Thursday, October 6, 2011

Organization Theory - 18

In the last blog, we began understanding the concept of formalization. In today's blog we look at why formalization would be important and the various techniques used to achieve formalization.

Standardization and formalization - essentially target the benefits accrued by regulating employee's behavior by reducing the variability. Almost all the employees behave to a particular response in a similar manner. 

This also increases the ability to coordinate. A football/soccer coach would spend hours coaching his team members with complex set of procedures for hours together. When a particular call is made from the side stand every individual on the ground knows what is the exact function to one has to do.

Last but not the least, formalization enables reaping the economics of quick decision making - the employee would have to really have less discretion and thereby be less of an overhead for the supervisors. 

A small thought and it would be easy for one to realize why many larger organizations have big accounting manuals, personnel manuals, purchasing manuals! All techniques used to formalize and leverage on its benefits.

Organizations use some or most of the following techniques to achieve formalization:
  • Selection
  • Role Requirements
  • Procedures
  • Policies
  • Training
  • Rituals
We shall deal with a couple of them over the next few days to get a better understanding of formalization.

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