prof. : vivian chen reporter : arthur chung. what is organization structure ? organization...
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OUTLINE
What is organization structure ? Organization structure six key
elements . Common organizational design . New design option . Why do structure differ ? Organization designs and
employee behavior . Summary .
Work Specialization . Departmentalization . Chain of Command . Span of Control . Centralization and Decentralization . Formalization .
ORGANIZATIONAL STRUCTURE SIX KEY ELEMENTS
Definition : The degree to which tasks in the
organization are subdivided into separate jobs . ( or division of labor )
The essence of work specialization is that rather than entire job being done by one individual , it is broken down into a number of steps , with each step being completed by a separate individual .
In essence , individuals specialize in doing part of an activity rather than the entire activity .
WORK SPECIALIZATION
Definition :The Basis by which jobs are grouped
together . Kinds of Departmentalization
Functions .Product of the organization produces .Geography or territory .Particular type of customer the organization
seeks to reach .
DEPARTMENTALIZATION
Definition : The unbroken line of the authority that extends
from the top of the organization to the lowest echelon and clarifies who reports to whom .
Authority The right inherent in a managerial position to give
orders and to expect to the orders to be obeyed . The unity-of-command principle helps
preserve the concept of an unbroken line of authority .
Unity-of-command The idea that a subordinate should have only one
superior to whom he pr she is directly responsible .
CHAIN OF COMMAND
Definition :The number of subordinates a manager can
efficiently and effectively direct .
SPAN OF CONTROL
Definition :The degree to which decision making is
concentrated at a single point in the organization . ( The rights inherent in one’s position ) , decentralization is oppositive .
CENTRALIZATION AND DECENTRALIZATION
The Simple Structure : A structure characterized by a low degree of
departmentalization , wide spans of control , authority centralized in a single person , and little formalization .
The Strength :1. Simplicity .2. Fast .3. Flexible .4. Inexpensive to maintain . 5. Accountability is clearly .
The Weakness :1. It’s difficult to maintain in anything other than
small organizations .
COMMON ORGANIZATIONAL DESIGNS(1)
The Bureaucracy : A structure with highly routine operating tasks achieved through
specialization , very formalization rules and regulations , tasks that are grouped into functional departments , centralized authority , narrow spans of control , and decision making that follows the chain of command .
The Strength :1. The ability to perform standardized activities in a highly efficient
manner . The Weakness :
1. It is illustrated in the following dialogue among four executives in one company :
1. Ya know , nothing happens in this happens until we produce something .2. Wrong .3. What are you talking about ?4. Nothing happens here until we sell something .
2. It is something we’ve all experienced at one time or another when have to deal with people who work in these organizations : obsessive concern with following rules .
COMMON ORGANIZATIONAL DESIGNS(2)
The Matrix Structure : A structure that creates dual lines of authority and combines
functional and product departmentalization . The Strength :
1. It lies in putting like specialists together , which minimizes the number necessary while following the pooling and sharing of specialized resources across products.
2. It lies in its ability to facilitate coordination when the organization has a multiplicity of the complex and interdependent activities .
3. It facilitates the efficient allocation of specialists . The Weakness :
1. The difficulty of coordinating the tasks of diverse functional specialists so that their activities are completed on time and within budget .
2. Ii lies in the confusion it creates , its propensity to foster power struggles , and the stress it places on individuals .
COMMON ORGANIZATIONAL DESIGNS(3)
Definition:1. The use of teams as the central device to
coordinate work activities .
NEW DESIGN OPTIONS -TEAM STRUCTURE
Sometimes called the network or modular organization .
Definition :A small , core organization that outsources
major business functions . Advantage :
Flexibility .
NEW DESIGN OPTIONS -VIRTUAL STRUCTURE
Definition :An organization that seeks to eliminate the
chain of command , have limitless spans of control , and replace departments with empowered teams .
NEW DESIGN OPTIONS -BOUNDARYLESS STRUCTURE
Mechanistic Model :A structure characterized by extensive
departmentalization , high formalization , a limited information network , and centralization .
Organic Model :A structure that is a flat , uses cross-
hierarchical and cross-functional teams , has low formalization , possesses a comprehensive information network , and relies on participative decision making .
WHAT DO STRUCTURE DIFFER ? (1)
Innovation Strategy :A strategy that emphasizes the introduction
of major new products and services . Cost-Minimization Strategy :
A strategy that emphasizes tight cost controls, avoidance of unnecessary innovation or marketing expenses , and price cutting .
Imitation Strategy :A strategy that seeks to move into new
products or new markets only after their viability has already been proven .
WHAT DO STRUCTURE DIFFER ? (2)STRATEGY
There is no considerable evidence to support the idea that an organization’s size affects its structure .
WHAT DO STRUCTURE DIFFER ? (3)ORGANIZATION SIZE
The term of technology refers to how an organization transfer its inputs into outputs .
WHAT DO STRUCTURE DIFFER ? (4)TECHNOLOGY
An organization’s environment is composed of institutions or forces outside the organization that potentially affect the organization’s performance .
Three-Dimensional Model of the Environment Capacity : support growth . Volatility : Dynamic or
stable . Complex : Scarce or
Abundant .
WHAT DO STRUCTURE DIFFER ? (5)ENVIRONMENT
To Maximize employee performance and satisfaction , individual differences , such as experience , personality , and the work task , should be taken into account .
In addition , national culture influences the preference for structure , so it , too , need to be considered .
ORGANIZATIONAL DESIGN AND EMPLOYEE BEHAVIOR