Organizational Agility
Operations Management
The Responsive Organization
The formal structure is put in place to control people, decisions, and actions. But in today’s fast-changing business environment, responsiveness —quickness, agility, the ability to adapt to changing demands—is more vital than ever to a firm’s survival.
The Responsive Organization
Mechanistic organization
A form of organization that seeks to maximize internal efficiency.
Organic structure
An organizational form that emphasizes flexibility.
Strategy and Organizational Agility
Certain strategies, and the structures, processes, and relationships that accompany them, seem particularly well suited to improving an organization’s ability to respond quickly and effectively to the challenges it faces.
Strategy and Organizational Agility
Organizing around Core Capabilities
A core capability is the knowledge, expertise, or skill that underlies a company’s ability to be a leader in providing a range of specific goods or services.
Managers who want to strengthen their firm’s competitiveness via core capabilities need to focus on several related issues:
Strategy and Organizational Agility
Strategic Alliances
A strategic alliance is a formal relationship created with the purpose of joint pursuit of mutual goals.
In a strategic alliance, individual organizations share administrative authority, form social links, and accept joint ownership.
Managers typically devote plenty of time to screening potential partners in financial terms.
But for the alliance to work, the partners also must consider one another’s areas of expertise and the incentives involved in the structure of the alliance.
Strategy and Organizational Agility
The learning Organization
A learning organization is an organization skilled at creating, acquiring, and transferring knowledge and at modifying its behavior to reflect new knowledge and insights.
How do firms become true learning organizations?
Strategy and Organizational Agility
The High – Involvement Organization
In a high-involvement organization, top management ensures that there is a consensus about the direction in which the business is heading.
The leader seeks input from his or her top management team and from lower levels of the company.
Structurally, this usually means that even lower-level employees have a direct relationship with a customer or supplier and thus receive feedback and are held accountable for a good or service delivery.
Organizational Size and Agility
One of the most important characteristics of an organization and one of the most important factors influencing its ability to respond effectively to its environment, is its size.
The challenge is to be both big and small to capitalize on the advantages of each
Large organizations
Are typically less organic and more bureaucratic.
Small organizations
Can move fast, provide quality goods and services to targeted market niches, and inspire greater involvement from their people.
Customers and the Responsive Organization
The point of structuring a responsive, agile organization lies in enabling it to meet and exceed the expectations of its customers
Managers need to balance the strategic triangle, and successful organizations use their strengths to create value by meeting customer requirements better tan competitors do.
Customers and the Responsive Organization
Customer Relationship Management
Customer relationship management (CRM) is a multifaceted process, typically mediated by a set of information technologies, that focuses on creating two-way exchanges with customers so that firms have an intimate knowledge of their needs, wants, and buying patterns.
Customers and the Responsive Organization
Value Chain
A value chain is the sequence of activities that flow from raw materials to the delivery of a good or service, with additional value created at each step.
Customers and the Responsive Organization
Quality Initiatives
Often the effort to be more responsive has brought managers face to face with the need to ensure consistently high quality.
Quality Initiatives | Description |
Total Quality Management (TQM) | An integrative approach to management that supports the attainment of customer satisfaction through a wide variety of tools and techniques that result in high-quality goods and services. |
Six Sigma Quality | A method of systematically analyzing work processes to identify and eliminate virtually all causes of defects, standardizing the processes to reach the lowest practicable level of any cause of customer dissatisfaction. |
ISO 9001 | A series of quality standards developed by a committee working under the International Organization for Standardization to improve total quality in all businesses for the benefit of producers and consumers. |
Technology and Organizational Agility
Technology can be viewed as the methods, processes, systems, and skills used to transform resources (inputs) into products (outputs).
In other words, the systematic application of scientific knowledge to a new product, process, or service.
Technology and Organizational �Agility
Types of Technology Configurations
Small batch | Technologies that produce goods and services in low volume. |
Large batch | Technologies that produce goods and services in high volume. |
Continuous process | A process that is highly automated and has a continuous production flow. |
Mass customization | The production of varied, individually customized products at the low cost of standardized, mass-produced products. |
Computer-integrated manufacturing (CIM) | The use of computer-aided design and computer-aided manufacturing to sequence and optimize a number of production processes. |
Flexible factories | Manufacturing plants that have short production runs, are organized around products, and use decentralized scheduling |
Lean manufacturing | An operation that strives to achieve the highest possible productivity and total quality, cost-effectively, by eliminating unnecessary steps in the production process and continually striving for improvement. |
Technology and Organizational Agility
Organizing for Speed: Time-Based Competition
Time has emerged as the key competitive advantage that can separate market leaders from also-rans.
Time-Based Competition (TBC) | Strategies aimed at reducing the total time needed to deliver a good or service. |
Logistics | The movement of the right goods in the right amount to the right place at the right time. |
Just-in-time (JIT) | A system that calls for subassemblies and components to be manufactured in very small lots and delivered to the next stage of the production process just as they are needed. |
Concurrent engineering | A design approach in which all relevant functions cooperate jointly and continually in a maximum effort aimed at producing high-quality products that meet customers’ needs. |