Important Notes

Chap-5-8
 Organization

• A pattern of many
interwoven,simultaneous
relationship- through
which people,under the
direction of
managers,pursue their
common goals.
 Organization
• Formal organization :A formalized intentional structure of
roles or positions(organizational chart)
• Informal organization:The undocumented and
officially unrecognized relationship between
members of an organization that inevitably emerge
out of the personal and group needs of employees.
 Organization Chart
advantage
• It shows formal authority
relationship and omits the many
significant informal and
informational relationship
 Organization Chart
disadvantage
• Organization structure is dynamic
chart may obsolete

• Make people overly conscious of

being superiors or inferiors
 Organization Chart

• Importance of Informal
organization and Grapevine
Is a network of interpersonal relationship that arise
when people associate with each other (not charted)
• Bring cohesiveness to formal
organization
• Channel of communication
• Inevitable and valuable
Organizing -4 building blocks
• Identification of required activities
• Grouping of activities necessary to attain
objective( departmentalization )
• Assignment of each group to a manager
with authority necessary to supervise
• The provision for coordination horizontally
and vertically
 Three level of strategy

CORPORATE STRATEGY
What kind of businesses,goals/expectations/resources

BUSINESS UNIT STRATEGY

Sales of a particular businesses

FUNCTIONAL LEVEL STRATEGY

Marketing/Production

OPERATING PLANS
Day to day activities
 Strategic Business Units

• strategic business unit is a significant

organization segment that is analyzed to
develop organizational strategy aimed at
generating future business or revenue.

•Increase the focus on a particular Business

 Strategic Business Units

It might be a certain product/company’s

division or product lines are promoted. It
has its;

•Own mission
•Definable group of competitors
•Own integrative
plan/resources/appropriate size
The Deming Cycle

A company within the company

 Strategic Business Units
The role of the Business unit Head /Business unit Manager

•Guiding and promoting product/product lines

•Close liaison with all the functional department
•Enhances the Entrepreneurship
•BOTTOM-LINE responsibility for its PROFITABILITY
•Accountable of all operations
 Core competency
Combination of both skills
component and quality of
resources that leads to obtain
“streams of technology.”

Potential problem with SBU

Not willing to share talented
people
 Power

Power The ability of individuals or groups to

induce or influence the beliefs or actions of
other persons or groups.
 Types of Power
• Power of knowledge (Expertness of a person)
• Referent power (Influence people bcoz believe in them and
their ideas)

• Reward power (Ability to reward)

• Coercive power (Ability to punish)
 Empowerment (employee
participation/TQM
Act of providing
authority,knowledge,and resources to
individual so they can achieve work .
2 ways to Empowerment
•Job Enlargement (Enlarging the scope of the job by adding similar
kind of the job without enhancing responsibility ) Horizontal

•Job Enrichment
•(Building into jobs a higher sense of challenge and achievement ) Vertical
Belief- values-attitude-
behavior –actions
 Culture is the general pattern of
behavior,shared beliefs and
values that organization members
have in common
Can corporate culture change?

Leader has a major role on organization culture

It takes time 5-10years
Understand the old culture
Identify the subculture
And rewarding those living new culture
 Organizational
Culture(corporate Culture)
It is total system of social and
cultural relationship where people
working together and fill in
intended roles to ensure the
required activities should be done
effectively and efficiently i-
e(organizational communication and decision making