Module 3
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  • 1. ORGANISING IN MANAGEMENT
  • 2. Planning Ahead
    • What is organizing as a management function?
    • What are the major types of organization structures?
    • What are the new developments in organization structures?
    • What organizing trends are changing the workplace?
  • 3. Organizing
    • The deployment of organizational resources to achieve strategic goals.
    • The deployment of resources is reflected in the division of labor.
    • Formal lines of authority and mechanisms for coordinating diverse organization tasks.
  • 4. What is organizing as a management function?
    • Organizing and organization structure
      • Organizing
        • The process of arranging people and other resources to work together to accomplish a goal.
      • Organization structure
        • The system of tasks, workflows, reporting relationships, and communication channels that link together diverse individuals and groups.
  • 5. Figure : Organizing viewed in relationship with the other management functions.
  • 6. What is organizing as a management function?
    • Organizing Process: consists of
        • a. Function of identifying, defining and grouping of work/activities or tasks, establishing authority relationships among people and assigning tasks to people.
        • b. Defining authority, responsibility, delegation and accountability
        • c. Allocating resources of an organization to achieve the specific orgn’l goals efficiently and effectively.
  • 7. What is organizing as a management function?
    • Organising Process: steps:
        • Consideration of orgl objectives
        • Grouping of activities into depatments
        • Deciding which department will be key departments (key result areas)
        • Determining levels at which various decisions are to be made.
        • Determining the span of management
        • Setting up a coordination mechanism
  • 8. Organsiation Structure: Formal And Informal
    • Formal structures 
      • The structure of the organization in its official state.
      • The intentional structure of roles in a formally organized enterprise.
      • An organization chart is a diagram describing reporting relationships and the formal arrangement of work positions within an organization.
      • An organization chart identifies the following aspects of formal structure:
        • The division of work.
        • Supervisory relationships.
        • Communication channels.
        • Major subunits.
        • Levels of management.
  • 9.
    • Informal structures 
      • A “shadow” organization made up of the unofficial, but often critical, working relationships between organization members.
      • A network of interpersonal relationships that arise when people associate with one another.
      • Potential advantages of informal structures:
        • Helping people accomplish their work.
        • Overcoming limits of formal structure.
        • Gaining access to interpersonal networks.
        • Informal learning.
  • 10.
    • Informal structures (cont.) 
      • Potential disadvantages of informal structures:
        • May work against best interests of entire organization.
        • Susceptibility to rumor.
        • May carry inaccurate information.
        • May breed resistance to change.
        • Diversion of work efforts from important objectives.
  • 11. Four Points About the Organization Chart Visual representation Set of formal tasks Formal reporting relationships Framework for vertical control
  • 12. Organizational Structure and Span of Control Relatively narrow span of control Relatively wide span of control
  • 13. Span of Management
    • The number of employees reporting to a supervisor.
    • Traditional view, seven or so per manager.
    • Many organizations today, 30 or more per manager.
    • Generally if supervisors must be closely involved with employees span should be small.
  • 14. Large Spans of Control: Factors:-
    • Work is stable or routine.
    • Similar task is performed by everyone.
    • A single location.
    • Employees are highly trained.
    • Rules and procedures are available.
    • Support systems and personnel are available for supervisor.
    • Little time is required in nonsupervisory activities.
    • Personal preferences and styles of management favor a large span.
  • 15. 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.
  • 16. Tall verses Flat Structure
  • 17. Basic Forms of Organizational Structure Divisional Organization International Organization Functional Organization Matrix Organization
  • 18. What are the major types of organization structures?
    • Functional structures
      • People with similar skills and performing similar tasks are grouped together into formal work units.
      • Members work in their functional areas of expertise.
      • Are not limited to businesses.
      • Work well for small organizations producing few products or services.
  • 19.
    • Potential advantages of functional structures:
      • Economies of scale.
      • Task assignments consistent with expertise and training.
      • High-quality technical problem solving,
      • In-depth training and skill development.
      • Clear career paths within functions.
  • 20. Figure 2 Functional structures in a business, branch bank, and community hospital.
  • 21.
    • Potential disadvantages of functional structures:
      • Difficulties in pinpointing responsibilities.
      • Functional chimneys problem.
      • Sense of cooperation and common purpose break down.
      • Narrow view of performance objectives.
      • Excessive upward referral of decisions.
  • 22.
    • Divisional structures
      • Group together people who work on the same product or process, serve similar customers, and/or are located in the same area or geographical region.
      • Common in complex organizations.
      • Avoid problems associated with functional structures.
  • 23. Figure 3 Divisional structures based on product, geography, customer, and process.
  • 24.
    • Potential advantages of divisional structures:
      • More flexibility in responding to environmental changes.
      • Improved coordination.
      • Clear points of responsibility.
      • Expertise focused on specific customers, products, and regions.
      • Greater ease in restructuring.
  • 25.
    • Potential disadvantages of divisional structures:
      • Duplication of resources and efforts across divisions.
      • Competition and poor coordination across divisions.
      • Emphasis on divisional goals at expense of organizational goals.
  • 26.
    • Types of divisional structures and how they group job and activities:
      • Product structures focus on a single product or service.
      • Geographical structures focus on the same location or geographical region.
      • Customer structures focus on the same customers or clients.
      • Process structures focus on the same processes.
  • 27.
    • Matrix structure
      • Combines functional and divisional structures to gain advantages and minimize disadvantages of each.
      • Used in:
        • Manufacturing
        • Service industries
        • Professional fields
        • Non-profit sector
        • Multi-national corporations
  • 28. Fig 4 Matrix structure in a small multi-project business firm.
  • 29.
    • Potential advantages of matrix structures:
      • Better cooperation across functions.
      • Improved decision making.
      • Increased flexibility in restructuring.
      • Better customer service.
      • Better performance accountability.
      • Improved strategic management.
  • 30.
    • Potential disadvantages of matrix structures:
      • Two-boss system is susceptible to power struggles.
      • Two-boss system can create task confusion and conflict in work priorities.
      • Team meetings are time consuming.
  • 31. What are the new developments in organization structures?
    • Guidelines for horizontal structures:
      • Focus the organization around processes, not functions.
      • Put people in charge of core processes.
      • Decrease hierarchy and increase the use of teams.
      • Empower people to make decisions critical to performance.
      • Utilize information technology.
      • Emphasize multiskilling and multiple competencies.
      • Teach people how to work in partnership with others.
      • Build a culture of openness, collaboration, and performance commitment.
  • 32. What are the new developments in organization structures?
    • Team structures
      • Extensively use permanent and temporary teams to solve problems, complete special projects, and accomplish day-to-day tasks.
      • Often use cross-functional teams.
  • 33. Fig 5 How a team structure uses cross-functional teams for improved lateral relations.
  • 34.
    • Potential advantages of team structures:
      • Eliminates difficulties with communication and decision making.
      • Eliminates barriers between operating departments.
      • Improved morale.
      • Greater sense of involvement and identification.
      • Increased enthusiasm for work.
      • Improved quality and speed of decision making.
  • 35.
    • Potential disadvantages of team structures:
      • Excessive time spent in meetings.
      • Effective use of time depends on quality of interpersonal relations, group dynamics, and team management.
  • 36.
    • Network structures
      • A central core that is linked through networks of relationships with outside contractors and suppliers of essential services.
      • Own only core components and use strategic alliances or outsourcing to provide other components.
  • 37. Figure 10.6 A network structure for a Web-based retail business.
  • 38.
    • Potential advantages of network structures:
      • Firms can operate with fewer full-time employees and less complex internal systems.
      • Reduced overhead costs and increased operating efficiency.
      • Permits operations across great distances.
  • 39.
    • Potential disadvantages of network structures:
      • Control and coordination problems may arise from network complexity.
      • Potential loss of control over outsourced activities.
      • Potential lack of loyalty among infrequently used contractors.
      • Excessively aggressive outsourcing can be dangerous.
  • 40. A Matrix Organization MARTHA STEWART Area Specialists Media Group Magazines Books Internet Radio/ Newspaper Network/ Cable TV Merchandising Group Kmart line Catalog line Sears Paint Specialty retailing Cooking Entertainment Weddings Crafts Gardening Home Holidays Children
  • 41. An International Organization CEO Retail Division A Retail Division B International Division Latin America Europe Asia
  • 42. The Future of Organizational Structure
    • Boundary-less Organizations
    • Team Organizations
    • Virtual Organizations
    • Learning Organizations
  • 43. What are the new developments in organization structures?
    • Deadly sins of outsourcing:
      • Outsourcing activities that are part of the core.
      • Outsourcing to untrustworthy vendors.
      • Not having good contracts with the vendor.
      • Overlooking impact on existing employees.
      • Not maintaining oversight; losing control to vendors.
      • Overlooking hidden costs of managing contracts.
      • Failing to anticipate need to change vendors, cease outsourcing.
  • 44. What are the new developments in organization structures?
    • Boundaryless organizations
      • Eliminate internal boundaries among subsystems and external boundaries with the external environment.
      • A combination of team and network structures, with the addition of “temporariness.”
      • Key requirements:
        • Absence of hierarchy.
        • Empowerment of team members.
        • Technology utilization.
        • Acceptance of impermanence.
    • Boundaryless organizations (cont.)
      • Encourage creativity, quality, timeliness, flexibility, and efficiency.
      • Knowledge sharing is both a goal and essential component
  • 45. Figure 10.7 The boundaryless organization eliminates internal and external barriers.
  • 46. What are the new developments in organization structures?
    • Team Organisation
    • Virtual organization.
        • A special form of boundaryless organization.
        • Operates in a shifting network of external alliances that are engaged as needed, using IT and the Internet.
    • Learning organization
  • 47.
    • Informal Groups
    • The Grapevine
    • Intrapreneuring
    The Informal Organization A Powerful Dynamic orgn
  • 48. What organizing trends are changing the workplace?
    • Contemporary organizing trends include:
      • Shorter chains of command .
      • Less unity of command .
      • Wider spans of control .
      • More delegation and empowerment .
      • Decentralization with centralization .
      • Reduced use of staff .
  • 49.
    • Shorter chains of command
      • The line of authority that vertically links all persons with successively higher levels of management.
      • Organizing trend:
        • Organizations are being “streamlined” by cutting unnecessary levels of management.
        • Flatter structures are viewed as a competitive advantage.
  • 50.
    • Less unity of command
      • Each person in an organization should report to one and only one supervisor.
      • Organizing trend:
        • Organizations are using more cross-functional teams, task forces, and horizontal structures.
        • Organizations are becoming more customer conscious.
        • Employees often find themselves working for more than one boss.
  • 51.
    • Wider spans of control
      • The number of persons directly reporting to a manager.
      • Organizing trend:
        • Many organizations are shifting to wider spans of control as levels of management are eliminated.
        • Managers have responsibility for a larger number of subordinates who operate with less direct supervision.
  • 52. Fig-8 Spans of control in “flat” versus “tall” structures.
  • 53.
    • More delegation and empowerment
      • Delegation is the process of entrusting work to others by giving them the right to make decisions and take action.
      • The manager assigns responsibility, grants authority to act, and creates accountability.
      • Authority should be commensurate with responsibility.
  • 54.
    • Guidelines for effective delegation:
      • Carefully choose the person to whom you delegate.
      • Define the responsibility; make the assignment clear.
      • Agree on performance objectives and standards.
      • Agree on a performance timetable.
      • Give authority; allow the other person to act independently.
      • Show trust in the other person.
      • Provide performance support.
      • Give performance feedback
      • Recognize and reinforce progress.
      • Help when things go wrong.
      • Don’t forget your accountability for performance results.
  • 55.
    • More delegation and empowerment (cont.)
      • A common management failure is unwillingness to delegate.
      • Delegation leads to empowerment.
      • Organizing trend:
        • Managers are delegating more and finding more ways to empower people at all levels.
  • 56.
    • Decentralization with centralization
      • Centralization is the concentration of authority for making most decisions at the top levels of the organization.
      • Decentralization is the dispersion of authority to make decisions throughout all levels of the organization.
  • 57.
    • Decentralization with centralization (cont.)
      • Centralization and decentralization not an “either/or” choice.
      • Organizing trend:
        • Delegation, empowerment, and horizontal structures contribute to more decentralization in organizations.
        • Advances in information technology allow for the retention of centralized control.
  • 58.
    • Reduced use of staff
      • Specialized staff
        • People who perform a technical service or provide special problem-solving expertise to other parts of the organization.
      • Personal staff
        • People working in “assistant-to” positions that provide special support to higher-level managers.
  • 59.
    • Reduced use of staff (cont.)
      • Line and staff managers may disagree over staff authority.
        • Advisory Authority.
        • Functional authority.
      • No one best solution for dividing line-staff responsibilities.
      • Organizing trend:
        • Organizations are reducing staff size.
        • Organizations are seeking increased operating efficiency by employing fewer staff personnel and smaller staff units.