What are some possible consequences to differentiation?

1. Hostility towards the “out-group”

2. Tendency to only see the good of your group and ignore the weaknesses

3. Selective listening- listen only to ideas that support your group and ignore those that might go against your group even if they are valid

4. De-individuate or depersonalize the out-group

Group culture comes from a combination of Hill's three design factors:

1. Group Composition

2. Task design

3. Formal organization

Design Factors Leading to Group Culture

1. Self-limiting behavior (I'm not smart enough to comment)

2. Swept up in the emotion/excitement of the moment

3. Wanting/Needing to look good for sponsors (Carter racing)

4. GROUPTHINK (Crowds out dissenters and careful reasoning based on the voice of the majority)

5. Time constraints

6. Fatigue

7. Face saving

8. Strong views are expressed by the leader

Confirmation Bias

Sunk Costs

Escalation of Commitment

Judgement Heuristics

Self-limiting behavior

Group-think

Bureaucratic ethic

In Group/Out Group Effects

1. Presence of someone with expertise

2. Compelling arguments

3. Lack of confidence

4. Belief that the decision being made is unimportant

5. Pressure to conform someone else's decision

6. Dysfunctional decision-making climate

1. Self-Censorship

2. Peer Pressure

3. Apparant Unanimity

4. Defective Decision-Making Strategies

5. Illusions of Invulnerability

6. Biased perceptions

1. More complete information

2. Increased diversity and views

3. Increased legitimacy

4. Increased acceptance of the solution

1. Time consuming

2. Pressure to conform

3. Domination by a few

4. Ambiguous responsibility

5. Slower than individuals and less efficient

1. Pay attention to group composition and size

2. Reduce power and status differences

3. Frame the task appropriately

4. Set clear, consistent, challenging and specific goals

5. Set group process norms

6. Monitor decision-making process

7. Provide honest feedback

1. Members have fixed positions that they rarely leave

2. Players play on a team but not necessarily as a team

Advantages: 

Disadvantages:

Members have fixed positions and play as a team

Advantages:

Disadvantages:

1. Members have a primary role, rather than a fixed position

2. Only the team performs while the members contribute

Advantages:

Disadvantages:

Managing Paradox (Hill)

Think of the Blue Angels as the prime example:

1. Embrace individual differences and still keep collective identity and goals

2. Foster support and confrontation among team members

3. Focus on performance and learning/development

4. Balance managerial authority and team member autonomy

1. Does the team's output meet the standards of those who have to use it?

2. Does the team experience contribute to the personal well-being and development of the members?

3. Does the team experience enhance the capability of the members to work and learn together in the future?

What is culture?

The reason I don’t think it is likely we will find a company who replicates SWA’s culture is because it is very difficult to create the necessary underlying assumptions to make it happen. These assumptions would be

nearly impossible to change in a large scale company like Delta and a small company has Southwest to compete with.

1. Let the group organize itself. The manager just provides direction and a positive environment.

2. Impose a structure on the group that is based on proven rational.

1. Division of Labor

2. Coordination of how tasks are integrated

3. Decision rights: who makes decisions?

4. Boundaries: what we make vs. what we buy

1. Informal Structure: influence how information flows

2. Political structure and power: agendas, coalitions

3. Legitimate Authority: title, expertise, charisma, social status

1. Functional

2. Divisional

3. Hybrid

4. Matrix

5. Network/Emerging

Advantages: Efficient use of resources, economies of scale, in-depth skill development, central decisions and directions, excellent coordination within functions.

Disadvantages: Poor coordination between functions, difficult to respond to environmental changes, decisions pile on top mgt, slow response, little innovation, who's responsible? No one knows!

Use with small to medium organizations in stable environments, goals of efficiency and technical quality

Advantages: Fast changes in unstable environment, product/customer focus, high coordination between functions, develops general managers.

Disadvantages: Duplication of resources, less technical specialization, poor coordination between product lines, less top mgt control.

Use in unstable environment, large size organization, goals of product specialization, innovation.

Advantages: Provides coordination within and between product divisions, helps organization attain adaptability in departments and efficiency in others.

Disadvantages: Conflict between corporation and divisions, administrative overhead.

Use in unstable environments, large size organization, product specialization and efficiency are goals.

Advantages: can manage dual demands from environment, flexible, efficient use of scarce resources, adaptation and innovation, develops general management skills.

Disadvantages: dual authority causes frustration and confusion, high conflict, time consuming, special training required, difficult to maintain power balance.

Use in very uncertain environments, medium to large organizations, non-routine technology, high interdependence, dual goals of product and functional specialization.

Advantages: highly flexible, customer focus, decisions taken at operating level, less formal hierarchy, fast response to change. 

Disadvantages: difficult to share knowledge between teams, eliminates formal expertise, lack of control from center, duplicated resources, diffused accountability.

Use in highly unstable environment, flexibility is the key, highly individualized service or product, professional service organizations.

1. Interpersonal-Figurehead, leader, liaison

2. Informational- monitor, disseminator, spokesperson

3. Decisional- Entrepreneur, disturbance handler, resource allocator, negotiator

Business Management: Amoral instrument of the manager's will.

Business Administration: the firm is viewed as a tool for social good.

Business Management: A contingency to be managed. A resource to be integrated in an organizational structure.

Business Administration: thinking, creative, and capable of making hard decisions. Seek responsibility.

1. Efficiency of resource utilization

2. Efficiency of time utilization

3. Responsiveness to the environment

4. Adaptability over time

5. Ability to hold people accountable

Change can take the form of:

Education, facilitation, negotiation

or

manipulation, co-optation, coercion

Success is whether or not change is implemented

Pretend the Microsoft/Yahoo merger deal has

just been finalized

o Using your knowledge of organizational change, what advice would you give the new leaders of the new, merged organization (aka “Microhoo”)? What change strategies should they employ and why?

o Using your knowledge of organizational culture, what issues do you foresee as the two companies merge?

• Businesses are increasingly involved in CGC that force them to work with communities to make a positive impact.

Corporate Social Responsibility

Friedman: Executives have a responsibility to their employees and the shareholders; social responsibilities may be a conflict of interest; social responsibility is UNDEMOCRATIC

Tichy: Yes- the corporation is the most powerful entity on the earth and can solve the world's most pressing problems.

Friedman: No- the corporation is not a person, the executives and employees can use their own money to help society solve its problems, executives are spending other people's money if they use the corporation to solve society's issues.

Yes. "they aren't like the rest of us. They have no soul to save, and they have no body to incarcerate." The only thing they have is "the bottom line"

If the corporation were a person, it might be considered a prototypical psychopath.

Are corporations simply artificial, legal structures, as Friedman states?

To whom do these companies, as legal persons, owe loyalty?

• Labor strife-23,000 strikes, corporations used the big stick theory-quelch strikes by violent force.
• New Fiction Theory- the corporation shifts from a creature of the state to one of private agreement.
• Railroads led to increased manufacturing
• Business strategy? Dog-eat-dog

• The economy/corporations should serve the public interest.
• Welfare Capitalism-Americanization classes, cooking & sewing classes, company housing, etc.
• Natural Entity Theory- the corporation is a real entity with power and influence.
• Corporation focuses on growth instead of attacking competitors.

• Greater governmental regulations on corporations. Social Security, SEC, etc.
• Institutional View of corporations- responsibility to stakeholders as well as shareholders, shareholders deserved a fixed return, life long employment, benefits for workers.
• Business strategy-sales and manufacturing, goal of stability and security.

• Increased international competitiveness, deregulation of the financial industry.
•  Shareholder Value theory- the corporation is a "nexus of contracts" (a collection of contracts between different parties), the firm is amoral and an instrument of the shareholders a corporations singular purpose: profit
• Increased jobs in services, decreased jobs in manufacturing
• Emphasis on shareholder returns (outsourcing, cutting costs, wages, jobs, benefits. 
• We are now an ownership society-number of Americans who own stock through 401k.

• We went from a society of corporations to a "portfolio society" in which households became more and more tied to the market
• Finance based theory-it is appropriate to guide corporations using share price as the North Star.

Is the shareholder primacy view part of the

reason for our current economic decline?