Organizational Structure and Design Chapter 5 BUSM 12 Ms. Stewart.
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Transcript of Organizational Structure and Design Chapter 5 BUSM 12 Ms. Stewart.
Organizational Structure and Design
Chapter 5
BUSM 12
Ms. Stewart
Organizational Structure
How job tasks are formally divided, grouped, and coordinated within an organization
When managers develop or change the structure, they are engaged in organizational design
Purposes of Organizing
Departmentalization
This is the basis on which jobs are grouped together
Common forms: Functional Geographical Product Process Customer
Functional Departmentalization
Groups jobs by functions performed
Geographical Departmentalization
Groups jobs on the basis of territory or geography
Product Departmentalization Groups jobs by product line
Process Departmentalization
Groups jobs on the basis of product or customer flow
Customer Departmentalization
Groups jobs on the basis of customer who have common needs or problems
Traditional Organization Structure
Line and Staff Managers
Line managers are responsible for essential activities of the organization, including production and sales
Staff Managers work in supporting activities of the organizations (such as Human Resources or Accounting)
Centralization
The degree to which decision making is concentrated at a single point in the organization
Example: If the top managers make the organization's key decisions with little to no input from below
Decentralization
The degree to which lower level employees provide input or actually make decisions