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Structuring organizations for Today’s Challenges (DECISIONS TO MAKE IN…
Structuring organizations for
Today’s Challenges
EVERYONE’S REORGANIZING
Building an Organization from the Bottom Up
Structuring an organization.
devising a division of labor, setting up teams or depart-
ments to do specific tasks, and assigning responsibility and authority to people.
develop an organization
that shows relationships among people; who is accountable for the completion of specific work, and who reports to whom.
THE CHANGING ORGANIZATION
Fayol’s Principles of Organization
Written rules, decision guidelines, and detailed records.
Consistent procedures, regulations, and policies.
Job descriptions.
Staffing and promotion based on qualifications.
Max Weber and Organizational Theory
Authority.
Degree of centralization.
Subordination of individual interests to the general interest.
Clear communication
Division of labor.
Order.
Hierarchy of authority.
Equity.
Unity of command.
Esprit de corps.
DECISIONS TO MAKE IN STRUCTURING
ORGANIZATIONS
Choosing the Appropriate Span
of Control
Span of control
Choosing between Tall and Flat Organization Structures
tall organization structures
flat organization structures
Choosing Centralized or Decentralized Authority
Centralized authority
Decentralized authority
Weighing the Advantages and
Disadvantages of Departmentalization
Departmentalization
Employees can coordinate work within the function, and top management can easily direct and control various departments’ activities.
Departments may not communicate well.
The company can achieve economies of scale by centralizing all the resources it needs and locate various experts in that area.
Employees may identify with their department’s goals rather than the organization’s.
Employees can develop skills in depth and progress within a department as they master more skills.
Looking at Alternative Ways to Departmentalize
By customer group
By geographic location
By function
By process
By product
MANAGING THE INTERACTIONS AMONG FIRMS
Transparency and Virtual Organizations
Real time
virtual corporation
Benchmarking and Core Competencies
Benchmarking
core competencies
Creating a Change-Oriented Organizational Culture
Managing the Informal Organization
formal organization
informal organization
Orga-
nizational (or corporate) culture
ORGANIZATIONAL MODELS
Line-and-Staff Organizations
Staff personnel
Line personnel
Line Organizations
responsibility
authority
communication
Cross-Functional Self-Managed Teams
groups of employees from different departments
who work together
Matrix-Style Organizations
It gives managers flexibility in assigning people to projects.
It encourages interorganizational cooperation and teamwork.
It can produce creative solutions to product development problems.
It makes efficient use of organizational resources.
Disavantage
It can confuse employees about where their loyalty belongs—with the
project manager or with their functional unit.
It requires good interpersonal skills as well as cooperative employees
and managers to avoid communication problems.
It’s costly and complex.