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Lesson 5 3


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Organizational Structure for Businesses …

Organizational Structure for Businesses
(Intro to Business, 6e)

Published in: Education, Business, Career

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  • 1. Intro to Business Organizational Structure for Business Lesson 5-3
  • 2. Designing an Effective Business Organization
    • Mission Statement
      • A short, specific written statement of the reason a business exists and what it wants to achieve.
      • Mission and Vision of Skaggs Community Health Center
  • 3.
    • Goals – precise statement of results the business expects to achieve.
    • Used to define what needs to be accomplished
    • Used to determine if the business is successful
  • 4.
    • Policies – guidelines used in making consistent decisions
    • Procedures – descriptions of the way work is to be done
    Effective policies and procedures provide guidance and direction to people working in the organization.
  • 5. Principles of Effective Organization
    • Responsibility – obligation to complete specific work.
    • Authority – right to make decisions about how responsibilities should be accomplished
    • Accountability – taking responsibility for the results achieved
  • 6. Principles (cont.)
    • Unity of Command – There is a clear reporting relationship for all staff of a business.
    • For each assignment, people need to know who the leader is and how decisions are made.
  • 7. Principles (cont.)
    • Span of Control – the number of employees who are assigned to a particular work task and manager.
    • Organizations need to make sure workers have a balance of supervision and freedom to do their work.
  • 8. Types of Organizational Structures
    • Organization Chart – diagram that shows the structure of an organization, classifications of work and jobs, and the relationship among those classifications.
  • 9. President VP of Finance VP of Operations VP of Marketing Senior Accountant Chief Auditor National Sales Manager Key Account Manager
  • 10. Functional Organization Management
    • Work is arranged within main business functions such as production, operations, marketing and human resources
    • People with jobs related to function will work together
    • Workers report to managers who are responsible for that function
    • Most businesses use functional style.
  • 11. Functional Organization Structure
    • Benefit
      • People work with others who have same skills
    • Drawbacks
      • People become more focused on their specific function than on the success of the whole business
      • People have little interaction with people in other parts of the business
  • 12. Matrix Organizational Structure
    • Newer organizational structure
    • Work is structured around specific projects, products, or customer groups
    • People with varied backgrounds work together because expertise is required for the project
    • Assignment may be temporary or long-term
  • 13. Matrix Organizational Structure
    • Benefits
      • Interesting and motivating to employees
      • Work with many different people
      • Focus is on specific project or task
    • Drawbacks
      • Confusing and inefficient without effective leadership and communication