organizational structure business management copyright © texas education agency, 2012. all rights...

Organizational Structure

Business Management

Copyright © Texas Education Agency, 2012. All rights reserved.

2

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What is Organizational Structure?

• The hierarchy within an organization that sets forth the chain of command in addition to the delegation of responsibilities

• Depends upon the goals of the organization• Illustrated by an organizational chart• Centralized – decision-making rests with upper

management• Decentralized – decision-making is the

responsibility of departments or divisions

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What is anAdaptive Organization?

• An organization that adjusts well to changes • More decision-making is with the employees

(decentralized)• Team-oriented• Focus on anticipation of customer needs to

more easily adjust to unpredictability

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When is Change Needed?

New competitors

New technology

New product or

service

Change in laws

Rapid growth or

decline

Customer dissatisfac-

tion

Increasing costs

Decreasing employee

morale

Merger


What is Human Resource Management?

• All of the activities associated with the personnel of an organization:– Hiring– Compensation– Performance evaluation– Employee relations– Health and safety


What is Span of Control?

• Span of control refers to the number of subordinates a member of management has direct authority over

• Easily displayed through an organizational chart

President

V.P. Sales V.P. Finance

V.P. Human Resources

Span of Control = 3


Types of StructureTypes of Structure

• Line– Direct line of authority from top

executives downward• Line and Staff

– Staff specialists assist the lines of authority

• Matrix– Temporary work teams

• Team– Permanent work teams


Line Organization

• Oldest form of organization

• Simplest form of organization

• Due to top-to-bottom chain of command, decisions can be made quicker

• Lack of specialization

President

ProductionManager

SalesManager

Assistant Manager

Controller

Branch A Manager

Branch BManager


Line-and-Staff Organization

• More complex than line organization

• Allows for experts at different levels in the organization

• Specialization• More costly than

line organization

President

Production Manager

ProductionSupervisor

Sales Manager

Marketing Assistant

Finance Manager

Finance Supervisor


Matrix Organization

• Teams designed for specific projects• No consistent organization structure

because of the changing nature of projects• Matches skills with projects


Team Organization

• Team leader acts as manager for the team• In self-directed teams, team members have

autonomy over planning, conducting, and reviewing their work with team leader acting as facilitator

• Feedback can come from customers• The team handles HR functions such as

hiring, firing, and evaluating performance


Independent Practice Assignments

• Corporate Organizational Chart Assignment #1 - Students are use the Internet to do research needed to create organizational charts for 2 different corporations in different industries, or students can use a local community business. You may create these charts in a word processing program using online graphics. Identify each as to the type of organizational structure it is and comment on whether or not the structure varied for different industries. Students must include a bibliography.

• Org Structure Rap Assignment #2 – In pairs students will create a rap outlining the four types of organization structure of a business. They should include enough detail in the rap to demonstrate their knowledge of the topic. They should also include reference to at least one major corporation or local business that the other students can recognize as well as its organizational structure. Students will then perform their rap to the class.


Independent Practice Assignments (Cont.)

• Case Study Report Assignment #3 – You are the owner of a business that sells uniforms and provides embroidery services for high school, college, and recreational sports teams in your area. You have managers in the following departments: High School Sales, Collegiate Sales, Recreational Sales, and Accounting. The High School and Collegiate Sales have one full-time sales associate and two part-time associates as well as a delivery person. The Recreational Sales department has one full-time and one part-time associate. The Accounting department has two full-time employees that report to the manager. Students will prepare a 2-page report that answer the following questions: 1) What does the organizational chart look like for your business? (Hint: create an organizational chart), 2) What organizational structure is your business?, 3) Assuming sales are declining in one of the sales departments, what would your recommendation be to possibly restructure to improve sales?, 4) If sales are increasing, make a recommendation on how to restructure to handle the increased business, 5) Is the current structure considered ‘tall’ (more centralized) or ‘flat’ (more decentralized)?


Independent Practice Assignments (Cont.)

• Teamwork Project Assignment #4 - Divide the class into teams of 5 if possible. They are to think of a team name and logo. They are to provide objects they can use to create a product. Bring either fruit or other food items you can arrange or put together in any way possible. Or bring wooden or plastic blocks or logs with which to create a toy. They must create an organization chart of all of their team members, identifying the type of structure, as well as job titles. They are to create a Marketing Plan for their finished food dish or toy including the four P’s for their product (product, price, place, promotion). All items can be affixed to a poster or flip chart. Finally, they will each prepare an ‘exit ticket’ that will include their own critique of their team’s organizational structure, team member duties, teamwork, their success (or lack of) with their product, and their overall assessment of their marketing plan. (An example of a marketing plan will be given.)


organizational structure business management copyright © texas education agency, 2012. all rights...

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