Conceptual Definitions: Administration, Organization, Management, Formal Structure, Organizational Chart, line and Staff Positions, etc. Prepared by: Jo B. Bitonio
Administration ADMINISTRATION - coordination and control of human and natural resources to achieve desired end set of functions to meet the organization's goals. The idea of a set of standard administrative functions carries back to Luther H. Gulick , who in 1937 established the acronym POSDCoRB " which stood for planning, organizing, staffing, directing, coordinating, reporting, and budgeting.
ORGANIZATION BY DWIGHT WALDO – is the structure of authoritative and habitual interrelationship in an administrative system. It is static and seek for pattern Organization Organizations have major subsystems, such as departments, programs, divisions, teams, etc. Each of these subsystems has a way of doing things along with other subsystems achieve the overall goals of the organization. Often, these systems and processes are defined by plans, policies and procedures.
1 a supposition or system of ideas explaining something, esp. one based on general principles independent of the particular things to be explained (opp. HYPOTHESIS) ( atomic theory; theory of evolution ).
2 a speculative (esp. fanciful) view ( one of my pet theories ).
3 the sphere of abstract knowledge or speculative thought ( this is all very well in theory, but how will it work in practice? ).
4 the exposition of the principles of a science etc. ( the theory of music ).
5 Math . a collection of propositions to illustrate the principles of a subject ( probability theory; theory of equations )
Oxford Encyclopedic English Dictionary
The Theories of Organization
The purpose of theory generally is to provide a more coherent and integrated understanding of our world than we might otherwise hold
Theory seeks to move beyond a simple observation of facts or blind adherence to certain values to provide more general interpretations
Why study formal Theories ?
Theory is a way of making sense of a situation All theories emphasize certain things and de-emphasize others, they are reflective of the broader commitments of a given culture
Neo-classical theories : human relations or human behavior school (Mary Parker Follet, Chester Barnand, Elton Mayo, Abraham Maslow, Frederick Herzberg, Douglas McGregor, Chris Argyris, Robert Blake and Jane Mouton Rensis Likert)
Public Administration (Woodrow Wilson, Frank Goodnow, Luther Gulick, W.F. Willoughby, Leonard White, Paul H. Appleby, Dwight Waldo) Integration or Modern Organization Theory ( Simon, McGregor, Argyris, Maslow, Likert, I. Von Berthallanfy, K. Boulding ) Development Administration (Goswami, Riggs, Weidner, Roman Dubsky, J. Nef, O.P. Dwivedi , George Gant) Theories of Organization
New Public Administration ( Minnowbrook Conference, H. George Frederickson) New Public Management ( Hammer and Champy, Ted Osborne and David Gaebler, W. F. Deming, UNDP, ADB, WB) Theories of Organization
Formal - means the intentional structure of roles in a formally organized enterprise
Informal - any joint personal activity without conscious joint purpose; a network of personal and social relations not established or required by the formal organization but arising spontaneously as people associate with one another
The Formal and Informal Group
Formal vs. Informal Structure
Informal structures develop because:
people find new ways of doing things which they find easier and save them time
patterns of interaction are shaped by friendship groups and other relationships
people forget what the formal structures are
it is easier to work with informal structures.
Coffee-regulars group News paper group Computer-wizard Group Spiceboys
Sometimes the informal structure may conflict with the formal one. Where this is the case the organization may become less efficient at meeting its stated objectives. However, in some cases the informal structure may prove to be more efficient at meeting organizational objectives because the formal structure was badly set out.
Managers need to learn to work with both formal and informal structures. A flexible manager will realize that elements of the informal structure can be formalized i.e. by adapting the formal structure to incorporate improvements which result from the day-to-day working of the informal structure
Traditional Structures of Business Organizations
Numerous driving forces are causing dramatic changes in how organizations design themselves to conduct business effectively. These new designs are used organization widely or for various teams in the organization. The new designs are self-organizing, self-directing or self-managing in nature.
Line and Staff organization
has the characteristics of line and functional structures
It is apparent from the scalar principle that line authority is the relationship which a superior exercises direct supervisions over a subordinate – an authority relationship in direct line or steps
The nature of the staff relationship is advisory. The function of people in a pure staff capacity is to investigate, research, give advise to line managers
Supervisors Employees Line and Staff Type of Organization __________ line authority - - - - - - - - - functional authority President Engineering Sales Prod Manager Controller Personnel Purchasing Supervisor Supervisor Supervisor Supervisor Employees Employees Employees Employees Employees Supervisor
Most business organizations start out with a functional structure, or a small variation of this structure. This is the basic "building block" for other structures. In this structure, there is a central office which oversees various departments or major functions, e.g., human resources, finances, sales, marketing, engineering, etc.
A Functional Organization President Finance Personnel Assist to Pres. Marketing Engineering Production
This structure is useful because it focuses highly skilled people from across the organization to work on a complex product or service. It can be difficult, though, because each person essentially reports to two supervisors: the supervisor of the functional area (e.g., engineering) and the product manager, as well.
Director of Engineering Product A Manager Product B Manager Product C Manager Product D Manager Design Mech Engr. Hydraulic Engr. Mettalurgical Engr. Elec. Engr. Project Organization in Engineering
Director of Engineering Matrix Organization in Engineering Chief Design Chief Mechanical . Chief Electrical Proj A Mgr. Proj B Mgr . Proj C Mgr. Proj D Mgr. Chief Hydraulic Chief Metallurgical
its oriented towards end results
Professional identification is maintained
Pinpoint product-profit responsibility
Conflict in organizational authority exists
Possibility of disunity of command
Requires manager to be effective in human relations
Geographic (Grid) Organization – this designs attempts to assign responsibilities by grouping functional specialists (e.g. production, marketing and finance together) while retaining geographical responsibilities under a collateral group of departments and attempting to provide functional specialization in a third set of departments.
President Central Reg Eastern Reg Western Reg Personnel Personnel Purchasing Marketing Finance Accounting Sales Southern Reg Eastern Reg Engn Production Geographic Organization
Places responsibility at a lower level
Places emphasis on local markets and problems
Improves coordination in a region
Takes advantage of economies of local operations
Furnishes measurable grounds for general managers
Requires more persons with general manager abilities
Tends to make maintenance of economical central services difficult and may require services such as personnel or purchasing at the regional level
Increases problem of top management control
Committee organization Board of Directors Audit & Inv. Com Conciliation & Mediation Com Credit Com Ethics & Accountability Com Election Com
Gaining group deliberation & judgment
Fear of too much authority in a singe person
Representation of interested group
Coordination of plans & policies
Transmission and sharing of information
Consolidation of authority
Motivation thru participation
Avoidance of action
High cost in time and money
Compromise at the least common denominator
Tendency to be self-destructive
Splitting of responsibility
Tyranny of the minority
Tall Organization with Narrow Spans
Fast communication between subordinates and superiors
Superiors tend to get too involved in subordinates’ work
Many levels of management
High cost due to many levels
Excessive distance between top to lowest level
Flat Organization with Wide Span
Superiors are forced to delegate
Clear policies must be made
Subordinates must be carefully selected
Tendency of overloaded superiors to become decision bottlenecks
Danger of superior’s loss of control
Requires exceptional quality
Factors Determining an Effective Span Communication techniques Hard Easy Amount of personal contact needed Hard Easy Variation by organization level Easy Hard Less More Less More More Less Communication techniques Hard Easy Amount of personal contact needed Hard Easy Variation by organization level Easy Hard Factor Narrow Spans Wide Spans Training of staff Less More Clarity of delegation or authority Less More Clarity of plan More Less Clarity of plan Change So Fast So Slow Communication techniques Hard Easy Amount of personal contact needed Hard Easy Variation by organization level Easy Hard
References: 2006 Managers’ Course, UP Institute for Small Scale Industries Frederick Harbison & Charles Myers, Education, manpower and Economic Growth: Strategies of HRD, McGraw Hill Book Co, 1964 p2