X100 Engagement #7 Organization Design A thought to ponder! What is more important to the economy? 1. More good paying jobs. 2. Higher company profits. 3. Lower prices. 4. Higher executive pay. 5. Easy credit terms. While all are positive, more good paying jobs is the long term perpetual engine of consumption! Economic Fundamental! Portion of productivity improvements goes to workers in form of higher pay. (Henry Ford) Today profits as a % of GDP never been higher, and Middle Class purchasing power continues to decline. System not working as it should! Term Paper Due 11/16 2 Weeks/or 14 days Eat the Frog!!!!!! Headlines/News Indiana Hoosiers IU 24 vs. Iowa Hawkeyes 42 (Still Undefeated) IU…4 and 5. 2 more wins to become bowl eligible. 2009 Level 5 Tally – 8 Games Green Section 19 Gold Section 23 Silver Section 21 Total 63 (-1) Goal 92 Need 15 for each of the last two games to hit our goal. The Four Basics of Management Planning Organizing Directing Controlling Often over looked in importance! Taylor Conrad Gold Tyun Fomby Silver Chad Smith Silver Brandon Cohen Silver David Greenberg Silver Manveer Grewal Silver Kaleem McGill Silver Level 5 Verification (10/31) Green (19) Andy Binkle Alesia Brown Sean Brown William Frasier Hunter Harritt Ebony Holmes Jordan Karasik David Kilpatrick Alexi Kotlairsky Noah McElroy Tyler Miller Amanda Monacy Brad Montgomery Derek Morphew Katy Sims James Roller Alexis Torrez Nick Turner Nick Vaughan +20 +10 +20 +20 +20 +10 +20 +20 +20 +10 +20 +20 +10 +10 +10 +10 +20 +10 +20 Level 5 Verification – 10/31 James Stark Gold (23) Marlon Wright Jessica Allman Joe Angeli Rajan Bawa Jonathan Brown Taylor Conrad Katelyn Dawson Chris Erhart Taylor Ford Yi Fu Amar Iyenger Lauren Kelley Jonathan Klem Kyle Little Charles Miller Rick Owens Alex Rich Ryne Ring Cerwin Rush Jake Schwartz +10 +20 +20 +10 +10 +10 +10 +10 +10 +20 +20 +20 +20 +10 +20 +20 +10 +20 +20 Corey Young Qiang Zhao +10 +20 +20 +10 Level 5 Verification (10/31) Silver (21) Justine Barbrack Brandon Cohen Korey Daumhauer Sheev Dave Paige Draga Rachel Elman Jason Feldman Tyun Fomby David Greenberg Manveer Greval Jarad Jochem Adrian Khudayev Jennifer Kienzl Lauren Kohut Dan Malloy Kaleem McGill Nitin Reddy +20 +10 +20 +20 +20 +10 +10 +10 +10 +10 +10 +20 +10 +10 +20 +10 +10 Jonah Scheichen Chad Smith Jameil White Alex Wojno +10 +10 +20 +20 20 Organization Design Past Traditional Command & Control Centralized Management & worker division – unions Protected worker Present Discussion of employee involvement and engagement, but not manifesting itself Command & control still rules Corporate trust at all time low Increasing pay spreads Isolated moves to decentralization Future Increased “New Market” focus Increased de-centralization Higher trust levels – less “meism” Reallocation of decisions, responsibility accountability, & pay from the top – “collective competitive mindset” Simplified project based work design ,work flow,& distribution of information 19 Key elements of an organization. (team) People – who (engines of business) (who on the bus) Roles – what each person does (right seat) Objectives – what needs to get done…alignment assignments both team/ individual Culture/Collective Mindset – the unwritten way a company completes the art of business. (invisible but measureable) 101 18 Every Organization is Unique! What works at one may not work for another! (?) Jack Welch General Electric (GE) Succession Cookie Cutter/One Size Fits All/Fad Solutions 17 Organizing is the single most important decision that will set the tone of your quality as a decision maker! (?) Fewer people to choose from in the future! (?) I2U 16 Having All “A” Players…Does Not Assure an “A” Team (?) 15 Synergy Whole is greater than the sum all the parts due to interdependent relationships – Others take others higher! I2U 14 The Organizing Process The primary function of any organization structure is to achieve the Mission & Objectives. Must include Customer Satisfaction. # 1 Leading Indicator of Long-Term Success! (?) I2U Different missions and objectives require different organization structures! 102 12 Organization Chart Often a Single Page Chain of command- Flow of authority- top to bottom! Departmentalization – grouping of linked activities – ie. Marketing /Sales/Advertising. Span of control – Number of direct reports. Centralization/De-centralization. – Freedom to operate own. 104 11 The culture/collective mindset of an organization holds the keys to level of sustainable performance. Assessing a culture is like having a crystal ball, it will predict your future success. I2U 10 An organizations/leaders personal belief about people shapes/brands/grips a business. The collective mindset shapes the results: Theory X Theory Y I2U Lazy Self starting Need to be motivated Will motivate themselves Repeat the past Creative/innovative change Do not care Improve to make better Just get through the day A better future 9 Management By Objective Great way to align and spell out department and individual responsibilities throughout the entire organization. Company goals Agreed goals supervisor and subordinate Individual objectives Monitor progress Annual employee performance reviews I2U 91 8 Characteristics of Good MBO Goals Consistent with organization’s goals (alignment) Quantifiable & achievable (measure) Understandable & understood (transfer understanding) Very Important! Empowerment without Alignment is Dangerous. Time based (schedule) 92 7 Ways of Doing Business • Problem Solving • Opportunity Seeking – Tactical – Strategic – Near term – Long term – Narrow definition – Broad definition – Reactive/negative – Proactive/positive – Promotes conflict – Promotes cooperation – Looks backward – Looks forward – Finds symptoms – Reveals underlying reality I2U 6 The Future - Accelerated Speed of Business/Change (More fluid organization designs.) • Increased Customer Focus • Increased Consumer Complexity - Declining Talent/Labor Market - Growth of Generation X and Y This going to be your world! 5 You Ain’t Seen Nothin’ Yet! It’s Only Going To Get Weirder, Tougher, and More Turbulent… Ladies and Gentlemen, The Captain Has Turned On The “Fasten Seat Belt” Sign…We’re Going From Nuts To Flat-Out Freakin’ Crazy. Tom Peters, Fast Company - Mach 2001 4 The Future Requires a Different Approach! • Past - Slower Market Changes ↓ Skillfully Managed by a Few I2U • Future - Faster Market Changes ↓ Complexity...Requires New Leadership Style 3 Our general conclusion is that, in far too many instances, the United States in attempting to implement tomorrow’s competitive strategies with yesterday’s managerial ideas. “The New American Workplace” James O’Toole and Edward Lawler III 2006 2 New Competitive Environment I2U •Required • Observed (1)focused diligence & (1)focused on internal reaction to market processes &cost changes reduction (2)creating a change (2)decisions made at the adaptive/high trust top, driven down culture (3) employees (3)having employee buy in micromanaged 1 Chain of command – Establishes the flow of authority and responsibility – Who reports to who – who the supervisor can delegate responsibility and what each person is accountable to do – who can help supervisor make organization better – Supervisor needs help!. Departmentalization - Functional – Marketing, Finance, etc. Customers – National airlines – commuter Geography – Location – US – Asian Rim Product Line – Buick, Pontiac Span of Control - Span refers to the number reporting directly to a person I2U Centralized organization – authority at one location De -Centralized – Toyota North America has offices in North America 105 - 107 Only 10% of employees look forward to going to work & most point to a lack of leadership. Maritz Research Seven Secrets of Inspiring Leaders! 1. 2. 3. 4. 5. 6. 7. Demonstrate Enthusiasm…Passion! (Hire Passion!) Articulate a Compelling Course of Action! (Buy-In!) Sell the Benefit! (Alignment!) Tell More Stories. (Transfer Understanding!) Invite Participation. (Involvement/Engagement!) Reinforce an Optimistic Outlook. (Hope!) Encourage Potential. (Stretch!) Carmine Gallo – BusinessWeek - 10/11/07 Go Hoosiers!!!