Documente Academic
Documente Profesional
Documente Cultură
Organizational Design
Six key Elements
1. Work Specialization
-Division of Labor
-The Degree to which Tasks/
Activities in an organization are
divided into Separate Jobs.
-A Job is broken down in Steps
and each Step is done by a
different person
1. Work Specialization
• Human Diseconomies from Specialization came
to be known as
BOREDOM,
FATIGUE,
STRESS,
LOW PRODUCTIVITY,
POOR QUALITY,
INCREASED ABSENTEEISM and
HIGH TURNOVER
ORGANIZATIONAL STRUCTURE
Organizational Design
2. DEPARTMENTALIZATION
• It is the basis of grouping of Jobs
• Ways of Classifying and Grouping Work
Activities
• 1. FUNCTIONAL:
• Groups Jobs by Functions
Performed.
• It is the most popular
way to GROUP ACTIVITIES
2. DEPARTMENTALIZATION-
FUNCTIONAL:
• …Can be Used in ALL types of
Organizations, Only the Functions Change
to Reflect the Organization’s Activies
ORGANIZATIONAL STRUCTURE
Organizational Design
3. PRUDUCT
• Departmentalization:
Groups Jobs by the Type of Product or Product
Line.
• The major Advantage is the Increased
ACOUNTABILITY for product PERFORMANCE
ORGANIZATIONAL STRUCTURE
4. PROCESS
• Groups jobs on the basis of Product Flow
• Each Dept. is Specializes in ONE SPECIFIC
PHASE of PRODUCTION
• It can also be Used for processing
CUSTOMERS as well as products
5. GEOGRAPHICAL …
• Groups jobs on the basis of Territory
or Geography
6. CUSTOMER
• Groups jobs on the basis of Common Customers
• Microsoft- organized around Four Customer
Markets;
Consumers, Businesses, Large Corporations,
Software Developers
ORGANIZATIONAL STRUCTURE
Organizational Design
3. CHAIN OF COMMAND
It is the Continuous Line of Authority that extends
from upper organizational level to lower levels
and CLARIFIES Who Reports to Whom.
4. SPAN OF CONTROL
7. FORMALIZATON
6. DECENTERLIZATION
The degree to which Lower level
employees provide input or actually
make decision
ORGANIZATIONAL STRUCTURE
Organizational Design
Two models of Organizational Design
1. MECHANISTIC
This organization is a Rigid,
and Tightly Controlled Structure and Characterized
by
High Specialization
Rigid Departmentalization
Narrow Span of Control
High Formalization and
Little Participation in decision making
by the lower-level employees.
Two models of Organizational Design
1. MECHANISTIC
• This organization has Rigid,
and
Tightly Controlled Structure and
Characterized by
High Specialization
Rigid Departmentalization
Narrow Span of Control
High Formalization and
Little Participation in decision
making by the lower-level
employees
ORGANIZATIONAL STRUCTURE
Organizational Design
2. ORGANIC ORGANIZATION
• CONTIGENCY FACTORS
What an appropriate structure of an
organization should be depends on
Four Contingency factors:
1. Organization’s Strategy
2. Size
3. Technology
4. Degree of
Environmental
Uncertainty
ORGANIZATIONAL STRUCTURE
Organizational Design
1. STRATEGY and STRUCTURE:
3. TECHNOLOGY and
STRUCTURE
a. Unit Production
b. Mass Production
c. Process Production
ORGANIZATIONAL STRUCTURE
Organizational Design
4. ENVIRONMENTAL UNCERTAINTY and
STRUCTURE
1. SIMPLE STRUCTURE:
A. Low Departmentalization
b. Wide Span of Control
c. Authority Centralized in a
Single person
d. Little Formalization
ORGANIZATIONAL STRUCTURE
TRADITIONAL ORGANIZATIONAL DESIGNS
2. BUREAUCRACY
MATRIX STRUCTURE
• Combines two forms of departmentalization:
Functional and Product
• It attempts to gain the Strengths of Each, while
Avoiding their Weaknesses
• It Breaks the Unity of command concept- Dual
Chain of command
MATRIX STRUCTURE
VIRTUAL ORGANIZATION
• They are small organizations that
OUTSOURCE major business functions
• It is highly Centralized, with little or no
Departmentalization
- Movie Making orgs.
- Reduces long-term risks, because there is no
long term- a team Assembled for a Finite
period and then Disbanded
NEW DESIGN OPTIONS
BOUNDARYLESS
ORGANIZATION
• Breaking down the External Barriers bt. The
company and its Customers and Suppliers
• It seeks to
Eliminate the Chain of Command
Have Limitless Span of Control
Replace departments with
Empowered Teams
ORGANIZATION DESIGN AND
EMPLOYEE BEHAVIOR