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Management Ch 5 Org. Structure

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Violetta Remeslova

on 5 March 2013

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Transcript of Management Ch 5 Org. Structure

6 Elements in
Organizational Design Work Specialization 5 Types of Departmentalization Authority and Responsibility Span of Control Centralization vs. decentralization Formalization Efficient use of the diversity of skills in a workforce
poor quality
high turnover what jobs are done by whom
coordinated and integrated work Functional Based on work performed
ex: accounting, HR, etc. Geographic Based on location served
ex: North, South, California, etc. Product Based on major product areas
ex: men's, women's, apparel, footwear, etc. Customer Based on customer problems and needs
ex: wholesale, retail, refunds, etc. Process Based on basis of work or customer flow
ex: testing, payment collection, information, etc. Cross-functional teams: people from various departments, crossing traditional department lines Division of labor common work activities are grouped together Chain of command: line of authority from upper management to lower levels Unity of command: directly report to only one boss Line authority: managers direct work of employees Staff authority: some authority; support and assist those in line of authority managers are no longer the only ones who have influence
authority vs. power
authority is a right that comes with a position
power is individual's capacity to influence decisions (cone analogy) Power Coercive: fear
Reward: give something others value
Legitimate: position based
Expert: special skills or knowledge
Referent: desirable resources or personal traits Number of employees a managers can efficiently and effectively supervise. depends on the level of manager (top ones deal with more unstructured problems)
more training requires less supervision later
other variables: similarity of tasks, physical proximity, etc. Centralization: degree to which decision making takes place at upper levels of organization
Decentralization: degree to which lower-level managers provide input or actually make decisions standardized jobs
employee behavior guided by rules Formalization used to be very important, while now, employees have more freedom to be creative with their decisions Organizational Structure
Choices 2 Types 4 Variable Effects Mechanistic bureaucratic
high in
centralization Organic collaborative
few rules
informal Strategy Facilitating goal
ex. organic is better with innovative goals Size The bigger the company, the more rules are necessary Technology organic:
unit production
process production
mass production Environment Organic: dynamic and uncertain
Mechanistic: stable Organizational Designs Simple low departmentalization
wide spans of control
authority of one person
little formalization
doesn't allow much growth Functional groups similar and related specialties
lose sight of what's best for organization as a whole Divisional separate business units or divisions
focuses on results
increased costs, decreased efficiency
duplication of activity Team made up of only teams and groups
involved and empowered employees
no clear chain of command Matrix-Project specialists work on a project under a project manager
return to areas once project is complete
respond to environmental changes
task and personality conflicts Project Structure: employees continuously work on projects Boundary less not defined by bounds
highly flexible
utilizes talent
lack of control
difficult to communicate Virtual organization: some full-time employees, many contractors hired as needed
Network organization: own employees for some activities, network of suppliers used for other tasks
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