Daft Characteristics of effective organizational design[ edit ] Some systems are effective and efficient whereas others are not. Successful systems may be attributable to the skill exercised in designing the system or to the quality of management practised during operations, or both. Successful systems are characterized by their simplicityflexibility, reliability, economy, and acceptability. Numerous relationships exist among these characteristics; for example, simplicity will affect economy and possibly reliability.
It is about the relationships between people, work, formal structures and informal practices and behaviors. It is about the way in which an organization structures and coordinates its people and process so it can benefit from its unique capabilities over the long-term.
It changes the role of the leaders as they become less decision makers and more decision shapers. The star model is a widely accepted organizational design model because of the strategy approach that seamlessly links competitive advantage to strategy to structure, people, lateral processes and reward mechanisms.
Determine direction through goals, objectives, values and mission. The strategy specifically delineates the products or services to be provided, the markets to be served, and the value to be offered to the customer. It also specifies sources of competitive advantage.
It also defines the criteria for selecting an organizational structure for example functional or matrix. The strategy defines the ways of making the best trade-off between alternatives. Strategy dictates which activities are most necessary, thereby providing the basis for making the best trade-offs in the organization design.
Determines the location of decision making power.
Structure policies can be subdivided into: Processes can be either vertical or horizontal. Vertical processes are usually business planning and budgeting processes. The needs of different departments are centrally collected, and priorities are decided for the budgeting and allocation of the resources to capital, research and development, training etc.
Horizontal — also known as lateral — processes are designed around the workflow, such as new product development or the entry and fulfillment of a customer order. Managers should use rewards to motivate and provide incentives for the desired behavior of employees.
The reward system must be congruent with the structure and processes to influence the strategic direction.
Reward systems are effective only when they form a consistent package in combination with the other design choices.
Human resource policies — in the appropriate combinations — produce the talent required by the strategy and structure of the organization, generating the skills and mind-sets necessary to implement the chosen direction.
Like the policy choices in the other areas, these policies work best when they are consistent with the other connecting design areas.
Human resource policies also build the organizational capabilities to execute the strategic directions. Flexible organizations require flexible people.
Cross-functional teams require people who are generalists and who can cooperate with each other. The above five factors must be internally consistent to enable effective behavior. Fortunately, a design sequence exists whose starting point is the strategy definition. Strategy drives organisational structure.
Structure and Processes define the implementation of reward systems and people policies.Designing Your Organization is a hands-on guide that provides managers with a set of practical tools to use when making organization design decisions. Based on Jay Galbraith’s widely used Star Model, the book covers the fundamentals of organization design and offers frameworks and tools to help leaders execute their strategy/5(18).
Jay Galbraith’s Star Model of Organizational Design Organizational design is not simply about structure and the resulting organizational chart. It is about the relationships between people, work, formal structures and informal practices and behaviors.
The American academic and consultant, Jay Galbraith, developed the Star Model as an organisational design framework. The model used design policies that guide organisational decision making and behaviour. Feb 05, · A five minute animated overview of the two core models in organization design: Galbraith's Star Model and Kates Kesler's Five Milestone Design Process.
The Star Model. Jay Galbraith's Star Model helps companies holistically create the o rganization necessary to sustain a company's business models and value propositions over time. It acknowledges the necessity of the organization to adapt over time in response to changes in strategy, in market forces, or in the rest of the external business.
Jay Galbraith’s Star Model of Organizational Design Organizational design is not simply about structure and the resulting organizational chart.
It is about the relationships between people, work, formal structures and informal practices and behaviors.