MGNT 1020 Week 7: Structuring and Designing Organizations

Vocabulary flashcards covering the key concepts, structural elements, departmentalization types, and traditional versus contemporary organizational designs from MGNT 1020 Week 7.

Organizational Structure

The pattern of organizational roles, relationships, and procedures that enable coordinated action among organizational members, consisting of formal tasks assigned, formal reporting relationships, and coordination systems.

Organizational Chart (O-chart)

A visual representation of an organization's structure displaying formal roles, reporting relationships, and procedures.

Organizational Design

The process of creating and changing an organization's structure.

Work Specialization

The degree to which work activities in an organization are divided into separate job tasks.

Human Diseconomies

The negative human and operational side effects—such as boredom, fatigue, stress, low productivity, poor quality, increased absenteeism, and high turnover—that occur when work specialization is carried too far and exceeds economic advantages.

Departmentalization

The basis on which work activities are grouped together to be completed in a coordinated way.

Functional Departmentalization

A grouping method that organizes employees based on the work performed or functions (such as engineering, accounting, manufacturing, human resources, and purchasing) to achieve economies of scale.

Product Departmentalization

A grouping method that organizes employees based on major product lines, thereby increasing accountability for product performance.

Customer Departmentalization

A grouping method that organizes employees based on the type of customer an organization seeks to reach, allowing teams to address a common set of customer problems.

Geographic Departmentalization

A grouping method that organizes employees based on the geographic territory or location served.

Process Departmentalization

A grouping method that organizes employees on the basis of work flow or customer flow (for example, application, testing, photo taking, payment, and delivery).

Authority

The rights inherent in a managerial position to give orders and expect those orders to be obeyed.

Responsibility

The obligation to perform assigned duties and activities that must be allocated alongside delegated authority.

Span of Control

The number of employees that a manager can efficiently and effectively supervise, defined by how many individuals directly report to the next level.

Centralization

The degree to which decision-making authority is concentrated at upper levels of the organization.

Decentralization

The degree to which lower-level managers provide input or are empowered to actually make decisions.

Formalization

The extent to which an organization's jobs and employee behaviors are guided by standardized rules, explicit job descriptions, and defined operating procedures.

Simple Structure

A traditional organizational design characterized by low departmentalization, wide spans of control, authority centralized in a single person, and little formalization; commonly used and fast, flexible, and inexpensive in small businesses.

Functional Structure

An organizational design that groups similar or related occupational specialties, offering economies of scale and minimal duplication while risking loss of organizational sight due to pursuit of narrow functional goals.

Divisional Structure

An organizational design composed of separate business units or divisions, where each division has limited autonomy and headquarters coordinates long-term strategic planning.

Team Structure

A contemporary organizational design in which the entire organization is made up of work teams responsible for all performance results, relying heavily on employee empowerment.

Matrix Structure

A contemporary organizational design that assigns specialists from different functional departments to work on projects led by project managers, returning to functional units upon completion.

Dual Chain of Command

A reporting arrangement characteristic of matrix structures in which employees report to two separate managers (a functional manager and a project manager) who share authority.