Basic Elements of Organizing
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Transcript of Basic Elements of Organizing
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Basic Elements of OrganizingBasic Elements of Organizing
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In this chapter you will learnIn this chapter you will learn
• Definition of Organizing
• Definition of organizational structure
• The Elements of Organizing
• 1. Designing Jobs– Job Specialization– Benefits and Limitations of
Specialization– Alternatives to Specialization
2. Grouping Jobs: Departmentalization– Rationale – Common Bases and advantage and
disadvantages of each base
3. Establishing Reporting Relationships– Chain of Command– Narrow Versus Wide Spans– Tall Versus Flat Organizations– Determining the Appropriate SOC
• Definition of Organizing
• Definition of organizational structure
• The Elements of Organizing
• 1. Designing Jobs– Job Specialization– Benefits and Limitations of
Specialization– Alternatives to Specialization
2. Grouping Jobs: Departmentalization– Rationale – Common Bases and advantage and
disadvantages of each base
3. Establishing Reporting Relationships– Chain of Command– Narrow Versus Wide Spans– Tall Versus Flat Organizations– Determining the Appropriate SOC
4. Distributing Authority– The Delegation Process– Decentralization and Centralization
5. Coordinating Activities– The Need for Coordination– Structural Coordination Techniques
6. Differentiating Between Positions– Differences Between Line and Staff– Administrative Intensity
4. Distributing Authority– The Delegation Process– Decentralization and Centralization
5. Coordinating Activities– The Need for Coordination– Structural Coordination Techniques
6. Differentiating Between Positions– Differences Between Line and Staff– Administrative Intensity
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The Elements OrganizingThe Elements Organizing
• Organizing– Deciding how to best
group organizational activities and resources.
• Organization Structure– The set of building blocks
that can be used to configure an organization.
• Organizing– Deciding how to best
group organizational activities and resources.
• Organization Structure– The set of building blocks
that can be used to configure an organization.
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Hierarchical OrganisationIn a hierarchical organisation employees are ranked at various levels within the organisation, each level is one above the other. At each stage in the chain, one person has a number of workers directly under them, within their span of control.
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Macquarie's six business Groups
Macquarie's organizational approach is designed to be non-hierarchical. Management of the organization is largely delegated to the Executive Committee, a central group comprising the Chairman, Managing Director, Deputy Managing Director, Head of Risk Management and heads of the Bank's six major business Groups.Within overall guidelines and specific parameters set by the Board and Executive Committee, the six business Groups have substantial discretion in the conduct of their various businesses. Business activities are carried out by Divisions, which focus on particular products and markets. Outside the major business Groups is a specialist business, Macquarie Direct Investment, which is responsible for managing the Bank's private equity activities.
Macquarie Bank - Organisation Structure
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Basic elements organizingBasic elements organizing
– Job DesigningJob Designing
– DepartmentalizationDepartmentalization
– Reporting Reporting RelationshipsRelationships
– Distribution of Distribution of Authority Authority
– CoordinationCoordination
– DifferentiationDifferentiation
– Job DesigningJob Designing
– DepartmentalizationDepartmentalization
– Reporting Reporting RelationshipsRelationships
– Distribution of Distribution of Authority Authority
– CoordinationCoordination
– DifferentiationDifferentiation
Basic Elements of Organizing
1-Job Design 2- Departmentalization
3- Reporting Relationship 4- Distributing Authority
5- Coordination 6- Differentiation
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Designing JobsDesigning Jobs
• What is ‘Designing Jobs’?• How would you design jobs for an entire
organization?• Define ‘Job Specialization - JS’?• What are the benefits of JS?• What are the limitations of JS?• Define the following terms:
– Job Rotation– Job Enlargement– Job Enrichment– Team work– Job- Characteristics Approach
• What is ‘Designing Jobs’?• How would you design jobs for an entire
organization?• Define ‘Job Specialization - JS’?• What are the benefits of JS?• What are the limitations of JS?• Define the following terms:
– Job Rotation– Job Enlargement– Job Enrichment– Team work– Job- Characteristics Approach
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Job DesignJob Design
Determination of an individual’s work-related responsibilities.
Determination of an individual’s work-related responsibilities.
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Job Specialization (Division of Job Specialization (Division of Labor)Labor)
The degree to which the
overall task of the organization is broken down and
divided into smaller component parts
The degree to which the
overall task of the organization is broken down and
divided into smaller component parts
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Making a nail dilemma?Making a nail dilemma?• How many tasks does it
take to make a nail?– 18
• How many nails can one worker make in a day, if he/she is doing all the tasks?– 20
• How many nails can be made by 20 workers?– 20 * 20 = 400 nails
• How many tasks does it take to make a nail?– 18
• How many nails can one worker make in a day, if he/she is doing all the tasks?– 20
• How many nails can be made by 20 workers?– 20 * 20 = 400 nails
• How many steps does it take to make a nail?– 18
• How many nails can one worker process in a day, if he/she is specialized in one task one?– 5000
• How many nails by 20 workers?– 20 * 5000 = 100,000 nails
• How many steps does it take to make a nail?– 18
• How many nails can one worker process in a day, if he/she is specialized in one task one?– 5000
• How many nails by 20 workers?– 20 * 5000 = 100,000 nails
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Adam Smith’s ExampleAdam Smith’s Exampleof Job Specializationof Job Specialization
Making a pin (nail) requires 18 tasks
1 worker doing all 18 tasks might make 20 pins (nails) a day.
20 workers = (20 x 20) = 400 pins______________________________
With specialization:
20 workers make 100,000 pins a day.1 worker = 5,000 pins
20 pins vs. 5,000 pins per worker
Making a pin (nail) requires 18 tasks
1 worker doing all 18 tasks might make 20 pins (nails) a day.
20 workers = (20 x 20) = 400 pins______________________________
With specialization:
20 workers make 100,000 pins a day.1 worker = 5,000 pins
20 pins vs. 5,000 pins per worker
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+ & - Job Specialization+ & - Job Specialization
Benefits•Proficient•Transfer time •Specialized equipment •Replacement
Limitations•Boredom and dissatisfaction •Anticipated benefits do not always occur.
Benefits•Proficient•Transfer time •Specialized equipment •Replacement
Limitations•Boredom and dissatisfaction •Anticipated benefits do not always occur.
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Alternatives to Job SpecializationAlternatives to Job Specialization
•Job Rotation•Job Enlargement•Job Enrichment•Team Work •Job Characteristics Approach
•Job Rotation•Job Enlargement•Job Enrichment•Team Work •Job Characteristics Approach
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Classify the following into: Work Teams, Job Classify the following into: Work Teams, Job Enrichment, Job Enlargement and Job Enrichment, Job Enlargement and Job Rotation.Rotation.
• An operator has four different jobs. He spends three weeks on each of these jobs and then starts the cycle over again with the first job of the operation.
• Sulma’s job is a data entry operator. Her job has been redesigned and now she also has a higher level responsibility in the PR. Now she is also responsible to reply customers complaints.
• Fatima is a typist for the sales section. Her job has been redesigned to include typing for the advertising section as well.
• Ahmed, Sulman and Ali are working as a group. They have the full autonomy to design the work system that they will use to perform an interrelated set of tasks.
• An operator has four different jobs. He spends three weeks on each of these jobs and then starts the cycle over again with the first job of the operation.
• Sulma’s job is a data entry operator. Her job has been redesigned and now she also has a higher level responsibility in the PR. Now she is also responsible to reply customers complaints.
• Fatima is a typist for the sales section. Her job has been redesigned to include typing for the advertising section as well.
• Ahmed, Sulman and Ali are working as a group. They have the full autonomy to design the work system that they will use to perform an interrelated set of tasks.
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Alternatives to SpecializationAlternatives to Specialization
• Job Rotation– Systematically moving employees from one job to another in
an attempt to reduce employee boredom. Most frequent use today is as a training device for skills and flexibility.
• Job Enlargement– An increase in the total number of tasks workers perform.
• Job Enrichment– Increasing both the number of tasks the worker does and the
control the worker has over the job.
• Job Rotation– Systematically moving employees from one job to another in
an attempt to reduce employee boredom. Most frequent use today is as a training device for skills and flexibility.
• Job Enlargement– An increase in the total number of tasks workers perform.
• Job Enrichment– Increasing both the number of tasks the worker does and the
control the worker has over the job.
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Alternatives to JSAlternatives to JS
• Work Teams– An alternative to job specialization that allows the entire
group to design the work system it will use to perform an interrelated set of tasks.
• Work Teams– An alternative to job specialization that allows the entire
group to design the work system it will use to perform an interrelated set of tasks.
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Alternatives to Specialization: Alternatives to Specialization: Job Characteristics Job Characteristics ApproachApproach
• Skill variety
• Task identity
• Task significance
• Autonomy
• Feedback
• Skill variety
• Task identity
• Task significance
• Autonomy
• Feedback
• The number of tasks a person does in a job.
• the extent to which the worker does a complete or identifiable portion of the total job
• the perceived importance of the task
• the degree of control the worker has over how the work is performed
• the extent to which the worker knows how well the job is being performed.
• The number of tasks a person does in a job.
• the extent to which the worker does a complete or identifiable portion of the total job
• the perceived importance of the task
• the degree of control the worker has over how the work is performed
• the extent to which the worker knows how well the job is being performed.
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Assess the jobs below using the dimensions of the job characteristics Assess the jobs below using the dimensions of the job characteristics approach approach * Assembly line operator responsible to put lids on the moving jam jars* Assembly line operator responsible to put lids on the moving jam jars* A dentist* A dentist
Skills Variety Number of tasks is high Number of Tasks is limited
Tasks Identity Worker does a minute or unidentifiable portion of the total job
Worker does a complete or identifiable portion of the total job
Task Significance The perceived importance of the task is high
The perceived importance of the task is low
Autonomy The employee has low control over how the work is performed
The employee has high control over how the work is performed
Feedback The employee clearly and immediately knows how well the job is being performed.
It takes time for the employee to formally know well the job has been performed
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Assess the jobs below using the dimensions of the job characteristics Assess the jobs below using the dimensions of the job characteristics approach approach
* Assembly line operator responsible to put lids on the moving jars* Assembly line operator responsible to put lids on the moving jars
Skills Variety Number of Tasks is limited
Tasks Identity Worker does a minute or unidentifiable portion of the total job
Task Significance the perceived importance of the task is low
Autonomy The employee has low control over how the work is performed
Feedback It takes time for the employee to know well the job has been performed
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Assess the jobs below using the dimensions of the job characteristics Assess the jobs below using the dimensions of the job characteristics approach approach
* A dentist* A dentist
Skills Variety Number of tasks is high
Tasks Identity Worker does a complete or identifiable portion of the total job
Task Significance the perceived importance of the task is high
Autonomy The employee has high control over how the work is performed
Feedback The employee clearly and immediately knows how well the job is being performed.
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Which of the following job dimensions will lead the Which of the following job dimensions will lead the dentist to experience the specified psychological dentist to experience the specified psychological state state
• The dentist will experience meaningfulness of his work because his job includes
a) High skills varietyb) High task identityc) High task significanced) High Autonomye) High Feedback
• The dentist will experience that he/she is responsible for the work done because his/her job is designed with
a) High skills varietyb) High task identityc) High task significanced) High Autonomye) High Feedback
• The dentist will experience meaningfulness of his work because his job includes
a) High skills varietyb) High task identityc) High task significanced) High Autonomye) High Feedback
• The dentist will experience that he/she is responsible for the work done because his/her job is designed with
a) High skills varietyb) High task identityc) High task significanced) High Autonomye) High Feedback
• The dentist will experience that he/she has knowledge of the actual results of his/her activities because his/her job is designed witha) High skills variety
b) High task identity
c) High task significance
d) High Autonomy
e) High Feedback
• The dentist will experience that he/she has knowledge of the actual results of his/her activities because his/her job is designed witha) High skills variety
b) High task identity
c) High task significance
d) High Autonomy
e) High Feedback
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Matching the person & the jobMatching the person & the job• You have been asked to design jobs
for the following job candidates. Use the Job Characteristics Approach to design the jobs.
– Jassim is highly motivated, exercises self control, fast learner ,independent and is a risk taker. He is always on the look for new challenges.
– Abullah is a reserved person, who likes to be told what to do and strictly follows the orders. He is risk averse.
• Whom would you describe as a person who is eager to grow. In other words who has strong desire to develop, and expand his capabilities.
– (a) Jassim– (b) Abullah
• You have been asked to design jobs for the following job candidates. Use the Job Characteristics Approach to design the jobs.
– Jassim is highly motivated, exercises self control, fast learner ,independent and is a risk taker. He is always on the look for new challenges.
– Abullah is a reserved person, who likes to be told what to do and strictly follows the orders. He is risk averse.
• Whom would you describe as a person who is eager to grow. In other words who has strong desire to develop, and expand his capabilities.
– (a) Jassim– (b) Abullah
• Would you design a job for Jassim that is high on the five core dimensions of the job characteristics approach.
(a) Yes(b) No
• Would it be right to describe Jassim as person who has high growth needs.
(a) Yes(b) No
• Would you describe the job that you would design for Jassim as
– (a) strong on all five dimensions of the job characteristics approach
– (b) Low on all five dimensions of the job characteristics approach
• Would you design a job for Jassim that is high on the five core dimensions of the job characteristics approach.
(a) Yes(b) No
• Would it be right to describe Jassim as person who has high growth needs.
(a) Yes(b) No
• Would you describe the job that you would design for Jassim as
– (a) strong on all five dimensions of the job characteristics approach
– (b) Low on all five dimensions of the job characteristics approach
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Job Job Characteristics Characteristics
ApproachApproach
Core jobdimensions
Personal andwork outcomes
Criticalpsychologicalstates
Experiencedresponsibilityfor outcomesof the work
• Skill variety• Task identity• Task significance
• Autonomy
• FeedbackKnowledge of theactual results ofwork activities
Employeegrowth-needstrength
• High internalwork motivation
• High-quality workperformance
• High satisfactionwith the work
• Low absenteeismand turnover
Experiencedmeaningfulnessof the work
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Grouping Jobs: Grouping Jobs: DepartmentalizationDepartmentalization
• Departmentalization– The process of grouping jobs according to some
logical arrangement.
• Rationale for Departmentalization– Organizational growth exceeds
the owner-manager’s capacity to personally supervise all of the organization.
– Additional managers are employed and assigned specific employees to supervise.
• Departmentalization– The process of grouping jobs according to some
logical arrangement.
• Rationale for Departmentalization– Organizational growth exceeds
the owner-manager’s capacity to personally supervise all of the organization.
– Additional managers are employed and assigned specific employees to supervise.
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Building Block 2: Grouping Jobs: Departmentalization
• What is Departmentalization?
• From the facts below, draw an organization chart for Apex Computers. Specify the departmentalization bases for each hierarchical level.
Apex computers has two divisions for its main products, Computers and software. Manufacturing, Finance an Marketing are the departments in the Computers division. The Software division is has Marketing, Finance and Design departments. The Design department has two sections, Saudi Arabia and Bahrain. The Manufacturing Department has two sections, UEA and Oman. The Marketing Department in the Computer Division has two sections, Industrial Sales and Consumer sales. The Consumer Sales section has five units, Saudi Arabia, UAE, Bahrain, Oman and Qatar.
• What is Departmentalization?
• From the facts below, draw an organization chart for Apex Computers. Specify the departmentalization bases for each hierarchical level.
Apex computers has two divisions for its main products, Computers and software. Manufacturing, Finance an Marketing are the departments in the Computers division. The Software division is has Marketing, Finance and Design departments. The Design department has two sections, Saudi Arabia and Bahrain. The Manufacturing Department has two sections, UEA and Oman. The Marketing Department in the Computer Division has two sections, Industrial Sales and Consumer sales. The Consumer Sales section has five units, Saudi Arabia, UAE, Bahrain, Oman and Qatar.
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Bases for Departmentalization: Apex ComputersBases for Departmentalization: Apex Computers
DesignMarketingMarketing
Computers
President
Software
Manufac-turing
FinanceFinance
OmanUAE
Consumer sales
Industrial sales
BahrainSaudi Arabia
UAE Oman QatarSaudi Arabia
Bahrain
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Functional DepartmentalizationFunctional Departmentalization
• Advantages– experts.– Supervision is facilitated – Coordination
• Advantages– experts.– Supervision is facilitated – Coordination
• Disadvantages– slow and bureaucratic.– narrow focus – Accountability
• Disadvantages– slow and bureaucratic.– narrow focus – Accountability
•Is the grouping of jobs involving the same or similar activities.
•Is the grouping of jobs involving the same or similar activities.
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Product Departmentalization Product Departmentalization FormForm
• Advantages– All in one– Speed and effectiveness – Performance assessment
• Advantages– All in one– Speed and effectiveness – Performance assessment
• Disadvantages– Product focus.– Administrative costs
• Disadvantages– Product focus.– Administrative costs
• Product Departmentalization
– The grouping of activities around products or product groups.
• Product Departmentalization
– The grouping of activities around products or product groups.
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Customer DepartmentalizationCustomer Departmentalization
• Customer Departmentalization– Grouping activities to respond to and interact with specific
customers and customer groups.
• Advantage– Skilled specialists can deal
with unique customers orcustomer groups.
• Disadvantage– A large administrative staff
is needed to integrate activities of various departments.
• Customer Departmentalization– Grouping activities to respond to and interact with specific
customers and customer groups.
• Advantage– Skilled specialists can deal
with unique customers orcustomer groups.
• Disadvantage– A large administrative staff
is needed to integrate activities of various departments.
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Location DepartmentalizationLocation Departmentalization
• Location Departmentalization– The grouping of jobs on the basis of defined
geographic sites or areas.
• Advantage– Quick response
• Disadvantage– Large administrative
• Location Departmentalization– The grouping of jobs on the basis of defined
geographic sites or areas.
• Advantage– Quick response
• Disadvantage– Large administrative
Advantages and Disadvantages of Each Departmentalization BaseAdvantages and Disadvantages of Each Departmentalization Base
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Functional Product Customer Location Advantage (+) and Disadvantage (-)
+The department can be staffed with experts in the functional areas
+Supervision is facilitated as each individual manager has to deal with relatively narrow set of skills
+ All activities associated with a specific product or product group are easily integrated and coordinated. Therefore, the speed and effectiveness of decision making regarding a specific products is enhanced
+ All activities associated with a customers are easily integrated and coordinated. Therefore, the speed and effectiveness of decision making regarding a specific customers is enhanced as skilled specialists can deal with unique customers or customer groups.
+ All activities associated with a specific geographical areas are easily integrated and coordinated. Therefore, the speed and effectiveness of decision making regarding a specific geographical area is enhanced
+ the performance of individual products or product groups can be assessed more easily and objectively
-Accountability and performance becomes more difficult to measure
+Quick response to the specific needs of customers in a specific geographical area
-As the organization grows, decision making tend to become slower and more bureaucratic
-narrow focus as employees tend to concentrate on their own unit rather than the total organization
- A large administrative staff is needed to integrate activities of various departments.
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Other Forms of Other Forms of Departmentalization:Departmentalization:
•Time
•Sequence
•Time
•Sequence
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Other ConsiderationsOther Considerations
•Sometimes departments are called something different, such as:– Division.– Units.– Section.– Bureaus.
•Sometimes departments are called something different, such as:– Division.– Units.– Section.– Bureaus.
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Establishing Reporting Establishing Reporting RelationshipsRelationships
• Chain of Command– A clear and distinct line of
authority among the positions in an organization.
– Unity of Command• Each person within an organization must have
a clear reporting relationship to one and only one boss.
– Scalar Principle
• A clear and unbroken line of authority must extend from the
bottom to the top of the organization.
• Chain of Command– A clear and distinct line of
authority among the positions in an organization.
– Unity of Command• Each person within an organization must have
a clear reporting relationship to one and only one boss.
– Scalar Principle
• A clear and unbroken line of authority must extend from the
bottom to the top of the organization.
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Chain of CommandChain of CommandChain of CommandChain of Command
Unity of Command – one and only one boss
Scalar Principal – clear and unbroken line of authority extending from the bottom to the top
02-05-I200-SL
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Span of Control (SOC)Span of Control (SOC)
Number of people who report to a particular manager
Number of people who report to a particular manager
02-12-I200-SL
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Span of ControlSpan of Control
Narrow Span of control
02-12-I200-SL
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Span of ControlSpan of Control
Narrow - Effective span of control
02-12-I200-SL
Narrow - Effective span of control
Narrow - Effective span of controlWide Span of Control
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Optimum Span of Control ?Optimum Span of Control ?
1 2 3 4 5
Supervisor
1 2 3 4 5
Supervisor
02-13-I200-SL
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? What is the optimum SOC? What is the optimum SOC
A. V. Graicunas
•Subordinate interactions
• I = N(2N/2 + N - 1)
A. V. Graicunas
•Subordinate interactions
• I = N(2N/2 + N - 1)
• Ralph Davis– Operative span for
lower-level managers up to 30 workers.
– Executive span for middle and top managers at 3 to 9.
• Al-Qosaibi– Refer to article
• Ralph Davis– Operative span for
lower-level managers up to 30 workers.
– Executive span for middle and top managers at 3 to 9.
• Al-Qosaibi– Refer to article
Highlight the appropriate type
Advantages (+) or Disadvantages (-)
Tall Organization
Flat Organization
- Expensive (Why?)
Tall Organization
Flat Organization
- Communication is relatively more difficult
Tall Organization
Flat Organization
+ leads to higher levels of employees moral and productivity
Tall Organization
Flat Organization
-Create more supervisory responsibility for managers due to the wider spans of control.
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Tall Versus Flat OrganizationsTall Versus Flat OrganizationsPresident
President
Tall Organization
Flat Organization
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Establishing Reporting Establishing Reporting Relationships:Relationships:
Tall versus Flat OrganizationsTall versus Flat Organizations• Tall Organizations
– expensive
– communication problems
• What type of SOC is associated with tall organization?
• Tall Organizations– expensive
– communication problems
• What type of SOC is associated with tall organization?
• Flat Organizations– higher levels of employee
morale and productivity
– Create more supervisory responsibility for managers due to wider spans of control.
• What type of SOC is associated with tall organization?
• Flat Organizations– higher levels of employee
morale and productivity
– Create more supervisory responsibility for managers due to wider spans of control.
• What type of SOC is associated with tall organization?
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Determining the Appropriate Span:Determining the Appropriate Span:Factors Influencing the Span of Factors Influencing the Span of
ManagementManagement1. Competence of supervisor and subordinates - the greater the
competence, the (wider, narrower) the potential span.
2. Physical dispersion of subordinates - the greater the dispersion, the (narrower, wider) the potential span.
3. Extent of nonsupervisory work in a manager’s job - the more nonsupervisory work, the (narrower, wider) the potential span.
4. Degree of required interaction - the less required interaction, the (wider, narrower) the potential span.
5. Extent of standardized procedures -the more procedures, the (wider, narrower) the potential span.
6. Similarity of tasks being supervised - the more similar the tasks, the (wider, narrower) the potential span.
7. Frequency of new problems - the higher the frequency, the (narrower, wider) the potential span.
8. Preferences of supervisors and subordinates.
Table 11.1
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Determining the Appropriate Span:Determining the Appropriate Span:Factors Influencing the Span of Factors Influencing the Span of
ManagementManagement1. Competence of supervisor and subordinates (the greater the
competence, the wider the potential span).
2. Physical dispersion of subordinates (the greater the dispersion, the narrower the potential span).
3. Extent of nonsupervisory work in a manager’s job (the more nonsupervisory work, the narrower the potential span).
4. Degree of required interaction (the less required interaction, the wider the potential span).
5. Extent of standardized procedures (the more procedures, the wider the potential span).
6. Similarity of tasks being supervised (the more similar the tasks, the wider the potential span).
7. Frequency of new problems (the higher the frequency, the nar-rower the potential span).
8. Preferences of supervisors and subordinates.
Table 11.1
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Distributing AuthorityDistributing Authority
• Authority– Power that has been legitimized by the organization.
• Delegation– The process by which managers assign a portion of their
total workload to others.
• Temporary
• Reasons for Delegation– get more work done – development of subordinates
• Authority– Power that has been legitimized by the organization.
• Delegation– The process by which managers assign a portion of their
total workload to others.
• Temporary
• Reasons for Delegation– get more work done – development of subordinates
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Steps in the Delegation ProcessSteps in the Delegation Process
Manager
Step 1Assigning
responsibility
Step 3Creating
accountability
Step 2Grantingauthority
Manager
Subordinate
Manager
Subordinate
ManagerManager
Subordinate
Figure 11.4
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Steps in the Delegation ProcessSteps in the Delegation Process
Manager
Step 1Telling the subordinated
to do the job
Step 3Establishing
Obligation
Step 2Power
Manager
Subordinate
Manager
Subordinate
ManagerManager
Subordinate
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Problems in DelegationProblems in Delegation
• Manager
– Reluctant to delegate
– Disorganized manager
– Threat
– Trust issue
• Manager
– Reluctant to delegate
– Disorganized manager
– Threat
– Trust issue
• Subordinate
– Fear of failure
– Avoidance of risk and responsibility
– no rewards
• Subordinate
– Fear of failure
– Avoidance of risk and responsibility
– no rewards
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Decentralization and Decentralization and CentralizationCentralization
• Decentralization– The process of systematically delegating power
and authority throughout the organization to middle- and lower-level managers.
• Centralization– The process of systematically retaining power
and authority in the hands of higher-level managers.
• Factors Determining the Choice of Centralization– The complexity and uncertainty of the external environment.– The history of the organization.– The nature (cost and risk) of the decisions to be made.
• Decentralization– The process of systematically delegating power
and authority throughout the organization to middle- and lower-level managers.
• Centralization– The process of systematically retaining power
and authority in the hands of higher-level managers.
• Factors Determining the Choice of Centralization– The complexity and uncertainty of the external environment.– The history of the organization.– The nature (cost and risk) of the decisions to be made.
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Coordinating ActivitiesCoordinating Activities
• Coordination
– The process of linking the activities of the various
departments of the organization.
• The Need for Coordination - Interdependence -
• Coordination
– The process of linking the activities of the various
departments of the organization.
• The Need for Coordination - Interdependence -
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Coordinating Activities: Coordinating Activities: Three Major Forms of Three Major Forms of InterdependenceInterdependence
• When the output of one unit becomes the input of another unit in an ordered fashion.
a) Pooled interdependence
b) Sequential interdependence
c) Reciprocal interdependence
• When units operate with little interaction; their output is simply gathered at the organizational level.
a) Pooled interdependence
b) Sequential interdependence
c) Reciprocal interdependence
• When the output of one unit becomes the input of another unit in an ordered fashion.
a) Pooled interdependence
b) Sequential interdependence
c) Reciprocal interdependence
• When units operate with little interaction; their output is simply gathered at the organizational level.
a) Pooled interdependence
b) Sequential interdependence
c) Reciprocal interdependence
• When activities flow both ways between units.
a) Pooled interdependence
b) Sequential interdependence
c) Reciprocal interdependence
• When activities flow both ways between units.
a) Pooled interdependence
b) Sequential interdependence
c) Reciprocal interdependence
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Coordinating Activities:Coordinating Activities:Three Major Forms of Three Major Forms of
InterdependenceInterdependence• Pooled interdependence
– When units operate with little interaction; their output is simply pooled at the organizational level.
• Sequential interdependence– When the output of one unit becomes the input of another
unit in sequential fashion.
• Reciprocal interdependence– When activities flow both ways
between units.
• Pooled interdependence– When units operate with little interaction; their output is
simply pooled at the organizational level.
• Sequential interdependence– When the output of one unit becomes the input of another
unit in sequential fashion.
• Reciprocal interdependence– When activities flow both ways
between units.
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InputInput OutputOutput
SequentialSequential
Three Major Forms of Three Major Forms of InterdependenceInterdependence
PooledPooled
InputInput
InputInput
InputInput
OutputOutput
OutputOutputInputInput
OutputOutputInputInputOutputOutputInputInput
ReciprocalReciprocal
In Kmart the nature of work in the Loading and
Unloading sections is highly interrelated
The nature of the Finance and Project Management
Department is acute
In Kmart, lunching a new product requires
temporary coordinating between many units
2 groups of employeesworking on different
shipments for thesame destination. One manager is
Acting as a point of contactbetween the two groups
In Kmart, everyone knows that the truck shipment
has priority over mail shipment
Structural Coordination Techniques
Coordination Techniques
Select the appropriate coordinating technique to each of the cases
1- Rules and Regulations- Routine coordination
activates can be handled via Rules and Regulations
2-Liaison Roles- A manager in a liaison
role coordinates interdependent units
3-Managerial Hierarchy – Placing one manager in
charge of two interdependent units
4- Integrating Department-Creating a permanent
department to coordinate between to highly interdependent units
5- Taskforce- Creating a temporary
taskforce to manage the coordination
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Structural Coordination TechniquesStructural Coordination Techniques• Routine coordination activities can be
handled via formal predetermined steps that set priorities and guidelines for actions.a) The Managerial Hierarchyb) Rules and Proceduresc) Liaison Rolesd) Task Forcese) Integrating Departments
• Placing one manager in charge of interdependent departments or units.a) The Managerial Hierarchyb) Rules and Proceduresc) Liaison Rolesd) Task Forcese) Integrating Departments
• A manager coordinates interdependent units by acting as a common point of contact, facilitating the flow of information.a) The Managerial Hierarchyb) Rules and Proceduresc) Liaison Rolesd) Task Forcese) Integrating Departments
• Routine coordination activities can be handled via formal predetermined steps that set priorities and guidelines for actions.a) The Managerial Hierarchyb) Rules and Proceduresc) Liaison Rolesd) Task Forcese) Integrating Departments
• Placing one manager in charge of interdependent departments or units.a) The Managerial Hierarchyb) Rules and Proceduresc) Liaison Rolesd) Task Forcese) Integrating Departments
• A manager coordinates interdependent units by acting as a common point of contact, facilitating the flow of information.a) The Managerial Hierarchyb) Rules and Proceduresc) Liaison Rolesd) Task Forcese) Integrating Departments
• Used with multiple units when coordination is complex, requiring more than one individual, and the need for coordination is acute. This type of coordination is disbanded when the need for coordination has been met.
a) The Managerial Hierarchyb) Rules and Proceduresc) Liaison Rolesd) Task Forcese) Integrating Departments
• Permanent organizational units that maintain internal integration and coordination on an ongoing basis. It may have authority and budgetary controls.
a) The Managerial Hierarchyb) Rules and Proceduresc) Liaison Rolesd) Task Forcese) Integrating Departments
• Used with multiple units when coordination is complex, requiring more than one individual, and the need for coordination is acute. This type of coordination is disbanded when the need for coordination has been met.
a) The Managerial Hierarchyb) Rules and Proceduresc) Liaison Rolesd) Task Forcese) Integrating Departments
• Permanent organizational units that maintain internal integration and coordination on an ongoing basis. It may have authority and budgetary controls.
a) The Managerial Hierarchyb) Rules and Proceduresc) Liaison Rolesd) Task Forcese) Integrating Departments
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Structural Coordination Structural Coordination TechniquesTechniques
• The Managerial Hierarchy– Placing one manager in charge of interdependent
departments or units.
• Rules and Procedures– Routine coordination activities can be handled via rules and
procedures that set priorities and guidelines for actions.
• Liaison Roles– A manager coordinates
interdependent units by acting as a common point of contact, facilitating the flow of information.
• The Managerial Hierarchy– Placing one manager in charge of interdependent
departments or units.
• Rules and Procedures– Routine coordination activities can be handled via rules and
procedures that set priorities and guidelines for actions.
• Liaison Roles– A manager coordinates
interdependent units by acting as a common point of contact, facilitating the flow of information.
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Structural Coordination Structural Coordination Techniques (cont’d)Techniques (cont’d)
• Task Forces– Used with multiple units when coordination
is complex requiring more than one individual and the need for coordination is acute.
– Disbanded when the need for coordination has been met.
• Integrating Departments– Permanent organizational units that maintain internal
integration and coordination on an ongoing basis.– May have authority and budgetary controls.
• Task Forces– Used with multiple units when coordination
is complex requiring more than one individual and the need for coordination is acute.
– Disbanded when the need for coordination has been met.
• Integrating Departments– Permanent organizational units that maintain internal
integration and coordination on an ongoing basis.– May have authority and budgetary controls.
Designing JobsJob SpecializationBenefits and Limitations of SpecializationAlternatives to Specialization
Rationale Common Bases Product Customer Location Functional
Chain of Command Unity of Command Scalar PrincipleSpan of ControlNarrow Versus Wide SpansTall Versus Flat Organizations
The Delegation ProcessDecentralization and Centralization
The Need for CoordinationTypes of CoordinationStructural Coordination Techniques
Differences Between Line and StaffAdministrative Intensity
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In this chapter you will learntIn this chapter you will learnt
• Definition of Organizing?• Definition of organizational structure
• The Elements of Organizing
• 1. Designing Jobs– Job Specialization– Benefits and Limitations of
Specialization– Alternatives to Specialization
2. Grouping Jobs: Departmentalization– Rationale – Common Bases and advantage and
disadvantages of each base
3. Establishing Reporting Relationships– Chain of Command– Narrow Versus Wide Spans– Tall Versus Flat Organizations– Determining the Appropriate SOC
• Definition of Organizing?• Definition of organizational structure
• The Elements of Organizing
• 1. Designing Jobs– Job Specialization– Benefits and Limitations of
Specialization– Alternatives to Specialization
2. Grouping Jobs: Departmentalization– Rationale – Common Bases and advantage and
disadvantages of each base
3. Establishing Reporting Relationships– Chain of Command– Narrow Versus Wide Spans– Tall Versus Flat Organizations– Determining the Appropriate SOC
4. Distributing Authority– The Delegation Process– Decentralization and Centralization
5. Coordinating Activities– The Need for Coordination– Structural Coordination Techniques
6. Differentiating Between Positions– Differences Between Line and Staff– Administrative Intensity
4. Distributing Authority– The Delegation Process– Decentralization and Centralization
5. Coordinating Activities– The Need for Coordination– Structural Coordination Techniques
6. Differentiating Between Positions– Differences Between Line and Staff– Administrative Intensity