Discussion: Managerial Levers Model

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Discussion: Managerial Levers Model

Discussion: Managerial Levers Model

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Organizational strategy includes the organization’s design, as well as the managerial choices that define, set up, coordinate, and control its work processes. As discussed in Chapter 1, many models of organizational strategy are available. One is the managerial levers framework that includes the complementary design variables shown in Figure 3.3. Optimized organizational designs support optimal business processes, and they, in turn, reflect the firm’s values and culture. Organizational strategy may be considered as the coordinated set of actions that lever- ages the use of organizational design, management control systems, and organizational culture to make the orga- nization effective by achieving its objectives. The organizational strategy works best when it meshes well with the IS strategy.

This chapter builds on the managerial levers model. Of primary concern is how IS impact the three types of managerial levers: organizational, control, and cultural. This chapter looks at organizational designs that incorpo- rate IS to define the flow of information throughout the organization, explores how IS can facilitate management control at the organizational and individual levels, and concludes with some ideas about how culture impacts IS and organizational performance. It focuses on organizational‐level issues related to strategy. The next two chapters complement these concepts with a discussion of new approaches to work and organizational processes.

Chief Executive Officer

Chief Operating Officer

Director, Industry

Solutions Unit

Director, Organization Infrastructure

Director, Strategic

Initiative Unit

Director, Major


Director, New Growth Markets



Emerging Markets




Business Process

Outsourcing Solutions

SME Solutions

Financial Solutions

Process Excellence

Resource Management

Shared Services

Technology Excellence

Multiple units

FIGURE 3.2 Tata Consultancy Services. Source: “TCS Plans New Organizational Structure” (February 12, 2008), http://www.livemint.com/Companies/2ODg7L1mCcRlFow K1ktX5N/TCS‐plans‐new‐organisational‐structure.html (accessed August 20, 2015).

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58 Organizational Strategy and Information Systems

Information Systems and Organizational Design Organizations must be designed in a way that enables them to perform effectively. Different designs accomplish different goals. This section examines organizational variables. It focuses on how IS are designed in conjunction with an organization’s structure. Ideally, an organizational structure is designed to facilitate the communication and work processes necessary for it to accomplish the organization’s goals, and the use of IS is often the way coordination and workflow are done. The organizational structures of Cognizant and TCS, while very different, reflect and support the goals of each company. Perhaps intuitively, organizational designers at those companies used organizational variables described in Figure 3.3 to build their structures. Those variables include decision rights that underlie formal structures, formal reporting relationships, and informal networks. Organizational processes are another important design component discussed in more detail in Chapter 5.

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