unit 2.2 organization human resources

Organizing Human Resources

Organizational structure helps arrange employees in a way that these things would be evident at glance:

• job titles

• Accountability

• Responsibility

Delegation

passing on of control and authority to others in a firm

Span of control

Refers to the amount of employees that a manager is responsible and accountable for.

Levels of hierarchy

An organizational structure that is based on a ranking system. Usually employees who are more skilled/ senior are at the top whereas low skilled/ senior employees are at the bottom.

Chain of command

Refers to the formal line of authority through which orders are passed down in an organization

Bureaucracy

The execution of tasks that are governed by administrative and formal rules of a firm

Different types of organizational structures

• centralized structure ( centralization)

• Decentralized structure ( decentralization)

• Delayering

• Matrix structure

Sentralization (organizational structure)

have a small group of people at the top who control decision making

Advantages:

• faster decision making

• Better control

• Better sense of direction

• Efficiency

Disadvantages:

• prolonged decision making

• Demotivation

• Added pressure for senior staff

• Inflexibility

Decentralization (organizational structures)

Decision making authority is shared with a greater amount of people in the organization

Advantages:

• Greater morale

• Faster decision making

• Input for workers

• Teamwork

Disadvantages:

• conflict

• costly

• Greater chances of mistakes

• Loss of control and communication issues

Delayering

The process of removing a layers in the hierarchy, it is designed to lengthen the chain span of control and shorten the chain of command.

Advantages:

• reduces cost

• More efficient

• More control

• Improves communication

• Encourages delegation and empowerment

Disadvantages:

• creates anxiety amount workers

• Demotivation

• Decisions take longer

• Overloads staff

Matrix structure

Organizes employees from different departments to temporarily work together to solve a complex task or a project

Advantages:

• cost effective

• Different set of skills

• Different perspectives and ideas

Disadvantages:

• Fear of ideas being stolen

• Conflict

Organizational charts

• horizontal of flat

• Tall of vertical

• By product, function, region

What’s shown by a organizational chart

• chain of command

• Span of control

• functional departments

• Channels of communication

• Levers of hierarchy

Flat/ horizontal structure

Fewer levels of hierarchy and longer spans of control

Advantages:

• increases opportunities for career development due to importance of delegation

• Improved communication

• Cheaper to operate

• Reduces power distance between senior and junior staff

Tall/ vertical structures

More levels of hierarchy, and a increased chain of command

Advantages :

• quicker and more effective communication

• Easier to control

• Increased efficiency and productivity due to specialization

Common reasons for restructuring a firm

• to incorporate new roles and jobs

• To reduce costs and debts

• To concentrate on key business activities

• To incorporate new technology

• To sell a part of the firms business activities

• To merge with another company

Changes in organizational structures (HL)

Project based organizations: firms organize their Human Resources around a particular project

Handys shamrock organization

Firms need to organize their human resource to be able to adapt quickly to the external environment.

• he proposed human resource should be organized into:

  • Core staff: full time staff

  • Peripheral workers: part time staff

  • Outsourced workers