Chapter 8
Why is benchmarking important
-Allows companies to focus on core competencies and offshore jobs it can't do well
Decentralized span of control advantages
-Better adaption to customer wants -Empowerment -Faster decision making -Higher morals
What is the traditional way to departmentalize
-By function-such as design, production, marketing, and accounting, and groups workers according to their skills, expertise, or resource use so that they can specialize and work together more effectively. -It may also save costs and thus improve efficiency.
What are the disadvantages of departmentalization?
-Departments may not communicate well. -Employees may identify with their department's goals rather than the organization's. -The company's response to external changes may be slow. -People may not be trained to take different managerial responsibilities;rather, they tend to become narrow specialists. -Department members may engage in groupthink(they think alike)
What do the terms division of labor and job specialization mean
-Division of Labor: Determining what work needs to be done and then dividing up the tasks -Job Specialization: Divides tasks into smaller jobs. Many jobs can be done quickly and well when each person specializes.
Decentralized span of control disadvantages
-Less efficiency -Complex distribution system -Less top-management control -Weakened corporate image
Disadvantages of centralized span of control
-Less responsive -Less empowerment -Interorganizational conflict
What is the main difference between a matrix-style organization's structure and the use of cross functional teams?
-Matrix style structure: 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. -Cross functional teams: Same benefit's but long term
Advantages of centralized span of control
-More efficiency -Simpler distribution system -Stronger brand/corporate image -Greater top management control
What is the difference between the formal and informal organization of a firm
-The formal organization details lines of responsibility, authority, and position. It's the structure shown on organization charts. -The informal organization 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 corporate culture.
What is an organizational culture
Consists of the widely shared values within an organization that foster unity and cooperation to achieve common goals.
What are the latest trends in structuring
Departments are often replaced or supplemented by matrix organizations and cross-functional teams that decentralize authority. The span of control becomes larger as employees become self-directed.
What are the principles of organizational management:
Devising a division of labor, departmentalization, and assigning responsibility and authority.
Why did matrix organizations become popular
=Today's economy is dominated by high growth industries like telecommunications, nanotechnology, robotics, biotechnology, and aerospace, where competition is stiff and the life cycle of new ideas is short. -Emphasis is on product development, creativity, special projects, rapid communication, and interdepartmental teamwork.
Why did production processes and business organization become so complex
Mass production
What are the key alternatives to the major organizational models
Matrix organizations assign people to projects temporarily and encourage interorganizational cooperation and teamwork. Cross-functional self-managed teams have all the benefits of the matrix style and are long term.
Interfirm teams
Members from two or more companies forming a team
What are the major concepts involved in interfirm communications
Networking, virtual corporation, benchmarking, core competencies,
What principles did Weber add
Principles of bureaucracy such as job descriptions, written rules and decision guidelines, consistent procedures, and staffing and promotions based on qualifications.
What are the alternative ways a firm can departmentalize?
Product, function, customer group, geographic location, and process
Line organizations don't have...
Specialists who provide managerial support. There is no legal department, accounting department, human resources department, or information technology department.
What are some reasons for having a narrow span of control in an organization?
The appropriate span gradually narrows at higher levels of the organization because work becomes less standardized and managers and workers need more face-to-face communication.
Chain of command
The line of authority that moves from the top of a hierarchy to the lowest level.
What is departmentalization?
The process of setting up individual departments to do specialized tasks is called departmentalization. EX: One team might mow a lawn and the other uses blowers to clean up leaves and debris.
What is happening today in American Business
They are adjusting to changing markets. The key to success is remaining flexible and adapting to the changing times.
Companies that are the most successful in adapting to change have these common traits
They listen to customers, they have inspirational managers, and they often have had a close call with going out of business.
How did Weber use bureaucrat
To describe a middle manager whose function was to implement top management's orders. Thus, bureaucracy came to be the term for an organization with many layers of management.
What were Fayol's basic principles
Unity of command, hierarchy of authority, division of labor, subordination of individual interests to the general interest, authority, clear communication channels, order, and equity.
Virtual corporation
a temporary networked organization made up of replaceable firms that join and leave as needed
-Where was matrix organization developed -Where is it now found
aerospace industry and is now familiar in areas such as banking, management consulting firms, accounting firms, ad agencies, and school systems.
What management principle does a matrix-style organization challenge?
directly challenge the rigid line and line-and-staff organization structures.
Two organizational systems
formal and informal organization
What are two major organizational models
line organizations and line-and-staff organizations
Line-and Staff Organizations
organizations with line managers forming the primary chain of authority in the company, and staff departments working alongside line departments
What are organizational charts used for
shows relationships among people, who is accountable for the completion of specific tasks, and who reports to whom.
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. -Many small businesses are organized this way
Core competencies
those functions that the organization can do as well as or better than any other organization in the world Left over after outsourcing
What are the four major choices in structuring organizations
Centralization versus decentralization, span of control, tall versus flat organizational structures, and type of departmentalization.
Self managed teams
Employees are empowered to make decisions without management approval. The barriers among design, engineering, marketing, distribution, and other functions fall when interdepartmental teams are created.
What are the advantages of departmentalization?
Employees develop skills and progress within a department as they master more skills. The company can achieve economies of scale by centralizing all the resources it needs and locate various experts in that area. Employees can coordinate work within the function, and top management can easily direct and control various departments' activities.