Professional Documents
Culture Documents
ORGANIZATION STRUCTURE
Principles of Management
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Learning Outcomes
11.1 Discuss the basic elements of organizing.
11.2 Describe the bureaucratic perspective on
organizational design.
11.3 Discuss the basic forms of organizational design in
the organization.
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Introduction
Competition, convergences and changes in technology
are forcing the organization to look into its
organizational structure to be more flexible in design.
Organizational structure describes how the total work of
the organization is divided into subunits and how these
subunits are coordinated for the organizations goals to
be achieved.
These new forms of organizing are highly adaptive and
innovative but require more advances in managerial
capabilities to operate successfully.
Principles of Management
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Principles of Management
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Job Specialization
Advantages
Improvement in productivity.
Straightforward, faster and efficient due to repetition of
the tasks.
Independent and requires less supervision .
Disadvantages
Boredom from doing the same job.
Development and career advancement are
limited.
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Departmentalization
Functional
Divisional
i. Product
ii. Customer
iii. Geography (Location)
Matrix
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Functional Departmentalization
Exhibit 11.1: Functional Departmentalization
FACTORY
MANAGER
MANAGER OF
HUMAN
RESOURCE
MANAGER OF
PRODUCTION
MANAGER OF
FINANCE
MANAGER OF
SALES
MANAGER OF
ENGINEERING
MANAGER OF
LOGISTIC
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Functional Departmentalization
A d a p t e d f r o m : B a t e m a n , T. S . a n d S n e l l , S . A . ( 2 0 1 4 ) , M a n a g e m e n t : L e a d i n g & C o l l a b o r a t i n g i n a C o m p e t i t i v e W o r l d . 11 t h e d . M c G r a w H i l l
Advantages
1. Economies of scale can be realized
2. Effective monitoring of the environment
3. Performance standards better maintained
4. Greater opportunity for specialized training
and skill development
Disadvantages
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Product Departmentalization
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Customer Departmentalization
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10
Geographic Departmentalization
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11
Product/Customer/Geographic Departmentalization
A d a p t e d f r o m : B a t e m a n , T. S . a n d S n e l l , S . A . ( 2 0 1 4 ) , M a n a g e m e n t : L e a d i n g & C o l l a b o r a t i n g i n a C o m p e t i t i v e W o r l d . 11 t h e d . M c G r a w H i l l
Advantages
Disadvantages
1.
2.
Duplication of resources
Poor exchange of information and coordination across
different products/services/ geographical.
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A d a p t e d f r o m : B a t e m a n , T. S . a n d S n e l l , S . A . ( 2 0 1 4 ) , M a n a g e m e n t : L e a d i n g & C o l l a b o r a t i n g i n a C o m p e t i t i v e W o r l d . 11 t h e d . M c G r a w H i l l
Matrix Design
Principles of Management
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8-13
A d a p t e d f r o m : B a t e m a n , T. S . a n d S n e l l , S . A . ( 2 0 1 4 ) , M a n a g e m e n t : L e a d i n g & C o l l a b o r a t i n g i n a C o m p e t i t i v e W o r l d . 11 t h e d . M c G r a w H i l l
Figure 8.5
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8-14
A d a p t e d f r o m : B a t e m a n , T. S . a n d S n e l l , S . A . ( 2 0 1 4 ) , M a n a g e m e n t : L e a d i n g & C o l l a b o r a t i n g i n a C o m p e t i t i v e W o r l d . 11 t h e d . M c G r a w H i l l
Table 8.2
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8-15
A d a p t e d f r o m : B a t e m a n , T. S . a n d S n e l l , S . A . ( 2 0 1 4 ) , M a n a g e m e n t : L e a d i n g & C o l l a b o r a t i n g i n a C o m p e t i t i v e W o r l d . 11 t h e d . M c G r a w H i l l
Table 8.2
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8-16
Assigning authority
Delegation
The assignment of direct authority and responsibility to a subordinate to complete
jobs.
Involves responsibility, authority and accountability
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Reporting relationship
Chain of Command
Vertical line of authority that clarifies who reports to whom throughout the
organisation.
Tall Organization
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Flat Organization
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20
Disadvantages
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21
Coordination
Structural techniques
Electronic coordination
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