MS Unit-IIs

8/8/2019 MS Unit-IIs

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UNIT-II

Designing Organizational

Structures


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Unit-2 Designing OrganisationalStructures 2

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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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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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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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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Unit-2 Designing OrganisationalStructures

11

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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12

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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14

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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Unit-2 Designing Organisational

Structures

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Lecture - 4 Pyramid Approach


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Structures

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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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Structures

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Structures

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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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Structures

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Lecture - 5 lean and flat organization structure


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Structures

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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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Structures

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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

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