Nik Gurney Week02 Application

In my pursuit to better understand the dissemination of ethical culture within organizations I recently read a journal article titled The Influence of Organizational Design on Knowledge Transfer by Martin-Perez et al. (2012). The research team examined Spanish non-profits to gain insight into the way knowledge transfer is affected by organizational design traits like delegation and rewards systems (Martin-Perez, Martin-Cruz & Estrada-Vaquero, 2012). The NPOs examined serve people with disabilities. The researchers chose this particular set of NPOs because, “providing assistance to people with disabilities requires diverse technical staff with highly specialized knowledge” and “Managers of these small NPOs do not have all these kinds of technical knowledge, and thus they need to delegate to experts in order to take adequate decisions” (Martin-Perez, Martin-Cruz & Estrada-Vaquero, p.11, 2012).

The design challenges in NPO settings do not differ from the for-profit sector. It is my suspicion that the for-profit world could learn a great deal about effective management strategies through examining the NPO world more carefully.  Even though it is slightly dated now, the dilemma noted by Lorsch regarding managers treating research staff with the same rigidity as production personnel (pp.10-11, 1975) is still relevant today and could easily be remedied with the knowledge gained through the study Martin-Perez et al. (2012) conducted. What seems obvious, and is probably the first consideration that should be made, is the nature of research scientists’ work is dramatically different from production, and as such needs to be managed differently regarding time flexibility. What is not so obvious is the need for rewards. In examining the Spanish NPOs it was found that if an organization is to remain relevant and viable it is essential that it establishes an effective “intrinsic-rewards system” to keep employees engaged (Martin-Perez, Martin-Cruz & Estrada-Vaquero, p.2, 2012).

But wait, what do intrinsic rewards have to do with a highly compensated research scientist? It is understandable NPOs need to offer something in order to keep specialists around. Most NPOs don’t have the cash necessary to really keep these highly functioning people engaged. There is more to it than just money though. Extrinsic rewards work in concert with intrinsic rewards to retain highly trained individuals as well as ensure the transfer and retention of important knowledge within the organization even after they have left (Martin-Perez, Martin-Cruz & Estrada-Vaquero, 2012). You are probably asking still, so what? Odds are a highly compensated research scientist can most likely be a highly compensated research scientist at more than just one organization. Who’s to say an employee won’t pick up and leave (with all their knowledge) tomorrow to the competitor down the street? Proper intrinsic rewards can help reduce the appeal of a move and at the very least ensure an employee’s tacit knowledge is made explicit knowledge before separation (Martin-Perez, Martin-Cruz & Estrada-Vaquero, 2012).

Galbraith dwelled largely on the fact that an organization cannot stagnate and remain competitive (2002). The way he sees it is in order to succeed a firm needs to be light footed. When I originally read the two chapters from him I kept thinking of Mohammad Ali, “Float like a butterfly, sting like a bee.” [Perhaps another metaphor for Morgan; I highbred super butterfly-or just Ali… (1998).] This idea seems to paraphrase, “Thus the challenge is to design organizations to execute strategies when there are no sustainable competitive advantages. When product advantages are not sustainable over time, the winners will be those who create a series of short-term temporary advantages. Under this scenario, the leaders will be future-oriented and will continuously create capabilities that lead to customer value. They will move quickly to combine these capabilities to match and surpass current advantages (including their own)” (Galbraith, p.75, 2002) quite well. However, one advantage I see as sustainable is always attracting and retaining the most talented employees available in your industry. Part of the trick to doing this is having a reward system set up that keeps them engaged holistically. As Worley and Lawler point out traditional compensation systems “do little but reward people for surviving” (p.20, 2006). When properly rewarded and motivated to progress these individuals will fuel an organization with the knowledge requisite to stay competitive. As Martin-Perez et al. succinctly noted, “Knowledge is the most strategically important resource for organizations” (2012, p.3). I contest that through proper talent management it is possible to retain, develop, and ensure the continual progression of organizational knowledge.

References

Galbraith, J.R. (2002). Designing a reconfigurable organization. In Designing organizations: An executive guide to strategy, structure, and process (pp. 73-90). San Francisco, CA: Jossey-Bass.

Galbraith, J.R. (2002). Introduction: Six immutable forces shaping today's organization. In Designing organizations: An executives guide to strategy, structure, and process (pp. 1-8). San Francisco, CA: Jossey-Bass.

Lorsch, J.W. (1975). Note on organizational design. Boston, MA: Harvard Business School.

Martin-Perez, V., Martin-Cruz, N., & Estrada-Vaquero, I. (2012). The influence of organizational design on knowledge transfer. Journal of Knowledge Management, 16(3), 1-32.

Morgan, G. (1998). Nature intervenes: Organizations as organisms. In Images of organization (pp. 35-67). Thousand Oaks, CA: Sage Publications, Inc.

Worley, C., & Lawler, E. (2006). Designing organizations that are built to change. MITSloan Management Review, 48(1), 19-23.