O R G A N I S AT I O N

STRUCTURE

P R E PA R E B Y
CHUO JIN XIN
 DEFINISION OF ORGANISING ,ORGANISATION
1
STRUCTURE,ORGANISATION CHART

2 Work specialisation

3 Chain of command

CONTENT 4
Span of management/span of
control

5 Centralisation &
decentralisation
 • Organizing allocates resources to achieve strategic goals, crucial
ORGANISATIO
for strategy implementation. It structures tasks, deploys
N resources, and coordinates departments.

ORGANISATIO • Formal task assignments and reporting define authority, decision-

N STRUCTURE making, hierarchy, and manager spans. Coordination systems enable
organized collaboration across departments.

ORGANISATIO • The org chart visually illustrates an organization's

N CHART vertical structure, depicting the chain of command,
departmental tasks, and overall order
 Work Specialization
• Efficiency is enhanced when employees specialize in tasks.
Work specialization, or division of labor, involves subdividing
organizational jobs into individual tasks.
• This results in efficient production as employees perform
small, well-defined tasks.
 • The chain of command shows
Chain of authority structure.
• Authority is a manager's right to make
Command
decisions, while responsibility is task
duty. Managers receive authority
corresponding to their responsibilities.

• The chain of command ensures clear

reporting relationships, upholding
unity of command and scalar principle
for accountability and defined
authority
 • Accountability aligns authority and
responsibility, justifying task outcomes
to higher-ups.
• Delegation transfers authority and
Chain of
responsibility to lower positions in the
Command hierarchy.

• Line authority gives managers formal control over

immediate subordinates.
• Staff authority, narrower than line authority, allows
specialists to advise, recommend, and counsel in their
area of expertise.
Span of Management

• Span of management is the number of

employees reporting to a supervisor,
affecting supervision intensity.
• Tall organizations have more levels and
narrow spans, while flat organizations
have wider spans and fewer levels.
• Traditionally, a span of control of 7 per
manager is deemed appropriate.
Span of Management (cont’d)
• Factors associated with less supervisor involvement and larger
span of control
➢Work is stable and routine
➢Subordinates perform similar work
➢Subordinates in single location
➢Highly trained and need little direction
➢Rules and procedures are defined
➢Support systems and personnel are available to manager
➢Little supervision is required
➢ Managers’ personal preference favor a large span
 Decision authority is located near the top of the
Centralization organization ( important decisions usually are made
at the top)

Decentralization delegates decision authority to lower levels

Decentralization for swift decision-making by those most affected and
knowledgeable, crucial in dynamic environments.

Change favors decentralization for faster customer

Factors that influence response, while crises may lead to centralized authority, as
centralization versus with Honda's new car model disagreements.
decentralization
 Departmentalization

Departmentalization organizes
individuals into departments and
shapes the overall organization, with
• Three approaches to structural design
managers using the chain of
reflect different
command to determine workgroup
uses of the chain of command in
arrangements.
departmentalization:
– Vertical functional
– Divisional
– Matrix
 Functional structure: Groups by shared skills,
with specialized departments, enhancing overall
Departmentalization:
organizational function.
Vertical Functional Approach

Functional structure: Streamlined

communication, coordinated tasks, and
aligned expertise among staff. Disadvantages :Inter-departmental barriers
hinder communication, coordination, and
responsiveness to changes.

Advantages: Task-based grouping enhances efficiency,

specialized skills, and unified direction.
 Divisions are self-contained with Divisional structure groups
separate departments. Each departments by outputs, common in
division, like Johnson & large corporations with separate
Johnson's, focuses on a product, divisions for tasks, technology, or
customer, or region. customers..
Departmentalization:
Divisional Approach
Disadvantage: Coordination
Advantage Customer-centric
across divisions is often poor.
organization with adaptable units,
– Duplication of resources across
improving coordination through
divisions
dedicated product-focused
– Less technical depth and
groups.
specialisation
 Matrix structure: Integrates In the matrix structure:
functional and divisional aspects • Dual lines of authority are unique.
with dual lines of authority for • Employees report to two supervisors.
control and coordination. • Matrix boss oversees one side.
• Top leader oversees both chains.

Departmentalization:
Matrix Approach
Matrix structure challenges
Matrix structure excels in dynamic include dual chains of command
environments by facilitating conflict and issue causing frustration, high conflict,
resolution, and optimizing resource utilization and time lost in meetings.
through specialist transfers.
 As organizations expand, senior managers must
Organizing for horizontal ensure cohesion among new departments.
coordination (cont’d) Coordination remains vital across all structures to
foster collaboration.

Coordination methods comprise: Standardization:

• Standardization o and procedures.
• Establishes uniform rules
• Planning • Integrates units by regulating actions.
• Mutual adjustment Effective • Formalization sets rules for interactions (e.g.,
communication systems also enhance attendance policies)
coordination.
Global operations encounter diverse goals, activities, distances,
and cultural differences. Managers prioritize information
sharing and cooperation for improved horizontal coordination.
 Coordination by mutual adjustment
Coordination by plan (Interdependent parties communicate directly
• Establish goals and schedules for
for coordination.)
interdependent units.
• Feedback and discussion for joint problem-
• Units must meet deadlines and
solving.
objectives for a common goal.
• Enables flexibility in handling novel
• Doesn't demand high stability and
problems.
routinization.
• Time-consuming due to extensive
• Units can adapt actions as long as
collaboration.
deadlines and targets are met.

Coordination and communication

• Organizations face significant information flows.
• Need structures to process information efficiently.
• Strategies: minimize information needs or enhance capacity.
 Coordination and communication

Option one: reducing the need for information

Creating slack resources: option two: increasing information
• Extra resources for emergencies (e.g., inventory). processing capability
• Reduces the need for detailed information (e.g., • short invest in information
about sales demand). systems - e.g., employing or
Creating self-contained tasks:
expanding computer systems
• Forming project teams where information is shared
• create horizontal relationships
among members directly.
• Reduces the need to rely on various functional which can foster coordination
departments for information. • across different units
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