Organizational Behavior - Session7

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Foundations of Organizational Structure Lecturer: Do Tien Long09 04 51 54 [email protected] Behavior, Do Tien LongWhat Is Organizational Structure?Organizational StructureHow job tasks are formally divided, grouped, and Key Elements:Key Elements:coordinated.•• Work specializationWork specialization•• DepartmentalizationDepartmentalization•• Chain of commandChain of command•• Span of controSpan of control l•• Centralization and Centralization and decendecenttralizationralization•• FormalizationFormalizationOrganisational Behavior, Do Tien LongKey Design Questions and Answers for Key Design Questions and Answers for Designing the Proper Organization StructureDesigning the Proper Organization StructureThe Key Question The Answer Is Provided By1. To what degree are articles Work specializationsubdivided into separate jobs? 2. On what basis will jobs be grouped Departmentalizationtogether? 3. To whom do individuals and groups Chain of commandreport? 4. How many individuals can a manager Span of controlefficiently and effectively direct? 5. Where does decision-making Centralizationauthority lie? and decentralization 6. To what degree will there be rules Formalizationand regulations to direct employeesand managers?E X H I B I T 16–1E X H I B I T 16–1Organisational Behavior, Do Tien LongWhat Is Organizational Structure? (cont’d)What Is Organizational Structure? (cont’d)Work SpecializationThe degree to which tasks in the organization are subdivided into separate jobs.Division of labor:Division of labor:•• Makes efficient use of employee skillsMakes efficient use of employee skills•• Increases employee skills through repetitionIncreases employee skills through repetition•• Less between-job downtime increases productivityLess between-job downtime increases productivity•• Specialized training is more efficientSpecialized training is more efficient•• Allows use of specialized equipmentAllows use of specialized equipmentOrganisational Behavior, Do Tien LongEconomies and Diseconomies of Work Economies and Diseconomies of Work SpecializationSpecializationE X H I B I T 16–2E X H I B I T 16–2Organisational Behavior, Do Tien LongWhat Is Organizational Structure? (cont’d)What Is Organizational Structure? (cont’d)DepartmentalizationThe basis by which jobs are grouped together.Grouping Activities By:Grouping Activities By:•• FunctionFunction•• ProductProduct•• GeographyGeography•• ProcessProcess•• CustomerCustomerOrganisational Behavior, Do Tien LongWhat Is Organizational Structure? (cont’d)What Is Organizational Structure? (cont’d)AuthorityThe rights inherent in a managerial position to give orders and to expect the orders to be obeyed.Chain of CommandThe unbroken line of authority that extends from the top of the organization to the lowest echelon and clarifies who reports to whom.Unity of CommandA subordinate should have only one superior to whom he or she is directly responsible.Organisational Behavior, Do Tien LongWhat Is Organizational Structure? (cont’d)What Is Organizational Structure? (cont’d)Span of ControlThe number of subordinates a manager can efficiently and effectively direct.Concept:Concept:Wider spans of managementWider spans of management increase organizational increase organizational efficiency.efficiency.NarrowNarrow Span Drawbacks: Span Drawbacks:•• Expense of additional layers of management.Expense of additional layers of management.•• Increased complexity of vertical communication.Increased complexity of vertical communication.•• Encouragement of overly tight supervision and Encouragement of overly tight supervision and discouragement of employee autonomy.discouragement of employee autonomy.Organisational Behavior, Do Tien LongContrasting Spans of ControlE X H I B I T 16–3E X H I B I T 16–3Organisational Behavior, Do Tien LongWhat Is Organizational Structure? (cont’d)What Is Organizational Structure? (cont’d)CentralizationThe degree to which decision making is concentrated at a single point in the organization.DecentralizationThe degree to which decision making is spread throughout the organization.FormalizationThe degree to which jobs within the organization are standardized.Organisational Behavior, Do Tien LongDocument Outline
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