BUS 101//Chapter 8: Structuring Organizations for Today's Challenges

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.

Virtual Corporation

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

Organization Chart

A visual device that shows relationships among people and divides the organization's work; it shoes 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-staff structure.

Decentralized Authority

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

Centralized Authority

An organization structure in which decision-making is maintained at the top level of management.

Flat Organization Structure

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

Line Organization

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

Inverted Organization

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

Bureaucracy

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

Tall Organization Structure

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

Benchmarking

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

Staff Personnel

Employees who advise and assist personnel in meeting their goals.

Line Personnel

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

Departmentalization

The dividing of organizational functions into separate units.

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.

Formal Organization

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

Informal Organization

The system that develops spontaneously as employees meet and form cliques, relationships, and lines of authority outside the formal organization.

Core Competencies

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

Networking

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

Organizational (or corporate) Culture

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

Digital Natives

Young people who have grown up using the digital internet and social networking.

Restructuring

Redesigning an organization so that it can more effectively serve its customers.

Chain of Command

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