principles of management unit 3 organizing
TRANSCRIPT
Prepared and presented by,
N . Ganesha Pandian,
Assistant professor,
Madurai School of Management
BA 5102 Principles of
Management
Unit 3: Organizing
Contents
Nature and purpose of organizing
Organization structure
Line and staff authority
Departmentation
Span of control
Centralization and decentralization
Delegation of authority
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Contents
Staffing
Selection and Recruitment
Career development
Career Stages
Training
Performance appraisal MSM - MBA content prepared by Ganesha
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Why do we organize
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Why organization role?
Verifiable objectives
A clear idea of major duties or activities
involved
Authority to whom the accomplished tasks
were reported
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What is organizing
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The term organizing means a formalized
intentional structure of roles and position.
Two types of organization: Formal and
Informal organization
Organizational division
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Organizational division or Department - it
designates any area, division or branch where
the authority assigned for the performance of
specified activities.
The span of management – the number of
persons limited to numbers managed by a
supervisor
Contd…
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Two types: Narrow span of managementand wide span of management
Narrow span of management:
Advantages:
1. Close supervision and control
2. Fast communication
Disadvantages:
1. many levels of management
2. High cost due to many levels
Contd…
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Wide span of Management:
Advantages:
1. Superiors are forced to delegate
2. Sub ordinates carefully watched
Disadvantages:
1. Tendency of overload
2. Danger of loss of control
Diagram of Narrow and Wide span of
organization structure
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Problems of organization levels
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Communication may be distorted or manipulated
Greater the organization structure then greater
the costs involved
Level of Co-ordination is needed – proper
functioning of org.
Division of activities lacks co-ordination
Re- Engineering the organization
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Hammer and Champy define re-
engineering as “the fundamental
rethinking and radical redesign of
business process to achieve dramatic
improvement in terms of performance”.
What is Re- engineering?
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Revamping of old procedures, systems and
outdated technology
New thinking – provide new perspective about
the management.
In place of customers meeting too many
people to get work done – replaced with
single time transaction
Logic of Organizing
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Precise organizational objective
Support Formulating objectives, plans and
policies
grouping of activities to be accomplished
Delegation of authority
Identification, analysis and classification of
activities to be done.
Departmentation
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Department by Enterprise function – based on the
functions of an organization.
Department by Territory or Geography – grouping of
activities based on Geographic area
Departmentation by Customer grouping – reflects a
primary interest in customers.
Departmentation by product – according to products
or product lines
Matrix organization
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Also called as Matrix or Grid Organization
Combining functional and project or product
pattern of Departmentation in same organization
Commonly used in Engineering and Research
and Development
Strategic Business Units (SBU’s)
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In larger MNC and corporate companies product lines
are handled separately as a Unit.
An independent company under a roof of common
seal
SBU manager is responsible for all the functional
activities Like
Marketing
Finance
Packing
Distributing
R&D
Virtual organization
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- a rather loose concept – group of
independent firms or people connected
with the help IT
Pushed after the digitalization and IT
revolution
Line/Staff and Functional
Authority
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Power – ability of individual in changing the
belief and actions of the group
Authority – right in position to exercise the
discretion in decision making
Power – Referent power, legitimate power,
reward power and Coercive power.
Empowerment
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Means that employee, managers, or teams at
all levels – given with the power to make
decisions without prior permission
Power, Responsibility and Empowerment
were related to one another
Empowerment – also called as worker’s
participation and employee engagement
Line or Staff concepts
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Scalar principle – there is a flow of the chain
from the top level supervisors to the low rank
employees
This principle stresses on more clearer the
line, more effective the organization
Staff relationship is advisory in organization
structure
It is the relationship of superior exercise their
Functional Authority
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- it is the right delegated to an individual
or to a department to control specified
processes, practices, policies or other
matters – exclusively undertaken by
other department
Line and staff Authority
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Centralization and
Decentralization
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This deals with the dispersion of
authority in organization
Decentralization – tendency to disperse
the decision making authority
Complete decentralization would cease
the work of manager
Different kinds of centralization
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Centralization of performance - based
on geographical location
Departmental centralization – based on
specialized activity
Centralization of Management –
tendency to restrict delegation of
decision making.
Delegation of Authority
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Superior gives the sub-ordinate the
discretion of decision making –
”Delegation of Authority”
In order to get work done from the sub-
ordinate the superiors has to delegate
some authority to the sub-ordinates.
Delegation of authority – an art
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Ineffective in delegating the authority to sub-
ordinate may be caused by many factors.
Some of the personal attitude of the Sub-ordinate
may influence such as:
1. Receptiveness
2. Willingness to let go
3. Willingness to allow mistakes by sub-ordinates
4. Willingness to establish and use broad control
Overcoming weak delegation
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1. Define assignments and delegate authority
(for expected results)
2. Select the person (job to be done)
3. Maintain open lines of communication
4. Establish proper control
5. Reward effective delegation
Recentralization of Authority
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- centralization of already decentralized
authority – not whole withdrawal
For effective management of sub-
ordinates : some control were backed
with the manager
Organization structure and
culture
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Organization structure to an extent influence the
organizational culture.
Culture is a set of norms and values to be followed by
particular group of people.
Positive organization culture will increase the
productivity, morale and value of the organization
Whereas Negative Organization culture will detoriate
all the above said.
Staffing - a managerial function
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Staffing – personnel management –
importance of measuring the human assets
Staffing defined as filling, keeping filled and
positions in the organization structure.
Performance appraisal, recruitment, selection,
career planning, compensation and training
are some of the functions of staffing.
Factors affecting staffing
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Head hunt depends on the
1, turnover rate
2, Expansion plan
3, complexity of organization
Demand and supply of Managers
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The management inventory
Inventory contains the details of the employees
potential to the managerial position.
Management inventory chart helps an
organization to promote the potential
candidate to the managerial position
Personnel action based on demand
and supply matrix
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High Low
High Selection
Placement
Promotion
Training and
development
Recruitment
Low Layoffs
Demotions
Early
retirement
Training and
development
if exp. In
future
Dem
and f
or
managers
Supply for managers
Situational factors affecting staffing
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Affected by many environmental factors such as
Legal
Political
Socio-cultural
Economical
Equal employment opportunity
Women in management
Diversity in workplace
Internal environment
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Promotion from within
Promotion from within in large companies
The policy of open competition
Responsibility for staffing
Selection
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Position requirement and job design
1. Identifying job requirements
2. Appropriate scope of the job
3. Meeting managerial skills required by job design
Job design
1. Design of jobs for individuals and work teams
2. Factors influencing job design
Skills and personal characteristics
needed in manager
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Analytical and problem solving abilities
Personal characteristics
1. Desire to manage
2. Communication skills and empathy
3. Integrity and honesty
4. Past performance as manager
Recruitment and selection
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Recruitment - attracting candidates to fill the
positions in the organization structure
Selection – choosing the right candidate for the job
Selection process – reliable and valid
Interviews
Tests – intelligent test, proficiency and aptitude test,
vocational test and personality test.
Assessment centers
Orientation and socialization
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Orientation – introduction of the new
employees into the job.
Large firms have a formal orientation program
explains the culture, history, functions, tasks
and people of the company
Socialization is the process of making the
employee formalized with the process of the
company.
Performance appraisal
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Measuring the performance of the
accomplished goals and plans as well as
performance as manager.
1. Performance in accomplishing goals
2. Performance as managers
Different views on Appraisal
issues
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Subjective versus objective evaluation
Judging Vs self-appraisal
Assessing past performance Vs future
development
Kinds of performance reviews
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A comprehensive review
Progress or periodic review
Continuous monitoring
Performance appraisal in
organization
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Some of the popular performance appraisal
methods are:
Assessment Centre Method
Behaviourally Anchored Rating Scale
Critical Incident Technique
Essay Evaluation
Human Asset Accounting Method
Management By Objective
Paired Comparison Method
Rating Scale
Career stages
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Training
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Training is a process of learning a sequence of
programmed behavior.
It is the application of knowledge & gives people
an awareness of rules & procedures to guide their
behavior
It helps in bringing about positive change in the
knowledge, skills & attitudes of employees.
References
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1. Koontz, H. (2012). Essentials Of
management: an international and
leadership perspective. New Delhi: McGraw-
Hill.