MGMT Test 3- Ch 10: Designing Organization Strucuture

Less Supervision (large spans of control) depends on:

-Work is stable and routine - Subordinates perform similar work - Subordinates are in one location - Subordinates are highly trained - Rules and Procedures are defined - Support Systems and personnel are available - Few nonsupervisory activities - Managers prefer a large span of control

Organization structure includes:

1)the set of formal tasks assigned to individuals and departments; 2)formal reporting relationships, including lines of authority, decision responsibility, number of hierarchical levels, and span of managers' control; and 3)the design of systems to ensure effective coordination of employees across departments.

Authority is distinguished by 3 characteristics:

1. Authority is vested in organizational positions, not people 2. Authority flows down the vertical hierarchy 3. Authority is accepted by subordinates

Diverse departments are brought together to produce a single organizational output, whether it is a product, a program, or a service to a single customer.

Divisional

Positions are grouped into departments based on similar skills, expertise, work activities and resource use

Functional

Once people are departmentalized into separate departments

Need for Coordination

What are the two underlying principles associated with Chain of Command?

Unity of Command and ScaLAR pRINCIPLE

Scalar Principle

a clearly defined line of authority in the organization that includes all employees.

Project Manager is not

a member of one of the departments being coordinated

Staff authority

authority that includes the right to advise, recommend and counsel in the staff specialists area of expertise

Departmentalization

basis for grouping positions into departments ad departments into total organizations

Cross Functional Teams

consist of employees from various functional departments who are responsible to meet as a a team and resolve mutual problems

When organizations face new strategic issues, managers often

create new positions or departments to deal with them

decentralization

decision authority is pushed downward to lower organization levels.

Span of control

determines how closely a supervisor can monitor subordinates.

For organizations to function well:

everyone needs to know what they are accountable for and accept the responsibility and authority for performing it.

5 Approaches to Departmentalization

functional, divisional, matrix, team, virtual network

Team Approach

gives managers a way to delegate authority, push responsibility to lower levels, and be more flexible and responsive in a complex and competitive global environment - Cross Functional Teams

Centralization and decentralization pertain to the

hierarchical level at which decisions are made

Strategy

how to achieve goals, and organizing defines how it will be done in terms of resources

Authority

is the formal and legitimate right of a manager to make decisions, issue orders, and allocate resources to achieve organizationally desired outcomes.

Collaboration

joint effort between people from two or more departments to produce outcomes that meet a common goal or shared purpose and that are typically greater than what could be achieved working alone- to achieve synergy

Line Authority

managers have formal authority to direct and control immediate subordinates- connected via a line in the org chart

Centralization

means that decision authority is located near the top of the organization.

Unity of Command

means that each employee is held accountable to only one supervisor

Accountability

means that people with authority and responsibility are subject to reporting and justifying task outcomes to those above them in the chain of command.

Factors that influence centralization:

o Rapid change and uncertainty in the environment are associated with decentralization o Crisis requires centralization o Fits the strategy

The characteristics of vertical structure are portrayed in an

organization chart

Project Manager

person who is responsible for coordinating the activities of several departments for the completion of a specific project

Span of management is also called

span of control

Tall Structure

span of management is narrow and therefore has many hierarchical levels, many layers of management

Flat Structure

span of management is wide and therefore has few hierarchal levels, fewer layers of management

Task Force

temporary team or committee designed to solve a problem involving several departments

Division of Labor/Work Specialization

the degree to which organizational tasks are subdivided into separate jobs

Organizing

the deployment of organizational resources to achieve strategic goals

Responsibility

the duty to perform the task or activity as assigned

responsibility

the duty to perform the task or activity as assigned

Functional Structure

the grouping of activities by common function from the bottom to the top of the organization

Coordination

the managerial task of collaborating across departments

Span of management

the number of employees reporting to a supervisor

virtual network structure

the organization subcontracts most of its major functions to separate companies and coordinates their activities from a small headquarters organization.

Delegation

the process that managers use to transfer authority and responsibility down the hierarchy

Division of Labor: Employees within each department only perform tasks relevant to

their specialized function

Chain of Command

unbroken line of authority that links all employees in an organization and shows who reports to whom.

accountability

willingness or obligation to accept responsibility

managers are assigned authority commensurate

with their responsibilities

Matrix Approach

· combines both functional and divisional approaches simultaneously, in the same part of the organization - Improves coordination and information

Divisional Structure

· departments are grouped together based on similar organizational outputs such as product/service OR. could base on geographic