Post on 10-Apr-2018
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UNIT-II
Designing Organizational
Structures
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Lesson Plan
LECTURE TOPIC SLIDE
FROM - TO
Lt 1 Introduction toOrganisation
4-8
Lt 2 Departmentation 10-12
Lt 3 Types of Organizations 14-28
Lt 4 Pyramid Approach 30-32
Lt 5 lean and flat organizationstructures
34-35
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Lecture - 1Introduction to Organisation
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Organization Organization refers to the institution
where in the management functions
are performed
Organizing: is one of the functionsof management means to achieve theplans.
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Basics concepts related to the
organization Organizational Hierarchy
Authority and Responsibility
Authority is the power to givecommands and to use discertionvested in that particular position orJob.
Responsibility is the obligation onthe part of the subordinate to completethe given job.
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Basics concepts related to the
organization Delegation of Authority
The process of transferring authority fromtop to the lower levels in the organization is
called delegation.Two types of Delegation
1. Centralized
2. De-centralized
Span of Management
Number of all kinds of relationships (N)=n(2n-1+n-1)
Where n=number of subordinates reporting to amanager
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Basics concepts related to the
organization
Flat and Tall organizations
Flat organization:-Which have relativelyfew or even one level of management.
Flat is also known as wider span of control
Flat organization
Managing Director
Manager(sales)
Manager(production)
Manager(personnel)
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Basics concepts related to the
organizationTall organization:-have many levels of
management
-involves narrow span ofmanagement
Tall organization
MD/ADDITIONAL MD
Manager(sales)
Manager(production)
Manager(personnel)
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Lecture - 2 Departmentation
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Departmentation:-
The division of labour divides the jobs into smaller activities. In order to
coordinate these activities, they are grouped together. The basis by
which these activities are grouped together are known asdepartmentalisation.
It may be defined as the process of forming departments or grouping
activities of an organisation into a number of separate units for the
purpose of efficient functioning. This term vary a great deal betweendifferent organisations.
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For example, in business undertaking, terms are
division, department and section; in Government these
are called branch, department and section; in military,
regiment, batallion groups and company.
The impact of departmentation is a delineation of
executive responsibilities and a grouping of operating
activities. Every level in the hierarchy below the apexis departmentalised and each succeeding lower level
involves further departmental differentiation.
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De
c
e
n
t
ra
l
i
s
a
ti
o
n
:
Th
Decentralisation:
An executive who personally takes many decisions is able to supervise
fewer people than an executive who merely provides encouragement and
occasional direction.
It should be clear that the size of the span of control is related to numerous
variables, and no single limit is likely to apply in all cases. A variety of
factors can influence the resulting number of employees comprising the
optimum span of control in any particular organisation. The span of control
also influence the creation of tall and flat structure. Let us learn the concept
of tall and flat structure.
The degree to which decision making power is extended to the lower levels
of management in the organisation.
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Lecture - 3Types of Organizations
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Types of Organizations1.Line organizations:- is also called military
or scalar organization. is said to be the oldest andmost traditional type of organizations. Managers in
this organizations have direct responsibility for theresults.
Line organization
Engineer
Draughtsman1(Design & Drawings)
Draughtsman 2(plans)
Draughtsman 3(specifications)
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2.Line and Staff Organization:
- Drawn from earlier civilisation and armies.
Staff managers support the functions of theline managers.
Line and staff organization is a serviceorganization.
Line and staff organization in a
manufacturing unit. Line and staff in the armed forces.
Line relationships in staff positions.
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3.Functional organization:
- F.W.Taylor suggested functional
organization in his theory of Scientificmanagement in support of his onebest way of doing things.
The planning and implementationtasks are divided to ensure thedivision of labour.
The foremen involved in the planningtask.
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4.Committee Organization:
-
A committee is formed when two ormore persons are appointed to work asa team to arrive at a decision on thematters referred to it.
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Merits:
- Pools up the organization resources in
terms of knowledge, skills andexperience.
Represents groups, facilitates groupdecisions
It yields good results
It reduces the fear of two muchauthority
It motivates all the concerned
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Demerits:
- Responsibility for decisions cannot be
fixed on a particular person.
It calls for high degree ofcoordination.
It involves high cost in terms of timeand money.
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5.Matrix organization:
- Also called Project organization.
It is a combination of all relationships
in the organization vertical, horizontaland diagonal.
It is mostly used in complex projects.
It provides a high degree ofoperational freedom.
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Merits:
- Offers operational freedom and
flexibility.
Seeks to optimize the utilization ofresources.
It focus on end results.
It maintains professional identity. It holds an employee responsible for
management of resources.
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Demerits:
- Very complex to manage.
Violates unity of command.
Employee may find it frustrating towork with two bosses.
Requires too much time for meetingand collaboration.
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6.Virtual Organization:
- Virtual organization structure does not
physically exist, but its effect is felt.
Example: Bata Shoes
Merits:-
Enable for doing business with less capital,less HR and other inputs.
Provide flexibility of operations. React to the environment demands most
efficiently.
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In the age of specialisation no organisation can survive
without outsourcing. The core activity remains with the main
organisation whereas parts are performed by others. The
virtual organisation (also known as network or modularorganisation) goes a step ahead by outsourcing major
business function. In structural terms the virtual organisation is
highly centralised, with little or no departmentation. When
large organisations use virtual structure, they frequently use it
to outsource manufacturing activities. This is the reason whydo some of the very large organisations do business of crores
of rupees without having manufacturing activities.
The Virtual Organisation :
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Demerits:
- Companies do not have strong
foundations or strengths in their
operations. Organizations have to heavily
depend on out sourcing.
Failure in network results in the
failure of the entire organization.
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7.Team Organization Structure:
- Team structure takes three forms
1. Project team
2. The task force team3. Venture team
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Robins has classified the structural designs into three broad types; the team
structure, the virtual organisation, and the boundary less organisation.
The Team Structure :
The team structure uses the team as the central device to coordinate workactivities. Robins defines work team as a group whose individual efforts result in a
performance greater than the sum of the individual inputs. The primary
characteristics of the team structure are that it breaks down departmental
barriers and decentralises decision making to the level of the work team. One of
the prerequisites of the team structure is that the employees have to be both
generalists as well as specialists. In India some of the well known multinationals
like Xerox, Motorola and the IT giant H.P uses cross functional teams.
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The Boundary Less Organisation :
The credit for coining the term boundary less organisation goes to Mr. Jack
Welch of General Electrics (GE). He wanted GE to become boundary less
organisation. The type of organisation, which seeks to eliminate the chain of
command, have limitless span of control and replace departments with
empowered teams. By removing vertical boundaries, management flattens
the hierarchy, status, and ranks are minimized. G.E. has been using cross-
hierarchical teams, participative decision making practices and 360-degree
performance appraisal system to break vertical boundaries. It is the
networked computers (with the help of internet and intra-net), which makes
the boundaryless organisation possible by allowing people to communicateacross inter-organisational and intra-organisational boundaries. Electronic
Mail for example permits hundreds of employee to share information
simultaneously and allows ranks and file workers to communicate directly
with senior executives.
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Lecture - 4 Pyramid Approach
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Details of the Inverted Pyramid Approach to
Information provision:
Scientific, academic papers are usually written with the regular
pyramid approach: starting with an introduction, review of prior
work, followed by a hypothesis, experimental results and finallythe conclusion. Jakob Nielsen had propounded the Inverted
Pyramid approach in 1996 for writings on the web. Today
almost all sites especially those providing information of
interest to the masses follow the approach.
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Standard vs. Inverted Pyramid Approach
A typical interface designed for an application such as Bhav
Puchiye with various
parameters to be controlled might have designed theinterface in a three stepped manner:
select a produce, select a place (market) and select a date.
But this leads to at least three
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Lecture - 5 lean and flat organization structure
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lean and flat organization structure :-
A system of non - financial controls used to improve
product and service quality and decrease waste. It is a
system of non - financial controls used to improve product
and service quality and decrease waste. it is a process formeasuring and reducing inventory and streamlining
production. It is a means for changing the way a company
measures plant performance. It is a knowledge-based
system. It takes years of hard work, preparation and
support from upper management. Lean is so namedbecause it purports to use much less of certain resources
(space, inventory, workers, etc.) than is used by normal
mass-production systems to produce comparable output.
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Merits of lean and flat organization structure
1.Faster decision making
2.Low overheads
3.More accountability
4.More pronounced responsibilities
5.At time overloaded