This document discusses organizational structure and design. It defines key concepts like organizing, organizational structure, organizational charts, and purposes of organizing like dividing work and coordinating tasks. It also outlines six elements of organizational design: work specialization, departmentalization, chain of command, span of control, centralization/decentralization, and formalization. Common structures like simple, bureaucracy, and matrix are explained. Factors that influence centralization and ways to create a positive organizational culture are provided.

1. Topic:
Organiztion Structure
Group Name:
M.Haseb Tayyab 073
Rana Adnan 071
Ali Hassan 079
Imran Jutt 032

2. Organizational Structure
•Organizing
• Arranging and structuring work to accomplish an organization’s
goals.
•Organizational Structure
• The formal arrangement of jobs within an organization.
•Organizational Chart
• The visual representation of jobs within an organization.

3. Purposes of Organizing
• Divides work to be done into specific jobs and departments.
• Assigns tasks and responsibilities associated with individual
jobs.
• Coordinates diverse organizational tasks.
• Clusters jobs into units.
• Establishes relationships among individuals, groups, and
departments.
• Establishes formal lines of authority.
• Allocates and deploys organizational resources.

4. Organizational Design
A process involving decisions about six key elements:
• Work specialization
• Departmentalization
• Chain of command
• Span of control
• Centralization and decentralization
• Formalization

5. Work Specialization
• The degree to which tasks in the organization are divided into
separate jobs with each step completed by a different person.
Departmentalization
The basis by which jobs are grouped together.
Division of labor:
• Makes efficient use of employee skills
• Increases employee skills through repetition
• Less between-job downtime increases productivity
• Specialized training is more efficient.
• Allows use of specialized equipment.

6. Departmentalization by Type
•Functional
• Grouping jobs by functions performed
•Geographical
• Grouping jobs on the basis of territory or geography
•Product
• Grouping jobs by product line
•Process
• Grouping jobs on the basis of product or customer flow
•Customer
• Grouping jobs by type of customer and needs
• Cross-functional Teams: Work teams composed of individuals
from various functional specialties.

7. Chain of Command
 The continuous line of authority that extends from upper levels of
an organization to the lowest levels of the organization and
clarifies who reports to whom.
•Authority
• The rights inherent in a managerial position to tell people what to
do and to expect them to do it.
•Responsibility
• The obligation or expectation to perform.
•Unity of Command
• The concept that a person should have one boss and should
report only to that person.

8. Span of Control
• The number of employees who can be effectively and efficiently
supervised by a manager.
Width of span is affected by:
 Skills and abilities of the manager
 Employee characteristics
 Characteristics of the work being done
 Similarity and complexity of tasks
 Standardization of tasks
 Detail of the organization’s information system
 Strength of the organization’s culture
 Preferred style of the manager

9. Centralization andDecentralization
•Centralization
• The degree to which decision making is concentrated at upper
levels in the organization.
 Organizations in which top managers make all the decisions and lower-
level employees simply carry out those orders.
•Decentralization
• Organizations in which decision making is pushed down to the
managers who are closest to the action.
•Employee Empowerment
• Increasing the decision-making authority (power) of employees.

10. Formalization
• The degree to which jobs within the organization are
standardized and the extent to which employee behavior is
guided by rules and procedures.
 Highly formalized jobs offer little discretion over what is to be done.
 Low formalization means fewer constraints on how employees do their
work.

11. => Factors that Influence the
Amount of Centralization
More Centralization
• Environment is stable.
• Lower-level managers are not as capable or experienced at making
decisions as upper-level managers.
• Lower-level managers do not want to have a say in decisions.
• Decisions are relatively minor.
• Organization is facing a crisis or the risk of company failure.
• Company is large.
• Effective implementation of company strategies depends on
managers retaining say over what happens.

12. Cont:
More Decentralization
• Environment is complex, uncertain.
• Lower-level managers are capable and experienced at making
decisions.
• Lower-level managers want a voice in decisions.
• Decisions are significant.
• Corporate culture is open to allowing managers to have a say in
what happens.
• Company is geographically dispersed.
• Effective implementation of company strategies depends on
managers having involvement and flexibility to make decisions.

13. => Common Organizational
Designs
• Three of the more common org. designs in use: the simple
structure, the bureaucracy, and the matrix
Simple Structure:
A structure characterized by a low degree of departmentalization, wide
spans of control, authority centralized in a single person, and little
formalization.
Bureaucracy:
The primary strength of the bureaucracy lies in its ability to perform
standardized activities in a highly efficient manner.

14. Strengths and weaknesses of
bureaucracy
• Strengths
• Functional economies of scale
• Minimum duplication of personnel and equipment
• Enhanced communication
• Centralized decision making
• Weaknesses
• Subunit conflicts with organizational goals
• Obsessive concern with rules and regulations
• Lack of employee discretion to deal with problems

15. Matrix Structure
• Matrix management is a technique of managing an org.(
or, more commonly, part of an org.) through a series of
dual-reporting relationships instead of a more traditional
linear management structure.
• In its simplest form, a matrix configuration may be
known as a cross-functional work team, which brings
together individuals who report to different parts of the
company in order to complete a particular project or
task.
• A structure that creates dual lines of authority and
combines functional and product departmentalization.

16. => New Design Options
Team structures:
 The entire organization is made up of work groups or self-managed teams
of empowered employees.
Virtual Organization:
 A small, core organization that outsources its major business functions.
 Highly centralized with little or no departmentalization.
Boundaryless Organization:
The boundary-less organization seeks to eliminate the chain of command,
have limitless spans of control, and replace departments with empowered
teams.

17. => Organizational Culture
• Organizational culture refers to a system of shared meaning held by
members that distinguishes the organization from other
organizations.
Essence of an organization’s culture:
1. Innovation and risk taking. The degree to which employees are encouraged
to be innovative and take risks.
2. Attention to detail. The degree to which employees are expected to exhibit
precision, analysis, and attention to detail.
3.Outcome orientation. The degree to which management focuses on results or
outcomes rather than on the techniques and processes used to achieve them.
4. People orientation. The degree to which management decisions take into
consideration the effect of outcomes on people within the organization.
5. Team orientation. The degree to which work activities are organized
around teams rather than individuals.
6. Aggressiveness. The degree to which people are aggressive and competitive
rather than easygoing.
7. Stability. The degree to which organizational activities emphasize maintaining
the status quo in contrast to growth.

18. => Creating a Positive
Organizational Culture
Building on Employee Strengths
Although a positive organizational culture does not ignore
problems, it does emphasize showing workers how they can
capitalize on their strengths.
 Rewarding More Than Punishing
Although most organizations are sufficiently focused on extrinsic
rewards such as pay and promotions, they often forget about
the power of smaller (and cheaper) rewards such as praise
 Emphasizing Vitality and Growth
Positive organizations focus on growth of employees and their
career.

19. The End