1. Principles Of Management-II
ORGANIZING
&
DEPARTMENTIZATION
Lecture No.3

2. THE ORGANIZING

3. DEFINITION OF ORGANIZAION
Organizations are experimenting with different approaches to organizational structure and design.

4. ORGANIZATION STRUCTURE
The system of tasks, workflows, reporting relationships, and communication channels that link together different individuals and groups.

6. The Elements of Organizing
Organizing is deciding how best to group organizational elements (resources).
Organizational Structure is a set of six basic building blocks (elements) that managers may use to configure (construct) an organization.

7. Six Basic Building Blocks for Organization Structure
Designing jobs
Grouping Jobs
Establishing reporting relationships between jobs
Distributing authority among jobs
Coordinating activities among jobs
Differentiating among positions

8. Span of Management Number of employees reporting to a supervisor
Tradition has recommended a span of management of four to seven subordinates
What is best depends on the situation 14

10. Major Concerns in Organizing
Division of Labor (Differentiation)
Coordination (Integration)
In Reference to the Organizational Chart, Organizing Involves:
VERTICAL STRUCTURE
Coordination from Top to Bottom
HORIZONTAL STRUCTURE
Departmentalization (Who works together?) 2

11. 2

12. Distributing Authority
Steps in the Delegation Process:
Manager should assign responsibility or give the subordinate a job to do.
Manager must give the subordinate the authority to do the job.
Manager must establish the subordinate’s accountability – ‘willingness to accept an obligation to carry out the task assigned’.

13. Steps in the Delegation Process

14. CENTRALIZATION AND DECENTRALIZATION

15. CENTRALIZATION AND DECENTRALIZATION
Centralization and decentralization refer to the degree to which authority is delegated in a business.
Complete centralization means that employees have no authority to make decisions.
Complete decentralization (delegation) means employees have all the authority to make decisions.
Centralization
Decentralization

16. DEPARTMENTIZATION

17. Departmentalization is an aspect of organizational design that includes the subdivision of a business into units based on their function or other criteria. Most companies, including restaurants, are likely to use two or more types of departmentalization simultaneously.

18. Departmentalization
Grouping of jobs into working units (departments, units, groups, divisions)
Functional departmentalization
Product departmentalization
Geographical departmentalization
Customer departmentalization

19. Functional Departmentalization
Employees grouped into department based on the day-to-day nature of their job descriptions

20. Product Departmentalization
Employees grouped into departments based on the product they are making

21. Geographical Departmentalization
Employees grouped by geographical region FF

22. Customer Departmentalization
Employees grouped into departments based on their end consumer (consumers or businesses)

23. Formal Communication
Flow of communication within the formal organizational structure as depicted on organizational charts.
Upward communication
Downward communication
Horizontal communication