers and employees have to be aware of the world and stakeholders changing around us daily. Managers should care about managing stakeholder relationships because doing so can lead to desirable organizational outcomes, such as improved predictability of environmental changes, more successful innovations, greater degree of trust among stakeholders, and greater organizational flexibility to reduce the impact of change.



References

Robbins, Stephen P., & Coulter, Mary (2009). Management. Upper Saddle River, New Jersey: Pearson Prentice Hall.

Alexander, Ian (2003). Stakeholders – Who is Your System For? Retrieved from http://easyweb.easynet.co.uk/~iany/consultancy/stakeholders/stakeholders.htm

Thompson, Rachel (2010). Stakeholder Analysis. Winning Support for your Projects. Retrieved from http://www.mindtools.com/pages/article/newPPM_07.htm

Wikipedia (2010). Stakeholder (corporate). Retrieved from http://en.wikipedia.org/wiki/Stakeholder_(corporate)

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Contact Info: To contact the author of “Top Ten Management on Stakeholders,” please email Whitney Varnado at whitney.varnado@selu.edu.

BIOGRAPHY

David C. Wyld (dwyld.kwu@gmail.com) is the Robert Maurin Professor of Management at Southeastern Louisiana University in Hammond, Louisiana. He is a management consultant, researcher/writer, and executive educator. His blog, Wyld About Business, can be viewed at http://wyld-business.blogspot.com/. He also maintains compilations of his student’s publications regarding book reviews (http://wyld-about-books.blogspot.com/) and international foods (http://wyld-about-food.blogspot.com/).

AN INVITATION TO WORK WITH US, TODAY!


If you enjoyed this publication, why not make one of your own with us! Are you a college or university student from anywhere in the world who would be interested in publishing your work in an edited online journal appropriate to your topic? Such a move can help put muscle into your resume and make a great impression on potential employers and graduate schools (and needless to say – and perhaps most importantly in the age in which we live – likely be the first thing that companies/universities view about you when “Googling” you)! If so, we can help you get that first publication for free (and more if you desire)! Visit Wyld Publishing Services (http://wyldpublishingservice.yolasite.com/) for details. We can work with you to publish your quality essays, research articles/papers, reviews, etc. – and even audio and visual media and PowerPoint presentations – given our network of edited publications and relationship with publishers around the world who want to work with you and your work. Contact us today at dwyld.kwu@gmail.com.


Read more:

Top Ten Management on Stakeholders: An Overview of Who Has a Real Stake in The Operations of Organizations

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Wednesday, July 28, 2010

How To Succeed With Reverse Auctions



Here's a quick article from Steve Bidoo on "How To Succeed With Reverse Auctions" (an ironic name when it comes to writing on reverse auctions, eh?) - see:

How To Succeed With Reverse Auctions

Good reading whether you are on the buying or selling side of the equation....

David

From the Reverse Auction Research Center: http://reverseauctionresearch.blogspot.com/

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UPCOMING TELECONFERENCE ON REVERSE AUCTIONS BEING CONDUCTED WITH LORMAN


Good day! Want to earn continuing professional education (CPE) credit and learn more about how to strategically use reverse auctions - all while not having to leave your office - or your backyard?

Here is a link to an upcoming teleconference - September 23, 2010 - that I will be conducting for Lorman - with info on registration as well - see:


Hope you can join me then!

David

From the Reverse Auction Research Center: http://reverseauctionresearch.blogspot.com/

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Think Before You Send It!: A Dozen Email Communication Tips for College, The Workplace, and Beyond

Old Main, University of Arizona 2Image by Ken Lund via Flickr
We live in an era of instant communications (Email, Text Messaging, Facebook and Twitter). It brings great advantages to how we live, work, learn and communicate, and yet, it can bring great peril as well – as once a message leaves, no “unsend” or delete really, really works! Here’s advise on how to use email more effectively with your colleagues, your boss, and even your professors!






Introduction – The World of OMG/LOL/{:-)/{:-C

Ok, this article is not provoked by any incident that particular incident that has happened to me with emails from – or to - students. However, over the past few years, as I have taught more and more online (and involved online with really everything I do, even in the traditional classroom setting), I have begun to use email - and now Facebook - as a primary communication medium with my students. In fact, I'm finding that low and behold, the "1950's model" of students waiting by a professor's office - or even calling to talk about an issue (like I did when I walked uphill through the snow in East Texas to college) - just doesn't happen anymore. In fact, I'd say that now, 90-95% of my interactions with students out of the classroom - whether with students on-line or in a "real" classroom with like desks and chairs (yeah, we still see those) - are via email.

So first, it's important that you see how many emails we see from students. Yes, I've been at the higher ed game for over twenty years, and I could write a book about the excuses I first heard, and now, which are being sent via email.

The Student Email Hall of Shame – WTF

But better to rely on the "wisdom of crowds," as the Chronicle of Higher Education has now compiled over 850 pages (as of late July 2010, and it keeps growing) of responses from professors with their favorite crazy student emails! For fun reading, see it here:

Chronicle Forums (In the Classroom: "favorite" student e-mails)

It includes such gems as those below:


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This one shows a BAD way to start:
"Yo [my last name]--what up with ". . .


This one is from the THIRD WEEK of an anonymous professor’s class:
"hi, this is ___and I'm in your ___ class but have been golfing in [sunny vacation destination] for the past couple weeks so i have missed the first few classes. just wondering if there is anything important that i have missed ... please let me know what i should do.”


This one seems to put you in a higher income bracket than the professor:
“I definitely read my schedule wrong and didn’t realize I had [your class] tomorrow morning. I had already signed up to go sailing tomorrow with a few friends. It’s the last chance of the season and I really don’t want to cancel on them. Is there any chance I can talk with you sometime tomorrow about what I will miss?”


This shows a lack of following the breadcrumb trail constructed for you to make it through the class:
“I have a question about the [assignment that is due on Friday, for which weekly reminders have been given and instructions available since the beginning of the semester]. What exactly what are we supposed to be doing??? Please let me know as soon as possible.”


This is not the way to improve your attendance and participation grade:
"I know I missed half of the classes, but receiving half the points seems a little dramatic."


Finally, this is simply inappropriate:
“Hey Sweet jeans, Can you schedule a review session this weekend? Please write me back before 5 pm because after that I only use the internet for porn. Thanks.”

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While I personally find most students to be professional in their emails, the other 10-20% are – shall we say at best – unprofessional and not well thought out (yes, there is a “draft” mode and a need to read and reread what you send BEFORE you send it). Above and beyond requests, begging and pleading, misspelled words, emails beginning - "HEY!..." All too often, that's what we see, and bad email practices can not only work against you in college (or in high school for that matter), but even more importantly, in the "real world" of work! For instance, watch the clip below that compiles email gaffes recounted by a collection of professors:





12 Pieces of Email Advice to Watch and Take Away into Your College Career and Your Bigger Career Ahead

So, what should you do to lessen the chance that you will end-up not just perhaps ruining your chances in the class (and later in your job search and even on your job) – and having your email end-up in a "hall of shame" – like the Chronicle of Higher Education has run for almost four years to date with thousands and thousands of entries. Here's a collection of a dozen videos to watch with some great email and overall netiquette advice (and yes, there are some laughs too, just don’t let these things happen to you!).




1. Email Advice for College Students in Particular From Dr. Brett McMillan at McDaniel College:





2. Howcasts on Both “How To Practice Good Phone and E-mail Etiquette At Work”




And "How to Follow Proper Netiquette Rules":





3. From Trainer and Author Tim Sanders:





4. From Will Schwalbe and David Shipley (authors of Think Before You Send):




5. From Seven Keys to Effective Email:




6. Ask the Techies (for free!!)":





7. From the Daily Idea:




8. From Corporate Comedian Greg Schwem:




9. From the Today Show:




10. And of course, from John Tesh:





11. And, of course, TheResident.Net, with the appropriate title "You Suck at Email":





12. Finally, Ricky Gervais and the original UK cast of “The Office”:






BIOGRAPHY
David C. Wyld (dwyld.kwu@gmail.com) is the Robert Maurin Professor of Management at Southeastern Louisiana University in Hammond, Louisiana. He is a management consultant, researcher/writer, and executive educator. His blog, Wyld About Business, can be viewed at http://wyld-business.blogspot.com/. He also serves as the Director of the Reverse Auction Research Center (http://reverseauctionresearch.blogspot.com/), a hub of research and news in the expanding world of competitive bidding. Dr. Wyld also maintains compilations of his student’s publications regarding management concepts (http://toptenmanagement.blogspot.com/), book reviews (http://wyld-about-books.blogspot.com/) and international foods (http://wyld-about-food.blogspot.com/).


Read More
Think Before You Send It: A Dozen Email Communication Tips for College, The Workplace, and Beyond

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Tuesday, July 27, 2010

The Rest of the Country Follows OUR Lead on Textbook Rental



One of the things that makes Southeastern very unique is the fact that we are one of the few colleges in the country that has a textbook rental system. Now with the rising costs of textbooks (up FOURTEEN PERCENT in the last year alone!), there are budding entrepreneurial start-ups like Chegg (http://www.chegg.com/) and Campus Book Rentals (http://www.campusbookrentals.com/) - and a little company called Barnes & Noble - that are starting to enter this market - with the cooperation of universities and their bookstores.

Read about these developments here in an article from today's Boston Herald:

http://www.boston.com/news/education/higher/articles/2010/07/26/as_college_text_prices_soar_students_get_a_rental_option/



What are your thoughts? How much do you think this has saved you as a student over your college career? What does this mean to you as a professor? Post your thoughts as comments here on the blog...and share this post to show how little old Southeastern Louisiana University has been doing something for decades that other leading colleges and universities are scrambling to put together now to serve their students!

David

P.S. An Important Point: This blog is not endorsed by, funded by, supported by, controlled by, (insert your verb here) by the Administration at Southeastern Louisiana University. All the input you see here is being done by faculty, staff, and students who care about Southeastern, and we are taking our own off-duty time and effort to use this space to publicize the things that are being done, today, on our campus and in our outreach beyond.



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Monday, July 26, 2010

Proof Positive That "Blank" ALWAYS Flows Downhill in Organizations

Well, the full credit for surfing the web for hours and hours to find something meaningful - and yes, funny - to share with all of you goes to my Southeastern student, Casey Hebert. He shared it with me privately and yes, you do need to see this at the link below from Canadian Content:

I’ve never seen a Flow Chart described so clearly

Here, you will find an explanation of this priceless graphic that says it all:



This is definitely a good one - and one to comment on and yes, share with your work colleagues especially!

David

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Sunday, July 25, 2010

Why Didn't I Think of That?: Proof Positive That American Ingenuity is Not Dead!



OK, don't let the title of the link fool you - or scare you off - or think I've lost my marbles! This one is definitely "safe" for work - or with the kiddos around. It is proof positive why we're going to come out of this recession the way we always do - by applying good old American ingenuity (Thomas Edison, Henry Ford, Bill Gates, Steve Jobs...)! Have a problem - there's someone making (or having made in China) a product to meet that need!

So, here's the solution for how to sneak wine or beer into an event undetected. I guess the market is tailgaters, concert goers, bored parents at kids' ball games - a million uses!

View the two videos here - both have their moments:





And read the story from AOL Small Business below:
Why Didn't I Think of That? The Wine Rack, Already a Breast-Seller - AOL Small Business.

So, whadya think? Gonna buy 1 for football season - or 12 for Christmas presents? Are you worried about what this says about us? What will kids think?

Post your comments here on the blog - this should be interesting - and yes, you can tell stories of "this happened to a 'friend of mine'...."

David



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Top Ten Management on Goal Setting: An Overview of How to Set Your Professional and Personal Goals Today


This overview of goal setting was prepared by Holly Caston-White while a Management major with a concentration in Human Resources in the College of Business at Southeastern Louisiana University.



Introduction
Goal setting can create a strong relationship between the different levels of management and lower level employees. Placing certain goals on employees could motivate them in a way which increases production, improves customer service and promotes an overall great image of the company. Also, by setting goals in someone’s professional career it could lead them to an overall change in their personal life as well. When a goal is reach it can boost a person’s sprit and give them the reason to aim higher and ultimately reach a personal goal they never thought possible. Anytime, a goal is reach it can lead to a level of success. It is a well known fact that success always breeds a desire for more personal and professional growth and a desire to be even more successful.



The Idea in a Nutshell
The goal setting concept is about a person or company trying to reach a certain object or end result that one strives to attain or aim for. These goals do not have to be large in size but can be obtain over a period of time. It is also possible by just completing smaller achievements they will help a person or persons reach a larger goal that ultimately might not have been obtainable without the smaller goals being completed.
The first studies of goal setting were performed by Cecil Alec Mace in 1935; however, Edwin A. Locke began to examine goal setting in the mid 1960s by deriving his idea for goal-setting from Aristotle. The idea behind goal setting was to make a person more prone to work through setbacks. In other words, a person is more willing to work through a setback if there is an important attended goal at the end. Pursuing a goal can lead an individual to develop cognitive strategies and can their change behavior which ultimately leads to the completion of more goals which are set in the future. Goal setting also breeds persistence within a person who is goal orientated which for a corporation could mean a number of positive things such as drive, desire and commitment.





The Top Ten Things You Need to Know About Goal Setting

1. The apparent benefits of knowing the Organization you are employed for or knowing your aspirations can help with the first goal setting rule. You should always Review the Organizations Mission or Purpose. In other words, if you choose a company whose values you do not agree with it may be impossible for you to set larger goals for yourself and the company. In the same respect, a company mission statement or purpose may be the reason you desire the employment of that company so to understand the mission statement my help you set the proper goals to gain the employment of your dreams.

2. Resources when setting goals can be extremely important. Whether or not you are setting personal or professional goals you should use every available resource and evaluate all the information at your finger tips. This is very important in today’s society because so much information can be located with the click of a mouse. Therefore; do not forget to do the research necessary but also consider the content of that research and its importance to your goal.

3. Before you can worry about resources and there importance and even before you can review a mission statement you must decide what goals you wish to accomplish. Therefore, determine your goals individually and/or gather input from others. Sometimes it helps to determine your path if you have gathered information from the ones who are closest to you. Do not be afraid of the feedback take it in stride and learn from it.

4. After you have determined your goals. The fourth thing that is most important is to write them down. Communication is a big key in making sure that you will complete those goals and be held accountable if they are not reached. However, that does not mean that you will reach every goal you set but as mentioned earlier it will make you more prone to work through those setbacks and make you a stronger person and/or employee.

5. It is important to always review your results regarding your personal and your professional goals. You should always take time to reevaluate your progress and see what changes or adjustments should be made in order to accomplish what goals have already been set. If some adjustments should be made you made want to get some feedback from another individually to see if they have better ideas that could help you revaluate and change your process. If you do not review your process this can reduce self-efficacy and thereby harm the performance outcomes in the long run.

6. When setting a goal for yourself or an employee be positive. It is difficult to get people excited about a project or a goal which needs to be completed if you are not positive. You will get a better reception from your employee and/or yourself if things are approached in a positive light. An incentive may be the given to make the goal more fun to complete. This technique is commonly used around the world to gain an end result which is being requested by a higher power.

7. Set Priorities: When goals are being handed out to certain employee or even to you set an order to be followed. If this order is set in a way which is easier for you to follow it is more likely to be accomplished in a timely manner. All of your goals should have priorities so that you are not doubling back or having to re-do an item on your list of goals because you skip a step. This will also allow you to not feel overwhelmed by having to many goals to complete and helps keep your direction on the most important ones at hand.

8. A useful way to making goals more powerful is to use the SMART mnemonic. This mnemonic is just a short and fast way for someone to remember the way to keep their goals in check. Any other words make sure your goals are specific, measurable, attainable, relevant and time-bound.

· S – Specific
· M – Measurable
· A – Attainable
· R – Relevant
· T – Time-bound




9. Goal setting is not just writing a few items down and hoping that you will complete them in some fashion. A part of goal setting is to be able to motivate you, an employee or even a team of co-workers. Goal setting will also help you build your self confidence, based on successful achievement of your goals or your team’s goals. I work for a company who preaches self confidence, reaching for the stars and setting goals which may seem impossible but to always dream of the impossible. They also believe you never give up and if you fall that a team mate will be there to help pick you up and get you back on track for your goals. Support of a team mate, boss or the company in which you work for is sometimes over looked but can be a key factor in goal setting. It can also mean the difference between making those dreams, goals come true in the short term and long term. for you personally and for the company in the long term. I have always believed that a happy employee will work harder for any boss and will do everything in their power to see that the goals are meet.

10. Brainstorming can also be helpful in setting your personal and professional goals. In other words, you may need to brain storm on the items in which you wish to achieve or find most important in your life. You must be organized or have some sort of map of the goals you wish to achieve in your life time. Whether those goals are more personal or professional you will not be able to complete any goals unless you do some soul searching to locate the most important ones to you. However, please make sure that you intend to complete those goals set forth by you. All goals are not easy to complete by if the intention is there they will form the basis for your goals and the fulfillment of your dreams.

The Video Lounge



My Take
The concept of goal setting is very important not only in the world of business but also in daily life. Those people who set goals and follow them in my opinion are more likely to complete those goals. They are also more likely to be successful and driven. Setting goals gives you something to strive for. A large part of goal setting is keeping a person motivated, wanting to aim for something better. Another part of goal setting that I find very positive is that it keeps you very organized and you feel like you have been able to scratch something off of your daily list whether you are at work or home.

References
1. Career Success Through Goal Setting. (n.d.). How to Make A Resume – Learn How to Do a Resume Right. Retrieved July 19, 2010, from http://www.powerful-sample-resume-formats.com/goal-setting.html
2. Robbins, S., & Coulter, M. (2009). Foundations Of Planning. Management (10 ed., pp. 143-160). Upper Saddle River, New Jersey: Pearson Prentice Hall.
3. Form, s. t. (n.d.). Success Factors Goal Management Software. Success Factors Business Execution Software. Retrieved July 19, 2010, from http://www.successfactors.com/info/en/goal-management-software/?source=Google_ppc&kw=Goal%20Setting&ad-id=1685157409&gclid=CLSM5YSx-KICFYlY2godXxGSkg
4. Theory, u. g., & setting, L. r. (n.d.). Locke’s Goal Setting Theory – Understanding SMART – Goal Setting Tools from MindTools.com. Mind Tools – Management Training, Leadership Training and Career Training – Right Here, Right Now.. Retrieved July 19, 2010, from http://www.mindtools.com/pages/article/newHTE_87.htm

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Contact Info:

To contact the author of “Top Ten Management on Goal Setting,” please email Holly Caston-White at W0219558@selu.edu or hollywhitemk@gmail.com.

BIOGRAPHY

David C. Wyld (dwyld.kwu@gmail.com) is the Robert Maurin Professor of Management at Southeastern Louisiana University in Hammond, Louisiana. He is a management consultant, researcher/writer, and executive educator. His blog, Wyld About Business, can be viewed at http://wyld-business.blogspot.com/. He also maintains compilations of his student’s publications regarding management concepts (http://toptenmanagement.blogspot.com/), book reviews (http://wyld-about-books.blogspot.com/), international foods (http://wyld-about-food.blogspot.com/).

AN INVITATION TO WORK WITH US, TODAY!

If you enjoyed this publication, why not make one of your own with us! Are you a college or university student from anywhere in the world who would be interested in publishing your work in an edited online journal appropriate to your topic? Such a move can help put muscle into your resume and make a great impression on potential employers and graduate schools (and needless to say – and perhaps most importantly in the age in which we live – likely be the first thing that companies/universities view about you when “Googling” you)! If so, we can help you get that first publication for free (and more if you desire)! Visit Wyld Publishing Services (http://wyldpublishingservice.yolasite.com/) for details. We can work with you to publish your quality essays, research articles/papers, reviews, etc. – and even audio and visual media and PowerPoint presentations – given our network of edited publications and relationship with publishers around the world who want to work with you and your work. Contact us today to get your work published at dwyld.kwu@gmail.com.


Read more:

Top Ten Management on Goal Setting: An Overview of How to Set Your Professional and Personal Goals Today

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Top Ten Management on Organizational Design: An Overview of Traditional and Contemporary Design Models

This overview of Organizational Design was prepared by Dustin Lane Dier while an Occupational Safety, Health & Environmental major in the College of Business at Southeastern Louisiana University.



Introduction


Designing an organizational structure is critical to managers and selecting the correct model, which fits your businesses core competencies and assets, can be a challenge. In reality, as any business evolves, chances are the organization will take on several of the below, outlined, organizational design models. Why is organizational design important? It is at the heart of how your business will function, determines how business decisions will be made, how many managers/employees a company will have and how it will conduct business. Without some form of organization design, whether traditional or contemporary, it will be difficult to focus your company and your human assets to maintain a competitive edge over the competition.



The Idea in a Nutshell

The organizational design of a company reflects its efforts to respond to changes, integrate new elements, ensure collaboration and allow for flexibility. Organizational design models have evolved over time due to several factors including technological advances, research of historical data regarding profitability of past companies and market changes. Traditional organizational design models include; simple structure, functional structure and divisional structure. Contemporary design models include; team structures, project structures and boundary less organizations. All have their distinct advantages and disadvantages which we will explore further.



The Top Ten Things You Need to Know About Organizational Design Models

1. Simple structures are typical for businesses in the early stages of development. They usually have one primary decision maker (owner/president) responsible for decisions in all functional areas. Span of control or number of employees overseen by one individual is greater than in other design models and very few rules exist.

2. Functional structures quite simply group occupational classes together. For instance, all HR professionals work together while all accountants have their own department. Operations exist in their own world while payroll acts independently of the other groups. This model encourages technical expertise and reduces duplication of activities.

3. Divisional structure is a design model that group specific business groups together. Perhaps those in the same industry (e.g. oil & gas) form one group while construction makes up another, separate business unit. This is typical in large companies that serve more than one industry and/or that have grown dramatically through merger and acquisitions.

4. Team structures assign specific work “teams” which are comprised of employees for different functional groups, to complete work tasks/projects in the manner they feel is best. Employee empowerment is the key and while freedom exist with little direct oversight, each team is completely responsible for the work of their group is assigned.

5. Project structures assemble teams of employees with specific skill sets and assets to work from project to project. The teams form and disband as work requires and this type of structure usually eliminates the bureaucracies of large organizations, specifically slow decision making processes. When one project is completed, employees move on to the next project, never returning to formal departments.

6. Boundaryless organizations have no limitations from horizontal, vertical or external boundaries. Walls are broken down and little actual structure exists between external customers, internal departments or functional groups and even vertical organizational levels of management. Work specialization is minimized thereby reducing departmentalization allowing creativity and most importantly employee empowerment.

7. Organizational designs today should support employees in doing their work flexibly but also effectively and efficient. Balancing these two items is at the heart of many touch decisions of managers in today’s organizations. The question should be which design model would best compliment your organization and be competitive by efficient work and cost savings while maintaining the best employees and talent possible, which can mean flexible work schedules.

8. Connecting employees in this new age of technology is crucial to maintain qualified resources. Gone are the days of all hours worked must be at the office and under the boss’s nose. Today, thanks to advances in the web and virtual programs, employees can be just as effective from home on the couch or in another state while visiting family.

9. Learning organizations know how to shake and roll. They are jumpers and earth shakers, experts at adapting to changes in the business environment and market fluctuations. Employees continuously evolve with advancements in technology and industry best practices continuously improving their ability to make decisions that keep the companies competitive advantage over the competition.

10. Most every company in today’s day and age are itching to go global. How does that affect organizational design? Well, greatly. While some models will work anywhere, cultural differences are at the heart of whether the organizational design you choose for your organization’s internationals locations will fail or succeed. Authority is valued differently in different areas of the world and freedom, acceptance, even colors make a difference. Did you know the color pink is unacceptable to men in China and could dramatically affect your marketing campaign? A CEO located in the United States certainly would more than likely be unaware of the offense of that color; however a project structured team, handling the business in China would have made that catch, altered the marketing strategy and perhaps saved the company thousands.



The Video Lounge



The above video clip does a great job in laying out several of the different options for organizational design. Functional, Product, Customer, Geographical and Matrix designs are all discussed in details and the speaker even gives on pro and one con per design choice.



My Take

Organizational design is still a paramount concept in business today. In fact, a company cannot exist except to be organized in one of the above mentioned ways. Selecting the right design model and recognizing when the organization has outgrown the one you choose first are critical to your success as a manager. Study them carefully and research competitors in your industry but do not be afraid to lead the way.


References

CliffsNotes.com. What is organizational design? 20 Jul 2010.

Coulter, Mary and Stephen P. Robbins. Management. 10th. Upper Saddle River, New Jersey: Pearson, 2009.
http://owl.English.Purdue.edu/owl/resource/560/01/

McNamara, Carter MBA, PhD (1995). Guidelines for Organizational Design. Retrieved from http://managementhelp.org/org_thry/design.htm

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Contact Info: To contact the author of “Top Ten Management on Organizational Design,” please email Dustin Lane Dier at Dustin.Dier@selu.edu or Dustin.Dier@yahoo.com.

BIOGRAPHY

David C. Wyld (dwyld.kwu@gmail.com) is the Robert Maurin Professor of Management at Southeastern Louisiana University in Hammond, Louisiana. He is a management consultant, researcher/writer, and executive educator. His blog, Wyld About Business, can be viewed at http://wyld-business.blogspot.com/. He also serves as the Director of the Reverse Auction Research Center (http://reverseauctionresearch.blogspot.com/), a hub of research and news in the expanding world of competitive bidding. Dr. Wyld also maintains compilations of his student’s publications regarding management concepts (http://toptenmanagement.blogspot.com/), book reviews (http://wyld-about-books.blogspot.com/) and international foods (http://wyld-about-food.blogspot.com/).

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Read more:
Top Ten Management on Organizational Design: An Overview of Traditional and Contemporary Design Models

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Yashi

Chitika