OrgCon© Recommendations

Based on your answers about the organization, its situation, and the conclusions with the greatest certainty factor from the analyses above OrgCon © has derived recommendations for the organization's configuration, complexity, formalization, and centralization. There are also recommendations for coordination and control, the appropriate media richness for communications, and incentives. More detailed recommendations for possible changes in the current organization are also provided.

Organizational Configurations

• The most likely configuration that best fits the situation has been estimated to be a matrix configuration (cf 80%)
• It could also be: an adhocracy configuration (cf 76%)
• It could also be: a divisional configuration (cf 70%)
• It is certainly not: a machine bureaucracy configuration (cf -100%)
• It is certainly not: a professional bureaucracy configuration (cf -100%)
• It is certainly not: a functional configuration (cf -100%)

A matrix structure is a structure that assigns specialists from functional departments to work on one or more interdisciplinary teams that are led by project leaders. Permanent product teams are also possible. A dual hierarchy manages the same activities and individuals at the same time. When Medtronic has many products or markets, a matrix configuration is a likely configuration. When Medtronic's environment has neither low equivocality nor low complexity, the configuration should be matrix. When Medtronic is large, the configuration can be a matrix configuration. The matrix configuration is a more likely configuration when Medtronic has a unit production technology. When strategy is prospector, the organizational configuration can be a matrix configuration. An organization with a group climate could have a matrix configuration. The matrix structure may be a trans-national structure. When foreign product/service diversity is high and international involvement is high, Medtronic should have a multidimensional, global configuration.

An adhocracy organization is normally an organization with high horizontal differentiation, low vertical differentiation, low formalization, decentralization, and great flexibility and responsiveness. An adhocracy configuration is appropriate when neither the environmental equivocality of Medtronic nor the environmental uncertainty is low. Medtronic has many products or many markets which indicates that an adhocracy is an appropriate configuration. Since top management has a leadership style as a leader, the ad hoc configuration is feasible. However, the size of the organization is not very important for the choice of an adhocracy configuration. A prospector like Medtronic should be configured as an ad hoc organization. An organization with a group climate could have an ad hoc configuration.

A divisional organization is an organization with self-contained unit grouping into relatively autonomous units coordinated by a headquarters, (product, customer, or geographical grouping). When the management has a leadership style as a leader, the configuration can be a divisional configuration. When the organization is large, the configuration can be a divisional configuration. Because the organization has many products, the configuration should be divisional. Because the technology is not fully divisible, care should be taken in recommending a divisional configuration.

When the organization has a nonroutine technology, it is not likely that a machine bureaucracy is an efficient organization. When the organization has a prospector strategy, it cannot be a machine bureaucracy! When the organization experiences high hostility, it is unlikely to be a machine bureaucracy. A machine bureaucracy will prevent it from acting appropriately when unexpected events occur.

Because the organization does not have a routine technology, it is not likely that a professional bureaucracy is an efficient organization. Since the organization has a prospector strategy, it cannot have a configuration like a professional bureaucracy.

The configuration cannot be a functional configuration when the technology is nonroutine.

Organizational Characteristics

• The recommended degree of organizational complexity is low (cf 61%)
• It, too, could be: high (cf 49%)
• It, too, could be: medium (cf 48%)

Medtronic has a prospector strategy. Then, the organizational complexity should be either low or high. Medtronic has a nonroutine technology, which implies that the organizational complexity should be low. Not much is known about the environment since both the environmental uncertainty and the environmental equivocality of Medtronic are high. In this situation, the organizational complexity should be low. This allows the organization to adapt quickly. When the environmental hostility of Medtronic is high, organizational complexity should be low. A group climate in the organization requires a low level of complexity with a low level of vertical differentiation.

• The recommended degree of horizontal differentiation is low (cf 61%)

• The recommended degree of vertical differentiation is low (cf 67%)
• It, too, could be: high (cf 47%)

• The recommended degree of formalization is low (cf 76%)

When the organization is in the manufacturing industry and it does not have a routine technology, its formalization should be higher than if it had been in the service industry. Medtronic has a prospector strategy. A low formalization is required so that the organization can react quickly. Low formalization is also required because of the need for innovations. Organizations with a nonroutine technology should have low formalization. Since the set of variables in the environment that will be important is not known and since it is not possible to predict what will happen, no efficient rules and procedures can be developed, which implies that Medtronic's formalization should be low. When environmental hostility is high formalization should be low. A low degree of formalization can be allowed if top management has a leadership style as a leader. A group climate in the organization requires a low level of formalization.

• The recommended degree of centralization is low (cf 54%)
• There is evidence against it should be: high (cf -7%)

Medtronic has a prospector strategy. A low centralization is required so that the organization can react and innovate quickly. Large organizations should have low centralization. Since there are many factors in the environment that affect the organization but Medtronic does not know which factors are or will be important for Medtronic, centralization should be low. A low degree of centralization can be allowed if top management has a leadership style as a leader. A group climate in the organization requires a low level of centralization.

• Medtronic's span of control should be narrow (cf 50%)

Since Medtronic has a nonroutine technology, it should have a narrow span of control.

• Incentives should be based on individual results (cf 82%)
• It should also be based on group results (cf 82%)

With high equivocality, high uncertainty, and high environmental complexity incentives should be results based. Incentives could be results based with an individual orientation when management has a leadership style as a leader. Incentives should be results based with an individual orientation, when the technological routiness is low. With a prospector strategy incentives should be based on an individual results.

With high equivocality, high uncertainty, and high environmental complexity incentives should be results based. When the organization has a group climate incentives could be results based but with a group orientation. Incentives should be results based with a group orientation, when the technological routiness is low.

• Medtronic should use media with high media richness (cf 97%)

• The information media that Medtronic uses should provide a large amount of information (cf 95%)

• Medtronic should use meetings as means for coordination and control (cf 99%)
• It should also use integrators as means for coordination and control (cf 82%)

Coordination is a major issue requiring a lot of time by functional managers and product or project managers. Managers should make frequent adjustments in order to maintain project and product goals and use scarce functional resources and personnel efficiently. In an international firm, matrix dimensions will likely include country or region and may include either product, customer, or function.

Project or product managers will likely be required to champion new innovations in customers, products or technologies.

With a nonroutine technology Medtronic should obtain coordination and control via group meetings. Media with high richness and large amount of information should be used.

When the environment of Medtronic has high equivocality, high uncertainty, and high complexity, coordination and control should be obtained through integrators and group meetings. The richness of the media should be high with a large amount of information.

If the management has a leadership style as a leader then the management will prefer coordinating and controlling using integrators and meetings.

When the organization has a group climate, coordination should be obtained using integrators and group meetings. An organization with a group climate will likely have to process a large amount of information and will need information media with high richness.

When the organization has a prospector strategy, coordination should be obtained using direct supervision and meetings.

Organizational Misfits

Organizational misfits compares the recommended organization with the current organization.

• The following organizational misfits are present: (cf 100%)

• Current and prescribed complexity do not match.

• Current and prescribed formalization do not match.

• Current and prescribed centralization do not match.

Recommendations on Removing Organizational Misfits

• There following more detailed recommendations are suggested: (cf 100%)

• Consider decreasing the number of positions for which job descriptions are available.

• Consider fewer written job descriptions.

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OrgCon organizational recommendations