Designing the Contemporary
The process of determining the tasks to be
done, who will do them, and how those tasks
will be managed and coordinated.
The Process of Organizing
Developing the foundation
- Determining tasks and defining jobs
- Defining work relationships
Developing organizational design
- Grouping organizational members
- Developing an integrating system
- Determining the locus of decision making
Goals and Objectives
Steps in organizing
• 1.Detailing of work.-Describing all the work that must be done.
• 2.Division of work-Dividing the total workload.
• 3.Aggregation of work-departmentalization.
• 4.Coordination of work-integration and standardization
• 5.Review of performance-assess managerial and organizational performance.
Division of work
The process of dividing jobs into smaller
components so that a worker performs only a
small part of the total jobs.
2.Allows people to learn skills and become
expert at their job functions.
Organizational Design Defined
The way in which the activities of an
organization are arranged and coordinated so
that its mission can be fulfilled and its goals
Components of Organizational Design
Overall organizational design is
defined by three primary
Organizational StructureOrganizational Structure
Integrating MechanismsIntegrating Mechanisms
Locus of Decision MakingLocus of Decision Making
• Organizational Structure
– Defines the primary reporting relationships that
exist within an organization.
– The chain of command and hierarchy of
responsibility, authority, and accountability are
established through organizational structure.
– Common forms of organizational structure:
• Functional structure, division structure, matrix
structure, and network structure.
• Functional Structure
– Members of the organization are grouped
according to the particular function that they
perform within the organization.
– Appropriate when an organization’s greatest
source of complexity comes from the diverse tasks
that must be performed rather than from its
products, geographic markets, or consumer
– Facilitates specialization.
– Cohesive work groups.
– Improved operational efficiency.
– Focus on departmental vs. organizational issues.
– Difficult to develop generalists needed for top-
– Only top-level management held accountable for
• Divisional Structure
– Members of the organization are grouped on the
basis of common products, geographic markets,
or customers served.
• Types of Divisional Structures
– Product divisional
• Most appropriate for organizations with
relatively diverse product lines that require
specialized efforts to achieve high product
• Types of Divisional Structures
– Geographic divisional
• Most appropriate for organizations with limited
product lines that either have wide geographic
coverage or desire to grow through geographic
– Customer divisional
• Most appropriate for organizations that have
separate customer groups with very specific
and distinct needs.
– Enhanced coordination.
– Better assessment of manager performance
– Development of generalist managers.
– Managers may lack expertise to operate in
wide geographic areas.
– Duplication of resources.
– Allows for focus on specific new markets.
– Good structure for growth along geographic
– Adaptable to local needs.
– Duplication of product or product/technology
– Coordination and integration are difficult.
• Matrix Structure
– A structure in which the tasks of the organization
are grouped along two organizational dimensions
– Examples include product/function,
product/geographic region, etc.
– Can achieve simultaneous objectives.
– Managers focus on two organizational
dimensions, resulting in more specific job skills.
– Complex, leading to difficulties in
– Behavioral difficulties from “two bosses.”
– Time consuming from a planning/coordination
• Network Structure
– A contemporary organizational structure that is
founded on a set of alliances with other
organizations that serve a wide variety of
• Types of Network Structures
– Internal network
• A network structure that relies on internally
developed units to provide services to a core
• Types of Network Structures
– Stable network
• A network structure that utilizes external
alliances selectively as a mechanism for gaining
– Dynamic network
• A network structure that makes extensive use
of outsourcing through alliances with outside
– Maximizes the effectiveness of the core unit.
– Do more with less resources.
– Fragmentation makes it difficult to develop
– Success is dependent on ability to locate
– Difficult to develop employee loyalty.
Managing Complexity Through
– The degree to which work groups are interrelated.
• Three primary levels of work group
– Pooled interdependence.
– Sequential interdependence.
– Reciprocal interdependence.
Occurs when organizational units have a
common resource but no interrelationship
with one another
Occurs when organizational units must coordinate
the flow of information, resources, and tasks from
one unit to another
A B C
Occurs when information, resources, and tasks must
be passed back and forth between work groups
• The working relationships that exist within an
organization affect how its activities are
accomplished and coordinated.
• These Relationships are Defined By:
– Chain of command
– Span of control
– Line and staff responsibilities
Chain of Command and Unity of
• Chain of Command
– The line of authority and responsibility that flows
throughout the organization.
• Unity of Command
– A principle that each employee in the organization
is accountable to one, and only one, supervisor.
Span of management
• Also known as span of control
• Refers to the number of subordinates who
reports directly to a manager.
• Broad span of mgt. – means a manager
supervises many subordinates ( 10 or more).
• Narrow span of mgt.- means a manager
supervises only a few workers (less than 10)
• Span of Control
– The number of employees reporting to a particular manager.
• In theory, when tasks are very complex, span of control should be relatively
• In contrast, where jobs are highly standardized and routine (low complexity),
a manager will not need to spend as much time supporting individual
subordinates, and the span of control may be larger
Span of Control
Narrow Span of Control
Wide Span of Control
Advantages of broad/wide span of
1.Superiors are forced to delegate
2.Clear policies must be made
3.Subordinates must be carefully selected
1.Burdening of managers
2.Danger of superior’s loss of control
Advantages of narrow span of management
3.Rapid com between subordinates and superiors
2.Excessive distance between the lowest and top levels
The importance of span of management
• 1.Affect effective utilization of managers e.g
Too broad span means a manager is
burdening himself with too much workload
• Too narrow span means a manager is
Situational determinants of span of
• 1.Similarity of work-e.g Broad span is appropriate for identical
• 2.Geographical contiguity e.g broad span is appropriate for
activities located in the same area of work
• 3.Complexity of work e.g Broad span is appropriate for simple
and repetitive tasks
• 4.Direction and control required by subordinates
• 5.Time spent coordinating and planning.
Influence, power and authority
• Influence-Actions or examples that cause a change in behavior or attitude of
another person. E.g a hard working manager may influence his subordinates to
increase their productivity
• Power - The ability to exert influence.French and Raven have identified five
sources of power :
• 1.Reward power : Ability to reward another person. E.g bonus, promotion
• 2.Coercive power :Ability to punish or take disciplinary action
• 3.Expert power : Based on a person’s possession of special knowledge or
• 4.Legitimate power-power vested in the constitution which acknowledges a
person’s right or lawfulness to exert influence
• 5.Referent power-based on the credibility, attractiveness and trustworthiness of
a person that makes subordinates want to imitate the leader’s behavior
• Authority- A form of legitimate power. There are two views of formal authority
• 1.The classical view
• 2.The acceptance view
The classical view
• Supposes that authority originates at some very high level of
society and then is passed down from level to level.
The acceptance view
• Finds the basis of authority in the influencee (subordinates) and
not the influencer (manager) Subordinates acceptance is vital to
ensure that instructions/ commands could be implemented
Line and Staff Responsibilities
• Line Personnel
– Those organizational members that are directly
involved in delivering the products and services of
• Staff Personnel
– Those organizational members that are not
directly involved in delivering the products and
services to the organization, but provide support
for line personnel.
Line and staff authority
• Line authority – refers to managers
and other employees who are
directly involve in the attainment of
the organization goals.e.g
production managers, operating
workers and marketing manager.
• Include all employees who provide service and advice to the
line authority.e.g counselor, personal assistant and typist.
• Three types of staff authority:
• 1.Personal staff e.g personal assistant
• 2.Specialized staff-e.g legal advisor, Vice president ( finance)
• 3.Functional staff e.g The Audit dept.-staff authority which
has the right to control line activities
• The assignment to another person of formal authority and
accountability for carrying out specific activities.However not all
authority and accountability can be delegated.e.g tasks in which
subordinates do not have the required qualifications and skills
The extent of delegation depends on such factors as :
• The organizational culture
• The nature of the tasks
• Subordinates capabilities
– The process of transforming the responsibility for a specific activity or task
to another member of the organization and empowering that individual to
accomplish the task effectively.
– Scalar principle
• A clear line of authority must run throughout the organization
Advantages of delegation
• Unburdening of top managers
• Improve decision making
• Better employees training
• Faster decision making
Barriers to effective delegation
1.Managers reluctance to delegate e.g
Lack of confidence on their
2.Subordinates reluctance to accept
delegation e.g do dot want the
• Reasons for Failing to Delegate
– The “time crunch.”
– Lack of confidence in the abilities of subordinates.
– Managers try to avoid the potential pitfalls of dual
– Managers may be insecure about their own value
to the organization.
• The Process of Delegation
-Decide which task to delegate
– Assigning responsibility
• Responsibility refers to the employee’s obligation to complete the
activities that he or she has been assigned.
– Granting authority
• Authority is the formal right of an employee to marshal resources
and make decisions necessary to fulfill work responsibility.
– Establishing accountability
• Where there is accountability for performance, employees
understand that they must justify their decisions and actions with
regard to the tasks for which they have assumed responsibility.
Classical guidelines to achieve effective
1.Assign Responsibilities, authority and
2.The scalar principle – a clear chain of
3.The unity of command principle –
employees report to only one leader.
Delegation: Learning to Delegate
• Principle 1:
– Match the employee to the task.
• Principle 2:
– Be organized and communicate clearly.
• Principle 3:
– Transfer authority and accountability with the
• Principle 4:
– Choose the level of delegation carefully.
Principles of delegation
1.Match the employee to the task –The selected
employee should possess the skills and capabilities.
2.Be organized and communicate clearly – state
clearly what is to be done, specific deadlines and special skills
3.Transfer Authority and accountability – provide
resource and power
4.Choose the level of delegation carefully.
Steps in delegation
1.Decide which tasks can be delegated
2.Decide who should get the
3.Delegate the assignment
4.Establish a feedback system.