MGMT Exam 3 Chap 10

Two specific issues that managers must address when distributing authority are:

Delegation • Establishment of a pattern of authority between a superior and one or more subordinates • Process by which managers assign a portion of their total workload to others • Reasons for Delegation: o Enable the manager to get more work done • Subordinates help ease the manager's burden by doing major portions of the organization's work. • In some instances, a subordinate may have more expertise in addressing a particular problem than the manager does. • For Example, the subordinate may have had special training in developing information systems or may be more familiar with a particular product line or geographic area. o Also helps develop subordinates • By participating in decision-making and problem solving, subordinates learn about overall operations and improve their managerial skills. • Parts of the Delegation Process o The delegation process involves three steps: • First, the manager assigns responsibility or gives the subordinate a job to do. • The assignment of responsibility might range from telling a subordinate to prepare a report to placing the person in charge of a task force. • Along with the assignment, the person is also given the authority to do the job • The manager may give the subordinate the power to requisition needed information from confidential files or to direct a group of other workers. • Finally, the manager establishes the subordinate's accountability— • That is, the subordinate accepts an obligation to carry out the task assigned by the manager • EXAMPLE: the CEO of AutoZone will sign off for the company on financial performance only when the individual manager responsible for each unit has certified his or her own results as being accurate. The firm believes that this high level of accountability will help it avoid the kind of accounting scandal that has hit many businesses in recent times o These three steps don't occur mechanically • When a manager and a subordinate have developed a good working relationship, the major parts of the process may be implied and understood rather than stated. • The manager may simply mention that a particular job must be done. • A perceptive subordinate may realize that the manager is actually assigning the job to her. • From past experience with the boss, she may also know, without being told, that she has the necessary authority to do the job and that she is accountable to the boss for finishing the job as "agreed." • Problems in Delegation o For example, a manager may be reluctant to delegate. Some managers are so disorganized that they cannot plan work in advance and, as a result, cannot delegate appropriately. o Similarly, some managers may worry that subordinates will do too well and pose a threat to their own advancement. o Finally, managers may not trust the subordinate to do the job well. Similarly, some subordinates are reluctant to accept delegation. They may be afraid that failure will result in a reprimand. They may also perceive that there are no rewards for accepting additional responsibility. Or they may simply prefer to avoid risk and therefore want their boss to take all responsibility. o There are no quick fixes for these problems - the basic issue is communication • Subordinates must understand their own responsibility, authority, and accountability, and the manager must come to recognize the value of effective delegation. • Ultimate responsibility for the outcome, however, continues to reside with the manager. o Richard Branson, founder of Virgin Record and owner of now over 400 companies within the Virgin Group, learned the importance of delegation early in his career • At beginning employees had freedom to take charge of any responsibilities they had the ability to do • But, as the employee count reached 100, Branson feared company was becoming too slow • To maintain employee flexibility but prevent slowdown, he split the company in half and pinpointed talented employees from Virgin Records to run it. Decentralization and Centralization • Decentralization is the process of systematically delegating power and authority throughout the organization to middle and lower level managers • It is important to remember that decentralization is actually one end of a continuum anchored at the other end by centralization, the process of systematically retaining power and authority in the hands of higher-level managers. • Hence, a decentralized organization is one in which decision-making power and authorities are delegated as far down the chain of command as possible. • Conversely, in a centralized organization, decision-making power and authority are retained at the higher levels of management. • When H. Ross Perot started EDS, he practiced centralization o No firm is ever completely centralized or decentralized • What factors determine an organization's position on the decentralization-centralization continuum? • One common determinant is the organization's external environment. o Usually, the greater the complexity and uncertainty of the environment, the greater is the tendency to decentralize. • Another crucial factor is the history of the organization. o Firms have a tendency to do what they have done in the past, so there is likely to be some relationship between what an organization did in its early history and what it chooses to do today in terms of centralization or decentralization. • The nature of the decisions being made is also considered. o The costlier and riskier the decisions, the more pressure there is to centralize. • Organizations also consider the abilities of lower-level managers. o If lower-level managers do not have the ability to make high-quality decisions, there is likely to be a high level of centralization. o If lower-level managers are well qualified, top management can take advantage of their talents by decentralizing; in fact, if top management does not, talented lower-level managers may leave the organization • A manager has no clear guidelines for determining whether to centralize or decentralize • Many successful organizations like GE and J&Jare quite decentralized and equally successful firms such as McDonals and Walmart have remained centralized • Some move from one to the other o EXAMPLE: Royal Dutch Shell & Yahoo- D to C o Toyota - C to D

• Organizational Structure -

Building blocks themselves o How the blocks can be put together o Organization design

• Organizing -

Deciding how best to group organizational elements o Just as children select different kinds of building blocks, managers can choose a variety of structural possibilities

• 4 most common bases for departmentalization:

Function Product Customer Location - Apex uses all

• Five alternate approaches to job design:

Job Rotation Job enlargement Job enrichment Job characteristics approach Work teams

Job Design • Job specialization -

The degree to which the overall task of the organization is broken down and divided into smaller component parts • Job specialization evolved from the concept of division of labor • EXAMPLE: Adam Smith (an 18th century economist) first discussed DOL in his case study about how a pin factory used it to improve productivity • He described how one man pulled the wire from a spool, another straightened it, next cut it, and 4th one ground the point • He clamed that 10 mean working in this fashion were able to produce 48,000 pins in a day where each man working alone could have produced only about 20 pins per day • First examples of the impact of specialization came from the automobile assembly lines pioneered by Henry Ford and his contemporaries • During 20th century, high levels of low cost production transformed the US society into one of the strongest economies in the history of the world • Job specialization in the purest form is a normal existence of organizational growth • EXAMPLE: Walt Disney started his co. and did everything himself - as it grew, he hired other to preform many of his same functions • As animation artists work on Disney movies today, they may specialize in generating computer images of a single character or doing only background scenery • Today Walt has thousands of different specialized jobs - no one person could preform them all

Other forms of departmentalization -

Time • Baker Hughes in Houston • Machine shop operates on three shifts • Each has a superintendent who reports to the plant manager and each has its own functional departments • Hospitals, airlines Sequence • College students registering in sequence • Seniors - Monday, Juniors - Tuesday • Credit departments and insurance claims divisions

• Span of Management -

establishing reporting relationships is determining how many people will report to each manager (span of control)

• Narrow -

few subordinates per manager

• AV Graicunas -

he quantified span of management issues o Noted that a manager must deal with three kinds of interactions with and among subordinates: o Direct - manager's one-to-one relationship with each subordinate o Cross - among the subordinates themselves o Group - between groups of subordinates o The number of all possible types between a manager and subordinates can be determined by the following formula: • I = N (2^N/2+N - 1) • I = total number of interactions with and among subordinates • N = number of subordinates • 2 subordinates = 6 • 3 = 18 • 5 = 100 • Each additional subordinate adds more complexity than the previous one did • Going from 9 to 10 subordinates is very different from going from 3 or 4

• Wide -

many subordinates

• Ralph C. Davis, described two kinds of spans:

o An operative span for lower level managers and o An executive span for middle and top managers o He argued that operative spans could approach 30 subordinates, whereas executive spans should be limited to between three and 9

• Lyndall Urwick -

suggested that an executive span should never exceed 6 subordinates, and General Ian Hamilton reached the same conclusion • Today we recognize that the span of management is a crucial factor in structuring organizations but that there are no universal, cut and dried prescriptions for an ideal or optimal span

Coordinating Activities -

• 5th Major element of organizing is coordination • Job specialization and departmentalization involve breaking jobs down into small units and then combing those jobs into departments o Once this has been accomplished, the activities of the departments must be linked - systems must be put into place to keep the activities of each department focused on the attainmentof organizational goals - this is accomplished by COORDINATION • Coordination - the process of linking the activities of the various departments of the organization

o Work teams - EXAMPLE

• A group is given responsibility for designing the work system to be used in preforming an interrelated set of tasks • In the typical assembly line system, the work flows from one worker to the next, and each worker has a specified job to perform • In a work team, the group itself decides how job will be allocated • EXAMPLE: the work team assigns specific tasks to members, monitors, and controls its own performance and has autonomy over work scheduling

Job rotation - EXAMPLE

• Systematically moving employees form one job to another • EX: a worker in a warehouse might unload trucks on Monday, carry incoming inventory to storage on Tuesday, verify invoices Wednesday, pull outgoing inventory on Thursday, and load trucks Friday • The jobs don't change, instead, workers move from job to job • For this reason job rotation has not been very successful in enhancing employee motivation or satisfaction • Jobs involved in job rotation are relatively standard or routine • Workers who are rotated to a "new" job may be more satisfied at first, but soon waves • Companies: American Cyanamid, Bethlehem Steel, Ford, Prudential Insurance, and Western Electric • It is most often used today as a training devide to improve worker skills and flexibility • Also being used more to increase flexibility and lower costs • Transportation Security Administration (TSA) security screeners rotate jobs every 15 minutes in order to maintain proficiency at all tasks and maintain focus

Rationale for Departmentalization

• When organizations are small, the owner-manager can personally oversee everyone who works there • As it grows, personally supervising all the employees becomes more and more difficult for the owner/manager • So, new managerial positions are created to supervise the work of others • Jobs are groups according to some plan - the logic embodied in such a plan is the basis for all departmentalization

• Six Basic Building Blocks that managers can use in constructing an organization:

o Designing Jobs o Grouping Jobs o Establishing reporting relationships between jobs o Distributing authority among jobs o Coordinating activities among jobs o Differentiating among positions

• How do mangers determine the appropriate span for their unique situation?

o No perfect formula exists, researchers have identified a set of factors that influence the span for a particular circumstance o EXAMPLE: if the managers and subordinates are competent and well trained a wide span may be effective o Physical dispersion is also important o The more widely subordinates are scattered, the narrower the span should be. On the other hand, if all the subordinates are in one location, the span can be somewhat wider. o The amount of nonsupervisory work expected of the manager is also important. • Some managers, especially at the lower levels of an organization, spend most or all of their time supervising subordinates. • Other managers spend a lot of time doing paperwork, planning, and engaging in other managerial activities. • Thus these managers may need a narrower span. o Some job situations also require a great deal of interaction between supervisor and subordinates. o In general, the more interaction that is required, the narrower the span should be. • Similarly, if there is a fairly comprehensive set of standard procedures, a relatively wide span is possible. • If only a few standard procedures exist, however, the supervisor usually has to play a larger role in overseeing day-to-day activities and may find a narrower span more efficient. o Task similarity is also important. • If most of the jobs being supervised are similar, a supervisor can handle a wider span. When each employee is performing a different task, more of the supervisor's time is spent on individual supervision. • Likewise, if new problems that require supervisory assistance arise often, a narrower span may be called for. • If new problems are relatively rare, though, a wider span can be established. o Finally, the preferences of both supervisor and subordinates may affect the optimal span. • Some managers prefer to spend less time actively supervising their employees, and many employees prefer to be more self-directed in their jobs. • A wider span may be possible in these situations. o EXAMPLE: the Case Corporation factory in Racine, Wisconsin, makes farm tractors exclusively to order in five to six weeks. • Farmers can select from among a wide array of options, including engines, tires, power trains, and music systems with USB ports. • A wide assortment of machines and processes is used to construct each tractor. Although workers are highly skilled operators of their particular machines, each machine is different. In this kind of setup, the complexities of each machine and the advanced skills needed by each operator mean that one supervisor can oversee only a small number of employees.

Electronic Coordination

• Advances are also providing useful mechanisms for coordination • Email makes it easier forpeople to communicate with one another o This communication enhances coordination • Many people in organizations use electronic scheduling • Local networks make it easer to coordinate activities o Betchel - now requires its contractors, sub cons, and suppliers to use a common web-based communication system to improve coordination among their myriad activities

Tall Versus Flat Organizations -

o One classic study at Sears found that a flat structure led to higher levels of employee morale and productivity o Researchers have also argued that a tall structure is more expensive (becuas of the large number of managers) and that t fosters more communication problems (because of the increased number of people through whom information must pass o On the other hand, a wide span of management in a flat organization may result in manager's having more administrative repsonsibiility (because thee are fewer managers) and more supervisory responsibility (because there are more subordinates reporting to each manager) o If these repsonsblities become excessive, the flat organization may suffer o Many experts agree that businesses can function effectively with fewer layers of organization than they currently have • EXAMPLE: Franklin Mint - reduced its number of management from 6 to 4 • At the same tme, the CEO increased his span of management from 6 to 12 • In similar fashion, IBM has eliminated several layers of management • The British firm Cadbury PLC, maker of Cadbury Dairy Choloates, Tident Gum and other confectionary products, eliminated a layer of management separating the CEO and the firm's operating units • Angelo American PLC, a large global mining co. also cut a layer of management • Allergan announced that a major reorganization will result in the elimination of an organizational later to maintain the company's lean and efficient business model • The specific reasons for change were to improve communication between CEO and the operating unit heads and to speed up decision making • One additional reason for this trend is that improved communication technologies such as an email and text messaging allow managers to stay in touch with a large number of subordinates than was possible even just a years ago

• Job Enrichment has disadvantages:

o Work systems need to be analyzed before enrichment, but this seldom happens, and managers rarely ask for employee perferences when enriching jobs o While Anderen Bank employees get to do more tasks and have greater responsibility, the firms' goal was to lower labor cost by employing fewer people o The impact of the changes on employee morale, performance and turnover have also not been assessed

o Job characteristics approach - EXAMPLE

• An alternative to job specializatioin that does take into account the work system and employee preferences • This approach suggests that jobs should be diagnosed and improved along five core dimensions: • Skill Variety: the number of things a person does in a job • Task Identity: the extent to which the worker does a complete or identifiable portion of the total job • Task significance: the perceived importance of the task • Autonomy: the degree of control the worker has over how the work is performed • Feedback: the extent to which the worker knows how well the job is being performed • The higher a job rates on those dimensions, the more employees will experience various psychological states • Experiencing these states, in turn presumably leads to a high motivation, high quality performance, high satisfaction and low absenteeism and turnover • Growth-need strength - is presumed to affect how the model works for different people • People with a strong desire to grow, develop and expand their capabilities are expected to respond strongly to the presence or absence of the basic job characteristics; those with low growth-need strength are expected not to respond as strongly or consistently • Southwestern Division of Prudential Insurance used this approach in its claims division - Results included moderate declines in turnover and a small but measurable improvement in work quality • Although this approach is one of the most promising alternatives to job specialization, it is probably not the final answer

Chain of Command - EX 2 components:

• An old concept, first popularized in the early years of the 20th century • EXAMPLE: early writers of the chain of command argued that clear and distinct lines of authority need to be established among all positions in an organization • It actually has two components: o Unity of command - each person within an organization must have a clear reporting relationship to one and only one boss o Scalar Principle - suggests that there must be a clear and unbroken line of authority that extends from the lowest to the highest position I the organization • "The buck stops here" is derived from this ideas - someone in the organization must ultimately be responsible for every decision

o Job enrichment - EXAMPLE

• Assumes that increasing the range and variety of tasks is not sufficient by itself to improve employee motivation • Its an attempt to increase both the number of tasks a worker does and the control the worker has over the job • To implement job enrichment, managers remove some controls from the job, delegate more authority to employees, and structure the work in complete, natural units • These changes increase subordinates' sense of responsibility • Another part of this is to continually assign new and challenging tasks, increasing employees' opportunity for growth and advancement • EXAMPLE: AT&T was one of the earliest companies to try job enrichment. In one experiment, 8 data entry clerks in a service unit prepared customer service orders • Faced with low output and high turnover, management determined that the data entry clerks felt little responsibility to clients and received little feedback • Task was changed from 10 specific steps to 3 more general steps and job titles were upgraded • Frequency of order processing increased from 27 percent to 90 percent, the need for messenger service was eliminated, accuracy improved and turnover became practically nil • Companies: Texas Instruments, IBM, and General Foods • It is also being used in some banks today with employees in branches being trained to work as tellers, open new accounts, and accept loan applications • By training all employees to perform multiple tasks, Orlando-based Anderen Bank has been able to reduce the average number of employees at each of its branches from 10 to 4

Designing jobs - logical first building block (for people in org.) -

• Determination of a person's work-related responsibilities • EXAMPLE: for a machinist at Caterpillar, a job design might specify what machines are to be operated during construction of a new piece of equipment, how the machines are to be operated and what performance standards are expected • For a manager at Caterpillar, job design might involve defining areas of decision-making responsibility, identifying goals and expectations and establishing appropriate indicators of success • The natural starting point for this building block is determining the level of desired specialization

Establishing Reporting Relationships - EXAMPLE 3rd element of organizing

• EXAMPLE: suppose manager of small business just hired two new employees - one for handling production and one for marketing (where will each report to?) • Clarifyng the chain of command and the span of management • In addition to formal departmental arrangement and prescribed reporting relationships, there is also considerable informal interaction that takes place among people in any organization

• Two final points about job grouping:

• First, Departments are often called something entirely different - divisions, units, sections, and bureaus - are all common synonyms • Higher we look in an organization, more likely we are to find departments referred to as divisions • H.J. Heinz is organized into 5 major divisions • The different labels all represent groups of jobs that have been yoked together according to some unifying principle • Second, Almost any organization is likely to employ multiple bases of departmentalization, depending on level • Finally, the role of social media in departmentalization is just now beginning to have an impact

Job Specializations 4 Benefits to organizations:

• First, workers performing small, simple tasks will become very proficient at each task • Second, transfer time between tasks decreases o If employee performs several different tasks, some time is lost as they stop doing the first task and start doing the next • Third, the more narrowly defined job is, the easier it is to develop specialized equipment to assist with that job • Fourth, when an employee who performs a highly specialized job is absent or resigns, the manager can train someone new at a relatively low cost o Although specialization is generally thought of in terms of operating jobs, many organizations have extended the basic elements of specialization to managerial and professional levels

Grouping Jobs: Departmentalization -

• Second building block of organization structure is the grouping of jobs according to some logical arrangement • Process of grouping is called Departmentalization

Function - EXAMPLE Adv vs DisAdv

• Functional Departmentalizaton groups together those hobs involving the same of smilar activities • Apex has manufacturing, finance, and marketing departments, each an organizational function • Most common approach in smaller organizations • 3 Primary Advantages: • Each department can be staffed by experts in that functional area o Marketing experts can be hired to run the marketing function • Supervision is facilitated because an individual manager needs to be familiar with only a relatively narrow set of skills • Coordinating activities inside each department is easier • Several Disadvantages of approach: • Decision making becomes slower and more bureaucratic • Employees may begin to concentrate too narrowly on their own unit and lose sight of the total organizational system • Accountability and performance become increasingly difficult to monitor o EXAMPLE: Determining whether a new product fails because of production deficiencies or poor marketing campaign may not be possible

Location - EXMAPLE Adv vs Disadv

• Groups jobs on the basis of defined greographic sites or areas • The sites or areas may rane in size from a hemisphere to only a few blocks of a large city • Manufacturing branch at Apex business has two plants - Dallas and Phoenix • The design division of its software has two labs - Chicago and St Lous • Their consumer sales groups has 5 sales territories cooresponding to different regions of the US o Transportation o Police departments o Fed Reserve bank o All use location departmentalization • Primary advantage: • Enables the organization to respond easily to unique customer and environmental characteristics in the various regions • Disadvantage: • A larger administrative staff may be required if the organization must keep track of units in scattered locations

Differentiating Between Positions

• Last Building Block of organization • Line Position - a positionin the drect chain of command that is responsible for the achievement of an organizations goals • Staff Position - intended to provide expertise, advice, and support for line positions o In Modern organizations these differences are begning to disappear

Differences between Line and Staff

• Most obvious difference between them is purpose: o Line managers work directly toward organizational goals o Staff mangers advise and assist • Line authority is generally thought of as the formal or legitimate authority created by the organizational hierarchy • Staff authority is less concrete and may take a variety of forms o One form is advise authority - line manager can choose to seek of avoid input from staff o Another form - Compulsory Advice - line manager must consider the advice but can choose to heed it or ignore it • EXAMPLE: Pope is expected to listen to advice of the Sacred College of Cardinals when dealing with church doctrine but may follow his own beliefs when making decisions o Most important form of staff authority - Functional Authority - formal or legitimate authority over activities related to the staff member's specialty • EXAMPLE: a human resource staff manager mayhave functional authority when there is a question of discrimination in hiring • Conferring functional authority is the most effective way to use staff positions because the organization can take advantage of specialized expertise while also maintaining a chain of command

Customer - EXAMPLE Adv vs Disadv

• Organization structures its activities to respond to and interact with specific customers or groups • Lending activities in most banks are usually tailored to meet the needs of different kinds of customers (business, consumer, mortgage, and ag loans) • Marketing branch of Apex has two compartments - industrial sales (marketing activates aimed at business customers) and consumer sales (responsible for wholesaling computers to retail stores catering to individual purchasers) • Basic Advantage: • The organization can use skilled specialists to deal with unique customers or groups o A fairly large administrative staff is required to integrate the activities of the various departments o EXAMPLE: in banks coordination is necessary to make sure that the organization foes not over commit itself in any one area and to handle collections on delinquent accounts from a diverse set of customers

Distributing Authority

• Power that has been legitimized by the organization • Distributing authority is another normal outgrowth of increasing organizational size o EXAMPLE: when an owner-manager hires a sales representative to market his products, he needs to give the new employee appropriate authority to make decisions about delivery dates, discounts, and so forth. • If every decision requires the approval of the owner-manager, he is no better off than he was before he hired the sales representative. • The power given to the sales representative to make certain kinds of decisions, then, represents the establishment of a pattern of authority—the sales representative can make some decisions alone and others in consultation with coworkers, and the sales representative must defer some decisions to the boss.

The Need for Coordination

• Primary need for it is that departments and work groups are interdependent - they deoend on one another for information and resources to preferom their respective activities • Greater the interdependence between departments, the more coordination the organization requires if the departments are able to perform effectively • 3 Major forms of interdependence: o Pooled • Lowest level • Units operate with little interaction • Output of units is pooled at te organizational level • Old Navy • Each store is known as a "department" by the parent Corporation • Each has own operating budget, staff, and so forth • Profits or losses from each store added together at the organizational level • Interdependent to the extent that the final success or failure of one store affects the other, but don't generally interact on a day to day basis o Sequential • Output of one unit becomes the input for another in sequential fashion • Created moderate level of interdependence • Nissan • One plant assembles engines and ships to final assembly sit at another plant where they are completed • Plants are interdependent in that the final assembly plant must have the engines from engine assembly before it can perform its primary function of producing finished automobiles • Level of interdependence is generally one way - the engine plant is not necessarily dependent on the final assembly plant o Reciprocal • Exists when activities flow both ways between units • Clearly most complex • Marriott Hotel • The reservations department, front desk check in, and housekeeping are all reciprocally interdependent • If any three jobs doesn't do its job properly, all the others will be affected

Product - EXAMPLE Adv vs DisAdv

• Second common approach, involves grouping and arranging activities around products or product groups • Apex Computers has two product based departments at the highest level of the firm • One responsible for all activities associated with Apex's personal computer business and the other handles the software business • Most larger business adopt this form for grouping activities at the business or corporate level • 3 Major Advantages: • All activities associated with 1 product or product group can be easily integrated and coordinated • Speed and effectiveness of decision making are enhanced • The performance of individual products and product groups can be assessed more easily and objectively, thereby improving the accountability of departments for the results of their activities • 2 Major Disadvantages: • Maangers in each department may focus on their own product or group to the exclusion of the rest of the organization o EXAMPLE: a marketing manager may see her primary duty as helping the group rather than helping the overall organization • Administrative costs rise because each department must have its own functional specialists for areas such as market research and financial analysis

Structural Coordination Techniques

• Some of the most useful devices for maintaining coordination among interdependent units are: o Managerial hierarchy • Ones that use this place one manager in charge of interdependent departments or units • Walmart - major activities include receiving and unloading bulk shipments from railroad cars and loading other shipments onto trucks for distribution to retail outlets • Two Groups (receiving and shipping) are interdependent in that they share the loading docks and some equipment • To ensure coordination and minimize conflict, one manager is in charge of the whole operation o Rules and procedures • Routine coordination activites can be handled via rules and procedures • Walmart - • An outgoing truck shipment has priority over an incoming rail shipment • When trucks are loaded, the shipping unit is given access to al the center's auxiliary forklifts • This priority is specifically stated in a rule • As useful as rules are, they are not effective when coordination problems are complex and unusual o Liaison roles • Coordinates interdependent unts b acting as a common point of contact • Person may not have any formal authority over the groups but instead simply facilitates the flow of information between unts • Two engineering groups working on component systems for a large project might interact through a liaison • It maintains familiarity with each group as well as with the overall project • Can answer questions and serve to integrate the activities of all the groups o Task forces • Created when the need for coordination is acute • When interdependence is complex and several units are involves, a single liaison person may not be sufficient • Task force might be assembled by drawing one rep. from each group • The coordination function is then spread across several individuals, each of whom has special information about one of the groups involved • When project is complete, task force members return to theur original positions • EXAMPLE: college overhauling its degree requirements might establish a task force made up of reps from each department affected by the change • Each person retains her or his regular departmental affiliation and duties but also serve on the special tasks force - after finished - task force is dissolved o Integrating departments • Occasionally used for coordination • Somewhat similar to task forces but are more permanent • Normally has some permanent members as well as some who are assigned temporarily • Usually has more authority than a task force and may be given some budgetary control by the organization o In general the greater degree of interdependence, the more attention the organization must devote to coordination o When interdependence is pooled or sequential, the managerial hierarchy or rules are often sufficient o When more complex forms of sequential or smpler forms of reciprocal interdependence exist, liasions or task forces may be more useful o When reciprocal interdependence is complex, task forces or integrating departments are needed

Administrative Intensity

• The degree to which managerial positions are concentrated in staff positions • An organization with high administrative intensity is one with many staff positions relative to the number of line positions; low administrative intensity reflects relatively more line positions • Many organizations have taken steps over the past few years to reduce their administrative intensity by eliminating staff positions o CBS cut hundreds of staff positions at its NY headquarters, and IBM cut its corp. staff from 7000 to 23000 o Burlington Northern generates almost $22bil in annual sales and manages a workforce of 43,000 with a corporate staff of only 77 managers o Ford and GM have both downsized dramatically through cuts and plant closings

o Job enlargement - EXAMPLE

• Was developed to increase the total number of tasks workers perform • As a result, all workers perform a wide variety of tasks, which reduces the level of job dissatisfaction • Companies: IBM, Detroit Edison, AT&T, the US Civil Service, & Maytag • EXAMPLE: At Maytag, the assembly line for producing washing machine water pumps was systematically changed so that work that had originally been preformed by six workers, who passed the work sequentially from one person to another, was performed by 4 workers, each of whom assembled a complete pump • Positive consequences are often offset by disadvantages: • Training costs usually increase • Unions have argues that pay should increase because the worker is doing more tasks • In many cases the work remains boring and routine even after job enlargements

Job Specialization Negative Consequences:

• Workers may become bored and dissatisfied o Job may be so specialized that is offers no challenge or stimulation o Boredom and monetary set in, absenteeism rises, and the quality of the work may suffer • Anticipated benefits of specialization may not always occur o EXAMPLE: a classic study conducted at Maytag found that the time spent moving work in process from one worker to another was greater than the time needed for the same person to change from job to job o Thus, some degree of specialization is necessary, it should not be carried to extremes because of the possible negative consequences o Managers must be sensitive to situations in which extreme specialization should be avoided o Several approaches to designing jobs have been developed in recent years