chapter 15: foundations of organizational structure

Organizational Structure

How jobs, tasks, and responsibilities are formally divided, grouped, and coordinated within an organization.

Work Specialization

The degree to which tasks in the organization are subdivided into separate jobs; increases efficiency and employee skills.

Departmentalization

The basis by which jobs are grouped together, such as by function, product, geography, process, or customer.

Chain of Command

The authority inherent in a managerial position to give orders; clarifies who reports to whom within an organization.

Span of Control

The number of subordinates a manager can efficiently and effectively direct; influences organizational efficiency.

Centralization

The degree to which decision making is concentrated at a single point in the organization.

Decentralization

The degree to which decision making is spread throughout the organization.

Formalization

The degree to which jobs within the organization are standardized and controlled by rules and procedures.

Boundary Spanning

Occurs when individuals form relationships with people outside their formally assigned groups.

Simple Structure

A structure characterized by low departmentalization, wide spans of control, and centralized authority in a single person.

Bureaucracy

A type of organizational structure characterized by standardization, highly routine tasks, and centralized authority.

Matrix Structure

A structure that creates dual lines of authority and combines functional and product departmentalization.

Virtual Organization

A small, core organization that outsources its major business functions for maximum flexibility.

Team Structure

Eliminates the chain of command and replaces departments with empowered teams.

Circular Structure

A structure where executives are at the center and managers, specialists, and workers are grouped radiating outward.

Downsizing

A systematic effort to make an organization leaner by reducing staff, closing locations, or selling off business units.

Three-Dimensional Environment Model

A model that encompasses capacity, volatility, and complexity of the external environment affecting organizations.

Capacity

The degree to which the environment can support growth.

Volatility

The degree of instability in the environment.

Complexity

The degree of heterogeneity and concentration among environmental elements.

Research Findings on Work Specialization

While it contributes to higher productivity, it may reduce job satisfaction.

Culture and Organizational Structure

Different cultures may prefer different organizational structures; for example, high-power distance cultures may prefer mechanistic structures.