Please enable JavaScript.
Coggle requires JavaScript to display documents.
ORGANISING - Coggle Diagram
ORGANISING
-
Key organising concepts
- Chain of command
- is an unbroken line of authority that links all employees and shows who reports to whom
associated with 2 underlying principles:
Unity of command
- each employee is held accountable to only one supervisor
Scalar principle
- a clearly defined line of authority in the organisation that includes all employees (usually from top - bottom linking all managers)
- Line and staff authority (managers can be either)
both have an advisory relationship
line department:
- people in management positions have formal authority to direct & control immediate subordinates
- perform tasks that reflect the organisation's primary goal and mission
staff authority:
- includes the right to advise, recommend and counsel in the staff specialists' area of expertise
- include those that provide specialised skills in support of the line departments
- Span of management
- number of employees reporting to a supervisor
factors that are associated with less supervisor involvement, thus larger span of control:
- work performed by subordinates is stable and routine
- subordinates perform similar work tasks
- subordinates are concentrated in a single location
- subordinates are highly trained & need little direction in performing tasks
- rules & procedures defining task are available
- support system & personnel are available for manager
- little time is required in nonsupervisory activities
(eg. coordination with other departments or planning)
-managers' personal preferences & styles favour a large span
TALL structure: narrow span, more hierarchical levels
FLAT structure: wide span, is horizontally dispersed and has fewer hierarchical levels (closer to high-level executives)
- Centralisation and decentralisation
Centralisation: decision authority is located near the top of organisation
Decentralisation: decision authority is pushed downward to lower organisational levels
- organisation have to experiment to find the correct hierarchical level at which to make decisions
Factors that typically influence:
- greater change and uncertainty in the environment are usually decentralisation (eg. natural disaster), as lower levels managers are closer to scene of action.
- in times of crisis or risk of company failure, authority are centralised at the top
- amount of centralisation/decentralisation should fit the firm's stratergy.
Departmentalisation
Traditional approaches
- Functional approach
- activities are grouped together by common function from top-bottom of the organisation
- based on similar skills, expertise, work activities and resource use (can be thought as departmentalisation by organisational resources)
eg. finance, marketing, human resource
ADVANTAGES
- efficient resource use and economies of scale
- in-depth skill specialisation and development
- centralised decision making and unified direction from top managers
DISADVANTAGES
- poor communication and coordination across departments
- slow response to environmental changes (as it requires involvement of several departments)
- decisions involving more than one department may pile up creating delay
- Divisional approach (3 types)
- people are grouped by common skills and resources
ADVANTAGES
- flexible and responsive to change
- fosters concern for customers' needs
- good coordination across functional departments and within divisions
DISADVANTAGES
- poor coordination across divisions
- duplication of resources across divisions
- high cost of running separate divisions
- loss of efficiency and economies of scale
- lack of technical specialisation, expertise and training.
(i) divisional approach by Products/Services
eg. product 1 marketing, HR, finance one department
DISADVANTAGES
duplicate of resources
(ii) divisional approach by Geographical Regions
- used by organisations with physically dispersed or non-interdependent operations/markets
- all functions in a specific country/region report to the same division manager
eg. Asia one department and Middle East another
(iii) divisional approach by Customers
- used by companies which provide different services to different types of customers
eg. industrial division and consumer division
- Matrix approach - combination of both functional (vertical) & divisional (horizontal) structures simultaneously
unique feature: it has dual lines of authority
ADVANTAGES
- more efficient use of resources than single hierarchy
- flexibility, adaptability to changing environment
- interdisciplinary corporation, expertise available to all divisions
DISADVANTAGES
- frustration and confusion from dual chain of command
- high level of conflict between two sides of matrix
- time lost to meetings and discussions to resolve conflicts than actions
innovative approaches
- Team approach
- gives managers a way to delegate authority, push responsibility to lower levels and be more flexible & responsive in a competitive global environment
one approach is through Cross-functional teams:
- consist of employees from various functional departments (able to use their different expertise) who are responsible to meet as a team & resolve problems
- can provide needed horizontal coordination to complement an existing divisional/functional structure.
ADVANTAGES
- reduced barriers across departments resulting in improves coordination and cooperation
- adapt more quickly to customers requests and environmental changes
- shorter response time and quicker decision-making
- better morale, enthusiasm from employee involvement
DISADVANTAGES
- dual loyalties and conflict due to different work demands
- time and resources devoted to meeting increasing coordination time
- unplanned decentralisation and decisions may be made against the organisation's good
- Network approach - extends the idea or horizonal coordination and collaboration beyond the boundaries of the organisation
- organisation may be viewed as a central hub surrounded by a network of outside specialists, sometimes spread all over the world
eg. company hub is branched out into: design (in canada), accounting (in US), Legal (in UK)
ADVANTAGES
- flexiblility and competitiveness on a global scale
- respond quickly to changes in the environemtnand customer needs
- reduced overhead costs as little supervision is required
DISADVANTAGES
- lack of hands-on control as operations are not under one roof
- greater uncerainity and demnads on managers due to weak boundaries
(meaning: managers in the outsource country have control over employees and not the organisation itself)
- customer service and loyalty can suffer
- employee loyalty can weaken