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Understanding Organizations • 91improve the organization’s functioning. Organizations attempt to apply the bestavailable knowledge to their system to enhance throughput. Drucker (1993)argues that organizational knowledge has progressed through three stages.The first he labels the Industrial Revolution (1700–1880), which was the applicationof knowledge to doing things. Drucker is unique in using this label forthis time period, but he is providing differentiation for the stages of knowledgeuse. During this time period, experience was converted into knowledge. Whatworked for individual crafts, occupation, or processes was studied. In a similarmanner, the particular tools, processes, and products were examined in thefirst engineering, mining, and agricultural schools leading to a systematic setof information and knowledge about how to do something. Production techniques,developed from this accumulated knowledge, lead to factories causinga concentration of workers in central locations. Second, the Productivity Revolution(1881–Post World War II) saw the applying of knowledge to improvework methods as we discussed during our analysis of Scientific Managementearlier in this chapter. During this time period, there was “practically no accessto a middle-class income without a formal degree, which certifies to the acquisitionof knowledge that can only be obtained systematically and in a school”(Drucker, 1993, p. 42). Finally, the Management Revolution (post-World WarII–2020) is seeing knowledge work rapidly replacing manual labor. We haveshifted from one set of knowledge about how to manage to a set of knowledgesor disciplines. We moved from crafts to methodologies; ad hoc experiences tosystems; anecdotes to information; and skills into concepts that can be taughtand learned. In other words, we are completing the movement from manualto mental. This will force a rapid decentralization in order to innovate andtake advantage of knowledge. Knowledge workers transform information intoknowledge and wisdom to support decisions, actions, and outcomes.Federalism is likely to become the optimum form with the various subunits,disciplines, or parts doing the creating while being supported by thecenter. This is not a hypothetical concept. ABB, a multinational organizationof 20,000 employees, has a center (headquarters) of 150 people. We now examinethe eight additional changes.Horizontal OrganizationsOrganizations are becoming more horizontal and removing layers (Wind &Main, 1998). Ideally, this horizontal organization strives to remove the separationof people and place work into functional departments. Using a culture ofcollaboration with employees working together, cooperation between units isencouraged and the hierarchy is flattened (Ostaff, 1999). The need for speed,customer focus, innovation, and information require a greater dependence onnetworks rather than a hierarchy or chain of command forcing a horizontalapproach. Flexibility in structure is becoming critical. Rather than being verticallyintegrated, organizations are becoming networked (Wind & Main, 1998).92 • Applied Organizational CommunicationThe digital age will include work groups connected electronically92 • Applied Organizational CommunicationThe digital age will include work groups connected electronically eventhough they may be dispersed around the globe. Overnight delivery of contentcan now be replaced digitally by a keystroke and an attachment command ona computer. Virtualization will be used increasingly to determine outcomeswithout any need for our physical presence. Teams will solve problems, disbandquickly and redeploy with a different mix of players to work on otherissues. Informed workers with various roles will perform ad hoc tasks usinginput from many sources.EmpowermentAllowing individuals to set their own work goals, make decisions, and solveproblems is the basis for empowerment (see chaps. 10 and 11). Probably anoverused term, the concept is on target. As we stated earlier, employees are anasset that can increase in value. But, that can only occur if they are allowed touse their minds. Employees are increasingly being viewed as an organization’smost valuable assets (Branch, 1999; Caudron, 1998). They are being encouragedto initiate and participate in decision making through training, empowermentto take actions, and providing creative answers (Conner, 1998). In theold organization, the top levels were the thinkers and the lower levels were thedoers. Empowerment, combined with a horizontal structure, allows everyoneto be both a thinker and doer—the combined strengths lead to an empoweredorganization (Gates, 1999; Jasinowski & Hamin, 1995).Information and Digital ProcessesIn the past, information tended to flow downward. In the future, informationwill move in all directions. As we indicated in chapter 1, capital and ownershipof assets is being replaced by the power of information. “Though the termmight sound cold, digital processes is about the empowerment of individuals.… A belief in empowerment is key to getting the most out of a digital nervoussystem” (Gates, 1999, p. 409). The impact is universal. “The Internet hasbecome ubiquitous, so companies can connect with talent anywhere in theblink of an eye, inside or outside the company. Open-source software can beplucked off the shelf to become the foundation of new software programs orWeb sites. Algorithms can be used to slice and dice market information andspot new trends” (Hamm, 2006, p. 71). We examine these trends more completelyin chapter 12.Learning OrganizationsThe dynamic nature of organizations underscores the critical impact ofknowledge and learning. Informing and training is increasing in the highlycompetitive organizations (Branch, 1999). Rather than using a “need to know”philosophy where upper management hoards information from lower levelsand, sometimes, each other, opportunities are created to increase understand-Understanding Organizations • 93Understanding Organizations • 93ing, involvement, and effectiveness. “A learning organization engages in a newway of communicating and interacting” (Barker & Camarata, 1998, p. 445; seechap. 1).Quality and CustomersMost organizations understand the importance of quality. However, qualityand customer satisfaction are moving targets because today’s consumer hashigher quality expectations (Cummings & Worley, 2005). Now, customers arebeing seen as allies, partners, and active participants in the creation and deliveryof products and services and not a passive group that can be easily manipulated.Quality is such an underlying principle that for many organizationsit is now an assumption or a fundamental part of doing business. Motorolaannounced its six-sigma standard in 1987. This amounts to no more than 3.4mistakes per million parts. Although Motorola is unlikely to consistently meetthis standard, it demonstrates how far quality has progressed. How significantis the six-sigma quality standard? If we have 99.9% defect-free work—muchless than six sigma, 50 newborn babies in the United States would be droppedon the floor by a physician daily; 200,000 incorrect prescriptions would befilled each year; two planes would not land safely each hour at Atlanta’s Hartsfield
International Airport; we would be without electricity, heat, or water
for 15 minutes each day; and 22,000 times an hour, banks would deduct the
wrong check from someone else’s account. In other words, “mistakes happen”
is not an acceptable part of the customer’s quality perspective.
Speed and Time
With the advent of new technologies, speed and time will remain at the forefront
of organizational change. “Speed is emerging as the ultimate competitive
weapon” (Hamm, 2006, p. 70). Speed to market, decrease in product development
time, and higher efficiencies will remain cornerstones of organizations
in the 21st century. Efforts at increasing efficiency will pick up because of
technological advances, cost savings, and competition. “Competition is more
intense than ever because of the rise of the Asian powerhouses and the spread
of disruptive new Internet technologies and business models. Companies
realize that all their attention to efficiency in the past decade was fine–but it’s
not nearly enough” (Hamm, 2006, p. 70).
Focus
Companies will concentrate on doing what they do best. For example, 3M
wants to solve problems innovatively. The Girl Scouts of America strive to
help a girl reach her highest potential. Hewlett-Packard wishes to make technical
contributions for the advancement and welfare of humanity. Mary Kay
Cosmetics wants to give unlimited opportunity to women. Walt Disney seeks
to make people happy. In the list of the most admired companies in America,
94 • Applied Organizational Communication
“All ten companies on the top of our list have a single-minded focus” (Brown,
1999, p. 73). Wal-Mart moves merchandise effectively to its 3,000 stores, GE
focuses on growth in shareholder value, Microsoft hires brilliant workers, and
“Southwest Airlines promotes a culture that impels employees to deliver topnotch
service on the ground and in the air” (Brown, 1999, p. 73).
Diversity
The entire workforce is changing as outlined earlier. By 2008, women and
minorities will make up 70% of the incoming workforce. Single households
in the United States now outnumber married couples with children (Armand-
Delille, 2006). Even though the values of a diverse workforce are well documented,
we face important challenges in making certain that differences are
valued. There are important obstacles that continued advancement must
overcome including changing the prevailing corporate culture to be more
inclusive, increasing role models, actively working to alter stereotyping and
preconceptions, and including marginalized groups into informal networks
(Klimley, 1999). Needless t
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