1. Daft 6th ed Fundamentals of Organizing
chp10
Daft 6th ed
Fundamentals of Organizing
Developed by Cool Pictures & MultiMedia Presentations
Copyright © 2003 by South-Western, a division of Thomson Learning. All rights reserved.
Developed by Cool Pictures & MultiMedia Presentations
Copyright © 2002 by South-Western, a division of Thompson Learning. All rights reserved.

2. Organizing
The deployment of organizational resources to achieve strategic goals
Reflects deployment of resources
Shows division of labor
Formal lines of authority and mechanisms is developed

3. Organization Structure
Defines how tasks are divided, resources are deployed, and departments are coordinated
The set of formal tasks assigned
Formal reporting relationships
The design of systems to ensure effective coordination of employees across department

4. The Organization Chart
Visual representation
Set of formal tasks
“The Home Depot is the world's largest home improvement retailer currently operating 1,363 stores.
Framework for vertical control
Formal reporting relationships

5. Work Specialization Tasks are subdivided into individual jobs
Division of labor concept
Employees perform only the tasks relevant to their specialized function
Jobs tend to be small, but they can be performed efficiently

6. Chain of Command
Unbroken line of authority that links all persons in an organization
Shows who reports to whom
Associated with two underlying principles
Unity of Command
Scalar Principle

7. Authority
Formal and legitimate right of a manager to make decisions and issue orders
Allocate resources to achieve organizationally desired outcomes
Authority is distinguished by three characteristics
Authority is vested in organizational positions, not people
Authority is accepted by subordinates
Authority flows down the vertical hierarchy

8. Responsibility
The duty to perform the task or activity an employee has been assigned
Managers are assigned authority commensurate with responsibility

9. Accountability
Mechanism through which authority and responsibility are brought into alignment
People are subject to reporting and justifying task outcomes to those above them in the chain of command
Can be built into the organization structure

10. Process managers use to transfer authority and responsibility
Delegation 1
Process managers use to transfer authority and responsibility 2
Organization encourage managers to delegate authority to lowest possible level

11. Techniques for Delegation
Give thorough instructions
Maintain feedback
Evaluate and reward performance
Techniques for Delegation
Delegate the whole task
Ensure that authority equals responsibility
Select the right person

12. Span of Management/ Span of Control
Number of employees who report to a supervisor
Traditional view, about seven subordinates per manager
Many lean organizations today have 30, 40, or even higher subordinates
When supervisors must be closely involved with subordinates, the span should be small
Supervisors need little involvement with subordinates, it can be large

13. Factors Associated With Less Supervisor Involvement
Work is stable and routine
Subordinates perform similar work tasks
Subordinates are concentrated in a single location
Subordinates are highly trained
Rules and procedure defining task activities are available
Support systems and personnel are available for the manager
Little time is required in nonsupervisory activities
Managers’ preferences and styles favor a large span

14. Tall versus Flat Structure
Span of Control used in an organization determines whether the structure is tall or flat
Tall structure has a narrow span and more hierarchical levels
Flat structure has a wide span, is horizontally dispersed and fewer hierarchical levels
The trend has been toward wider spans of control

15. Centralization versus Decentralization
Greater change and uncertainty in the environment are usually associated with decentralization
The amount of centralization or decentralization should fit the firm’s strategy
In times of crisis or risk of company failure, authority may be centralized at the top

16. Departmentalization The basis on which individuals are grouped into departments
Vertical functional approach. People are grouped together in departments by common skills.
Divisional approach. Grouped together based on a common product, program, or geographical region.
Horizontal matrix approach. Functional and divisional chains of command. Some employees report to two bosses
Team-based approach. Created to accomplish specific tasks
Network approach. Small, central hub electronically connected to their other organizations that perform vital functions. Departments are independent, and can be located anywhere.
Virtual approach. Brings people together temporarily to exploit specific opportunities then disbands

17. Five Approaches to Structural Design

18. Five Approaches to Structural Design Slide 2

19. Divisional Structure Advantages
Efficient use of resources
Skill specialization development
Top management control
Excellent coordination
Quality technical problem solving

20. Divisional Structure Disadvantages
Poor communications
Slow response to external changes
Decisions concentrated at top
Pin pointing responsibility is difficult
Limited view of organizational goals by employees

21. Horizontal Matrix Advantages
More efficient use of resources than single hierarchy
Adaptable to changing environment
Development of both general and specialists management skills
Expertise available to all divisions
Enlarged tasks for employees 32

22. Dual Authority Structure in a Matrix Organization

23. Horizontal Matrix Disadvantages
Dual chain of command
High conflict between two sides of matrix
Many meetings to coordinate activities
Need for human relations training
Power domination by one side of matrix 33

24. Team Advantages Same advantages as functional structure
Reduced barriers among departments
Quicker response time
Better morale
Reduced administrative overhead 35

25. Team Disadvantages Dual loyalties and conflict
Time and resources spent on meetings
Unplanned decentralization 36

26. Network Approach Advantages
Global competitiveness
Work force flexibility
Reduced administrative overhead 38

27. Network Approach Disadvantages
No hands-on control
Loss of part of the organization severely impacts remainder of organization
Employee loyalty weakened 39