mo 2nd class
TRANSCRIPT
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The process of organizing takes
place within a structure reflected
by the way in which the
organization
Divides its labor into departments andjobs
Establishes formal lines of authority
Establishes mechanisms for coordinating
diverse tasks
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What is Organizing
The grouping of activities necessary forattaining objective.
The process of creating an organizationsStructure .
A Process that initiates implementation ofplans by clarifying jobs and workingrelationship and effectively deployingresources for attainment of identified anddesired results
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Definition
Organizing is the process of identifying
and grouping the work to be performed,
defining and delegating responsibility and
authority, and establishing relationships
for the purpose of enabling people to
work most effectively together in
accomplishing objectives.Louis Allen
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Organizing process leads to creation of
an Organizational Structure
Formal tasks assigned
Formal reporting relationships
Systems design for coordination acrossdepartments
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Importance of Organizing
Benefits of specialization
Clarity in working relationships
Optimum utilization of resources
Adaptation to change
Development of personnel Expansion and growth
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Purposes of Organizing
Divide work to be done into specific jobsand Departments
Assign tasks and responsibilities
associated with individual Coordinates diverse organizational tasks.
Clusters job in to Units.
Establish relationship among individuals ,group , and departments .
Allocates and deploys organizational
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Principles of Organization
Organizational structure- The way
managers design their firms to
achieve their organizations missionand goals.
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Formal and Informal
Organization
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Formal Organization
The Formal Organization is a system ofwell-defined jobs, each bearing a definitemeasure of authority, responsibility and
accountability.Louis Allen
Formal Organization is a system of
consciously coordinated activities of twoor more persons toward a commonobjective.
Chester Barnard29 November 2013 9
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Formal Organizations
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Advantages
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Easier to fix Responsibility
No ambiguity in the role . This also
helps in avoiding duplication of
effort.
Behavior of Employee fairly
predicted
Unity of command through an
established chain of command
Stability to the organization
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Limitations
The formal communication may lead to
procedural delays
Do not provide adequate recognition to
creative talent
More emphasis on Structure and Work,
difficult to understand all human relationships
in an enterprise as it places
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Informal Organization
An Informal organization is an aggregate
of interpersonal relationships without any
conscious purpose but which may
contribute to joint results.
Chester Barnard
Informal organization is a network of
interpersonal relationship that arise when
people associate with one another .
Keith Davis
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Features
Originates from within the formal organisationas a result of personal interaction amongemployees.
The standards of behavior evolve from groupnorms.
Independent channels of communication
without specified direction of flow ofinformation are developed by group members.
Emerges spontaneously and is not deliberatelycreated by the management.
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A
B C C
D E F G H I
J L N P R UK M 0 Q T V
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Chess group
Bowling Team
Morning coffeee regulars
Cricket lovers
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Advantages:
It helps to fulfill the social needs .
Sense of belongingness in the organisation
Faster spread of information as well as quick
feedback.
It contributes towards fulfillment of organizational
objectives. For example, employees reactions
towards plans and policies can be tested through theinformal network.
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Disadvantages:
It spreads rumors. This may work against the interest
of the formal organisation.
The management may not be successful in
implementing changes if the informal organisationopposes them. Such resistance to change may delay
or restrict growth.
It pressurizes members to conform to group
expectations.
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Elements in Organizing process
Work Specialization
Departmentalization
Chain of command
Centralization and Decentralization
Formalization
Span of Control Delegation
Empowerment29 November 2013 20
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Principles of Organization
Division of Labor and Departmentalization
Division of labor - Degree to which tasks aresubdivided into separate jobs.
Specialization can lead to efficiency andincreased performance, but if jobs becometoo specialized and boring, performance
can decrease. DepartmentalizationGrouping of related
activities into units.
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Principles of Organization
Chain of Command
Line of authority from the top to the
bottom of the organization.
Tells you who your boss is and who to go to
for help.
To work quickly, employees at all levels
need to communicate directly, and who the
boss is can change according to the task to
be performed.6-22
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Principles of Organization
Span of Management
It is the number of employees reporting to
a manager.
The number of employees reporting to one
manager affects the number of levels of
managers.
With downsizing, the trend has clearly been
to increase the span of management.
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Span of Management
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Principles of Organization
Delegation
- Appointing a person to act on one's behalf.
- Delegation is the entrusting of authority, power
and responsibility to another.
-Makes work easier.
-Improves efficiency.
-Increases employee effectiveness.
-Develops employees.
-Ensures that the right people do the right jobs.
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Principles of Organization
Centralized and Decentralized Authority
With centralized authority, top managers
make important decisions.
With decentralized authority, middle and
first-line managers make important
decisions where the action is.
Decentralization allows more input into
decision making and greater employee
commitment to carrying out the decisions.6-26
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Principles of Organization
Empowerment
The process of giving employees at all levels in the
organization the authority to make decisions, be
responsible for their outcomes, improve quality,and cut costs
Empowerment increases a managers ability to get
things done
Empowerment increases workers involvement,
motivation, and commitment
Empowerment gives managers more time to
concentrate on their pressing concerns
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Exhibit 6.2 - Organization Chart
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Common Types of
Departmentalization
Functional Departmentalization
Involves organizing departments around essential
input activities, such as production and
operations, finance and accounting, marketingand sales, human resources.
Product (Service) Departmentalization
Involves organizing departments around goodsand services provided.
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Common Types of
Departmentalization
Customer Departmentalization
Involves organizing departments around the
needs of different types of customers.
Territory (Geographic) Departmentalization
Involves organizing departments in each area in
which the enterprise does business.
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Common Types of
Departmentalization
Divisional Departmentalization (Subsidiary)
The firm develops independent lines of business
that operate as separate companies, all
contributing to the corporation profitability.
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Common Types of
Departmentalization
Matrix Departmentalization
Combines the functional and product
departmentalization structures.
Its flexibility is a major advantage.
Combination
Many large companies have more than one form
of departmentalization.
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Matrix Structure
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Multi-base Departmentalization
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Contemporary Organization
Team organizations and reengineering
Contemporary organizations are using teamsas a
central coordinating organizational principle.
The coordinating focus is horizontal rather than
vertical.
Cross-functional teams have members from
different departments to coordinate tasksbetween departments.
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Contemporary Organization
Virtual organizations
Outsources major business functions and focuses
on core competencies.
Core competencies are the functions an
organization does well.
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Contemporary Organization
e-Organizations
Use e-business.
Communicate over the Internet, Intranets, and
Extranets.
All employees can quickly and easily get
information from sources both inside and outside
the organization to break down boundary barriers.
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Organizational Structure
Mechanistic Structure
Division of work
Bureaucratic
Multiple and strict levels of authority
Supports people as well as suppresses them
Strong in task support
Unidirectional communication
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Organizational Structure
Organic Structure
Decline in use of structure
Organic, flexible structures
Multidirectional communication
Joint problem solving
Tasks not defined well enough to become routine
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