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Lesson 5 3

Lesson 5 3



Organizational Structure for Businesses

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



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    Lesson 5 3 Lesson 5 3 Presentation Transcript

    • Intro to Business Organizational Structure for Business Lesson 5-3
    • 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
      • 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
      • 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.
    • 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
    • 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.
    • 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.
    • 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.
    • President VP of Finance VP of Operations VP of Marketing Senior Accountant Chief Auditor National Sales Manager Key Account Manager
    • 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.
    • 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
    • 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
    • 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