Friday, June 17, 2011

Evolution of Formal Organizations





            Everything in today’s society has changed in many ways compared to the way they were

done 100 years ago. Starting with the way jobs are done, and their employees. One of the few

things that remains from the past (and hopefully will continue to remain intact) is the way

organizations and their hard work is recognized. Over time, new workers start to take over, and

a lot of formal organizations started to change to be more flexible in the work environment.

For centuries, most of the formal organizations operated under conventional bureaucracy,

which is made of many levels like a pyramid. The pyramid starts out with the “top” people in the

organization, who have the highest ranking authority to tell the people under them what they

need to do. This pyramid works its way down to the people of the formal organization that have

no authority what so ever. The pyramid allows an organized structure. This makes it to where

there is always a supervisor that one must comply with. Within the pyramid, every person in it

has a responsibility to uphold. Each person in the pyramid has a specific responsibility and then

they must report to a specific person or supervisor. This means that there is no equality within

the company, and the lowest person in the chain has to do whatever those with the higher power

in the company told them to do.

Back in the early 1900’s, organizations were not efficient enough in the quantity or

quality, and even their job performances. Because of this, the managers only had a few tasks that

were required of them. The manager would look at each worker, and their performed job, and

then designate the allotted time to finish their job. After that they would try to figure out how to

get the most out of their workers time. In the end, incentives for the workplace were created in

order to show the appreciation of the organization to its employees known as Scientific

Management.

During the mid 1900’s the companies were not making the most out of their workers

especially when it came to the hiring process, or advancements in the company. Since most of

the managers in high positions were white men. Minorities and women were not allowed to

move up in the company. This is known as a “closed organization”, and caused unproductive

workers due to the lack of being able to advance in the company. Once companies realized that

they needed to be more open and allowed the minorities and women to advance in their

company, they became more profitable.

In this day and age, organizations are more flexible about their workers, and the

advancements within the company for its workers. Instead of using the previous model of top-

down pyramid, they now work together as a team with a senior manager overseeing their

responsibilities. Team members are now implemented for their creativity and ideas (if

appropriate). There is less supervision with the same expectation of work. Employees are now

encouraged to work in “teams” which is very different from a century ago. We now live in an

ever changing world that has creativity and adaptation that are vital to the business organizations

today.

In order for Micah’s company to become more profitable, it needs to be more flexible

with its employees. One of the most important things that need to change is the top-down

pyramid of hierarchy. The first change that his company needs to make is make smaller groups

that are geared towards the same goal. This would make the efficiency and production within the

company a lot better. The next change his company needs to make is the hierarchy; if they were

to create a smaller chain in command, this would not only open up more job opportunities for the

employees, but it would also make the staff less resentful. Policies and regulations would be the

next thing that needs to be changed. It is up to the employee to follow the regulations put in

place. The next step is to have a membership criterion, allowing the head of the department to

encourage their employees instead of just ordering them what to do. The fifth step that his

company needs to work on is “relationships”. Micah needs to know all the employees all the way

from the owner of the company to the lowest person on the pyramid. The sixth characteristic is

communication. Usually in a formal bureaucratic organization, there are things like; memos, and

letters that are sent to the employees and hold un-thoughtful information, and they are sent from

the person at the top of the chain, and received by all employees. It would be best if they were to

have open meetings about the notes sent out in order to get the feedback from the employees, and

also make the employees feel like they can have an open relationship with their managers. This

helps if there is ever an issue that occurs; the employee will feel more comfortable talking with

their managers. The last step that this company needs to work on is focus. Since formal

organizations are task-oriented; if they were to become more people oriented, and show how

much they care for their employees, then Micah’s company would have better results showing

enhanced efficiency between employees and will boost up the productivity, thus improving the

profit made by the company.

There are three different trends that I predict will happen in the work place and will be

likely to take place in the future. The first trend that I think is going to take place is the

companies requiring their employees to all be equally creative, not just the minimum wage

worker that never gets credit for the work they are doing. Instead of it all being left up to the

“lower” employees, this will be effective for the people in “upper” management as well. An

organization that is not only flexible but open with their employees, can better themselves by

splitting the employees into smaller, more competitive groups, thus allowing them to be

independently creative, yet reaching for the same objective. “Great supervisors come up with the

creative vision, analyze whether their ideas are good, execute their ideas, convince others of their

values, and ensure that their ideas are for the common greater good of the company.” (Sternberg,

2006). A good supervisor will actually do the job that they set out to do instead of sending

someone else to do it for them. Also, a good incentive to work harder is the Performance Pay,

which works by matching a CEO’s pay to their performance. “It can motivate, retain, and better

align the CEO with various constituencies.” (Masters, 1999)


The second trend I am going to talk about is some things that the Japanese organizations

already have done, and found them to have a very good end result, and shows the loyalty of the

workers. First, they hired the new employees in groups, and giving them the same responsibility

and salary. Then a lot of the Japanese companies hired their people with a lifelong contract.

Then, they trained all the employees in all aspects of operations. “[Fourth, although Japanese

corporate leaders took ultimate responsibility for their organization’s performance, they involved

workers in “quality circles” to discuss decisions that affect them. Fifth, Japanese companies

played a large role in the lives of workers, providing home mortgages, sponsoring recreational

activities, and scheduling social events.]”  (Macionis, 2006) I think that if American companies

were to start any of the five trends listed here by the Japanese, then we could better prosper like

they have.

The third is not a trend that I think will happen, but something that has already happened

to America’s largest automotive parts maker; Delphi; who tried to change their organization, and

did some things that were radical and did not work out very well. They thought if they could get

rid of their labor contract their company would be doing better off. So, when the average person

who worked at Delphi’s wages went from $27.00/per hour to $9.00/per hour, one could only

imagine the rage that an employee here felt. The company now has to hide behind the protection

of bankruptcy, and says “We will close all our US plants unless trade unions agree to wage cuts

to rescue America's largest auto parts-maker.”  (Finfacts, 2007). If our all of our formal

organizations were to do this, there would be a lot of upset, out of money, out of a job citizen

sitting in our soil. I think there would be an even bigger economic crisis then there is now.

            My overall prediction of how formal organizations like Micah’s are likely to evolve in

the future is they will become better once they figure out that the changes that are listed above

will give them more profit and productivity. Once a company reduces the chain of command into

smaller groups, it will enhance and support creativity and inside competition. This gives a self

motivator to the employee, and a happy employee is a productive employee.

1 comment:

  1. Thanks for posting these! Now I'll know where to look when my students plagiarize!

    ReplyDelete