SGMA-CHapter 10

Disadvantages of the matrix structure.

Power struggles(product and functional managers might have different goals), Confusion among team members, Lack of cohesiveness(team member from different functional areas might have difficulty communicating)

Informal Organization Functions

1. Provides friendships and social contact, help employees feel more connected and informed, can provide status and recognition, aids in socialization of new employees,

Virtual Corporation

A network of independent companies like by information technology to share skills, costs, and access to one another markets. Allows the companies to come together quickly to exploit rapidly changing opportunities.

Organization Chart

A visual representation of the structured relationships among tasks and the people given the authority to do those tasks.

Line Positions

All positions in the organization directly concerned with producing goods and serves and directly connected from top to bottom(production, marketing,finance)

Matrix Structure(project management)

An organizational structure that combines functional and product departmentalization by bringing together people from different functional areas of the organization to work on a special project. Each employee has two direct supervisors, a line manager and a project manager.

Line and Staff organizations

An organizational structure that includes both line and staff positions.

Mechanistic Organization

An organizational structure that is characterized by a relatively high degree of job specialization, rigid departmentalization, many layers of management, narrow spans of control, centralized decision making, and a long chain of command.

Organic Organization

An organizational structure that is characterized by a relatively low degree of job specialization, loose departmentalization, few levels of management, wide spans of control, decentralized decision making, and a short chain of command. (Smaller companies)

Committee Structure

An organizational structure which authority and responsibility are held by a group rather than an individual.

Line Organization

An organizational structure with direct, clear lines of authority and communication flowing from the top managers downward. (well suited for small entrepreneurial companies)

Geographic Departmentalization

Departmentalization that is based on the geographic segmentation of the organizational units.

Product Departmentalization

Departmentalization that is based on the goods or services produced or sold by the organizational unit.

Functional Departmentalization

Departmentalization that is based on the primary functions performed within an organizational unit.

Customer Departmentalization

Departmentalization that is based on the primary type of customers served by the organizational unit.

Process Departmentalization

Departmentalization that is based on the production process used by the organizational unit.

Organizing process is accomplished by:

Determining work activities and dividing up tasks(division of labor), grouping jobs and employees(departmentalization), assigning authority and responsibilities(delegation). These result in formal organizational structure.

Unity of Command Principle

Everyone reports to and gets instructions from only one boss. Guarantees that every employee will have a direct supervisor and will not be taking orders from a number of supervisors.

Contemporary(team based) Structures

Flexible and assemble employees to respond quickly to dynamic business environments.

Authority

Legitimate power granted by the organization and acknowledged by the employees, that allows an individual to request action and expect compliance.

Work teams

Like a work group, but also requires pooling of knowledge, skills, abilities and resources to achieve a common goal.

Cross-functional team

Member from the same organizational level, but different functional areas.

Traditional Structures

More rigid and group employees by function, products, processes, customers or regions.

Optimal Span of Control is determine by:

Nature of the task(more complex, less span of control), Location of the workers (more locations, less span of control), Ability of manager to delegate responsibility( greater ability to delegate, greater span of control), Amount of interaction between workers and manager, (more interaction=less span of control), Level of skill and motivation of workers(high skill and motivation=wider span and control)

Decentralization is desirable when:

Organization is very large, company is in a dynamic environment where decisions have to be made quickly, managers are willing to share power, employees are wiling to take more responsibility, the company is spread out geographically.

Staff positions

Positions in an organization held by individuals who provide the administrative and support services that line employees need to achieve the companys goals. (legal counselling, managerial consulting, public relations, human resource management)

3 basic types of work teams

Problem solving, self managed, and cross functional.

Decentralization

Process of pushing decision making authority down the organizational hierarchy. Can help with quicker decision making, increased levels of innovation and creativity.

Informal Communication Channels

Referred to as the grapevine, the rumour mill, or the intelligence network.

Self-managed work teams

Teams without formal supervision that plan, select alternatives, and evaluuate their own performance.

Advantages of Martix Structure

Teamwork, Efficient use of resources(project managers only use specialized staff), Flexibility( the group can be disbanded when it is no longer needed), Ability to balance conflicting objectives(balance between company and customer wants) , Higher performance, Opportunities for personal and professional development

Key Attributes to Virtual Corporation

Technology, Opportunism( Alliances are less permanent, more formal and more opportunistic than in traditional partnerships), Excellence, Trust, no borders

Delegation of Authority

The assignment of some degree of authority and responsibility to persons lower in the chain of command. Accountability and responsibility moves is less as you move down an organization.

Re-engineering

The complete re-design of business structures and processes to improve operations.

Centralization

The degree to which formal authority is concentrated in one area or level of an organization.

Group Cohesiveness

The degree to which group members want to stay in the group and tend to resist outside influences.

Specialization

The degree to which tasks are subdivided into smaller jobs.

Work Groups

The groups that share resources and coordinate efforts to help members better perform their individual jobs. Performance can be evaluated by adding up the contributions of the individual group members

Managerial Hierchy(management Pyramid)

The levels of management within an organization; typically includes top, middle, and supervisory management. (Number of employees increases as you move down the pyramid)

Chain of Command

The line of authority that extends from one level of an organizations hierarchy to the next, from the top to the bottom, and makes clear who reports to who. (this is well defied hierarchy) Shown in an organization chart that can be traced from the CEO all the way down.

Informal Organization

The network of connections and channels of communication based on the informal relationships of individuals inside an organization.

Span of control

The number of employees a manager directly supervises, also called span of management. Generally, the larger the span of control the more efficient the organization is.

Formal Organization

The order and design of relationships within a company, consists of two or more people working together with a common objective and clarity of purpose. Have well defined lines of authority, channels for information flow and means of control.

Division of Labour

The process of dividing work into separate jobs by assigning tasks to workers.

Departmentalization

The process of grouping jobs together so that similar or associated tasks and activities can be coordinated.

How to decide between mechanistic organization and organic organization

The size, companys overall strategy, types of technologies used in the company all decide what type of organization to use.

Problem Solving Teams

Usually members of the same department who meet regularly to suggest ways to improve operations and solve specific problems.Generate ideas, and may recommend a specific course of action, however they typically do not make final decisions, allocate resources, or implement change.