MGT 330 Principles Of Management

1. 1 MGT 330 Principles Of Management CHAPTER 7Basic Organization Designs Introduction

2. Four Functions of Management Planning Organizing Leading Controlling

3. Organizing �Managers are responsible for designing an organization�s structure. We call this management function organizing.� p. 7 �Organizing includes determining what tasks are to be done, who is to do them, how the tasks are to be grouped, who reports to whom, and where decisions are to be made�ibid

4. Organizational Structure �The organization�s formal framework by which job tasks are divided, grouped, and coordinated� Management, Robbins & Coulter, glossary Includes lines of authority communication responsibility decision-making

5. 5 Organization Structure key elements  1. Work Specialization 2. Chain of Command 3. Span of Control 4. Authority & Responsibility 5. Centralization/Decentralization 6. Departmentalization

6. 6 Organization Structure  1. Work Specialization > Division of Labor 2. Chain of Command 3. Span of Control 4. Authority & Responsibility 5. Centralization/Decentralization 6. Departmentalization

7. Division of Labor Benefits include: Increasing levels of skill Less time is wasted moving from job to job Training is less costly Increased focus Adam Smith�s pin factory �Men are much more likely to discover easier and readier methods of attaining any object, when the whole attention of their minds is directed towards that single object, than when it is dissipated among a great variety of things.� WON p. 14

8. Economies and Diseconomies of Work Specialization

9. 9  Organization Structure 1. Work Specialization 2. Chain of Command -- Employees report to one boss only 3. Span of Control -- flat vs tall organizations 4. Authority & Responsibility 5. Centralization/Decentralization 6. Departmentalization

10. Chain of Command Span of Control

11. 11 Organization Structure 1. Work Specialization 2. Chain of Command 3. Span of Control 4. Authority & Responsibility 5. Centralization/Decentralization 6. Departmentalization

12. Authority

13. Line versus Staff Authority

15. Types of Power

16. 16  Organization Structure 1. Work Specialization 2. Chain of Command 3. Span of control 4. Authority & Responsibility 5. Centralization/Decentralization 6. Departmentalization

17. Centralization/Decentralization A function of how much decision-making authority is pushed down to lower levels in an organization; the more centralized an organization is, the higher is the level at which decisions are made. Traditionally: pyramid structure Today: push towards employee empowerment (decentralization)

18. 18  Organization Design  1. Work Specialization > Division of Labor 2. Chain of Command 3. Span of control 4. Authority & Responsibility 5. Centralization/Decentralization 6. Departmentalization

19. Departmentalization

20. Functional Departmentalization

21. Product Departmentalization

22. Customer Departmentalization

23. Geographic Departmentalization

24. Process Departmentalization

25. 25 ORGANIZATION DESIGN APPLICATIONS Mechanistic Vs. Organic

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27. Jazz Band

28. Mechanistic versus Organic Organizations Rigid hierarchical relationships Fixed duties Many Rules Formalized communication channels Centralized decision authority Taller structures collaboration (both vertical and horizontal Adaptable duties Few Rules Informal communication Decentralized decision authority Flatter structures

29. 29 Simple Structure Functional Structure Divisional Structure Matrix Structure Team-based Structure Boundaryless Organizations ORGANIZATION DESIGN APPLICATIONS

30. Mechanistic Designs

31. Sample Matrix Structure

32. Organization Design Options

33. 33 STRUCTURE: CONTINGENCIES Strategy Organization Size Technology Environment

34. Organization Culture

35. 35 Questions & Answers