PBAM Unit 6

Organizational Structure:

Organizing-Key management process that should be conducted with equal awareness within the internal and external environment of a company

Organizational Structure-specification of the jobs to be done within an organization and the ways in which they relate to one another

specialization-determining who will do what

departmentalization-determining how people performing certain tasks can best be grouped together

Profit center-separate company unit responsible for its own costs and profits

Organization Charts:

organization charts-specification of the jobs to be done within an organization and the ways in which they relate to one another

Chain of Command- the solid lines in an organizational chart that show reporting relationships within a company

Unstructured companies-tend to be more adaptable to their environments than structured companies

Specialization:

• Job Specialization

  • the process of identifying the specific jobs that need to be done and designating the people who will perform them

  • helps workers develop expertise in their jobs

  • Natural part of organizational growth

• Employees looking at specialization chart

  • to find out how their job relates to others they typically will look within their department

  • this allows workers to look at the people they work with daily

Departmentalization:

Functional Departmentalization-dividing an organization according to groups’ functions or activities. This is Effective for small/new organizations

Product Departmentalization-dividing an organization according to specific products or services being created. This helps focus on special product lines

Process Departmentalization-dividing an organization according to production processes used to create a good or service

Customer departmentalization-dividing an organization to offer products and meet needs for identifiable customer groups

Geographic Departmentalization-dividing an organization according to the areas of the country or the world served by a business

Centralization and Decentralization:

• Establishment of a Decision-Making Hierarchy

  • deciding who will be empowered to make which decisions and who will have authority over others

• Centralized Organization

  • organization in which most decision-making authority is held by upper-level management Decentralized Organization

• Decentralized Organization

  • organization in which a great deal of decision-making authority is delegated to levels of management at points below the top

Flat and Tall Organizations:

Flat organizational structure-characteristic of decentralized companies with relatively few layers of management

Tall organizational structure-characteristic of centralized companies with multiple layers of management

Delegation process:

delegation - process through which a manager allocates work to subordinates

1. .Assigning responsibility - the duty to perform an assigned task

2. Granting authority - the power to make the decisions necessary to complete the task

3. Creating accountability - the obligation employees have for the successful completion of the task

Forms of Authority:

Line authority - organizational structure in which authority flows in a direct chain of command from the top of the company to the bottom

Staff Authority - authority based on expertise that usually involves counseling and advising line managers

Staff members - advisers and counselors who help line departments in making decisions but who do not have the authority to make final decisions

committee and team authority - authority granted to committees or teams involved in a firm’s daily operations

work team - group of operating employees who are empowered to plan and organize their own work and to perform that work with a minimum of supervision

Structure

Functional structure-organization structure in which authority is determined by the relationships between group functions and activities

Divisional structure-organizational structure in which corporate divisions operate as autonomous businesses under the larger corporate umbrella

Matrix Structure-organizational structure created by superimposing one form of structure onto another

International Organization structures-approaches to organizational structure developed in response to the need to manufacture, purchase, and sell in global markets

Team Organization-relies almost exclusively on project-type teams, with little or no underlying functional hierarchy

Learning organization-works to facilitate the lifelong learning and personal development of all of its employees while continually transforming itself to respond to changing demands and needs

Virtual organization-only a handful of permanent employees, a very small staff, and a modest administrative facility