MGT162 2024 Chapter 4: Organizing - PDF

ORGANIZING CHAPTER 4  Learning Objectives Define organizing Describe the process of organizing Understand the division of work/labour Explain the types of organizational structure/departmentalization Describe the span of management,...

ORGANIZING CHAPTER 4  Learning Objectives Define organizing Describe the process of organizing Understand the division of work/labour Explain the types of organizational structure/departmentalization Describe the span of management, chain of command, authority, centralization and decentralization Discuss delegation and its importance Understand coordination  Organizing Organizational Chain of Definition Process Span of control Authority Delegation structure command Detailing of Factors Functional Types Components Staff Steps work influence Unity of Division of work Product Wide Line Benefits command Departmentaliza Scalar Customer Narrow Barriers tion relationship Coordination of Geographic work Monitoring and Matrix reorganizing Network Definition Organizing is defined as the process of determining the tasks to be done, who will do them, and how those tasks will be managed and coordinated. The Organizing Process  Organizing Organizational Chain of Definition Process Span of control Authority Delegation structure command Detailing of Factors Functional Types Components Staff Steps work influence Unity of Division of work Product Wide Line Benefits command Departmentaliza Scalar Customer Narrow Barriers tion relationship Coordination of Geographic work Monitoring and Matrix reorganizing Network  Step 1 Detailing of work Various tasks of the organization must first be determined. Ex: a restaurant owner, before he operate a new restaurant, he must detail the number of person involved, the type of cooking.  Step 2 Division of work Dividing the total workload into activities that can logically and comfortably be performed by one person of by a group. Division of labor and the grouping together of people should be organized by reference to some common characteristics which will form a logical link between the activities involved.  Advantages & disadvantages of division of work/labour Person-to-fit (based on Boredom talents and interests) - Higher degree of control the job given can be fit based on individual’s ability. Creates job specialization Increase productivity Advantages Disadvantages  Step 3 Departmentalization Group individuals into related assigned tasks. Ex: individuals involved in sales, promotions, advertising to be grouped under the marketing department.  Step 4 Coordination of work Reconcile differences in approach, timing effort, or interest and to harmonize individual goals to contribute to organizational goals.  Step 5 Monitoring and reorganizing Periodical reassessment of the four preceding steps is necessary. The structure of the organization must be reevaluated to make sure it is consistent with the current requirements and see that it is still effective and efficient.  Organizing Organizational Chain of Definition Process Span of control Authority Delegation structure command Detailing of Factors Functional Types Components Staff Steps work influence Unity of Division of work Product Wide Line Benefits command Departmentaliza Scalar Customer Narrow Barriers tion relationship Coordination of Geographic work Monitoring and Matrix reorganizing Network Functional Structure Grouping based on functions performed.  Advantages & disadvantages Functional Structure Facilitates specialization Focus on departmental versus Cohesive work groups organizational issues Improved operational efficiency Difficult to develop generalists needed for top-level Easy supervision management Only top-level management held accountable for profitability Slow in decision Difficult to monitor performance Advantages Disadvantages Product Structure  Grouping based on the basis of products manufactured. For organizations with relatively diverse product lines that require specialized efforts to achieve high product quality.  Advantages & disadvantages Product Divisional Structure Enhanced coordination. Less control and may be Better assessment of manager difficult to manage diverse performance and product lines. responsibility. Duplication of resources and Development of generalist increase costs managers. Focus only on own products Easy focus and quick/speed in decision Advantages Disadvantages Customer Structure  Grouping based on the types of customers served. For organizations that have separate customer groups with very specific and distinct needs.  Advantages & disadvantages Customer Divisional Good structure for serving large Ineffective and inefficient use of customer groups. resources if most customer groups Helps allocate resources to meet served are small. demands of specific customer Internal competition for resources groups. to serve customers groups may Best for growth by targeting new cause loss of market focus. and distinct groups. Difficult to coordinate operations Good feeling from customers. and must be experts in customers’ Expert in the customer handling problems Advantages Disadvantages Geographic Structure  Grouping based on geographical areas. For organizations with limited product lines that either have wide geographic coverage or desire to grow through geographic expansion.  Advantages & disadvantages Geographic Divisional Allows for focus on specific new Duplication of job, product or markets. technology efforts. Good structure for growth along Coordination and integration are geographic lines. difficult. Adaptable to local needs and Managers may lack expertise to lead to positive competition operate in wide geographic Better communication with areas. customers Duplication of resources and increase costs Advantages Disadvantages Matrix Structure  Two different dimensions/departments grouped simultaneously. A structure in which the tasks of the organization are grouped along two organizational dimensions simultaneously. Examples include: Product/function Product/geographic region Manager, Product A Manager, Product B  Advantages & disadvantages Matrix Structure Good use of resources and Complex, leading to difficulties sharing of information in implementation Can achieve simultaneous Behavioral difficulties from objectives “two bosses” Managers focus on two Time consuming from a organizational dimensions, planning/coordination resulting in more specific job perspective skills Frustration and confusion High conflict Advantages Disadvantages Network Structure Set of alliances with other organizations An organizational structure that is founded on a set of alliances with other organizations that serve a wide variety of functions. An organization that has a core coordinating with other organizations or organizational units. Building Contractor  Advantages & disadvantages Network Structure Maximizes the effectiveness of Fragmentation makes it the core unit difficult to develop control Do more with less resources. systems Reduce cost. Success is dependent on ability Flexibility to locate sources Difficult to develop employee loyalty Conflict between management Advantages Disadvantages  Organizing Organizational Chain of Definition Process Span of control Authority Delegation structure command Detailing of Factors Functional Types Components Staff Steps work influence Unity of Division of work Product Wide Line Benefits command Departmentaliza Scalar Customer Narrow Barriers tion relationship Coordination of Geographic work Monitoring and Matrix reorganizing Network Types of Span of Management Number of subordinates who report directly to a manager. Narrow span (tall structure) Wide span (flat structure) Factors That Influence The Span of Management The type of work (heavy supervision or not) The location of the tasks The ability of the manager The abilities and skills of the employees The amount and type of communication required among the members  Organizing Organizational Chain of Definition Process Span of control Authority Delegation structure command Detailing of Factors Functional Types Components Staff Steps work influence Unity of Division of work Product Wide Line Benefits command Departmentaliza Scalar Customer Narrow Barriers tion relationship Coordination of Geographic work Monitoring and Matrix reorganizing Network Chain of Command Definition: Separate lines of authority/power among all position in an organization. Line of authority and responsibility. Unity of Command Suggests that each person within an organization must have a clear reporting relationship to only one superior Scalar Relationship Suggests that there must be a clear and unbroken line of authority that extends from the lowest to the highest position in the organization  Organizing Organizational Chain of Definition Process Span of control Authority Delegation structure command Detailing of Factors Functional Types Components Staff Steps work influence Unity of Division of work Product Wide Line Benefits command Departmentaliza Scalar Customer Narrow Barriers tion relationship Coordination of Geographic work Monitoring and Matrix reorganizing Network Authority The right to make decisions with respect to work assignments & to require subordinates to perform assigned tasks in accordance with the decision made.  Staff authority Those organizational members that are not directly involved in delivering the products and services to the organization, but provide support for line personnel  Line authority Those organizational members that are directly involved in delivering the products and services of the organization  Organizing Organizational Chain of Definition Process Span of control Authority Delegation structure command Detailing of Factors Functional Types Components Staff Steps work influence Unity of Division of work Product Wide Line Benefits command Departmentaliza Scalar Customer Narrow Barriers tion relationship Coordination of Geographic work Monitoring and Matrix reorganizing Network Delegation  The process of transferring the authority for a specific activity or task to another member of the organization and empowering that individual to accomplish the task effectively Steps In Delegation  Step 1 Decide which goals or tasks to delegate Teach the department or organization mission. Find a capable person. Teach/train the person.  Step 2 Make assignments Agree on mission, goals, tasks. Establish limits (policy). Agree on results. Establish monitors and feedback. Give information.  Step 3 Grant authority Transfer right to decide. Transfer right to commit resources. Make it public. Do not interfere.  Step 4 Hold responsible/ accountable Check progress. Treat problems and challenges as teaching/learning opportunities. Step 5 Monitor Teach. Reward. Communicate. Give information. Give resources. Remove roadblocks. Benefits of Delegation Leads to a more involved and empowered workforce. Improved response time as a result of decisions and information not needing to be passed up and down the organization Leads to better decision making. Provides opportunity for employee to develop analytical and problem-solving skills. Provides managers the opportunity to accomplish more complicated, difficult, or important tasks. Empowerment Managers magnify their accomplishment Barriers of Delegation Manager may refrain to delegate because they are insecure about their value to the organization Managers simply lack confidence in the abilities of their subordinates Manager experience dual accountability Subordinate are reluctant to accept delegation No reward for the job done. THANK YOU