Intro to Business, chapter 7

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 customer served by the organizational unit

group cohesiveness

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

What are the traditional forms of organizational structure?

Firms typically use traditional, contemporary, or team-based approaches when designing their organizational structure. In the traditional approach, companies first divide the work into separate jobs and tasks. Managers and group related jobs and tasks together in two departments. Five basic types of departmentalization are commonly used in organizations: Functional: based on the primary functions performed within an organizational unit Product: based on the goods or services produced or sold by the organizational unit Process: based on the production process used by the organizational unit Customer: based on the primary type of customer served by the organizational unit Geographic: based on the geographic segmentation of organizational units

self-managed work teams

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

How do you mechanistic an organic organizations different?

A mechanistic organization is characterized by a relatively high degree of work specialization, Richard departmentalization, many layers of management particularly middle-management Nero spans of control centralized decision making, and a long chain of command. This combination of elements results in a tall organizational structure. In contrast, and organic organization is characterized by a relatively low degree of work specialization, Luz departmentalization, a few levels of management, white spans of control, D centralized decision making, and a short chain of command. This combination of elements results in a flat organizational structure.

organization chart

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

organic organization

And organizational structure that is characterized by a relatively low degree of job specialization, Luz departmentalization, a few levels of management, white spans of control, D centralized decision making, and a short chain of command

line organization

And organizational structure with direct, clear lines of authority and communication flowing from the top managers downward.

Geographic Departmentalization

Departmentalization is based on the geographic segmentation of the organizational unit

Process departmentalization

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

How come the degree of centralization decentralization be altered to make an organization more successful?

In a highly centralized structure, top management makes most of the key decisions in the organization, with very little input from lower level employees. Centralization let's top managers develop a Broadview of operations and exercise tight financial controls in a highly decentralized organization, decision making authority is pushed down the organizational hierarchy, giving lower level personnel more responsibility and power to make an implement decisions. Decentralization can result in faster decision-making and increased innovation and responsiveness to customer preferences.

What contemporary organizational structures our company is using?

In recent decades, companies have begun to expand beyond traditional departmentalization methods and use matrix, committee, and team-based structures. Matrix structures combine two types of traditional organizational structures for example geographic and functional. Matrix structures bring together people from different functional areas of the organization to work on a small project. As such matrix organizations are more flexible, but because employees report to two different supervisors, managing matrix structures can be challenging. Committee structures give authority and responsibility to a group rather than to an individual. Committees are part of a line and staff organization and often fulfill only an advisory role. Team-based structures also involve a signing authority and responsibility to groups rather than individuals, but, different from committees, team-based structures give these groups autonomy to carry out their work.

staff positions

Positions in an organization held by individuals who provide the administrative and support services that line employees need to achieve the firms goals.

What trends are influencing the way businesses organize?

Reengineering is a complete redesign of business structures and processes in order to improve operations. The goal of reengineering is to re-design business processes to achieve improvements in cost control, product quality, customer service, and speed. The virtual corporation is a network of independent companies suppliers, customers, even competitors linked by IT to share skills costs and access one another's markets. This network structure allows companies to come together quickly to exploit rapidly changing opportunities. Many companies are now using technology to create virtual teams. Team members may be down the hall or across the ocean. Outsourcing business functions both globally and domestically continues to be a regular business practice for companies large and small. Companies choose to outsource either as a cost saving measure or as a way to gain access to needed human resource talent and innovation. Global mergers raise important issues and organizational structure and culture. The ultimate challenge for management is to take to organizations and create a single successful cohesive organization.

virtual corporation

A network of independent companies linked by information technology to share skills, costs, and access to one another's market; allows companies to come together quickly to exploit rapidly changing opportunities

Matrix structure a.k.a. project management

And 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

Line and staff organization

And organizational structure that includes both line and staff positions

mechanistic organization

And organizational structure that is characterized by a relatively high degree of job specialization, Richard departmentalization, many layers of management, Nero spans of control, centralized decision making, and a long chain of command

authority

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

Work teams

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

Decentralization

The assignment of some degree of authority and responsibility to persons lower in the chain of command

Reengineering

The complete redesign of business structures and processes in order to improve operations

Centralization

The degree to which formal authority is concentrated in one area or level of an organization. Top management makes most of the decisions.

Specialization

The degree to which tasks are subdivided into smaller jobs

work group

The group that shares resources and coordinate efforts to help members better perform their individual jobs

How does the informal organization affect the performance of a company?

The informal organization is the network of connections and channels of communication based on the informal relationships of individuals inside the organization. Informal relationships can be between people at the same hierarchal level or between people at different levels and in different departments. Informal organizations give employees more control over their work environment by delivering a continuous stream of company information throughout the organization, they are by helping employees stay informed.

Managerial Hierarchy

The levels of management within an organization; typically includes top, middle, and supervisory management.

chain of command

The line of authority that extends from one level of an organization's hierarchy to the next, from top to bottom, and makes clear who reports to whom

What tools do companies used to establish relationships within their organizations?

The managerial hierarchy or the management pyramid, comprises the levels of management within the organization, and the managerial span of control is the number of employees the manager directly supervisors. And daily operations, individuals in line positions are directly involved in the processes used to create goods and services. Individuals in staff positions provide the administrative and support services that line employees need to achieve the firms schools. Line positions in organizations are typically in areas such as production, marketing, and finance. Staff positions are found in areas such as legal counseling, managerial consulting, public relations, and Human Resources Mgmt

organization

The order and design of relationships within a firm; consist of two or more people working together with a common objective and clarity of purpose.

formal organization

The order and design of relationships within the firm consists of two or more people working together with a common objective and clarity a purpose

division of labor

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

Departmentalization

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

Problem solving teams

Usually members of the same department who meet regularly to suggest ways to improve operations and solve specific problems

Why are companies using team-based organizational structures?

Work group share resources and coordinate efforts to help members better perform their individual duties and responsibilities. The performance of the group can be evaluated by adding up the contributions of the individual group members. Work teams require not only coordination but also collaboration, the pooling of knowledge, skills, abilities, and resources in a collective effort to attain a common goal. Four types of work teams are used: problem-solving, self managed, cross functional, and virtual teams. Companies are using teams to improve individual and group motivation and performance.

cross-functional team

a team composed of employees from different functional areas of the organization

Committee Structure

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

line positions

positions in the organization directly concerned with the producing goods and services and that are directly connected from top to bottom

span of control

the optimal number of subordinates a manager supervises or should supervise