Markets Bureaucracies and Clans
Please hand in typed answers to the following questions on Moodle. Ideally, give examples associated with your project organization (your business, not your student group working on the project), but if you can’t think of one, give an example from any of your experiences (e.g. your sports teams, clubs, family, work experience.)
1. Ouchi states that “Transaction costs are a solution to the problem of cooperation in the realm of economic activity?” In your own words, what does this mean by this sentence? Please include in your explanation an example of how transaction costs solve a problem ideally for your project organization or if not for another example of economic activity.
2. Ouchi maps organizational structure (markets, bureaucracies and clans) using a framework of “goal incongruence” and “performance ambiguity.” In your own words, what does he mean by these two terms? Please provide four (4) examples, one (1) each for: a congruent goal, an incongruent goal, performance that is ambiguous, performance that is not ambiguous. Again, ideally use examples from your project organization. We will make a chart with these examples in class.
3. What is a “clan”? Give an example of a clan-like organization (it may be a group or element within an organization rather than a distinct independent organization). Try to give an example of a clan-like element within your project firm.
4. How might a manager go about increasing “goal congruence”within his or her organization? Provide at least one (1) example, again, ideally from your project firm.