Scribd
Upload
77 views24 pages

Chapter 4 Organizational Structure

Organizational structure involves dividing work into specific jobs and departments, coordinating tasks, and establishing lines of authority. There are several key elements of organizational structure: 1) Work is divided into jobs and departments through specialization and departmentalization. 2) Authority, responsibility, and the chain of command define who reports to whom. 3) Decisions can be made centrally at the top or decentralized to lower levels. 4) Departments are formed through functional, product, customer, geographic, or process approaches.

Uploaded by

khalilgbrn666
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as KEY, PDF, TXT or read online on Scribd
77 views24 pages

Chapter 4 Organizational Structure

Organizational structure involves dividing work into specific jobs and departments, coordinating tasks, and establishing lines of authority. There are several key elements of organizational structure: 1) Work is divided into jobs and departments through specialization and departmentalization. 2) Authority, responsibility, and the chain of command define who reports to whom. 3) Decisions can be made centrally at the top or decentralized to lower levels. 4) Departments are formed through functional, product, customer, geographic, or process approaches.

Uploaded by

khalilgbrn666
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as KEY, PDF, TXT or read online on Scribd
You are on page 1/ 24

CHAPTER 4:

ORGANISATIONAL
STRUCTURE
What is organizational design?

Arrange and structure work to How?


accomplish organizational goal. Divides work in accordance to specific jobs and
group them together into specific department.
Assign tasks and responsibilities
Coordinate's diversity of tasks
Establish relationship and formal lines of
authority
Allocates and deploys organizational resources
1. Work specialization
(Division of labor):
which of the job in the
organization are
divided into sub-tasks.
Each sub task will be
performed by the
individual of the
employee. One
particular=one
Beneficial for manufacturing activities particular job.
Assemble the bricks--- emphasize paint the
products-Check the quality of the products---
 Prepare for packaging- Distribute to end
users
Framing-- Siding- Painting-Inspection-
Advantages and Disadvantages
Disadvantages
Advantages
Each employee can be an expert Limit the ability to perform many tasks
Higher levels of productivity Feel boredom
Work completed faster and more Smaller skills sets
efficient Employees rarely challenged
Quality control costs are lowered Limited cooperation and communication
Sense of pride and job security Limit the amount of work
Higher profit potential
Who is my bos? Who do I report to? Who
do I go if I have a problem?

Authority-What people expect to do?

2. Chain of
Command RESPONSIBILITY-THIS IS YOUR TASK!!

UNITY OF COMMAND-THIS IS YOUR


MANAGER
Chain of command:

The continuous line of authority that


extends from upper organizational
levels to the lowest levels and
clarifies who reports to whom.
WHO DO I GO TO IF I HAVE A
PROBLEM? WHO DO I REPORT TO?
THREE ELEMENTS: AUTHORITY,
RESPONSIBILITY AND UNITY OF
COMMAND
3. Span of control:

The number of subordinates a manager can


direct efficiently and effectively.
4. Authority: WHAT PEOPLE TO DO
AND EXPECT TO DO?
The rights inherent in a managerial
position to give orders and expect
them to be obeyed.
THE CONDITIONS OF GIVING
ORDERED:

Understand the order


Consistent and know the
purpose
Avoid conflicts with the
personal beliefs
Able to perform the tasks as
directed
Line authority- employer-
employee authority
relationship.
The position authority
(given and defined by
the organization) that
entitles a manager to
direct the work of
operative employees
without consulting to
anyone.
Staff authority
Positions that have
some authority (e.g.,
organization policy
enforcement) but that
are created to support,
assist, and advise the
holders of line
authority.
Responsibility:

An obligation to perform assigned activities.


5. Power:

An individual’s capacity to
influence decisions.
TYPES OF
POWER
Coercive power Power based on fear.
Reward power Power based on the ability to
distribute something that others value.
Legitimate power Power based on one’s position
in the formal hierarchy.
Expert power Power based on one’s expertise,
special skill, or knowledge.
Referent power Power based on identification
with a person who has desirable resources or
personal traits.
Unity of command:

The management
principle that no person
should report to more
than one boss.
6. Centralization:
At what organizational level are decisions
made?

ORGANIZATION WITH A CENTRALIZED


STRUCTURE KEEP DECISION-MAKING
FIRMLY AT THE TOP OF THE
HIERARCHY (AMONGST THE SENIOR
MANAGEMENT).
Decentralization:

IN DECENTRALIZED STRUCTURE,
DECISION MAKING IS SPREAD OUT TO
INCLUDE MORE JUNIOR MANAGERS
IN THE HIERARCHY, AS WELL AS
INDIVIDUAL ORGANIZATION UNITS.
Centralization vs decentralization
Decentralization
Centralization
Environment is complex, uncertain
Lower-level managers are capable to
make decisions
Environment is Lower level Decisions are Decision is significant
stable managers are not relatively monitor
capable to make Corporate culture is open to allow
decisions
managers a say in what happens
Company is geographically dispersed
Effective implementation of company
strategies depends on managers
Crisis or the risk of Company is large Effective being involved and flexibility to make
failure implementation of
company strategies
decisions.
depends of
managers retaining
say over what
happens
7. DEPARTMENTALIZATION:
HOW JOBS ARE GROUPED TOGETHER
Plant Manager

Accounting Manufacturing Purchasing HR Manager


Manager Manager Manager

Efficient according to the special skills, knowledge


Functional Departmentalization: and orientation.
Coordination within functional area
In depth specialization
The grouping of activities Poor communication across functional area
by functions performed Limited view of organizational goals
Product
Departmentalization
:

The grouping of
activities by
product
produced
Sales
Director

Manager, Wholesale Purchasing CRM


retail manager Manager Manager
accounts

Customer’s needs and problems can be met by


Customer Departmentalization:
specialists
Duplication of functions
Groups jobs on the basis Limited view of organizational goals
of specific unique
customers
Vice
President of
Sales

Sales Director Sales Director Sales Sales Director


Western Southern Director, ASIA Eastern
region Region Region

Geographic Departmentalization: MORE EFFECTIVE AND EFFICIENT IN HANDLING


OF SPECIFIC REGIONAL ISSUES THAT ARISE
SERVE NEEDS OF UNIQUE GEOGRAPHIC MARKETS
The grouping of DUPLICATION OF FUNCTIONS
activities by CAN FEEL ISOLATED FROM OTHER
GEOGRAPHIC REGION ORGANIZATIONAL GOALS.
Plant
Superitendant

Sewing Planning and Assesmbling Finishing Inspection and


Department Milling Dpmt Dpmt Dpmt Shipping Dpmt
Manager Manager Manager Manager Manager

Process Departmentalization:

The grouping of activities by process on the basis of product or customer flow


-it is more efficient flow of work activities
-can be only uses for specific types of product
Q&A Session

You might also like