Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–1 CHAPTER 8 ORGANISATION STRUCTURE

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–2 LECTURE OUTLINE Nature of organisation structure Job design Types of departmentalisation Methods of vertical coordination Promoting innovation (methods of horizontal coordination)

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–3 NATURE OF ORGANISATION STRUCTURE Formal pattern of interactions and coordination designed by management to link the tasks of individuals and groups in achieving organisational goals.

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–4 NATURE OF ORGANISATION STRUCTURE Four elements: 1. Assignment of tasks and responsibilities to individuals and units 2. Clustering these to form a hierarchy 3. Mechanisms for vertical coordination 4. Mechanisms for horizontal coordination

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–5 NATURE OF ORGANISATION STRUCTURE The organisation chart – Line diagram depicting broad outlines of an organisation’s structure The chain of command – Unbroken line of command ultimately linking each individual with the top organisational position

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–6 NATURE OF ORGANISATION STRUCTURE Principles of chart design – As few hierarchical levels as possible – Charts should show who has authority over who – Charts should show official lines of responsibility & communication

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–7 NATURE OF ORGANISATION STRUCTURE ABC INC.

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–8 JOB DESIGN Work Specialisation Degree to which work is broken down into various jobs Most organisations require work specialisation, otherwise every employee would need to be able to perform every job

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–9 JOB DESIGN Specification of task activities associated with a particular job logical grouping of tasks design of jobs affects employee motivation

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–10 JOB DESIGN Four main approaches: Job simplification Job rotation Job enlargement Job enrichment

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–11 JOB DESIGN Job simplification Process of configuring jobs so job-holders have only a small number of narrow activities to perform.

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–12 JOB DESIGN Job rotation Practice of periodically shifting workers through a set of jobs in a planned sequence.

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–13 JOB DESIGN Job enlargement Allocation of a wider variety of similar tasks to a job to make it more challenging. Job Scope Number of different tasks an employee performs in a particular job.

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–14 JOB DESIGN Job enrichment Process of upgrading the job-task in order to increase significantly potential for growth, achievement, responsibility and recognition. Job depth Job characteristics model

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–15 JOB DESIGN Job characteristics model: Model developed to guide job- enrichment efforts. Core job characteristics Critical psychological states Outcomes

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–16 JOB DESIGN Core job characteristics Skill variety Task identity Task significance Autonomy Feedback

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–17 JOB DESIGN Critical psychological states: Experienced meaningfulness of work Experienced responsibility for work outcomes Knowledge of the actual results of work

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–18 CORE JOB CHARACTERISTICS Outcomes High internal work motivation High ‘growth’ satisfaction High general job satisfaction High work effectiveness

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–19 skill variety experienced meaningfulness task identity of the work high internal work task significance work motivation high ‘growth’ autonomy experienced responsibility satisfaction for work outcomes high work feedback from knowledge of results from effectiveness work activities Core Job Characteristics Critical Psychological States Outcomes Moderators: 1.Knowledge & skill 2.Growth need strength 3.Context satisfactions

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–20 MANAGING DIVERSITY: ALTERNATIVE WORK SCHEDULES Balancing work and personal life Flexitime: core hours to be worked, more at employee discretion Flexitime: core hours to be worked, more at employee discretion Compressed work week: longer hours worked per day, shorter working week Compressed work week: longer hours worked per day, shorter working week Job sharing: two or more people sharing a full-time job Job sharing: two or more people sharing a full-time job

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–21 MANAGING DIVERSITY: ALTERNATIVE WORK SCHEDULES Schedules based on adjustments in the normal work schedule rather than in the job content. Flexitime Compressed work week Job sharing

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–22 DEPARTMENTALISATION Clustering individuals into units, and units into departments and larger units, to facilitate achieving organisational goals.

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–23 TYPES OF DEPARTMENTALISATION Functional Divisional Hybrid Matrix

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–24 DEPARTMENTALISATION Functional: based on expertise, skill & similarity of work activity Functional: based on expertise, skill & similarity of work activity Divisional: based on product or market similarities Divisional: based on product or market similarities Hybrid: some activities grouped by function, some by products or markets Hybrid: some activities grouped by function, some by products or markets Matrix: Superimpose horizontal divisional over hierarchical functional structure Matrix: Superimpose horizontal divisional over hierarchical functional structure

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–25 METHODS OF VERTICAL COORDINATION Linking of activities at the top of the organisation with those at the middle and lower levels to achieve organisational goals. Formalisation Span of management Centralisation vs decentralisation Delegation Line & staff positions

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–26 METHODS OF VERTICAL COORDINATION Formalisation: Degree to which written policies, rules, procedures, job descriptions and other documents specify what actions are (not) to be taken under a given set of circumstances Extent of formalisation tends to grow with age & size.

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–27 METHODS OF VERTICAL COORDINATION Factors influencing span of management: – High competence levels – Low interaction requirements – Work similarity (between organisational peers) – Low problem frequency and seriousness – Physical proximity – Few non-supervisory duties of managers – Considerable available assistance – High motivational work possibilities

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–28 METHODS OF VERTICAL COORDINATION Centralisation Extent to which power & authority are retained at the top organisational levels Decentralisation Extent to which power & authority are delegated to lower levels Factors favouring centralisation Large organisational size Geographic dispersion Technological complexity Environmental uncertainty

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–29 METHODS OF VERTICAL COORDINATION Extent to which power and authority will be retained at upper levels. Influenced by: Large size: larger organisations likely to be more decentralised. Large size: larger organisations likely to be more decentralised. Geographic dispersion: more dispersed likely to be decentralised, to enable control at a number of sites. Geographic dispersion: more dispersed likely to be decentralised, to enable control at a number of sites. Technological complexity: with more complex technology, need to devolve authority to lower levels. Technological complexity: with more complex technology, need to devolve authority to lower levels. Environmental uncertainty: with rapid change, need for more employees to be involved in responding to challenges. Environmental uncertainty: with rapid change, need for more employees to be involved in responding to challenges.

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–30 METHODS OF VERTICAL COORDINATION Delegation Assignment of part of a manager’s work to others, along with both responsibility & authority necessary to achieve expected results Factors restraining delegation Fear of subordinate failure Time to train subordinates Enjoy doing tasks Release of authority Concern for task performance Fear subordinate competence

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–31 METHODS OF VERTICAL COORDINATION Configuration of line and staff positions: Line authority Authority following the chain of command established by the formal hierarchy Functional authority Authority of staff over others in the organisation in matters related directly to their respective functions e.g. HRM dept

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–32 METHODS OF HORIZONTAL COORDINATION Horizontal coordination: Linking of activities across departments at similar levels Need for information processing across the organisation Promotes innovation through dissemination of ideas & information

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–33 METHODS OF HORIZONTAL COORDINATION Horizontal coordination promoted by: Slack resources Cushion of resources that facilitates adaptations to internal/external pressures, as well as initiation of changes Information systems One information source for many users Lateral relations Direct contact, liaison roles, task forces, teams

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–34 LECTURE SUMMARY The nature of organisational structure – Definition – Organisation chart – Job design Job design – Designing for motivation: job enlargement, rotation, enrichment, simplification Types of departmentalisation – Functional, divisional, hybrid, matrix

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–35 LECTURE SUMMARY Methods of vertical coordination – Formalisation – Span of management – Centralisation vs decentralisation – Delegation – Line & staff authority

Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 8–36 LECTURE SUMMARY Methods of horizontal coordination – Slack resources – Information systems – Lateral relations