I am, and have been, involved in many organizations, but
very few of those have undergone any sort of structural/organizational
change. One small example of
organizational change that I have witnessed is in the Society of Women in
Business (SWB). Traditionally, SWB has
ten executive board members and a handful of committee chairs that have
committees of 3-5 women. In order to
accommodate a growing member population, SWB added additional committee and
chair positions to better regulate and facilitate their organization. We now have ten committee chairs as opposed
to around 7 in the past. I believe that
the additional leadership positions have greatly benefitted the members of SWB,
because now, it is much more efficient and has more interesting and worthwhile
events.
In terms of transaction costs in this example of organizational change, I believe that they were very
low compared to the payoff that they created.
Though it did take extra time and effort to create new positions, hold
interviews and elect members to these new positions, I believe that the
organization and its members have benefitted from this extra work. SWB doesn’t produce a product, however, it does
provide a service, and by creating new positions, they increased efficiency and
are now able to reach a greater population.
I believe that the greatest transaction costs in many of the RSO's on campus, including the Society of Women in Business, are the result of bargaining and policing and enforcing costs. I define bargaining costs as any cost required to create an agreement between two parties, which, in this case, would be the member and the leadership of SWB. In SWB, I believe that the membership agreement and requirements create a bargaining cost because this creates an understanding between both parties and creates expectations. In SWB, the leadership (the executive board and committee chairs) must generate acceptable requirements for membership eligibility, while the member understands that by agreeing to such standards, she must attend said number of specific events.
Similarly, I define policing and enforcing costs as any cost that the parties incur while making sure both parties stick to the contact. There are very few costs to the members in this transaction cost area, but the leadership of SWB must pay attention to this concept. Oftentimes, members do not keep track of the number of events or types of events they attend, and this causes a problem for the leadership. In order to clear up any confusion, they created a system in which at every event, members sign in with their Net ID and name and this is then entered into a Googledoc containing member information. This member information is accessible to members by means of the SWB website and makes it easy for the leadership and members to keep track of requirements. Though this system requires more effort by the leadership committee of SWB, it helps the organization run smoothly, and I believe it is efficient.
I believe that the greatest transaction costs in many of the RSO's on campus, including the Society of Women in Business, are the result of bargaining and policing and enforcing costs. I define bargaining costs as any cost required to create an agreement between two parties, which, in this case, would be the member and the leadership of SWB. In SWB, I believe that the membership agreement and requirements create a bargaining cost because this creates an understanding between both parties and creates expectations. In SWB, the leadership (the executive board and committee chairs) must generate acceptable requirements for membership eligibility, while the member understands that by agreeing to such standards, she must attend said number of specific events.
Similarly, I define policing and enforcing costs as any cost that the parties incur while making sure both parties stick to the contact. There are very few costs to the members in this transaction cost area, but the leadership of SWB must pay attention to this concept. Oftentimes, members do not keep track of the number of events or types of events they attend, and this causes a problem for the leadership. In order to clear up any confusion, they created a system in which at every event, members sign in with their Net ID and name and this is then entered into a Googledoc containing member information. This member information is accessible to members by means of the SWB website and makes it easy for the leadership and members to keep track of requirements. Though this system requires more effort by the leadership committee of SWB, it helps the organization run smoothly, and I believe it is efficient.
This is meant both as a reaction to the current post and as a guide to future such posts. You know a lot about SWB. I know nothing about it. Indeed I know very little about RSOs in general. If you envision your classmates as readers, you might count on them understanding RSOs, but still not know about SWB does. In my case, it is best to assume a blank slate across the board.
ReplyDeleteSo when you get into structural discussions initially, I'm hoping that you first discuss mission an function - of the entire SWB, then of perhaps one or two committees. Here are a few examples of questions I have on this score. How many members are there in the entire SWB? How often does it meet as a whole? Are all members on at least one committee? What happens at a committee meeting. Are those well attended? I could go on, but I hope you get the idea.
You talked about structural change in response to a growing membership - there needed to be more committees. That might seem an obvious solution to you, but you know what is going on. It is not an obvious solution to me, because I don't. What would have happened if the number of committees had stayed fixed?
Likewise, in your last two paragraphs you took on the issue of attendance at events and tracking of that. This was good in terms of getting a managerial and transaction cost issues. But I really didn't understand what difference it makes if somebody comes to an event or not. Does it make the even more successful if more people attend? What about participation once in attendance? Does that matter too? If so, why track attendance but not participation? If you got at that , you'd have gone deeper into explaining what's going on.
Hi Professor Arvan, thanks for your comment. Let me first address your questions about SWB. SWB is an inclusive RSO that encourages women of all majors to become involved in business. Therefore, it normally has well over 200 member each year. As a whole, the organization never actually meets. In theory, all members could attend each and every hosted event, but this rarely happens. In order to be recognized an active member during a semester, one must attend two professional events, one social event, one mentoring event, one service event and two additional events of your choice. Since many events of each listed type are held multiple times a semester, many members don't attend the same event, but are recognized as members. In terms of committees, there are several consisting of anywhere from 5-7 women and they are specific to chair positions (i.e. the marketing committee or the digital media committee). Members are not required to be on committees, and if they would like to be on one, they must apply when when seats on the committee become available.
DeleteI believe that if the number of committees had stayed fixed, there would have been some scheduling problems and attendance would not have been as high as it has been. Additionally, extra committees has reduced the work load of the executive leader board so that they can commit to planning more events in the future.
Attendance and participation are often synonyms when talking about SWB. Oftentimes, a professional event will consist of a presentation from a company about a work related topic (i.e. work-life balance), and simply attending the event and signing in gives you credit for that specific situation. I believe events are more successful if more people attend because it demonstrates that 1) there was a desire to participate in whatever activity we may be doing or listen to the speaker and 2) members are allowed to interact and benefit from networking.
I hope this clears up some of the confusion you may have had when I explained SWB and its transaction costs. I'll try to be more thorough in the future.