The organizational system @ bec doms bagalkot mba

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The organizational system @ bec doms bagalkot mba

  1. 1. The Organizational System
  2. 2. What is Structure? <ul><li>The degree of complexity, formalization and centralization in the organization. </li></ul><ul><li>Complexity is the degree of vertical, horizontal and spatial differentiation in an organization </li></ul><ul><li>Formalization is the degree to which jobs within the organization are standardized. </li></ul><ul><li>Centralization is the degree to which decision making in concentrated at a single point in the organization </li></ul>
  3. 3. Classical View of Structure <ul><li>Division of Labour – Specialization; breaking jobs down into simple and repetitions tasks </li></ul><ul><li>Unity of Command – a subordinate should have only one superior to whom he or she is directly responsible. </li></ul><ul><li>Responsibility - an obligation to perform </li></ul><ul><li>Line Authority – authority to direct the work of a subordinate </li></ul>
  4. 4. Classical View of Structure…… <ul><li>Chain of Command – the superior-subordinate authority chain that extends from the top of the organization to the lowest echelon </li></ul><ul><li>Staff Authority – positions that support, assist and advise line managers </li></ul><ul><li>Span of Control – the number of subordinates a manger can efficiently and effectively divert </li></ul><ul><li>Departmentation: grouping of activities on some common basis </li></ul>
  5. 5. Departmentation by Function Plant Manager Manger Engineering Manager Accounts Manger Manufacturing Manger Personal Manager Purchase
  6. 6. Departmentalization by Product President VP (Fuels) VP (Lubricants & Waxes) VP (chemicals) Marketing Planning Supply & distribution Manufacturing
  7. 7. Departmentalization by Customer Manager Loans FEX SA TDR
  8. 8. Departmentalization by Geography VP (Sales) Sales Manager Western Region Sales Manager Southern Region Sales Manager Northern Region Sales Manager Eastern Region
  9. 9. Departmentalization by Process Plant Manager Cast Department Manager Press Department Manager Tube Department Manager Finishing Department Manager Inspection, packing & Shipping Dept Manager
  10. 10. The coming of the New Organization <ul><li>Rapid and unexpected change </li></ul><ul><li>Increasing diversity </li></ul><ul><li>Change in managerial behaviour </li></ul><ul><li>Adoption to computer technology </li></ul>
  11. 11. The Mechanistic Structure
  12. 12. The Mechanistic Structure…… <ul><li>High horizontal differentiation </li></ul><ul><li>Rigid hierarchical relationships </li></ul><ul><li>Fixed duties </li></ul><ul><li>High formalization </li></ul><ul><li>Formalized communication channels </li></ul><ul><li>Centralized decision authority </li></ul>
  13. 13. The Organic Structure
  14. 14. The Organic Structure….. <ul><li>Low horizontal differentiation </li></ul><ul><li>Collaboration (both horizontal and vertical) </li></ul><ul><li>Adaptable duties </li></ul><ul><li>Low formalization </li></ul><ul><li>Informal communication </li></ul><ul><li>Decentralized decision authority </li></ul>
  15. 15. Why do Structures Differ? <ul><li>Strategy </li></ul>Strategy Structural Option Innovation Organic: loose structures; low division of labour, low formalization, decentralized. Cost minimization Mechanistic: tight control; extensive division of labour, high formalization, high centralization. Initiation Mechanistic and Organic: mix of loose and tight properties; tight controls for current activities, loose controls for newer undertakings.
  16. 16. Why do Structures Differ?..... <ul><li>Size </li></ul><ul><ul><li>Increase in the number of employees results in </li></ul></ul><ul><ul><ul><ul><li>High complexity </li></ul></ul></ul></ul><ul><ul><ul><ul><li>High formalization </li></ul></ul></ul></ul><ul><ul><ul><ul><li>decentralization </li></ul></ul></ul></ul>
  17. 17. Why do Structures Differ?.... <ul><li>Technology </li></ul>Unit Production Mass Production Process Production Structural characteristics Low vertical differentiation Low horizontal differentiation Low formalization Moderate vertical differentiation High horizontal differentiation High formalization High vertical differentiation Low horizontal differentiation Low formalization Most effective structure Organic Mechanistic Organic
  18. 18. Technology… Non routine Routine Craft Engineering 1 2 3 4 Well-defined Ill-defined Task variability Few Exceptions Many Exceptions Problem Analyzability
  19. 19. Technology… A B C D Input Output A. Long-linked Technology Client A Client B Transformational Process B. Mediating Technology Resources A B C D Transformational Process Feedback Output C. Intensive Technology
  20. 20. Why do Structures Differ?..... Environment Abundant Scarce Complex simple Stable Dynamic Three Dimensional Model of the Environment
  21. 21. Why do Structures Differ?... <ul><li>Power control </li></ul><ul><ul><li>An organization structure is the result of power struggle by internal constituencies who are seeking to further their interests </li></ul></ul>
  22. 22. Mintzberg`s five design configurations <ul><li>The operating core : Employees who perform the basic work related to the production of products and services </li></ul><ul><li>The strategic apex : Top level managers who are charged with the overall responsibility of the organization </li></ul><ul><li>The middle level: Managers who connect the operating core to the strategic apex </li></ul><ul><li>The technosturcture : Analysts who have the responsibility for effecting certain forms of standardization in the organization </li></ul><ul><li>The support staff: People who fill the staff units, who provide indirect services for the organization </li></ul>
  23. 23. Basic Elements
  24. 24. Basic Subunits SubunitExample positions from a manufacturing firm. <ul><li>Strategic Apex: Board of Directors, Chief Executive Officer </li></ul><ul><li>Techno structure: Strategic Planning, Personnel Training, Operations Research, Systems Analysis and Design </li></ul><ul><li>Support Staff: Legal Counsel, Public Relations, Payroll, Mailroom Clerks, Cafeteria Workers </li></ul><ul><li>Middle Line: VP Operations, VP Marketing, Plant Managers Sales Managers </li></ul><ul><li>Operating Core: Purchasing Agents, Machine Operators, Assemblers, Sales Persons, Shippers </li></ul>
  25. 25. The Simple Structure <ul><li>Low complexity </li></ul><ul><li>Low formalization </li></ul><ul><li>Centralized authority </li></ul>
  26. 26. The Machine Bureaucracy <ul><li>High in complexity, formalization and centralization </li></ul><ul><li>Key part is technostructure </li></ul>
  27. 27. The Professional Bureaucracy <ul><li>High in complexity, formalization </li></ul><ul><li>Low centralization </li></ul>
  28. 28. The Divisional Structure <ul><li>A set of autonomous units coordinated by central headquarters </li></ul>
  29. 29. The Adhocracy <ul><li>A structure characterized as low in complexity, formalization centralization </li></ul>
  30. 30. The Matrix Structure Academic departments Programs Matrix Structure for a College of Business Administration Under graduate Master’s Ph.D. Research Executive programs Community service programs Accounting Administrative Studies Economics Finance Marketing

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