organizing presentation

Organizing

Contents

Organizing Henry Fayol’s 14 Principles Of Management Organizational Structure Division Of Work Departmentalization Chain Of Command Authority Delegation Coordination Decentralization And Centralization

Organizing Organizing is the process of arranging and allocating work,

authority, and resources among an organization’s members so they can achieve an organization’s goal efficiently.

-Stoner & Freeman

Henry Fayol’s 14 Principles Of Management Division of work – Tasks are distributed to qualified and

competent workers or when people do specialize. Authority – Managers have the rights to command and give

orders to their subordinates. Discipline – Members in any organization have to respect the

rules and agreements governing it. Respect and obedience to rules is embodied in the conduct of good life and discipline.

Unity of command – Employees must receive instruction only from one person. Reporting to more than one manager results to conflict in instruction and confusion of authority.

Henry Fayol’s 14 Principles Of Management Unity of direction – Operations within any organization

having the same objective must be directed by only manager using one plan.

Subordination of individual interest – Individual interest must be subordinate to general interest when there is conflict between the two. The agreement between the employers and the employees should be fair and there should be constant vigilance and supervision.

Remuneration – Compensation for work done should be fair to both employers and employees.

Centralization – Decreasing the role of subordinates in decision making. Managers should retain their final responsibility, while at the same time give their subordinates to do their job properly.

Henry Fayol’s 14 Principles Of Management Scalar chain – The line of authority in any organization turns

in the order of rand from top management to the lowest level of the enterprise.

Order – Either material or human resources should be in the right place at the right time. People should be in the jobs or positions they are suited to.

Equity – Equity is combination of justice and kindness Equity in treatment and behaviour is liked by everyone and it brings loyalty in the organization. This brings cordial relation between the management and labour.

Stability of tenure of personal – Employees work better if job security and career progress are assured to them. A high employee turnover rate will affect the organization

Henry Fayol’s 14 Principles Of Management Initiative – Managers should encourage their employees for

taking initiative within limits of authority and discipline Initiative increases the zeal and energy on the part of human beings Fayols describes initiative as one of the keenest satisfactions for an intelligent man to experience.

Team spirit (Esprit de Corps) – Teamwork is fundamentally important to an organization work teams and extensive face to face verbal communication encourages team work.

Organizational Structure Organizational structure refers to the way in which an organization’s

activities are divided, organized, and coordinated. Ernest Dale’s description of organizing as a five step process

provides a good frame work for our discussion. List the work that needs to be done to accomplish organization

goals. Divide the total work load into tasks that can logically and

comfortably be performed by individuals or groups. Combine tasks in a logical and efficient manner. Setup mechanisms for coordination. This integration of individual,

group, and department efforts makes it easier to achieve goals. Monitor the organizational structure’s effectiveness and make

adjustment as needed.

Division of Work The breakdown of a complex task into components so that

individuals are responsible for a limited set of activities instead of the task as a whole.

For an example, describing the work in a pin factory, one man draws the wire, another straightens it, a third cuts it, a fourth points it, and a fifth grinds it at the top for receiving the head. Ten men are working in this fashion, they can make 48,000 pins in one day. But if they had all wrought separately and independently, each might at best have produced 20 pins a day.

Advantages of Division of Work The great advantage of the division of labour was that by

breaking the total job down into small, simple, separate operations in which each worker could specialize, total productivity was multiplied geometrically.

Second, transfer time between tasks decreases. If employees perform several different tasks, sometime is lost as they stop doing the first task and start doing the next.

Third, the more narrowly defined a job is, the easier it is to develop specialized equipment to assist with that job.

Fourth, when an employee who performs a highly specialized job is absent or resigns, the manager is able to train someone new at relatively low cost.

Disadvantages of Division of Work Boredom and absenteeism may rise when a specialized task

becomes repetitious and personally unsatisfying. The job may be so specialized that it offers no challenge or

stimulation. Boredom and monotony set in, absenteeism rises, and the

quality of the work may suffer Increased dependence Danger of Unemployment

Alternatives to Specialization Job Rotation

Job rotation involves systematically moving employees from one job to another.

Jobs that are amenable to rotation tend to be relatively standard and routine. Workers who are rotated to a "new" job may be more satisfied at first, but satisfaction soon wanes. Although many companies have tried job rotation, it is most often used today as a training device to improve worker skills and flexibility.

Alternatives to Specialization Job Enlargement

An alternative to job specialization that involves giving the employee more tasks to perform.

Job enlargement was developed to increase the total number of tasks workers perform. As a result, all workers perform a wide variety of tasks, which presumably reduces the level of job dissatisfaction.

Alternatives to Specialization Job Enrichment

An alternative to job specialization that involves increasing both the number of tasks the worker does and the control the worker has over the job.

To implement job enrichment, managers remove some controls from the job, delegate more authority to employees, and structure the work in complete, natural units.

Alternatives to Specialization Job Characteristics Approach

An alternative to job specialization that suggests that jobs should be diagnosed and improved along five core dimensions, taking into account both the work system and employee preferences.

Alternatives to Specialization Job characteristics approach suggests that jobs should be

diagnosed and improved along five core dimensions1. Skill variety, the number of things a person does in a job2. Task identity, the extent to which the worker does a

complete or identifiable portion of the total job3. Task significance, the perceived importance of the task4. Autonomy, the degree of control the worker has over how

the work is performed5. Feedback, the extent to which the worker knows how well

the job is being performed

Alternatives to Specialization

Core job dimensions

Critical psychological

statesPersonal and work

outcomes

Skill variety Task identity Task

significance

Autonomy

Feedback

Experienced meaningfulness of

the work

Experienced responsibility for outcomes of the

workKnowledge of the actual results of work activities

High internal work motivation

High-quality work performance

High satisfaction with the work

Low absenteeism and turnover

Employee growth-need strength

Job Characteristics Model

Alternatives to Specialization Work Teams

An alternative to job specialization that allows an entire group to design the work system it will use to perform an interrelated set of tasks.

Under this arrangement, a group is given responsibility for designing the work system to be used in performing an interrelated set of tasks.

Departmentalization The process of grouping jobs according to some logical

arrangement or the grouping into departments of work activities that are similar and logically connected.

Common Bases for Departmentalization Functional Departmentalization – It is perhaps the most

logical and basic form of departmentalization. It groups together those jobs involving the same or similar activities.

Plant ManagerManager, Engineeri

ng

Manager, Accountin

g

Manager, Manufact

uring

Manager, Human

Resources

Manager, Purchasin

g

Common Bases for Departmentalization Product Departmentalization – It involves grouping and

arranging activities around products or product groups. The organization of a company into divisions that bring together all those involved with a certain type of product.

President

Vice President,

Research & Development

Vice President, Marketing

Vice President, Production

Vice President, Finance

Vice President,

Pharmaceutical Products

Vice President, Proprietary Products

Vice President, Personal –

Care Products

Common Bases for Departmentalization Geographical Departmentalization – It groups jobs on the

basis of defined geographic sites or areas. The defined sites or areas may range in size from a hemisphere to only a few blocks of a large city.

Vice President for SalesSales Director, Western Region

Sales Director, Southern Region

Sales Director,

North Region

Sales Director, Eastern Region

Common Bases for Departmentalization Customer Departmentalization – It is a grouping activities

to respond to and interact with specific customers or customer groups. Under customer departmentalization, the organization structures its activities to respond to and interact with specific customers or customer groups

Director of SalesManager, Retail

AccountsManager,

Wholesale AccountsManager,

Government Accounts

Common Bases for Departmentalization Matrix Departmentalization – Matrix management

structures combine functional and product departmentalization. They simultaneously organize part of a company along product or project lines and part of it around functional lines to get the advantages of both.President CEO

Marketing

Product Manager

Product Manager

Laboratory

Product Manager Process

Product Manager

Pharmaceutcial

Engineering

Engineering Employee 1




Research

Research Employee 1

Research Employee 2

Research Employee 3

Research Employee 4

Manufacturing

Manufacturing Employee 1




Materials

Materials Employee 1




SPAN OF MANAGEMENT OR SPAN OF CONTROL

Span of Management or Span of Control can be defined as the number of subordinates reporting directly to a given manager.

Choosing an appropriate span of management is important for two reasons: First, it affects efficiency. Too wide a span may mean that

managers are overextended and subordinates are receiving too little guidance or control. In contrast, too narrow span may mean that managers are underutilized.

Second, span of management create tall organizational structure with many levels between the highest and lowest manager. Wide spans, in contrast, create flat organizational structure, with fewer management levels between top and bottom.

Tall organizational structure Vs. Flat organizational structure

CEO

CEO

Tall organizational structure

Flat organizational structure

Factors influencing the span of management Competence of supervisor and subordinates (the greater the competence,

the wider the potential span) Physical dispersion of subordinates (the greater the dispersion, the

narrower the potential span) Extent of nonsupervisory work in manager's job (the more nonsupervisory

work, the narrower the potential span) Degree of required interaction (the less required interaction, the wider the

potential span) Extent of standardized procedures (the more procedures, the wider the

potential span) Similarity of tasks being supervised (the more similar the tasks, the wider

the potential span) Frequency of new problems (the higher the frequency, the narrower the

potential span) Preferences of supervisors and subordinates

Chain of Command Chain of command is a clear and distinct line of authority

among the positions in an organization. The chain of command actually has two components.

The first, called unity of command, suggests that each person within an organization must have a clear reporting relationship to one and only one boss.

The second, called the scalar principle, suggests that there must be a clear and unbroken line of authority that extends from the lowest to the highest position in the organization.

Authority

Authority is power that has been legitimized by the organization. It refers to the rights inherent in a managerial position to tell people what to do and to expect them to do it.

Delegation Delegation is the establishment of a pattern of authority

between a superior and one or more subordinates. Specifically, delegation is the process by which managers assign a portion of their total workload to others.

Advantages of Delegation More task manager are able to delegate, the more opportunity

they have to seek and accept increased responsibilities from higher level managers.

It frequently leads to better decisions. It speeds up decision making. It improves their self-confidence and willingness to take

initiative. Barriers to Delegation

Many manager are as reluctant to delegate authority as subordinates are to accept it.

Insecurity and confusion about who is ultimately responsible for specific tasks.

Fear that delegating authority to a subordinates reduces their own their own authority.

Coordination Coordination is the process of integrating the objectives and

activities of separate work units (department or functional areas) in order to realize the organization’s goals effectively.

Decentralization and Centralization Decentralization

Decentralization is the delegation of power and authority from higher to lower levels of the organization, often accomplished by the creation of small, self-contained organizational units.

There is more decentralization the more that lower-level employees provide input or actually make decisions.

Centralization Centralization is the process of systematically retaining

power and authority in the hands of higher-level managers.

Factors determine an organization’s position on the decentralization and centralization

Organization’s external environment History of the organization The nature of the decisions being made is also considered. The

costlier and riskier the decisions, the more pressure there is to centralize.

Abilities of lower-level managers

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