Business Management Chapter 9
advantages of departmentalization by product
- allows people to specialize in one area of expertise - makes its easier to asses performance - makes decision making faster
advantages of departmentalization by function
- allows work to be done by highly qualified specialists - lowers cost by reducing duplication - makes communication and coordination easier
disadvantages of departmentalization by function
- cross department coordination can be difficult - slower decision making
disadvantages of departmentalization by product
- duplication - coordination across different product departments
disadvantages of departmentalization by geographic
- duplication of resources - difficult to coordinate departments
disadvantages of departmentalization by customer
- duplication of resources - might please customers but hurt business
advantages of departmentalization by customer
- focuses on customer needs - allows companies to specialize products and service to customer needs
advantages of departmentalization by geographic
- helps companies respond to different markets - reduce cost by locating resources closer to customer
disadvantages of departmentalization by matrix
- high level of coordination - most employees will report to 2 bosses - complexity of ongoing projects
advantages of departmentalization by matrix
- more efficient with large complex task
staff authority
right to advise but not command
line authority
right to command immediate subordinates in the chain of command
authority
right to give commands, take actions, and make decisions to achieve organizational objectives
line function
an activity that contributes directly to creating or selling the companies products
organizational process
collection of activities that transforms inputs into outputs that customers value
delegation of authority
direct authority and responsibility to a subordinate to complete tasks for which the manager is normally responsible
staff function
does not contribute directly to creating/ selling the companies products but supports line activity
simple matrix
managers in different parts negotiate conflicts and resources directly
departmentalization
method of subdividing work and workers into separate units
departmentalization by matrix
organizational structure in which 2 or more forms of departmentalization are used together
departmentalization by geographic location
organizes work and workers in particular geographic areas
departmentalization by function
organizes work and workers into functional areas of expertise
departmentalization by customer
organizes work and workers into separate units based on the kind of customer
departmentalization by product
organizes work and workers into units based on a particular product or service
complex matrix
specialized matrix managers and departments are added to the organizational structure to help sort out conflicts and problems
organizational structure
vertical and horizontal configuration of departments, authority, and jobs within a company
chain of command
vertical line of authority that clarifies who reports to who throughout the organization
unity of command
workers should report to just one boss to prevent confusion and conflict
