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THESTARMODEL
THE STAR MODEL?
JAY R. GALBRAITH
The Star Model? framework for organization design is the foundation
on which a company bases its design choices. The framework consists of a
series of design policies that are controllable by management and can
influence employee behavior. The policies are the tools with which
management must become skilled in order to shape the decisions and
behaviors of their organizations effectively.
What is the Star Model??
The organization design framework portrayed in Figure 1 is called the
“Star Model?.” In the Star Model?, design policies fall into five categories.
The first is strategy, which determines direction. The second is structure, which
determines the location of decision-making power. The third is processes,
which have to do with the flow of information; they are the means of
responding to information technologies. The fourth is rewards and reward
systems, which influence the motivation of people to perform and address
organizational goals. The fifth category of the model is made up of policies
relating to people (human resource policies), which influence and frequently
define the employees’ mind-sets and skills.
Figure 1—The Star Model?
? Jay R. Galbraith. Do not post, publish or reproduce without permission. All rights reserved.
JAY R. GALBRAITH THE STAR MODEL? 2
Strategy
Strategy is the company’s formula for winning. The company’s
strategy specifies the goals and objectives to be achieved as well as the values
and missions to be pursued; it sets out the basic direction of the company. The
strategy specifically delineates the products or services to be provided, the
markets to be served, and the value to be offered to the customer. It also
specifies sources of competitive advantage.
Traditionally, strategy is the first compone
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