Week 3 Project

Strategic Decisions in Organizational Design

Global organizations are repatriating manufacturing back to the United States. In prior decades, manufacturing work was transferred from the United States to overseas competition where labor was, by comparison, much cheaper. Today, the United States is experiencing a renaissance in manufacturing due to improvements in technologies. Work that used to require hundreds of laborers in manufacturing now requires a fraction of people. In addition (and as important) to needing fewer laborers, improvements in technology allow substantial improvements in productivity. Interestingly enough, because of advances in manufacturing technologies, global �rms are looking to the United States for their manufacturing needs. This is true even though the labor costs in the United States are among the highest in the world. The advantage the United States is now offering is not with cheaper labor but its application of technological know-how.

In order to compete and survive, organizations today, now more than ever, need to keep current with the changes in technology. Technology being referred to includes much more than just equipment. It includes how work is arranged and processed; the equipment, machines, and techniques used; and innovative methods for selecting and transforming inputs (raw materials such as cotton, wood, steel, and glass) into outputs (clothes, cars, etc.).

Organizational Design

The link here is how organizations make strategic decisions in organizational design based upon its use of technology. How can an organization be designed to provide the maximum productivity and ef�ciency from its use of technology? Organizations have both core and noncore work processes that are used together to achieve ef�ciency and effectiveness. Decisions to optimize the core processes include how technologies are acquired and used and traditional and contemporary

applications of those technologies through lean manufacturing and smart factories. Decisions to optimize the noncore processes include functions of human resources, marketing, accounting, �nance, etc.

Additional Materials

From your course textbook Organization Theory and Design, read the following chapter:

Manufacturing and Service Technologies