TABLE OF CONTENTS
I. Introduction:..............................................................................2
II. Detail:........................................................................................3
1. Evaluate and compare different organizational structures and culture:.........3
2. The relationship between an organization’s structure and culture and the
effects on business performance:.............................................................................8
3. The factors which influence individual behavior at work:................................9
4. Organization theory strengthens principles and practice of organizing and
management.............................................................................................................12
Classical management theory.................................................................................12
5. The different approaches to management and theories of organization used
by Microsoft:.............................................................................................................14
6. The different leadership styles and the effectiveness of these leadership
approaches in Microsoft Corp. :.............................................................................16
Conclusion:..................................................................................17
Reference :...................................................................................18
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I. Introduction:
In the case of Microsoft Corp. Software Company, after 27 exist years, Microsoft network is
broadened in 105 countries and region with 78000 people
1
. The success of Microsoft is a proof for
management’s talent of William H. Gates and Steven A. Ballmer although they have a different
management way. Have a question is given: What is the best way for management? There are not
any adequate answers for this question. However, in management the talent of overview, foreseen
and observes are necessary to evaluate flexible most.
1
Microsoft Corporation (2007, July 30) Bill Gates-Chairman, Microsoft Corp. Retrieved March 24, 2008, Web site:
/>2
II. Detail:
1. Evaluate and compare different organizational structures and culture:

Getting the structure right is important for any organization, whatever its size, its technology
or its environment. In this point of Child’s view, it is claimed:
“The allocation of responsibilities, the grouping of functions, decision - making, co –
ordination, control and reward – all these are fundamental requirement for the continued operation
of an organization. The quality of an organization’s structure will affect how well these
requirements are met.”
2
Depend on environment, technology and tasks or strategy of management, each organization will be
structured to meet its objective or motivate workers. Organization structure can be broken down into
two main types: function and division.
“A function is a set of people who perform the same types of tasks or hold similar
positions in an organization.”
“A division is a group of functions created to allow an organization to produce and
dispose of its goods and services to customers.”
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Besides, authority/power is also a factor influencing on “shape of organization”. The span of
control is a tool to evaluate authority and hierarchy structure is “flat” or “tall”. It is mean that an
organization with the narrow span of control and high level will lead to tall structure. In contrast,
wider span of control and low level is result in flat structure. The figure below is about
organizational pyramid what shows you span of control, overall.
2
Child J. (1988). Organization: A guide to Problems and Practice. Paul Chapman.
3
Veeramuthu (2008) Organizations and Behavior, Hanoi: National Economic University. 2- page handout on the
Organizational Structure and Culture.
3
Figure 1.1. Organizational pyramid
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Relate to hierarchy, authority can be recognized under an aspect of centralize or decentralize. In the
centralized organizations, managers retain most of responsibilities and the power concentration in

one person. In contrast, decentralized organizations disperse responsibilities and decisions for lower
level managers. At all, each organization will decide what combination is most effective.
Making up a right structure is not enough for an organization to run clearly and effectively.
Organizational culture is also remarkable. As the same as other concepts, there are many way to
define organizational culture. One of the definition is described as follow:
“Culture (in the sense of organizational ‘climate’) is the collective self-image and style
of the organization; its shared values and beliefs, norms and symbols”
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Each organization has different expectations, values, norms and ways to adapt and identify its
culture. Thus, culture in each organization is unique. For example: if relationship of customers is
cared of the culture, this distinction will be adopted by individuals. However, following the ideas of
4
EDEXCEL HNC & HND BUSINESS, (2004) Mandatory Unit 3: Organizations and Behavior Supporting foundation
degrees. 1
st
ed., London: BPP Professional Education, Aldine House, Aldine Place, pp. 64.
5
EDEXCEL HNC & HND BUSINESS, (2004) Mandatory Unit 3: Organizations and Behavior Supporting foundation
degrees. 1
st
ed., London: BPP Professional Education, Aldine House, Aldine Place, pp. 103.
4
Harrison, Handy classify four main types of organizational culture: power, role, task, and person
culture.
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Within power culture, power is central by judgment of key individual. In role culture,
individuals pay attention to their particular job. Furthermore, task culture based on job satisfaction
and expert power. Finally, person culture takes individual as central focus and talent of individual is
target for structure exists.

As we mentioned about organizational structure and culture before, now we will look through
the case scenario of Microsoft; the article “Ballmer’s Microsoft” that published in Business Week on
17
th
June, 2002; to understand more clearly:
• Under management of Gate:
Building a Microsoft basic foundation, Gates paid attention to develop production “the
Windows operating system and Office suite of applications” that he believed more customers’
attraction and competition moves. To be convenient for product development and management, he
divided company following functional structure. “Gates gave his pal free rein to restructure the way
Microsoft manages finance, sales, product development, marketing, even strategic planning”.
Concentrate to production, Microsoft employees worked in smaller groups and all product activities
were done at one site. It is reason why the amount of Microsoft’s products was always competitive
comparing with other company in the industry. “We have always had a multi-product strategy
where the product managers and the development teams are the champions, and that is a process
that has allowed us to have many more products than any one else in the industry”.
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In general,
with the Microsoft’s goal at this time, organization structure that Gate created is suitable. To manage
employees pretty well he used flat structure with narrow span control for office. Hierarchy was
centralized that Gate handed most of power. It is true as Jame Collins said: “To my mind, Microsoft
has never been a company. It's a single remarkable individual, Gates, with thousands of the
smartest, best-paid people anywhere helping that individual. It's basically like a big wheel, with
Gates at the hub.”
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The authority of Gates covered around company and the last decision in hand.
One of the evidence for his strong power is he had his own “think week” when he can think a new
strategy in technology. This proof seems like simple but it expresses that he is such an important and
6
Handy C.B. (1993). Understanding Organizations. Penguin

7
Lalonde J.E. (1990,Feb. 18). A Billion-Now Microsoft's Chairman Bill Gates Needs A New President For The '90S.
Retrieved April 17, 2008, Web site: />site=
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Gates, Bill Leadership the Bill Gate way. Retrieved April 17, 2008, Web site:
/>%20Gates%20Way-Leadership%20and%20Entrepreneurship.htm#Introduction
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seft-decision person “Gates had his ‘think week’ where he secluded himself at his family’s retreat in
Hood Canal in northwest Washington to ruminate on the Next Big Thing in technology”.
Turn your sight into culture. Power culture is the way Gate created in first years of Microsoft.
At that time, the control key is Gates, he handed off decisions. It is may be that, others ideas were
gathered and filled up each other but the last is Gates.
• Under management of Ballmer:
Gates gave his place to Ballmer in January 2000. Taking a position as CEO of Software
Company with clearly goal “great, long- lasting company”, Ballmer has reconstructed Microsoft’s
corporate from top to bottom. With open-mind, he had a big innovation shaping Microsoft‘s
division, tall, unwieldy and decentralized structure. He has broken Microsoft into seven operating
divisions, each units has own leader and they have individual decision making and accountability
“It’s a balance sheet that divides the company into seven distinct businesses and gives each unit’s
leader the financial tools to measure its performance”. Looking ahead, the scale of Microsoft rose
larger with a number of employees. It is reason why he has delegated a second tier of executives.
Ballmer gave up old line of hierarchy that in the hands of Gates and Ballmer and made Microsoft to
become decentralized structure “He has empowered a second tier of executives to run their
businesses with less supervision, breaking from Microsoft’s heritage of placing every important
decision in the hands of Gates and Ballmer” .Moreover, “management sync weeks” every quarter
day-after-day proclaims a changing management from Ballmer, once again. Here, all ideas are
expressed and the final is group-decision. On the other hand, Ballmer has reduced a level of
management to manage more easily and efficiently. Microsoft structure is less flat therefore, the
span of control is narrower and the gap between the sales and product-development are restored.
Now, we are going definitely to Microsoft’s culture under management of Ballmer. Refer to

division structure, Ballmer sent off a strong role culture. Firstly, we will focus on belief, one of the
firm to appreciate organization culture. By the vision improving the relationship with customers and
competitors, he has pointed out an anchor that influence on not only the method customers respond
but also employees interact with customers “Microsoft’s mission is not just about technology. It’s
also about improving the way the company handles relationships with customers and others in the
technology industry”. Further, specific manifestations of culture are people behaviors, too. It is also
regarded as belief that look at aspect of perception and feeling “People have to be very open, self-
critical, almost relentlessly honest, and, at the same time, respectful”. Secondly, value is also
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important aspect. Giving core values “honesty, integrity, and respect”, Ballmer guides employees
and promote their behavior in Microsoft environment. To be considerable positive mind, from these
core values, Ballmer takes relationship with the rest of industry that did not happen with aggressive
person as Gate. Finally, norm is a number of rule and order that are forced employees to obey. With
an aim making all stick and employees are independent in their job, Ballmer has ordered array of
meetings, reviews and examine “He says the company’s core value of honesty, integrity, and respect
must shine through with customers, partners, and the tech industry”. In sum up, under Ballmer’s
hand, Microsoft has made its own culture that has created specific image in industry.
• Competitor of Microsoft’s software company: Mozilla – Producer of Mozilla
FireFox, the software Web browsers.
It is time to look at one another competitor of Microsoft to evaluate and have a view more
adequate. Consider as a big competitor, Mozilla with software web browsers Mozilla FireFox is
actually competition comparing with the software IE (Internet Explore) of Microsoft. The reason
choosing Mozilla but not another one is the different nature and nature goal. While the goal of
Microsoft is a high fiscal, Mozilla is only a non-profit Corporation. Another reason is an image
about open culture that Mozilla is a priority. Contrastively, Microsoft always tries to give persuasive
data fights against this trend
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. Focus on making great products, Mozilla has applied a functional
structure. This type of structure is effective for managing and easy to focus on product group “This
unique structure enables Mozilla to financially support and cultivate competitive, viable community

innovation. The result is great products build by passionate people”
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. Because of the main mission
is an openness and opportunity on the Internet rather than business, like profits or price of stock
therefore authority are decentralize and opener “Developers and programmers are central, but
designers, testers, users and advocates are also key elements”.
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About culture, it can be said that an innovation. Indeed, over 20 percent market share in
Europe, Mozilla FireFox send off free culture. In early, this organization has affirmed its own value,
it is explain why the corporation have a success and bring its culture to around World Wide Web
“providing a Web browser with enough marketshare to drive open standards on the Web. Carefully
managed, this value — and the resulting ability to generate revenue — can be used to make the
Mozilla project self-sustaining and help keep the Internet open and diverse”.
12
Next, believing in
personal traits make organization culture stronger. In this case, stand for nonprofit organization, it is
9
D.T., (2007,May 29). Who makes Miccrosoft unsleep well?. Retrieved April 17, 2008, from Estern Culure Web site:

10
About Mozilla. Retrieved April 17, 2008, from Mozilla Web site:
11
About Mozilla. Retrieved April 17, 2008, from Mozilla Web site:
12
About Mozilla. Retrieved April 17, 2008, from Mozilla Web site:
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not just belief, it is also independent attitude. Take examples are ability to work well, entrepreneurial
style and spirit, good judgment and consensus building skills…etc.
2. The relationship between an organization’s structure and culture and the effects on business
performance:

As we noted, in one organization, structure and culture have mutual actions. Rely on what
type of structure is shaped, culture will have an effect. For example: with type of functional,
centralized structure, most of managers will show his organization to role culture. It is simple to
understand, role culture has a main trend well personal relations so function structure seems like the
most suitable. Because the characteristic of function is dividing to tasks, employees of individual
task can exchange and work each others. And then, the more exchange the more relationship.
• Advantages:
Microsoft also is not exception. Everything went well for Microsoft; the fiscal went sharply
within 27 years. Aside from a management the way dividing employees to perform similar tasks and
group smaller one to develop and complete independent projects are adequate business. It helped
higher product capacity and work effectively “Gates believed that user-friendly computers and
easily accessible software could attract many new customers. He tried to view the entire product
portfolio of Microsoft in the light of future prospects and likely competitor moves. Accordingly, he
made strategic decisions regarding product development”.
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Day to day, the scale of Microsoft
expand more and more. The management is quite difficult, there is not another way is empower to
second authority to manage. It not only solves a difficult in management employees but also gives a
condition for sub-units to express potential and take full advantages in source of grey matter.
Further, a volume of time to supervise is release in stead of a manager can spend time to make a
strategy or schedule of work in the future.
• Disadvantages:
Microsoft is not always right. Once again, Microsoft wants to bridge a belief in customers by
getting product-development groups. However, the business was not successful because of these
elements:
First of all, a net work of Microsoft is too large. Develop more groups of product is having to
add more people for project. It is a really trouble with such a large company as Microsoft Corp. The
13
Lalonde J.E. (1990,Feb. 18). A Billion-Now Microsoft's Chairman Bill Gates Needs A New President For The '90S.
Retrieved April 17, 2008, Web site: />site=

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