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8/19/2019 Organization Structures for Slide Show
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ORGANIZATION STRUCTURES
“It’s all about
working together”
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ORGANIZATION STRUCTURES
Organizing As A Management Responsibility
Organizing is one of the
management functions.It involves determining how
activities
and resources are to begrouped.
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ORGANIZATION STRUCTURES Roles and Importance
What You Can Learn from an OrganizationChart
Division of work - Positions and titles show work responsibilities.
Supervisory relationships - Lines between positions show who reports to whom in
the chain of command.
Span of control - The number of persons reporting to a supervisor.
Communication channels - Lines between positions show routes for formal
communication flows.
Major subunits - Which job titles are grouped together in work units
departments or divisions.
Staff positions - Staff specialists that support other positions and parts of the
organi!ation.Levels of management - The number of management layers from top to bottom
." #hain of #ommand $ is Scalar Principles meaning unbroken line of authorityfrom top to bottom. % &nity of #ommand $ 'ne and only one boss.(elegation of )uthority $ Proper authority should be delegated to all levels of*anagement +
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ORGANIZATION STRUCTURES
Organizing As A Management Responsibility
Organizingprocess of arranging people and resources to work
toward a common goal.
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Formal tructureThe official structure of the organi!ation
Informal tructurethe unofficial relationships that develop
among an organi!ation,s members.
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ORGANIZATION STRUCTURES ormalStr!ct!res
tructure system of tasks reporting relationships and communication that links
people and positions within an organi!ation.
Organization Charts describe the formal structure how an organi!ation should ideally work.
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ORGANIZATION STRUCTURES In"ormal Str!ct!res
nformal
'rgani!ation
Sports roup
*orning #offee
regulars
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Major Concerns in Organizing Major Concerns in Organizing
!ivision of Labor "!i#erentiation$!ivision of Labor "!i#erentiation$Coordination "Integration$Coordination "Integration$
In %eference to the OrganizationalIn %eference to the OrganizationalChart&Chart& Organizing Involves'Organizing Involves'
()%*IC+L *%,C*,%) or Flat Org. Chart()%*IC+L *%,C*,%) or Flat Org. Chart
Coordination from *op to -ottomCoordination from *op to -ottom
O%I/O0*+L *%,C*,%) or *all Org ChartO%I/O0*+L *%,C*,%) or *all Org Chart
!epartmentalization "Who wor1s together2$!epartmentalization "Who wor1s together2$
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© Copyright 200 Mc!raw"#ill$ %ll rights reserve&$ '()2
Tall and Flat Organizations Tall and Flat Organizations
/ Tall structures have many levels of authorityTall structures have many levels of authorityand narrow spans of control.and narrow spans of control.
As hierarchy levels increase, communicationAs hierarchy levels increase, communication
gets difcult, creating delays in the timegets difcult, creating delays in the time
being taken to implement decisions.being taken to implement decisions.Communications can also become garbled asCommunications can also become garbled as
it is repeated through the rm.it is repeated through the rm.
/0lat structures have fewer levels and wide0lat structures have fewer levels and wide
spans of control.spans of control.
tructure results in !uick communicationstructure results in !uick communications
but can lead to over"orked managers.but can lead to over"orked managers.
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© Copyright 200 Mc!raw"#ill$ %ll rights reserve&$ '()*
Flat OrganizationsFlat Organizations
+igure '$,a
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© Copyright 200 Mc!raw"#ill$ %ll rights reserve&$ '()
Tall Organizations Tall Organizations
+igure '$,b
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Organization design and processinvolves decision about 3ve 1e4elements as '
Wor1 pecialization
Chain of Command
pan of Control+uthorit4
!epartmentalization
Structuring an organi!ation for
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Work Specialization Work Specialization
!egree to which tas1s are subdivided into individual 5obs!egree to which tas1s are subdivided into individual 5obs
+ highl4 specialized 5ob is narrow in scope+ highl4 specialized 5ob is narrow in scope
Increases e6cienc4 up to a pointIncreases e6cienc4 up to a point
With e7treme specialization& wor1ers tend to becomeWith e7treme specialization& wor1ers tend to become
bored and alienatedbored and alienated
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Chain of Command Chain of Command
*he line of authorit4& shown in*he line of authorit4& shown in
the organization chart& thatthe organization chart& that
lin1s all persons and shows wholin1s all persons and shows who
reports to whom.reports to whom.C-.C-.
/ Marketing/ Marketing / ro&uction/ ro&uction / +inance/ +inance
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Authority Authority
8anagers have authorit4 because of the8anagers have authorit4 because of thepositions the4 hold "not who the4 are$positions the4 hold "not who the4 are$
*o be e#ective& it*o be e#ective& it must be acceptedmust be accepted b4b4subordinates.subordinates.
%esponsibilit4%esponsibilit4!ut4 to perform the tas1 an emplo4ee!ut4 to perform the tas1 an emplo4ee
has been assignedhas been assigned+uthorit4 should be commensurate with+uthorit4 should be commensurate with
responsibilit4.responsibilit4.
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Span of Management Span of Management
0umber of emplo4ees reporting0umber of emplo4ees reporting
to a supervisorto a supervisor
*radition has recommended a*radition has recommended a
span of management of four tospan of management of four to
seven subordinatesseven subordinates
What is best depends on theWhat is best depends on the
situationsituation
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#asic $epartmentation
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-1#34 ))$ Changing Organizational tructures andIncreasing Comple7it4 as Firms 9row
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1$22
'rgani!ing process
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/ 4ime/ 5umber
6 -7uipment
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Departmentalization Departmentalization
-asis for grouping 5ob positions into departments-asis for grouping 5ob positions into departmentsand departments into the total organization.and departments into the total organization.
Internal Operations OrientedInternal Operations Oriented +unctional+unctional
5etwork 8/irtual95etwork 8/irtual9
Output OrientedOutput Oriented DivisionalDivisionalro&uctro&uct
!eographic!eographic
Customer Customer
4eam 8Cluster94eam 8Cluster9
CombinationsCombinations #ybri& 8&ifferent types at#ybri& 8&ifferent types at &ifferent&ifferent places inplaces in
an org$9an org$9
Matri: 8&ifferent types at simultaneous atMatri: 8&ifferent types at simultaneous atthethe samesame places in an org$9places in an org$9
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http://www.bized.co.uk
Copyright 2006 – Biz/ed
Ways to Structure a Business
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$epartmentation by !nctional
!epartmentalization rouping together people and jobs into one unit
Functional tructures group together people using similar skills to perform similar activities.
Potential )dvantages of 0unctional Structures
/ 3conomies of scale make efficient use of human resources./ 0unctional e4perts are good at solving technical problems./ Training within functions promotes skill development./ #areer paths are available within each function.
(isadvantages
(ifficult for departments to communicate with others.
Preoccupation with own department and losing sight of
organi!ational goals.
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Functional Approach Functional Approach
Departments based on similar actiities!Departments based on similar actiities!skills and resource use"skills and resource use"
+dvantages'+dvantages'
)6cient use of)6cient use ofresourcesresources
)conomies of)conomies of
calecale
In:depth s1illIn:depth s1illspecializationspecialization
!isadvantages'!isadvantages';oor communication;oor communication
among departmentsamong departmentslow response tolow response to
e7ternal changese7ternal changes
Lo4alt4 more toLo4alt4 more to
function thanfunction thancustomer or thecustomer or the
whole organizationwhole organization
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*he*he
FunctionFunction
alal
tructurtructur
e of ;iere of ;ier
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ORGANIZATION STRUCTURES
!nctional Str!ct!res
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Functional Chimne4s ;roblem
) lack of communication and coordinationacross functional organi!ations
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© Copyright 200 Mc!raw"#ill$ %ll rights reserve&$ '(*)
#epartmentation by $roduct or#epartmentation by $roduct or
erviceservices
/ Product StructureProduct StructureCustomers are served by sel%&containedCustomers are served by sel%&contained
divisions that handle a specic type o%divisions that handle a specic type o%
product or service.product or service.
/ )llows functional managers to speciali!e in one )llows functional managers to speciali!e in oneproduct area.product area.
/ (ivision managers become e4perts in their area.(ivision managers become e4perts in their area.
/ 5emoves need for direct supervision of division by5emoves need for direct supervision of division by
corporate managers.corporate managers./ (ivisional management improves the use of(ivisional management improves the use of
resources.resources.
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© Copyright 200 Mc!raw"#ill$ %ll rights reserve&$ '(*2
(iacom=s(iacom=s
>????<
;roduct;roduct
tructuretructure
+igure '$;
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;roduct&;roduct&
8ar1et&8ar1et&
andand
9eographi9eographi
cctructurestructures
+igure '$
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© Copyright 200 Mc!raw"#ill$ %ll rights reserve&$ '(*
#epartmentation by Territory#epartmentation by Territory
/ eographic Structureeographic Structure'ach regional or a country or area "ith'ach regional or a country or area "ith
customers "ith di(ering needs is served by acustomers "ith di(ering needs is served by a
local sel%&contained division producinglocal sel%&contained division producing
products that best meet those needs.products that best meet those needs.)lobal geographic structure)lobal geographic structure
/ (ifferent divisions serve each world region when(ifferent divisions serve each world region when
managers find different problems or demands acrossmanagers find different problems or demands across
the globe.the globe./ enerally this structure is adopted when managersenerally this structure is adopted when managers
are pursuing a multidomestic strategy.are pursuing a multidomestic strategy.
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© Copyright 200 Mc!raw"#ill$ %ll rights reserve&$ '(*;
;roduct&;roduct&
8ar1et&8ar1et&
andand
9eographi9eographi
cctructurestructures
+igure '$
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© Copyright 200 Mc!raw"#ill$ %ll rights reserve&$ '(*<
#epartmentation by Customer or#epartmentation by Customer or
*arket*arket
/ *arket "#ustomer+ Structure*arket "#ustomer+ Structure)roups together people and +obs that serve)roups together people and +obs that serve
the same customers or clientsthe same customers or clients
)lobal market customer- structure)lobal market customer- structure
/ #ustomers in different regions buy similar products so#ustomers in different regions buy similar products so
firms can locate manufacturing facilities and productfirms can locate manufacturing facilities and product
distribution networks where they decide is best.distribution networks where they decide is best.
/ 0irms pursuing a global strategy will use this type of0irms pursuing a global strategy will use this type of
structure.structure.
d
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© Copyright 200 Mc!raw"#ill$ %ll rights reserve&$ '(*'
;roduct&;roduct&
8ar1et&8ar1et&
andand
9eographi9eographi
cctructurestructures
+igure '$
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$epartmentation by %rocess orE&!ipment
- Separated based on their role in a production process.6est e4ample of process departmentali!ation can be seen
in a te4tile mill where we may have a spinning department
weaving department dyeing department printing
department etc.
#artridge #olor 0illersPrinters
http://lh3.googleusercontent.com/-UU13fsh2IX4/TzNhCt6xbPI/AAAAAAAAFxY/aYsEykwNO1s/s800/Process-Departmentalization.png
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4ime &epartmentali=ation n time departmentali!ation departments are separated based on the
division of their working time or job shifts.
0or an e4ample departments can be made based on night shift morning or
regular shift evening shift etc.
5umber &epartmentali=ation
n number departmentali!ation separate departments are made after
analy!ing and judging the ma4imum limit up to which number of persons can
be managed or educated or supervised or taken care of.
0or e4ample students having numbers from 1 to 78 are made to sit in )
division of their class and so on. *ilitary forces also use this method.(epartmentali!ation by numbers is depicted in the image given below.
number departmentali!ation.
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orms o" Organization Str!ct!res
. Line and ta# Organization
@. Functional OrganizationA. ;ro5ect Organization
B. 8atri7 Organization
. Committee Organization
Li i ti
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Line organi=ation- Simplest and oldest type of 'rgani!ation- )lso known as *ilitary organi!ation and was used first by 5oman army.- Lines of authority flows from top to bottom in more less straight line
so it gives the name 9 Line 'rgani!ation:
Types of Line 'rgani!ation
1. Pure line organi!ation
- the activities at any one
level are the same and all
individuals perform the
same type of work.
2. (epartmental Line
organi!ation - the firm is
broadly divided intodepartments
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*erits of Line 'rgani!ationSimplest-&nity of #ommand "scalar chain +.
6etter discipline-0i4ed responsibility- 0le4ibility- Prompt decision
(emerits of Line 'rgani!ation'ver reliance- The line e4ecutive,s decisions are implemented to the
bottom. This results in over-relying on the line officials.
Lack of speciali!ation- nade;uate communication- Lack of #o-ordination
- )uthority leadership- The line officials have tendency to misuse their
authority positions. This leads to autocratic leadership and monopoly in the
concern.
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Line an& Staff .rgani=ation
Line and staff management has two separate hierarchies<
8)94he line hierarchy in which the departments are revenue generators
"manufacturing selling+ and their managers are responsible for achieving the
organi!ation=s main objectives by e4ecuting the key functions "such as policy
making target setting decision making+> (oes actual e4ecution of the work
and has direct line authority.
"2+ 4he staff hierarchy> in which the departments are revenue consumers
and their managers are responsible for activities that support line functions
"such as accounting maintenance personnel management+. While both
hierarchies have their own chains of command a line manager may have
direct control over staff employees but a staff manager may have no such
power over the line employees. n modern practice however the difference in
the two hierarchies is not so clear-cut and jobs often have elements of the
both types of functions. Staff or specialists attached to the line manager to
advice them on important matters. Staff relationship is purely advisory.
3g. )ssistant to president ?5 *gr.
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- - - - -
Line
)uthorit
Staff
)uthori
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%ros and Cons o" 'ine ( Sta"" Org)
;ros
pecialization: 'pert Advice / 0elie%to 1ine 'ecutives
& Fleibility2 ta( can be added to line"ithout disturbing the line procedures.
Cons
& Con%usion , Con3ict , 'pensive
l
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!nctional Organization
A %unctional organization structure is ahierarchical type o% organization structure"herein people are grouped as per their area o%specialization. 4t allo"s decisions to be
decentralized since issues are delegated tospecialized persons or units, leaving them theresponsibility o% implementing, evaluating, orcontrolling the given procedures or goals.
F.6 Taylor coined term 7FunctionalForemanship8
to provide specialized skills at superior level.
F W # l d d i h b i l k i i d
http://en.wikipedia.org/wiki/Decentralisationhttp://en.wikipedia.org/wiki/Delegationhttp://en.wikipedia.org/wiki/Delegationhttp://en.wikipedia.org/wiki/Decentralisation
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F"W" #aylor recommended eight bosses i"e" route clerk! instruction cardclerk! time $ cost clerk and disciplinarian for the office and
%ang boss! speed boss! inspector and repair boss for the factory"
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&nder 0unctional org. the entire work is divided intomajor functions. 3very function is placed under the
charge of a specialist.
) functional specialists directs all the subordinateslower to his line for all the works of his function. n
other words all the lower level subordinates are to
report to every functional manager regarding for
performance of related functions under every
functional manager.
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%ros and Cons o" !nctional Org
;ros D pecialization , 'fciency and$roductivity,
'pansion94t o(ers a greater scope %or epansion ascompared to line organization : #oesn;t %ace the problem o% limitedcapabilities o% a %e" line managers.
Cons &
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Committee Organization
+ committee is a group of peoplewho
meet to plan& to discuss or ma1e a
decision for a particular sub5ect.
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4n pro+ectized organizations, the pro+ect manager is in chargeo% his pro+ect, and he has %ull authority over it. 'veryone inhis team reports to him. The pro+ected organization structureis opposite to the %unctional organization structure. @ere,either there "ill be no %unctional manager, or i% he eists, he
"ill have a very limited role and authority. Advantages o% a $ro+ectized Organized tructure & clear line
o% authority & shorter lines o% communication "hich createsstrong and e(ective communication & less time is consumedin communication, and response to stakeholders; concerns is%ast.
#isadvantages o% a $ro+ectized Organization tructure & "orkenvironment stress%ul & sense o% insecurity & cost o%employees and e!uipment can be higher
roject .rgani=ation
#emporary organisation designed to achiee specific
http://pmstudycircle.com/2012/08/what-is-a-functional-organization-structure/http://pmstudycircle.com/2012/08/what-is-a-functional-organization-structure/
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%ro*ect Org) results by using teams of specialists from differentfunctional areas in the organisation)
M t i St t
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Matri+ Str!ct!res
8atri7 tructureuses permanent cross functional
teams to try to gain the advantages of
both the functional and divisionalapproaches.
8atri7 forms are h4brids
ome h4brids combine a mostl4
functional structure with one or more important
products or mar1ets& e.g.& 0orth +merica
ome h4brids combine a mostl4 divisionalstructure with one or more important functions&e.g.& mar1eting
ORGANIZATION STRUCTURES
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ORGANIZATION STRUCTURES
Matri+ Str!ct!res
;otential +dvantages of 8atri7 tructures
;erformance accountabilit4 rests with program& product& or pro5ectmanagers.
*eams enable better communication and cooperation across functions. *eams ma1e more decisions and solve more problems at their levels. *op managers spend more time on strategic issues. + cross:functional team brings together members from di#erent
functional departments.
*he “ 8r G 8rs %ightH Organizational
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*he “ 8r. G 8rs. %ightH OrganizationalForm
There is no 7 right 8 "ay to organize
Organization are not 7 $ure8 but mied
#epartmentation is never permanent
Team Str!ct!res
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Team Str!ct!res *eam tructures ;roduct *eam tructure
The members are permanently assigned to the team and empowered to bring a product to market.
)voids problems of two-way communication and the conflicting demands of functional and product team bosses.
#ross-functional team is composed of a group of managers from different departments working together to perform
organi!ational tasks.make e4tensive use of permanent and temporary teams often cross functional to improve
communication cooperation and problem solving.
Potential )dvantages of Team Structures
/Team assignments improve communication cooperation anddecision-making./Team members get to know each other as persons not just job
titles./Team memberships boost morale and increase enthusiasm and
task involvement.
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!ivisionalOrganization
al tructure' 4n this type o% structure,
the organisation canhave di(erent basis on"hich departments are
%ormed. They are2 i- Function,
ii- $roduct,
iii- )eographicterritory,
iv- $ro+ect and iv- Combination
approach.
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Net,or- Str!ct!res
0etwor1 structures maintain a sta# of corefulltime emplo4ees and use contractedservices and strategic alliances to accomplishman4 business needs.
ORGANIZATION STRUCTURES
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.irt!al Str!ct!res
(irtual tructure&ses information technologies to operate as a
shifting network of alliances.
*)@)3*3@T TPSSeven deadly sins of outsourcing<
1. 'utsourcing activities that are part of the core competency
2. 'utsourcing to untrustworthy vendors
A. )greeing to unfavorable contracts with the vendor
B. 'verlooking impact on e4isting employees
7. @ot maintaining oversight> losing control to vendorsC. 'verlooking hidden costs of managing contracts
D. 0ailing to anticipate need to change vendors or cease outsourcing
trategic business unit "-,$ is a unit o%
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trategic business unit "-,$ is a unit o%the company that has a separate mission andob+ectives that can be planned separately %romother company businesses
Company division $roduct line "ithin a division ingle product or brand
Growth share matrix is a portfolio planning method thatevaluates a company’s strategic business units in termsof their market growth rate and relative share
Strategic business units are classified as:•
Stars• Cash Cows• Question marks• Dogs
&C% % h Sh M i
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&C% %ro'th(Share Matri)
5elative market share
* a r k e t g r o w t h
r a t e
L o w
?
i g h
Low?igh
Star Euestion mark
#ash cow (og
©2006 Pearson Education, Inc. Marketing for Hospitality and Touris, !t" edition
#pper $addle %i&er, '( 0)!*+ otler, -oen, and Makens
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5elative *arket share $ ) method of measuring market share. ) company will measure its own market share comparing with market shares
of its competitors.
*arket growth rate $ increase in si!e or sales observed within a given consumer
roup over a specified time frame.
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+ contingenc4 theor4 is anorganizational theor4 that claimsthat there is no best wa4 toorganize a corporation& to lead acompan4& or to ma1e decisions.
Instead& the optimal course ofaction is contingent "dependent$upon the internal and e7ternal
situation
/Which contingenc4 factorsinuence organizational
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gdesign2 )nvironment& strateg4&technolog4& size& andpeople are all contingency%actors in3uencingorganizational design./ Technology && Best use o%technical kno"ledge,e!uipment, and "ork methodsin the trans%ormation process,is an important considerationin organizational design./'nvironments 2 Change in thebusiness environment a(ectsorg. structures. *icro : *acro
'nvironment./ize 2 ize a(ectsorganizational design. 1argeorganization have complestructures./trategic Choice 2 When
strategy changes structures mustchan e.
Et/ical Iss!es and
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Et/ical Iss!es and Organizational $esign 0Cont)1
)thical issues about reducing thesize of an organization andincreasing its e6cienc4. +utilitarian anal4sis loo1s at the
net bene3ts of management=sactions
igh conict and ambiguit4 ofmatri7 organizations can act as a
signi3cant stressor8oving to the alternative forms is
large:scale organizational changeand stress for man4 people
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0emales are very much interested to
work in 6anks." Sheikh 5ayeem
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(pt
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Fey Points <
*otivation< ates uses stock options to attract and retain employees
3mployees have become millionaires.
Staffing < Gery 3ffective ?uman 5esource Talents selecting Process Selection of 5ight kind of employee
0le4ible Working ?ours
Stress *gt < 34ercise 5ooms
Simple Structure with easy flow of nformation among product teams.
or $e2elopment o" 3in Operating
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or $e2elopment o" 3in OperatingSystem
-g$ #ybri& 6 4eam .rgani=ation Structure i$e roject .rg
with effective cor&ination ? flow of Communication
ates
Prjct *gr- raphics
0inance (pt*ktg (ept
Person 6
Prjct *gr- )pps
Person #
Person 3
Person (
Person )
Case
Leo arris one of 4our assistants in a 3re insurance compan4 is in charge of a
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Leo arris& one of 4our assistants in a 3re insurance compan4& is in charge of agroup of
clerical wor1ers who review changed policies& calculate commissions& andmaintain records.
e is ver4 hard wor1ing and ever4thing coming out of his group is perfect. e
does not delegate authorit4 and responsibilit4 but rechec1s in detail all the wor1turned out b4 his group.
e 1eeps turning bac1 to them careless and inaccurate wor1 until it is perfect.+s a
result he is bus4 from earl4 morning until late at night doing detail wor1 andneglecting his
role as supervisor. is wor1ers have 3gured him out and are ta1ing it eas4. *he4
do slap:dash wor1 and correct it as often as he returns it. You are afraid that arris is overwor1ing and heading for a nervous brea1down. You have
told him in general terms to delegate authorit4 and responsibilit4 and todiscipline his group.
e sa4s that 4ou 5ust can=t 3nd people an4 more who have pride in their wor1 orconcern for
the compan4 and that if he 3res an4 of his people or the4 uit the replacementswould
probabl4 be worse.
. ow should he go about delegating authorit4 to them2@. What are some of ualities that arris lac1s2
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g g &
!on=t want to compromise in ualit4&
0o con3dence on subordinates J others.
>. a. tart selecting capable wor1er and teach them tomentor others. 9ive them some responsibilit4 of thewor1.
b. 8otivate good wor1ers.
c. Wor1ers with minimum faults can be given someincentives
for motivation.
@. a. Leadership ualities b. *eam ma1er
A. tart with selection of s1illed and meritoriouswor1ers& ma1e
them foremanGsupervisor& cordial relationship with all &motivate them for better wor1s with some rewards.
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Wednesday *arch H 281C (rafted by Sheikh @ayeem IA
@ueries A
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84 name is hei1h 0a4eem
J m4 blood group is -e;ositive