Business Ch 8

1- centralization vs decentralization 2- breadth of span of control 3- tall versus flat organizational structures 4- type of departmentalization

What are the four major choices in structuring organizations?

Matrix organizations assign people to projects temporarily and encourage inter-organizational cooperation and teamwork. Cross-functional self-managed teams have all the benefits of the matrix style and are long term.

What are the key alternatives to the major organizational models?

Departments are often replaced or supplemented by matrix organizations and cross-functional teams the decentralize authority. the span of control becomes larger as employees become self-directed. Another trend is to eliminate managers and flatten organizations.

What are the latest trends in structuring?

- Unity of management- - Hierarchy of authority - Division of labor - Subordination of individual interest to the general interest - Authority - Degree if centralization - Clear communication channels - Order - Equity - Esprit de corps

What are the principles of management outlined by Fayol?

Structuring an organization means devising a division of labor (sometimes resulting in specialization), setting up teams or departments , and assigning responsibility and authority. It includes allocating resources (such as funds) , assigning specific tasks, and establishing procedures for accomplishing the organizational objectives. Managers also have to make ethical decisions about how to treat workers.

What are the principles of organizational management?

1- line organization 2- line-and-staff organizations A line organization has clearly defined responsibility and authority, is easy to understand, and provides each worker with only one supervisor. The expert advice of staff assistants in a line-and-staff organization helps in areas such as safety, quality control, computer technology, human resource management, and investing.

What are the two major organizational models?

A firm can departmentalize by function- such as design, production, marketing, and accounting.

What are the various ways a firm can departmentalize?

Weber added : - Job descriptions - Written rules, decision guidelines and detailed records - Consistent procedures, regulations, and policies - Staffing and promotion based on qualifications.

What did Weber add to the principles of Fayol?

Division of labor means dividing up the task among different people and job specialization means a job composed of a small part of a larger task or process.

What do the terms division of labor and job specialization mean?

A inverted organization places employees at the top of the hierarchy; managers are at the bottom to train and assist employees.

What is an inverted organization?

An organization that has contacted people at the top and the chief executive officer at the bottom of the organization chart.

What is an inverted organization?

they are adjusting to changing markets. that is a normal function in a capitalist economy. There will be big winners, like Google and Facebook, and big losers as well. The key to success is remaining flexible and adapting to the changing times.

What is happening today to American Businesses?

Organizational (or corporate) culture consists of the widely share values within an organization that foster unity and cooperation to achieve common goals.

What is organizational culture?

Organizational culture is a system of shared assumptions, values, and beliefs, which governs how people behave in organizations. These shared values have a strong influence on the people in the organization and dictate ho they dress, act, and perform their jobs.

What is organizational culture?

A major difference is authority, line personnel have formal authority to make policy decisions. Staff personnel have authority to advise line personnel and influence their decisions, but they can't make policy changes themselves. Line manager may seek or ignore the advice from staff personnel.

What is the difference between line and staff personnel?

cross-functional self-managed teams

groups of employees from different departments who work together on a long-term basis

networking

using communications technology and other means to link organizations and allow them to work together on common objectives

mass production

Process of making large quantities of a product quickly and cheaply

Narrow span of control means more control by top management, more chances for advancement, greater specialization, closer supervision.

What are some reasons for having a narrow span of control in an organization?

Advantages of Departmentalization include better adaptation to customer wants, more empowerment of workers, faster decision making , and higher morale disadvantages include; less efficiency, complex distribution system, less top-management control, weakened corporate image.

What are the advantages and disadvantages of departmentalization?

advantages: - it gives managers flexibility in assigning people to projects - it encourages interoranizational cooperation and teamwork - It can produce creative solutions to product development problems - It makes efficient use of organizational resources Disadvantages: - its costly and complex - it can confuse employees about where their loyalty belongs-with the project manager or with their functional unit. - it requires good interpersonal skills as well as cooperative employees and managers to avoid communication problems - it may be only temporary solution to a long-term problem.

What are the advantages and disadvantages of the matrix structure?

Networking uses communications technology and other means to link organizations and allow them to work together on common objectives. A virtual corporation is a networked organization of replaceable firms that join and leave as needed. Benchmarking tells firms how their performance measures up to that of their competitors in specific functions. The company may then outsource to companies that perform its weaker functions more effectively and efficiently. the functions that are left are the firm's core competencies.

What are the major concepts involved in interfirm communications?

Job Specialization

a job composed of a small part of a larger task or process

division of labor

dividing up the task among different people

staff personnel

employees who advise and assist line personnel in meeting their goals

Oraganizing

structuring

departmentalization

the dividing of organizational functions into separate units

organizational (or corporate) culture

widely shared values within an organization that provide unity and cooperation to achieve common goals

hierarchy

A system in which one person is at the top of the organization and there is a ranked or sequential ordering from the top down of managers who are responsible to that person.

Organization chart

A visual device that shows relationships among people and divides the organization's work; it shows who is accountable for the completion of specific work and who reports to whom

Matrix organization

An organization in which specialists from different parts of the organization are brought together to work on specific projects but still remain part of a line-and-staff structure.

Decentralized authority

An organization structure in which decision-making authority is delegated to lower-level managers more familiar with local conditions than headquarters management could be.

Line organization

An organization that has direct two-way lines of responsibility, authority, and communication running from the top to the bottom of the organization, with all people reporting to only one supervisor.

Bureaucracy

An organization with many layers of managers who set rules and regulations and oversee all decisions.

Centralized authority

An organizational structure in which decision-making authority is maintained at the top level of management at the company's headquarters .

benchmarking

Comparing an organization's practices, processes, and products against the world's best.

Line personnel

Employees who are part of the chain of command that is responsible for achieving organizational goals

Formal organization

The structure that details lines of responsibility, authority, and position; that is, the structure shown on organization charts.

the formal organization details lines of responsibility , authority, and position. It's the structure shown on organization charts. The informal orgnaization is the system that develops spontaneously as employees meet and form cliques, relationships, and lines of authority outside the formal organization. It's the human side of the organization. The informal organization is an invaluable managerial asset that often promotes harmony among workers and establishes the corporate culture. As effective as the informal organization may be in creating group cooperation, it can still be equally powerful n resisting management directives.

What is the difference between the formal and informal organization of a firm?

Cross-functional teams tend to be long-lived as compared to the temporary and fluid nature of teams in a matrix-style organization.

What is the main difference between a matrix-style organization's structure and the use of cross-functional teams?

The flexibility inherent in the matrix-style organization directly challenges the rigid line and line-and-staff organization structure.

What management principle does a matrix-style organization challenge?

1- centralization vs decentralization 2- span of control 3- tall vs flat organizational structure 4- departmentalization

What organizational issues does make?

Weber added principles of bureaucracy such as job descriptions, written rules and decision guidelines, consistent procedures, and staffing and promotions based on qualifications.

What principles did Weber add?

Fayol introduced principles such as unity of command, hierarchy of authority, division of labor, subordination of individual interests to the general interest, authority, clear communication channels, order, and equity.

What were Fayol's basic principles?

an economic theoretician that published a book called General and Industrial Management in 1919.

Who was Henry Fayol?

wrote the book The Theory of Social and Economic Organizations in the US in the 1940s. a German sociologist and economist and promoted the pyramid-shaped organizational structure that became popular in large firms.

Who was Max Weber?

organizations are becoming flatter to try to match the friendliness of small firms, whose workers often know customers by name. the flatter the organization the broader the span of control.

Why are organizations becoming flatter?

To keep up with the market and technology advances.

Why do organizations outsource functions?

virtual corporation

a temporary networked organization made up of replaceable firms that join and leave as needed

Flat organizational structure

an organization structure that has few layers of management and a broad span of control

inverted organization

an organization that has contact people at the top and the chief executive officer at the bottom of the organization chart

tall organizational structure

an organizational structure in which the pyramidal organization chart would be quite tall because of the various levels of management

restructuring

redesigning an organization so that it can more effectively and efficiently serve its customers

chain of command

the line of authority that moves from the top of a hierarchy to the lowest level

span of control

the optimal number of subordinates a manager supervises or should supervise

real time

the present moment or the actual time in which something takes place

economies of scale

the situation in which companies can reduce their production costs if they can purchase raw materials in bulk; the average cost of goods goes down as production levels increase.

informal organization

the system that develops spontaneously as employees meet and form cliques, relationships, and lines of authority outside the formal organization; that is, the human side of the organization that does not appear on any organization chart.

core competencies

those functions that the organization can do as well as or better than any other organization in the world

digital natives

young people who have grown up using the internet and social networking