Technical Competency in the Organization Design

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Table of Contents

Introduction
Literature Review
Methodology
Results
Analysis and Discussion
Conclusion
Reference List

Introduction

Nowadays, the importance of technology competence for the organization’s performance seems to be unquestioned. One would hardly argue with the fact that innovative technologies are likely to improve the work of all the organizational departments and to create an attractive image for customers. The development of technology competence is widely discussed in various books and brochures, and almost every corporate report includes this issue on its top priorities list. Meanwhile, the experience shows that whereas the matter is commonly admitted to be important, things prove to be less particular when it comes to the practical application of this principle to practice. Thus, in the majority of cases, the technology competence remains the privilege of special IT departments, while the rest of the workforce does not usually participate in the technology-related activity.

One should necessarily note that the described phenomenon is most typical of small enterprises and companies. Whereas big corporations try to maintain high technology-consciousness, their smaller partners prefer to do with the formal procedures like annual technology seminars and conferences that are supposed to improve the general corporate competence.

Such a discrepancy between theory and practice deprives an average company of a series of benefits and advantages. The narrow view of the technical competence notion, as well as the underestimation of its role in the general organization design, leads to the progress’s restrain and brings down significantly the competitive abilities of a firm.

Therefore, the following paper is aimed at examining the true role of the technical competence in the organization design, in general, and defining the ways of its development, in particular. Thus, one makes an attempt to analyze the place of technology competence’s integration in a company’s inner strategy with the help of qualitative research. With the use of the relevant literature analysis and the examples of the concrete case studies, one tries to find out whether the technical competence, indeed, presents a determining factor of a successful company’s performance.

Literature Review

Necessary Terms

Before one proceeds to the analysis of the relevant problem and its background, it is vital to determine the definition of the relevant terms to elucidate the most ambiguous interpretations. Despite the wide-spread tendency to consider technology in close relation to the equipment field, one would like to take a more general interpretation as the basis of the relevant study. Thus, the description provided by the USA Professor of Management, Gareth R. Jones, seems to be the most appropriate in this case. According to the professor, technology is to be regarded as an entire set of skills and knowledge along with engaged equipment that is combined together in order to turn the initial raw material into particular values that the company produces (Jones 2010).

Moreover, from the very beginning, one should essentially point out that organizational design will be regarded not simply within the framework of the corporate strategy, but within the context of its performance as well. Thus, one will not only define the place of the technical competence in the general picture but will make an attempt to define the proper ways of its efficient integration.

As far as one is determined to examine the role of the technical competence for the organization design, one should necessarily note that the former will stand for the general corporate structure and strategy. In other words, the study will focus on finding out how important it is to be technology skillful for an average employee, and how this competence can influence the general corporate performance on condition that it is well-developed within the entire workforce.

Literature Background

The role of technical competence in the organization design has been widely discussed throughout the past decades. In order to evaluate its importance in the context of the current environment, one should analyze the latest trends that are present in the relevant field.

To begin with, one should note that the understanding of the necessity for the organization design’s change is a relatively new tendency in management science. Thus, a few decades ago one would claim that once the organization design is worked out, no need for further transformations can ever appear. Nevertheless, an organization design consultant, Naomi Stanford, insists that such an assumption is quite misleading. According to the consultant, whereas the general design of a company might be rather well-thought and reasonable, some of its principals may turn out to be irrelevant in the context of the constantly changing environment.

Thus, the author suggests that outdated design should be necessarily altered – even though the process can be rather long-term and challenging, the final results are, certainly, worth the efforts (Stanford 2013). This statement is rather important as it can explain why some companies systematically lose the technology competence race – the unwillingness to monitor the technology market, along with the certitude of the success of the initially accepted organizational design, prevents their leaders from potential progress.

Another important issue to be mentioned in reliance with the technical competence is the commonly spread stereotype that this kind of competence is better developed in the companies the principal activity of which is in some way connected with technologies (Basselier & Benbasat 2004). In other words, there is an unreasonable assumption that IT companies have a better technology competence than those organizations that do not deal with producing technologies or providing this kind of service. In fact, this statement is ultimately ungrounded – the experience proves that the efficiency of a company’s organization design does not depend on its line of business.

Current research shows that entrepreneurs and creative managers tend to be more technically competent performers than their IT colleagues (A.T. Kearney, 2005). Whereas such a paradox sounds like bad news for the IT field, it demonstrates the general availability of profound technology competence and proves that it can be developed within a company of literally any profile. Meanwhile, many specialists agree on the point that there is no precise methodology for effective step-by-step development of technical competence. Each company has its own vision of the problem that signifies the existing misunderstanding of the relevant concept (Oakey, Groen & Cook 2012).

One has already mentioned the problem of the narrow view of technical competence and its contradiction with the existing reality. The majority of the researchers in the relevant field agree on the point that, today, a technology competence opens a series of promising opportunities in front of the companies that fully possess it. Thus, the author of “Organizational Theory, Design and Change”, Gareth R. Jones, claims that technical competence is to be present at all the organizational levels, including the input, the conversion, and the output. According to his point of view, the technology competence can bring benefits only on the condition that it is not limited by the particular IT department but is present in all the employees of a company (Jones 2010).

This opinion coincides with the ideas described by the strategic management specialists, Bondaruk and Olivas-Luján, in their book “Human Resource Management, Social Innovation and Technology”. The authors suggest that the existing difference between the technology competence of certain company’s departments and the rest of the staff is quite alarming. Thus, according to Bondaruk and Olivas-Luján, there is a modern tendency to include the technology competence on the targeting list in order to maintain the up-to-date image of a company. Meanwhile, the real activity aimed at raising the competence level is frequently rather passive (Bondaruk & Olivas-Luján 2014).

Professors Foss and Knudsen try to explain this phenomenon by the fact that a competitive technology competence requires an unconventional approach to the general organizational strategy. Hence, the professors believe that the key aim of technical competence is to optimize the performance of a concrete company or its department. Otherwise stated, such competence is more about “how” than simply “what” (Foss & Knudsen 2013).

Whereas the necessity of including the technology competence on the top priority list of the organizational strategy design is widely discussed, little attention is paid to the description of its practical application and the precise aims it should pursue. Thus, the majority of the relevant literature does with a brief mentioning of the technical competence’s significance. The business analyst, Morrison, points out the urgent need for finding new approaches to the development of technical competence at all the organizational levels.

According to the analyst, the existing approach to the issue is of no more relevance in the context of the new opportunities and challenges that the global environment offers (Morrison 2015). Various periodicals also try to draw the public’s attention to the relevant issue. A few years ago the famous business journal “MIS Quarterly” published an article devoted to the problem of lack of practical orientation of the organizational designs in many companies. The researchers put a particular emphasis on the technology competence’s underestimation (Sein et al. 2011).

The presence of the high technical competence in all the corporate departments can be demonstrated by the examples of big and powerful concerns that have spent much time and effort in order to work out the most efficient organizational design. Thus, for example, the corporate annual report of Coca-Cola shows that the company makes the best out of its technical competence. According to the report, the technology competence helps the company complete the most challenging task from the minimization of the environmental risks due to the launch of the new production technology to the maintenance of the customers’ loyalty due to the introduction of the innovative technology services (Coca-Cola HBC, 2014).

Finally, the new approach to the understanding of the technical competence’s role in a company’s organizational design has been suggested by the USA researchers Knight and Cavusgil. Apart from proving the commonly known advantages of such competence, the analysts have come to the conclusion that a high technical competence of a company increases its chances to expand to the global market. The researchers claim that this interconnection is determined by the fact that the staff that is technically competent proves to show a highly innovative performance (Knight & Cavusgil 2004). This assumption seems to be rather reasonable as a profound understanding of the principals, which constitute one technology, is likely to be applied to the invention of a new one.

Methodology

The research methodology of the study is initially determined by its qualitative design. Therefore, the data collection tool is the performed survey, and the employed data analysis is of a statistical character. One has applied a histogram as the most appropriate data analysis tool. The experimental group of the study is represented by 100 anonymous employees of different companies that have been asked to answer a series of questions estimating both their own technical competence and corporate technology competence.

One has selected this methodology base as the people’s experience is expected to provide a more realistic vision of the true state of things than the official corporate reports. As a consequence, the principal subject of the following research is the staff employed in a variety of occupations fields.

On the basis of the thorough literature analysis one is able to suggest the following hypotheses:

Hypothesis 1: the technology competence has a positive influence on the organizational performance in case it is included on the company’s top priority list.
Hypothesis 2: the majority of employees do not have a precise idea of how technical competence can be applied to performance improvement.

Results

The experimental group of 100 anonymous employees has been selected to take part in the relevant study. The people that took part in the research are employed in principally different occupation fields in order to receive the most objective results that are independent of a particular business segment. The subjects of the survey were asked to estimate the verity of the four statements that were put as follows:

My company declares technical competence to be one of the priority components of the general strategy.
My company has a high technical competence.
I am technically competent.
I can name at least three examples of how technical competence has improved the corporate performance of my company throughout the past five years.

The participants were asked to use the “yes” and “no” answers. The variant “I hesitate” was intentionally excluded in order to prevent the potential ambiguity. It is, therefore, presumed that the positive answer is given in the cases of the maximum certitude and the negative response substitutes the doubtful cases.

The final results of the survey are represented in the histograms, where the “S” stands for the relevant statement from the survey. Thus, the histogram shows the percentage number of people that have given either a positive or a negative response to the suggested statements.

The percentage number of people that have given either a positive or a negative response to the suggested statements — Histogram 1

Analysis and Discussion

Data Interpretation

On the whole, one should point out that the results of the performed survey generally coincide with the initial expectations based on the literature review and the examined statistics. Therefore, the collected data helps one to make a series of conclusions.

First of all, the majority of people from the experimental group prove that the organizational design normally includes technical competence, and this priority aspect is openly announced by the corporate headquarters.

Moreover, most of the research participants believe that their companies are high technologically competent. This phenomenon can be explained by the results for statement 1 – once the company announces its concern for the technology competent organization, it automatically receives the relevant image in the opinion of its employees. It is important to note, here, that the real activity does not play an important role in this case.

Furthermore, one of the most counter-intuitive facts is that, whereas most employees consider their companies to be technologically competent, their self-esteem is not that optimistic. Thus, only 47,3% of all the interview think they have sufficient technical competence. Such a discrepancy might be determined by the employees’ failure to define the concept of technical competence itself. Thus, the uncertainty in the notion’s interpretation makes it easier to apply the technical competence to the abstract performer. The results for the third statement are of the crucial importance as they demonstrate the problem of the theoretical character of the technical competence that has already been mentioned above.

Finally, results for Statement 4 serve to be another proof of the lack of the common vision of the technical competence phenomenon. The figures are particularly curious, taking into account the fact that the same responders gave a positive answer to the question of their corporate technology competence. Meanwhile, the following figures do not necessarily signify the mistaken response for the first statement. In fact, they just mean that the practical application of technical competence is still an unclear issue for the majority of the employees.

Hypotheses Validation

The collected data enables one to testify the suggested hypotheses. Therefore, one comes to the following conclusion:

Hypothesis 1: rejected. The results of the research have shown that technical competence is included on the top priority list of almost all the companies meanwhile there is no proof that this factor has no significant impact on corporate performance.
Hypothesis 2: proved. The research has shown that most of the employees do not have a precise understanding of the technical competence, its aims, and functions, its place in the organizational design.

Further Prospects

The relevant study has discovered a series of important facts regarding the technology competence issue. Meanwhile, it was mainly aimed at the identification of the existing problems in the relevant field. The collected data helps to pursue the current tendencies and monitor the most actual challenges that managers might experience while working out the organizational design of the company. The results of this research can be used as the basis for further studies. Thus, one might extend the following analysis and try to examine the interconnections between the gathered figures and the detailed characteristics of the interviewed, such as their age and the occupation sphere. Another variant of the potential further research can be aimed at the examination of the correspondence of the official corporate claims in the reports and the employees’ feedback.

One believes that the question under discussion is of great significance for management science and needs to be further examined in order to enable companies and firms to build up their organizational design in complete accordance with the current global environment.

Conclusion

The primary aim of the following paper was to perform a profound analysis of the technical competence phenomenon, its aims, and functions, as well as to evaluate its importance for the organizational design of a company.

In order to receive a complete and precise idea of the current state of things in the relevant field, one has divided the following research into two stages: theoretical and practical. The theoretical stage implied the analysis of the corresponding literature. At this phase, one managed to learn that whereas the importance of technical competence is widely discussed in different sources, there is little to be said about its practical application. This discovery made one put forward a hypothesis that there is a discrepancy between the people’s interpretation of the concept under discussion and its true character.

The practical stage was represented by the research carried out within an experimental group within 100 employees. The results of the following examination provided a series of proofs for the initially suggested hypothesis. The gathered data also showed that the majority of employees consider their companies to be high technology competent mainly due to the announced strategy but not to the real activity.

The following study has partially enlightened the problem of technology competence and its role in the organizational design of a company. The gathered data can be applied to the potentially extended research in the relevant field. It is suggested that one goes on to study the interconnection between technical competence and the employees’ qualities as well as the relations between technical competence and the particular business lines.

One should necessarily point out that the main concern of the following paper was to define the existing problem and to try to analyze its grounds. Therefore, the provided analysis might assist in a further search for the problem’s solutions.

Reference List

A.T. Kearney 2005, Why Today’s Organisation Won’t Work Tomorrow, A.T. Kearney Inc, Chicago.

Basselier, G & Benbasat, I 2004, ‘Business Competence of Information Technology Professionals: Conceptual Development and Influence on IT-Business Partnerships’, Management Information Systems Quarterly, vol. 28, no. 4, pp. 673-694.

Bondaruk, T & Olivas-Luján, MR 2014, Human Resource Management, Social Innovation and Technology, Emerald Group Publishing, Bingley.

Coca-Cola HBC 2014, Integrated Annual Report, Black Sun, Zug.

Foss, NJ & Knudsen, C 2013, Towards a Competence Theory of the Firm, Routledge, New York.

Jones, GR 2010, Organisational Theory, Design, and Change, Prentice Hall, New York.

Knight, GA & Cavusgil, ST 2004, ‘Innovation, organisational capabilities, and the born-global firm’, Journal of International Business Studies, vol. 35, no. 1, pp. 124-141.

Morrison, R 2015, Data-driven Organisation Design: Sustaining the Competitive Edge Through Organisational Analytics, Kogan Page Publishers, London.

Oakey, RP, Groen, A & Cook, G 2012, New Technology-Based Firms in the New Millennium: Strategic and Educational Options, Emerald Group Publishing, New York.

Sein, MK, Henfridsson, O, Purao, S, Rossi, M & Lindgren, R 2011, ‘Action Design Research’, Management Information Systems Quarterly, vol. 35, no. 1, pp. 37-56.

Stanford, N 2013, Organisation Design: Engaging with Change, Routledge, New York.

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