Management Functions Module 3

8/4/2019 Management Functions Module 3

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Module 3Organisational Planning and

Creating an Organisational Structure


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Part 1: Organisational Planning

Planning defined? How do you plan? All other management functions stem from

planning A plan is a blueprint for goal achievement What are our goals and how will we achieve

them? Planning = preparing for tomorrow today!


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The 6 Basic Planning Questions

What needs to be accomplished? When is the deadline? Where will this be done? Who will be responsible for it? How will it get done?

How much time, energy and resources arerequired to accomplish this goal?


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The Advantages of PlanningIf you fail to plan, you plan to fail.

Gives an organisation a sense of direction

Focuses attention on objectives and results Establishes a basis for teamwork Helps anticipate problems and cope with change Provides guidelines for decision making A prerequisite to all other management functions


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Criteria for an Effective Goal

Specific and measurable Covering key result areas Challenging but not too difficult Time deadline Linked to rewards (motivational)


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SMART GoalsWork smarter, not harder

Specific

Measurable Agreed/achievable Realistic/Relevant Timebound


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Coordination of Goals

Top-level managers strategic goals

Middle-level managers tactical goals First-level managers operational goals


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Types of Plans

Operational plans (single use or ongoing apolicy, procedure or rule)

Tactical plans (concerned with what each deptor division must do, time span 1 year or less)

Strategic plans (designed with the goals of theentire organisation as a whole in mind, looking

ahead for the next 2, 3, 5 or even more years) Contingency plans what could go wrong?


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Barriers to Planning

Inability to plan or inadequate planning Lack of commitment to the planning process Inferior information Focusing on the present at the futures expense Too much reliance on the planning department

Concentrating on controllable variables


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Part 2: Creating anOrganisational Structure

From planning to organising

The plan is in place now allocate theresources to achieve the goal Tasks must be assigned and coordinated Organising transforms plans into reality through

the deployment of people and resources within aframework known as the organisational structure


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The Organisational Process

1. Review plans and objectives2. Determine the work activities required to

achieve the objectives3. Group the necessary work activities into

manageable units4. Assign activities and delegate authority

5. Design a hierarchy of relationships


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Concepts of Effective Organising

Work specialisation (a more efficient way ofworking?)

Chain of command (line of authority whoreports to whom)

Management authority (formal and legitimateright to make decisions, issue orders and

allocate resources) Span of control (wide or narrow number of

workers reporting to a manager) Delegation (downward transfer of authority)


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Why the Reluctance to Delegate?

I can do it quicker myself! I can do it better than you! You might do it better than me (embarrassing)! Its risky you might do it wrong! I wont be needed any more!

Ill be unpopular only giving the dull jobs out! Theyll think I cant do it myself! I dont know how to delegate!


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Benefits for the Delegator

More free time

Increase in knowledge, skills & experience

Builds relationship with delegatee

If over -specialised, can pass on knowledge and skills

Enhances upward mobility within company

Higher earning potential

Can provide a refresher for delegator

Job satisfaction


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Benefits for the Delegatee

Increase in knowledge and skills, more

versatile Motivation and greater job satisfaction

Improved promotion prospects

Builds relationship with delegator Less likely to leave company


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Benefits for the Organisation

More flexible/versatile/productive workforce

Higher staff morale

Lower staff turnover

Lower sickness/absenteeism rates

Costs savings on recruitment

Higher productivity and revenues

Enhanced company image/reputation

When recruiting, more applicants to choose from


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Key Principles of Delegation

Match the employee to the task

Be organised and communicate clearly Transfer authority and accountability

Choose the level of delegation carefully


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Centralisation versus Decentralisation

Centralised organisation = authorityconcentrated at upper levels

Decentralised = authority spread to lower levels

External environment (complex, unpredicable?)

Nature of the decision (important, risky?)

Abilities of low level managers (strong decisionmaking skills?)

Organisations tradition of management (whathas been done before?)


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The Informal Organisation

The hidden side of the organisation!

Defined by the behaviours and interactions thatstem from personal rather than officialrelationships within the company

Individuals can possess a lot of informal power

Its not what you know, its who you know! The grapevine the informal communication

network; usually much faster than formalchannels!


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Factors Affecting Organisational Design

Organisation size (small = simple, large = needfor formal structure)

Organisation life cycle (birth, youth, midlife,maturity)

Organisational strategy

Environment (stable or dynamic) Technology


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Five Approaches toOrganisational Design

Functional structure

Divisional structure Matrix structure

Team structure

Network structure


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Functional Structure


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Divisional Structure


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Matrix Structure


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Network Structure


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Any Questions?

Documents

Management Functions Module 3