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Management Leading and Collaborating in A Competitive World 10Th Edition Bateman Solutions Manual Full Chapter PDF
Management Leading and Collaborating in A Competitive World 10Th Edition Bateman Solutions Manual Full Chapter PDF
Organization Structure
Chapter
8
CHAPTER CONTENTS
Learning Objectives 2
Lecturettes 206
Examples 218
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Chapter 08 - Organization Structure
LEARNING OBJECTIVES
3 Define the roles of the board of directors and the chief executive
officer.
4 Discuss how span of control affects structure and managerial ef-
fectiveness.
5 Explain how to delegate effectively.
6 Distinguish between centralized and decentralized organizations.
7 Summarize ways organizations can be structured.
8 Identify the unique challenges of the matrix organization.
9 Describe important integrative mechanisms.
This chapter is such a wealth of information that you may be overrun with student questions as you lec-
ture. Two popular topics for questions include specifics about organizational design, and delegation. For
instance, your students may ask:
1. “What is the most widely used approach to organizational structure in
U.S. businesses and what are the reasons it is used most?”
2. “What is the difference between the board of directors and the chief
executive officers?”
3. “How can a manager overcome his or her fears of delegating?”
4. “What different things can managers do to increase the likelihood that
their associates will follow through with delegated tasks?”
While these questions generally have straightforward answers, they also provide opportunities to examine
some of the complexities of organizational structure. For example:
1. While most mid- to large-size organizations in the U.S. today have a functional structure, the majority
of U.S. companies are small, entrepreneurial firms. These firms tend to have very organic structures
since they have few employees, so all employees must do everything.
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2. The apparent answer to this question is that the CEO is an employee of the organization, while the
board of directors is an outside governing body, whose members are not employees of the organiza-
tion. Most organizations have strict independence standards which apply to the board of directors.
However, when answering this question, you might also discuss how boards of directors pick new
members (they are typically chosen by the CEO) and what kinds of rewards people get for being on
boards of directors (everything from deferred compensation, to life insurance, to limousine service!)
3. The answer here is that “fear” is often a manager’s sense that what has been delegated will not be
done, or will be done incorrectly. This can be overcome by working with the employee to clarify ex-
pectations, giving the employee the right training to do the job, and setting up regular checkpoints to
assess progress. This question also presents a good opportunity to discuss how delegation differs from
the perspective of the employee and the manager.
Teaching Tip:
Ask everyone in the class to write down what they think the word “fear” refers to in this question.
Then get students who have been managers to share their answers, followed by students who
have been employees. The employee group is likely to see ‘fear’ as worry about being upstaged
by an employee, while the manager group is likely to see “worry” as concern that the employee
won’t do the job right.
4. Employees will be more likely to follow through on their tasks if they know why they are doing those
tasks, if they consider the tasks to be important, and they have a say in how to do the tasks, and if they
are rewarded for those tasks. In addition, clear expectations, training, and regular checkpoints also
help to be sure that the tasks will be done on time.
CLASS ROADMAP
Management Connection
How Cisco Systems is Cleaning Up Its Organizational Chart
Cisco systems established itself as the leader in hardware for wired networks. After years of rapid
growth, internal struggles have hampered Cisco’s ability to identify and seize new business opportunities.
John Chambers, CEO of Cisco, recently announced what he hopes will be a solution to this dilemma: a
new way or organizing the company structure. He defined five areas of information technology and as-
signed an engineering staff to each area. He also divided sales into three geographic regions: 1) the
Americas, 2) Asia, and 3) Europe, Africa, and the Middle East. These changes reversed the matrix struc-
ture that was put in place a few years ago to facilitate rapid business growth and expansion by appointing
employees from across the organization to internal councils which made major business decisions. Ini-
tially it served it purpose, but over time this model created confusion and distractions for managers.
Chambers hopes a more traditional management approach will allow employees to devote themselves to
greater efficiency in executing their business strategy.
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C. Integration
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B. Hierarchical Levels
1. Top management
a. Hierarchy is the authority levels of the organ-
izational pyramid.
b. The CEO occupies the top position and is the
senior member of top management.
c. Corporate governance is a term describing
the oversight of the firm by its executive staff
and board of directors.
d. Presidents and vice presidents are also includ-
ed in the top management.
2. Middle management LO 4: Discuss how span of
a. This is the second broad level. control affects structure and
b. Made up of managers who are in charge of managerial effectiveness
plants or departments.
3. Operational management
a. This is the lowest level of management.
b. It includes office managers, sales managers,
E.G.
Use Example 8.3 –
supervisors, and other first-line managers as Span of control here
well as the employees who report directly to
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them.
c. Subunits are subdivisions of an organization
D. Span of Control
1. Span of control is the number of subordinates
who report directly to an executive or supervisor.
2. Narrow spans build a tall organization with many
reporting levels.
3. Wide spans create a flat organization with fewer
reporting levels.
4. The optimal span of control depends of a number
of factors:
E. Delegation E.G.
Use Example 8.4 – Delegation
1. Delegation is the assignment of new or additional here
responsibilities to a subordinate. (Figure 8.2)
2. Responsibility and accountability must be looked
at before delegating any authority.
3. Responsibility is an assignment of a task that an
employee is supposed to carry out.
4. Authority means that the person has the power
and the right to make decisions, gives orders,
draws upon resources, and does whatever else is
necessary to fulfill the responsibility.
5. Accountability is the expectation that employees
perform a job, take corrective action when neces-
sary, and report upward on the status and quality
of their performance.
6. Advantages of delegation
a. Allows managers to accomplish much more
than they would be able to do on their own
b. Helps develop effective subordinates
7. How should managers delegate?
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F. Decentralization
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must
a. choose the right specialty
b. choose collaborators that are also excellent,
but provide complementary strengths
c. make certain that all parties fully understand
the strategic goals of the partnership
d. be able to trust all parties with strategic infor- LO 9: Describe important in-
mation and trust that collaborators will deliver, tegrative mechanisms
even when business demands are heavy.
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d. Teams
e. Product, program, or project managers
f. Matrix prganizations
TEXT REFERENCE
3. Managing high information-processing demands Management Connection – Onward
(Figure 8.8) Cisco’s attempts to “flatten” their organization
resulted in confusion for many senior managers
who felt frustration and distracted from running
their own units. The approach also required
hiring more managers and sometimes failed to
IV. LOOKING AHEAD identify who was accountable for results of
each board or council. Cisco has retained three
1. Organizations are more like a motion picture – they boards and three councils with their new organ-
izational model. Chambers has announced that
move. restructuring will “empower teams, integrate
major functions, and allow people to focus on
2. Organizations are becoming more flexible and inno- inspiring and important work.”
vative, even virtual are forming. • Has Chamber’s prediction proved to be
3. No organization is static. correct? What is the current status of Cisco
Systems?
• How has the change from the councils and
boards, back to a more traditional divisional
model impacted Cisco?
____________________________________
Accountability The expectation that employees will perform a job, take corrective action when neces-
sary, and report upward on the status and quality of their performance
Authority The legitimate right to make decisions and to tell other people what to do
Broker A person who assembles and coordinates participants in a network
Centralized organization An organization in which high-level executives make most decisions and pass
them down to lower levels for implementation
Coordination The procedures that link the various parts of an organization for the purpose of achieving
the organization’s overall mission
Coordination by mutual adjustment Units interact with one another to make accommodations to achieve
flexible coordination
Coordination by plan Interdependent units are required to meet deadlines and objectives that contribute
to a common goal
Corporate governance The role of a corporation’s executive staff and board of directors in ensuring that
the firm’s activities meet the goals of the firm’s stakeholders
Decentralized organization An organization in which lower-level managers make important decisions
Delegation The assignment of new or additional responsibilities to a subordinate
Departmentalization Subdividing an organization into smaller subunits
Differentiation An aspect of the organization’s internal environment created by job specialization and
the division of labor
Division of labor the assignment of different tasks to different people or groups
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Divisional organization Departmentalization that groups units around products, customers, or geograph-
ic regions
Dynamic network Temporary arrangements among partners that can be assembled and reassembled to
adapt to the environment
Formalization the presence of rules and regulations governing how people in the organization interact
Functional organization Departmentalization around specialized activities such as production, market-
ing, and human resources
Hierarchy The authority levels of the organizational pyramid
Integration the degree to which differentiated work units work together and coordinate their efforts
Line departments Units that deal directly with the organization’s primary goods and services
Matrix organization An organization composed of dual reporting relationships in which some managers
report to two superiors – a functional manager and a divisional manager
Network organization A collection of independent, mostly single-function firms that collaborate on a
good or service
Organization chart the reporting structure and division of labor in an organization
Responsibility The assignment of a task that an employee is supposed to carry out
Span of control The number of subordinates who report directly to an executive or supervisor
Specialization A process in which different individuals and units performs different tasks
Staff departments Units that support line departments
Standardization Establishing common routines and procedures that apply uniformly to everyone
Subunits Subdivisions of an organization
Unity-of-command principle A structure in which each worker reports to one boss, who in turn reports
to one boss
LECTURETTES
1. The managerial span of control refers to the number of subordinates that a given manager can effec-
tively direct. For decades, management thinkers have struggled with the issue of the managerial span
of control because it directly impacts the size and shape of the organizational structure of a business,
and it impacts both the effectiveness and efficiency of the work process.
GRAICUNAS’S THEORY
1. In 1933, A.V. Graicunas published an article, “Relationship in Organization,” in The Bulletin of the
International Management Institute in which he established his theory of the span of managerial con-
trol. Graicunas noted that when dealing with subordinates, the manager had to consider not only the
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direct relationships between himself or herself and each subordinate as an individual, but also his or
her relationships with different groups of subordinates as well as the cross relationships among all
members of the work group. Graicunas recognized that the total of these relationships was quite nu-
merous within a large work group.
2. Graicunas’ research led him to find that the manager’s direct relationships increased in proportion to
the additional size of the group. However, he found that the group and cross relationships increased
more than proportionately.
3. The resulting Granicunas Theory calculates the number of possible relationships in a work group
from the formula:
R = n (2(n-1) + n – 1)
Where R = the number of relationships, and n = the number of subordinates managed. For example,
if a manager must supervise three subordinates, the total number of possible relationships in the work
group is calculated as R = 3(22 + 3 – 1) = 18. As the number of subordinates is increased, the total
number of possible relationships grows rapidly. For instance, if the number of subordinates is in-
creased to five, the number of relationships increases
to R = 5(24 + 5 – 1) = 100.
1. Since the number of relationships with which a manager must deal increases geometrically as subor-
dinates are added to the work group, the span of management becomes a critical organizational factor.
For many jobs, it is found that a manager has difficulty directing more than five or six people. In oth-
er jobs, spans of managerial control have been expanded to 50 or more.
2. Where the work is unstructured, as in a research laboratory, the span of management is quite low.
However, on an assembly line, where the work is highly structured, larger spans of control are usually
possible.
3. Subordinate relationships are more positive and control is maximized by small or “narrow” spans of
management. However, narrow spans of control cost money in terms of salaries, fringe benefits,
space and other support factors. Perhaps an even more serious problem with narrow spans of control
is the cost of longer communication and authority channels. Narrow spans slow down the flow of es-
sential information and delimit the delegation of authority.
4. On the other hand, wide spans of managerial control often result in overworked and stressed-out
managers, ineffective decision-making, and inefficient operations that tend to go out of control.
1. Obviously, it is in the best interests of the organization to keep the spans of control as wide as possi-
ble without allowing the process to get out of control. As a result, researchers have established a
number of ways by which organizations may attempt to increase the span of management without ad-
verse effects on the organization. Some of those techniques for increasing the span of control are
listed below:
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DISCUSSION QUESTIONS
1. Based on the description of Cisco in this chapter, give some examples of differentiation in that
organization. In other words, what specialized tasks have to be performed, and how is labor
divided at Cisco? Also, how does Cisco integrate the work of these different units? Based on
what you have learned in this chapter, would you say Cisco has an effective structure? Why or
why not?
Cisco’s structure follow the divisional model with five areas: 1) routing and switching, 2) collabora-
tion, 3) video, 4) data center virtualization, and 5) cloud. In addition, they have three sales divisions
consisting of: 1) the Americas, 2) Asia, and 3) Europe, Africa, and the Middle East.
The five divisions are based on the five key product areas. They each have very specialized takes to
be performed. However, some redundancy exists in that Chambers is allowing each division to retain
their own engineering team to facilitate changes and updates for the division’s products. To integrate
the work of the units, Cisco retained the three councils: 1) a service provider council, 2) an enterprise
council, and 3) an emerging countries council. These councils evaluate new ideas and concepts and
help each division implement changes and upgrades when they are ready. This model appears to be
much more simplified than the previous model and will likely be more useful and successful. If the
new model creates less confusion and conflict, then it is more likely that the company can focus on
delivering products and services that customers want and be able to do this in a timely manner.
1 Adapted from G.G. Fisch, “Stretching the Span of Management,” Harvard Business Review, September-October 1962, 80-81; A.V
Graicunas, “Relationship in Organization,” Bulletin of the International Management Institute, 1933; Harold KoontZ, “Making Theory
Operational: The Span of Management,” The Journal of Management Studies, October 1966, 229-243; Lyndall Urwick, “The Man-
ager’s Span of Control,” Harvard Business Review, May-June 1956, 39-47; Lyndall Urwick, Scientific Principles and Organization
(New York; American Management Association, 1938).
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2. What are some advantages and disadvantages of being in the CEO position?
The advantage of being a CEO is that, from an organizational perspective, it is the position of deci-
sion-making and power. In theory, whatever the CEO says is implemented. It is a position that pro-
vides the individual with an opportunity to focus on the overall strategy and development of the com-
pany. A CEO’s compensation generally consists of relatively high salary and a bonus package as
well as perks such as a company car, an expense account, etc.
The disadvantages of the position are that the CEO is usually responsible to a board of directors and
stockholders. He or she is the person on whom everybody focuses when things go wrong. The posi-
tion usually involves a lot of work and can be extremely stressful.
3. Would you like to sit on a board of directors? Why or why not? If you did serve on a board,
what kind of organization would you prefer? As a board member, in what kinds of activities do
you think you would most actively engage?
The idea of serving on a board of directors will appeal to some students and not to others. Some will
see it as an opportunity to be involved, on a limited basis, in the direction of an organization, and
some may mention the financial benefits of board membership (although many board members serve
on a voluntary basis—especially in the case of nonprofit organizations). Others, however, will be
afraid of the responsibility given the increased visibility of board members and their growing legal re-
sponsibility for the actions of the organization.
As to the type of organization they would prefer, many may choose a nonprofit essentially as a means
of serving society. They may feel there is great satisfaction to be gained from giving time and effort
to helping those who are less fortunate. Others might see serving on the board of a business entity as
a more meaningful role…and there may be additional compensation!
Students will see their potential involvement in terms of their own interests. Some may see them-
selves serving on the finance committee while others may feel more comfortable on the compensation
committee.
4. Interview a member of a board of directors and discuss the member’s perspectives on his or her
role.
Suggest to the students that they ask some of the following questions:
➢ How much time do you devote each month to the board’s activities? Do you think this is suffi-
cient? Or too much?
➢ Do you feel you really understand what is going on in the organization? Or do you sometimes
feel that you are getting a distorted view?
➢ Do you really understand the financial data with which you are provided? Are you given all of
the financial data that is needed to gain a realistic picture of the organization’s results?
➢ Are the board meetings meaningful? Or do you sometimes feel they are a waste of time?
➢ What would you like to see changed so that the board might be more effective in its role?
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5. Pick a job you have held and describe it in terms of span of control, delegation, responsibility,
authority, and accountability.
Students who have not held a management position may not relate to the aspects of authority and span
of control. However, they should be able to describe the responsibilities that were delegated to them
and the ways in which they were accountable.
Students who have held a managerial position may be able to demonstrate the various factors (such as
span of control, delegation, and etc.) by drawing an organization chart and showing the working rela-
tionships.
6. Why do you think managers have difficulty delegating? What can be done to overcome these
difficulties?
Ultimately, in any organization, managers are responsible for the activities of those individuals who
report to them. If they do something themselves, they know that it was done correctly (or at least in
the way they think it should be done). Delegating responsibility represents a loss of control, and
managers are often reluctant to do so because it puts their reputation and, possibly their career, in the
hands of someone else.
What can be done to overcome this? Managers can be trained how to delegate effectively. There are
numerous courses offered on “how to delegate” and “effective delegation for the manager.” From a
practical point of view, managers can delegate a task to subordinates, oversee their efforts, and ensure
ongoing reporting so that, at no time is the task out of control. Once a task is delegated, the manager
should serve as a resource person and check in with the employee repeatedly to ensure that progress is
made towards achieving the task. Then, as subordinates learn and demonstrate their ability, the su-
pervision and reporting can be withdrawn until, eventually, the manager can be confident that the
subordinates will do the task as well as the manager would.
7. Consider an organization in which you have worked, draw its organization chart, and describe
it using terms in this chapter. How did you like working there, and why?
Most students have held a position in some organization and thus should be able to draw the organiza-
tion chart. It may help for them to do it by name rather than position.
Among the terms that should be used are span of control, delegation, responsibility, and authority.
In terms of whether or not they liked working there, it may be helpful to ask whether or not the organ-
ization’s structure (i.e., the organization chart and the reporting relationships) helped in making it en-
joyable…or perhaps the organizational structure was one of the reasons why students did not enjoy
working for the organization.
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A functional organization is one in which the unit or group focuses on one activity (e.g., production,
marketing, finance, etc.), whereas, in a divisional or product organization, the group handles all the
functional activities (such as production and marketing) for the product.
Some students may prefer the functional organization because they wish to specialize and become
highly skilled in some specialization. They may comment that they “want to be accountants not
marketers.” Others may see the product organization as giving them a much wider range of opportu-
nities and may state that it will: “offer the opportunity to learn everything about the business.”
Question: Why do some students select one approach and some another? Answer: They have differ-
ent personality types, different goals and objectives, etc.
9. If you learned that a company had a matrix structure, would you be more or less interested in
working there? Explain your answer. How would you prepare yourself to work effectively in a
matrix?
It might be appropriate to start the discussion question with another question, namely: What differ-
ence do you think working for a company with a matrix organization has from the employee’s per-
spective.
Some students will welcome the idea of working for two superiors. They will feel that it will give
them a broader perspective on the company and provide more opportunities for learning and ad-
vancement. Others, however, will view the prospect of working for two superiors rather frightening.
They will feel uncomfortable working in an environment with multiple demands and, sometimes,
conflicting orders.
The key to working for two bosses is communication and working in a matrix organization probably
means that the individual has to be more proactive or assertive in determining the exact requirements
and in communicating effectively with both individuals when there is conflict or ambiguity.
10. Brainstorm a list of methods for integrating interdependent work units. Discuss the activities
that need to be undertaken and the pros and cons of each approach.
This may be a challenging question for students to answer. Some typical responses might include:
• Clarify the vision or common goal that people share.
• Help people get to know one another’s strengths.
• Focus on the things that each person brings “to the table” and recognize efforts to succeed as
well as those who get results.
• Emphasize effective communication and follow through on tasks.
• Specify the person who is accountable for any new tasks assigned and follow up to make sure
task is completed in a satisfactory manner.
• Students may offer other ideas. The goal here is to help students think about the future and to
challenge them to think about the outcomes of their actions.
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CONCLUDING CASE
Case Summary:
The Stanley Lynch Investment Group is a large investment firm headquartered in New York. It has
12 major investment funds, each with analysts in a separate department. Part of their strategic ad-
vantage is its advanced information technology system. However, with IT employees assigned to
specific funds, it was nearly impossible to obtain consistent or comprehensive information. A new
manager, J.T. Kundra, decided to have his employees download all of their programs to a wiki and he
convinced other high-level managers to require their employees to do the same as part of their per-
formance appraisals. The IT employees discovered that the wiki would help them perform more ef-
fectively and it provided a trail of information from the original documents to the more recent docu-
ments on any topic which was downloaded. The wiki eventually came to be viewed as one of their
most important systems.
Suggested Response:
Various organizational charts are to be expected in the individual student response to this question.
However, acceptable responses must incorporate the following guidelines and information: (1) the
greater the diversity of products, the greater the decentralization, (2) the larger the organization, the
greater the decentralization, (3) a rapidly changing environment demands greater decentralization,
and (4) designing timely control processes and training managers how to delegate effectively are key
factors in managing decentralization.
Suggested Response:
While decentralization reduces direct control by strategic leaders over employees’ daily work, it does
empower employees to address problems, respond to opportunities, and to take action to protect the
best interests of their assigned areas of responsibility. Decentralization builds on the belief that spe
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cialists can obtain better results in situations that require a great deal of knowledge, information, and
insight.
Suggested Response:
Decentralization tends to limit the communication between departments and units in a company. It
can also be a source of infighting and internal discord as employees act to protect their own interests
without regard for the impact of their decisions and actions on other units. Decentralization can also
produce a considerable amount of redundancy in the organization in areas of business services and
employee positions.
EXPERIENTIAL EXERCISES
Teaching Tip:
Students can do the first part of this assignment (identifying the org. chart for their school) prior
to coming to class, then the second part (designing a new organization) can be assigned after you
have covered the material in the chapter.
Objectives
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Suggested responses
Board of Trustees
Counselors Division
Chairs
Recommended changes would include a finance division to be added to the organization structure
Board of Trustees
Foundation
Counselors Division Chairs Director
One strength of this organization’s structure is that it has a functional approach to its structure. It is sim-
plistic, easy to understand, and is able to meet the mission of this institution. Strategic plans are imple-
mented to permit growth and meet the student needs. A weakness would be to create a matrix organiza-
tion to have members of the staff cross over and formulate a team approach to resolve some of the aca-
demic issues.
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Most students probably will conclude that, in a general sense, their business school is well organized.
However, some students may, as a result of their interviews, have received comments suggesting that
while the school is well organized in some areas (such as teaching), it is not well organized in others
such as research, community service, and etc.
Students tend to see their school as being mechanistic. They likely view it as being bureaucratic, in-
flexible, fragmented, and possibly indifferent to the needs of students.
3. In what ways is the school’s structure designed to suit the needs of students, faculty, staff, the
administration, and the business community?
Students are apt to consider the school to be organized to suit administrative tasks and to functional-
ize the faculty relationships and believe that too little is done to serve the needs of the students. They
may fail to consider the needs of staff and the business community.
Teaching Tips:
The instructions call for each student to explore the organizational structure of the school and to
draw an actual and proposed organization. You might add a behavioral element to the exercise
by dividing the class into small groups and proceeding as follows:
1. Each small group of students begins by holding two brainstorming sessions—the first to iden-
tify the organizational structure as they know it and the second to identify those organiza-
tional factors that need to be investigated (levels of administration, spans of control, chain of
command, working relationships, etc.).
2. Each group member is assigned a particular organizational feature to investigate through in-
terviews with faculty, staff, administrators, student leaders, advisory personnel, etc.
3. Each small group reconvenes and shares the results of the investigations. Another brain-
storming session is used to draw both an actual and a proposed organization chart.
4. The whole class reconvenes and hears presentations by the small-group spokespersons. Then
the class brainstorms a final organization chart proposal.
Overview
Designing a student-run organization is a good beginning activity, as it helps students realize that de-
sign involves far more than an organization chart and job descriptions. Students find it easy to relate
to the task. We have found it useful to introduce the topic of organization design in the prior class
session, by showing Galbraith’s “star” model and discussing the importance of integrating multiple
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design dimensions (Strategy, Task, Structure, Information Technology, and Decision Making, People,
and Rewards).
Activity Procedure
The following is the sequence of activities, the necessary time required and some tips.
Tasks 1 and 2: The activity takes little introduction, and in fact is helped if the instructor’s beginning
comments are brief. Announce that the entire class session will be devoted to this design activity.
The sequence will be instructions, working for 40-60 minutes in a group of (10-20) students, sharing
the results (20 minutes), and finally, instructor’s concluding remarks (10-20 minutes).
Read the learning objectives along with other objectives you may have for the session. Read the
background statement and be prepared to answer student questions about the task. Typical questions
including “Is the $20,000 separate from the space, equipment, and materials money?” (yes). “Can
we spend the money on anything we think is needed?” (yes, subject to faculty advisor approval).
“Who do we have to satisfy with this organization design?” (the dean).
Teaching Tips:
We have found that it is important to emphasize that the task involves Total Organization Design.
That is, they are to brainstorm all design dimensions to be dealt with, before working on a single
dimension, such as organization structure. You can provide them examples, if needed, such as a
mission statement and set of goals.
Environment
• Scan the environment
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Strategy
• Learning experience, education as an overall theme
• Students will design the organization, and will create mission statement, vision,
goals, guidelines for consulting, and list of services to be offered
• To help nonprofit groups to be more successful and efficient
• The focus must be clear, such as supporting organizations that help youth, e.g.,
YMCA
• Nonprofit, student-run, offering low cost and innovative services
Transformation Process
• Based on a model of consulting – students take a course to select and modify the
consulting process
• Students from all programs and concentrations are involved to bring a variety of
ideas to the consulting process
• Generalists make initial contacts, followed by multifunctional teams which diag-
nose specific client needs
• Faculty and community executives provide oversight during start-up and beyond
• Relies on unique college capabilities including information technology
• Relies on strong project management system, intranet and internet
Structure
• A flat organization with little or no hierarchy
• Based on a “club” concept, emphasizing fun activities and social support
• Links to existing functional clubs in the college, such as accounting, marketing
• Functional expertise and resources brought together based on project needs (ma-
trix)
• A team leader is point of contact both internally and externally to the client, but
otherwise, leadership is shared
• Beyond the teams, support groups are needed to sustain this organization, such as
internal fund-raising, social events planning, advising, etc.
• Some jobs such as team leader require experience
People
• Recruitment of skilled personnel, resolution mechanisms needed for staffing
• Orientation, training issues
• Guidelines for gaining experience and for advancing in the organization
• Building a community – through work that is socially worthwhile, allowing crea-
tivity and learning
Rewards
• Incentives to participate: course credit, internships, senior projects
• Challenging assignments, personal and professional growth
• Team and individual recognition
• Social events
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Chapter 08 - Organization Structure
Other
• Formal linkage to the college, legal liability considerations met, long term finan-
cial viability considered
• Develop the actual start-up steps for establishment of this organization
Objectives
1. To explore the reasons for, as well as the pros and cons of, decentralizing.
Suggested responses
1. Product diversity creates the need for increased decentralization of authority with greater flexibil-
ity required for the organization structure due to increased product diversification.
2. With increased size and power of an organization, there is a need to decentralize responsibility
and authority to become customer driven and customize the product to meet the customers’
needs.
3. In a fast paced environment an organizational change is required. Thus there is a need to create
decentralized responsibility and authority.
4. Timely accurate controls are required for a decentralized environment due to the need to create
accountability of people’s actions and their responsibility for implementing these action plans.
5. Managers must delegate and implement employee empowerment to permit employees to be re-
sponsible and have authority to make timely decisions.
6. The principle of delegation is the reassigning of responsibility and authority in having individuals
account for their actions. The act of delegating is a procedure that creates employee empower-
ment of performing one’s job. Yes, the statement is true that when a manager delegates to an em-
ployee authority or the right to make a decision is transferred to this individual.
Teaching Tips:
1. Divide the class into groups of six and have each student focus on one of the questions with
the assignment of identifying specific companies that can be placed from one end of the other of
the characteristic. Have the students who focused on, say, question #1 present their findings to
the class.
EXAMPLES
Example 8.1 - Integration: The KSS Design Group is an architectural and design practice that
was founded in 1991. Their core competency is integration - their home page boasts that “Our
range of services includes master planning, architecture, interior design, graphics and branding,
and we can bring these disciplines together into a seamless package for any given project.” In an
article in “Design Week”, Sara Wilkins discusses the need to break down the traditional division-
al structure of most creative companies - KSS tries to “actively and positively mix our varied
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Chapter 08 - Organization Structure
skill sets.”2 She stresses the role education and communication have played in helping to integrate
the various functions of her organization, and she says that KSS continually invests in training,
both for their employees and their clients. They also pull people together by making sure that
everyone in the organization works in all of the diverse industry sectors served by KSS, and by
having regular internal project reviews, where everyone in the organization is given the oppor-
tunity to offer objective opinions about projects.
Example 8.2 – Board of directors: Real Estate Investment Trusts (REITs) provide their inves-
tors with income based on owning and operating real estate, including apartments, shopping cen-
ters, homes, and other properties. Like many other types of organizations, their boards of direc-
tors have seen changes related to the Sarbanes-Oxley Act. One REIT, the Mills Corporation, was
acquired in 2007 after an SEC investigation found problems with the company’s accounting rec-
ords. The CEO stepped down as a result of the investigation, but there were several questions
raised about whether or not the company’s board of directors should have reined in Mills’ expan-
sion plans before they got out of control. An example of more appropriate board behavior can be
found in the story of Developers Diversified Realty (DDR), which was considering going into a
joint development venture in China. DDR’s board of directors voted down the plan, saying that
any investment in China should be part of a long-term strategy, and not a one-time deal.3
Example 8.3 – Span of control: The Friendly Ice Cream Corporation manufactures and serves
ice cream, along with operating 530 company and franchised restaurants throughout the North-
east. In 2005 Friendly’s restructured their management team, and 1) reduced spans of control for
front-line and second-line supervisors, 2) created a new recognition and reward program for serv-
ers, and 3) created an Internet-based guest feedback system. These changes were designed to
help Friendly’s obtain higher margin revenues by helping employees to work more efficiently.4
Example 8.4 - Delegation: Students may not realize it, but one of the most important things a
first level fire officer does when first arriving on the scene of a fire is to delegate responsibilities.
The way firefighters approach a fire depends on the officer’s ability to:
According to a 2007 article in “Firehouse”5, these actions are equivalent to “calling a play” in
football. If the fire officer calls the right play, all of the responding firefighters will know exactly
what they are to do, and chances of injury will be minimized.
Example 8.5 – Functional and divisional organization: The Allstate Insurance Company com-
bines functional and divisional organization structures by separating the company into three divi-
sions - Personal Property & Casualty, Business Insurance, and Financial (Life and Savings).
Within each of these divisions are functional departments such as Human Resources, Finance,
Underwriting, etc. The Sales and Claims departments are company-wide departments, since all
Allstate sales agents sell all three kinds of insurance, and claims representatives can handle any
type of claim.
2
Design Week, “The one stop creative shop” September 20, 2007, pg. 22.
3
Filisko, G.M., “Looking out for shareholders.” National Real Estate Investor. Aug. 2007, Issue 8, pg. 40
4
Business Wire. “Friendly Ice Cream Corporation reports second quarter 2005 results.” August 4, 2005. Online at
http://biz.yahoo.com/bw/050804/45877.html.
5
Emery, Mark. “The ten commandments of intelligent and safe fireground operations.” Firehouse. Aug. 2007, Vol. 32, Iss. 8, pg. 72.
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Chapter 08 - Organization Structure
Example 8.6 – Matrix structure: Phillips, a large Dutch electrical company, has had a matrix
structure from the end of World War II, organized on both national lines and product divisions.
For example, the head of a washing machine division in Italy might report to both the head of
Philips in Italy as well as a washing machine executive in the Netherlands. Recently, however,
the company began modifying its matrix structure to improve accountability within the organiza-
tion. Under the slogan “One Phillips”, the company is gradually encouraging employees to col-
laborate with people outside of their divisions, and to move around in their careers, rather than
staying in one geographical location or with one product.6
Example 8.7 – Network organization: Jay Galbraith has coined the term “The Front-Back Or-
ganization” to refer to companies which are structured one way near customers, and another way
near operations. For example, The Gap organizes its stores geographically, giving individual
store managers a fair amount of autonomy in operations. However, the manufacturing operations,
research and design, accounting, and other corporate departments are organized functionally,
making them more efficient. The “go-between” is the Marketing Department, which is charged
with taking information from the stores and making sure it gets to the corporate departments, and
vice-versa.7
Example 8.8 - Standardization: According to the telecom glossary the International Standards
Organization (ISO) is “An organization established to promote the development of standards to
facilitate the international exchange of goods and services, and to develop mutual cooperation in
areas of intellectual, scientific, technological, and economic activity.” Most large global high-
tech companies proudly display banners stating that they are “ISO XXXXX certified.” In 2009,
ISO will publish an International Standard for social responsibility.8 If a company chooses to fol-
low ISO 26000, it will be one more way for it to coordinate the activities of its employees with
regard to social responsibility around the world.
SUPPLEMENTAL FEATURES
Please see the following materials in the Asset Gallery on the text website.
CHAPTER VIDEO
Howard Schultz, CEO of Starbucks, says that his desire is to create a community, to build a third place
between home and work to provide a human conection. Starbucks, which began over 40 years ago with a
single store in Seattle, has grown to over 17,000 stores around the globe. In 2000, Schultz stepped down
as CEO to focus on expansion.
Starting with the recession in 2007, it all came crashing down including reductions in stores and employ-
ees. In response to worries that Starbucks might go under, Schultz returned to the CEO role in 2008 and
closed hundreds of stores to reduce costs. He was under pressure to reduce health insurance for employ-
6
The Economist. “The matrix master. January 21, 2006.
7
Galbraith, Jay. Designing Organizations: An Executive Briefing on Strategy, Structure, and Process. Jossey-Bass, 1995.
8
Parkinson, Alex. “ISO takes steps to standardize social responsibility.” The Accountant. Oct. 31, 2006, pg. 7.
8-25
Chapter 08 - Organization Structure
ees. Starbucks was a pioneer in providing insurance benefits to its employees. He remembered how as a
child, his father was injured on a job which had a major impact on his family due to a lack of insurance.
He also tackled concerns such as why the breakfast food was making the stores smell like burned cheese
and why partners were hidden behind espresso machines.
Schultz says there is now a renewed focus on coffee, the product that put Starbucks on the map.
Every day in the tasting room in the Seattle headquarters the tasting team “tests” dozens of batch-
es of coffee from around the world. Starbucks is now steaming ahead in a more controlled
growth mode these days by installing new coffee brewing systems in their stores which Schultz
says brew the perfect cup of coffee and they by releasing new products including tea, nutrition
bars, etc. Schultz remains a “man on a mission” in which coffee is just the beginning. He pro-
claims that Starbucks is in the people business of serving coffee.
SELF-ASSESSMENTS
• Identify Your Preferred Organizational Structure
Expanded PowerPoint Slides include most Basic PowerPoint slides, along with additional material that
can be used to expand the lecture.
8-26
Chapter 08 - Organization Structure
EXPANDED POWERPOINT
EXPANDED POWERPOINT EXPANDED POWERPOINT
SLIDE 8
SLIDE 7 SLIDE 9
Integration
Differentiation Authority in Organizations: defn.
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Chapter 08 - Organization Structure
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Chapter 08 - Organization Structure
8-29
Chapter 08 - Organization Structure
EXPANDED POWERPOINT
SLIDE 40
VIDEO: STARBUCKS
8-30
Another random document with
no related content on Scribd:
The other version current in Usagara, in the north of the Colony,
says nothing of the serpent or the hot water, but states that the
sorcerers began by ordering large beer-drinkings in every village.
When the pombe had produced its effect, the villagers were initiated
into the conspiracy, and received their dawa, of whose composition
no details are given, but which, in this case also, was supposed to
possess the power of making them invulnerable, so that the bullets of
the Germans would simply be changed into water as soon as they left
the rifle-barrel. The Majimaji soon discovered, in the course of
numerous battles that this was not the case, but nevertheless, the
fanaticism of these natives, who, under a murderous fire, charged up
to within a spear’s length of the machine-guns—the bumbum, as they
call them—is truly astonishing.
From the coast to a little beyond Nyangao the character of the
vegetation is essentially different from that which we find farther
west. The greater part of the road (the barabara, in the carriers’
jargon, that is to say, the path cut to the regulation width on which
all the long-distance traffic takes place) runs as far as Nyangao
through thick scrub from 10 to 15 feet high, from which rise here and
there single trees of twice or three times that height. Several times in
the course of the day’s march the traveller comes across large open
spaces in the bush on either side of the path. It is clear from the
absence of underwood and the presence of charred stumps that this
is old cultivated ground—no doubt the sites of former villages. But
where are the huts and where the people who once hoed their
gardens here? Here we find a typical touch of African history, more
especially in recent times, when its primitive conditions have been
modified by the modern plantation system with its demand for
labour and the necessity for a native military force. Originally and in
himself the African is by no means shy, on the contrary, he is
inquisitive and fully alive to the attractions of town life and social
intercourse. But he cannot stand having his private affairs interfered
with. Every caravan of inland natives on their way to the coast,
whether to sell their supplies of wax, tobacco or what not, or to
engage themselves as labourers to some European, considered that
they had a natural right to expect food and drink from the villagers
along their route. Even the caravan of a white man is apt to make the
same sort of demands on the villagers. How often have I seen my
men scatter at every halt, to ask for some service or other—perhaps
merely the loan of a gourd dipper—at one or other of the straggling
huts, which may be half-a-mile apart. However good-natured and
obliging the native may be, he cannot put up with an indefinite
continuance of such disturbances to the quiet of his home life, and
therefore prefers to pull down his huts and build new ones in the
bush at a distance from the main road, where they can only be
reached by narrow side paths.
Anthropologically speaking, one might take the Wamwera for
Indians, such is the lustrous copper tone of their skins. At first I
thought that this marked redness of tint was a peculiarity of the
tribe, but have since met with many individuals of exactly the same
shade among the Makua of Hatia’s, Nangoo and Chikugwe, and a few
among the Yaos at this place and those at Mtua, and Mtama. In fact,
it seems to me very difficult to do any really satisfactory
anthropological work here—the types are too much mixed, and it is
impossible to tell from any man’s features the tribe to which he
belongs. Probably, indeed, there is no distinction of race at all, for
Wamwera, Wangindo, Wayao, Makonde, Matambwe and Makua
alike belong to the great sub-group of the East African Bantu. This is
one additional reason, when time is so precious, for giving to
anthropology even less attention than I had originally planned. Let
the gentlemen come out here themselves with their measuring
instruments, compasses and poles—we ethnographers have more
urgent work to attend to.
The Wamwera are just now in a deplorable condition. The whole of
this tribe was concerned in the rising, and though refusing to
acknowledge defeat in battle after battle, were ultimately forced to
take refuge in the bush. The mere fact of living for months without
shelter in the rainy season would of itself cause suffering enough;
and when we add that they have had no harvest, being unable to sow
their crops at the beginning of the rains, it can readily be understood
that numbers must have perished. Now that most of the ringleaders
have been secured and sent down to the coast, the survivors are
gradually coming forth from their hiding-places. But what a spectacle
do the poor creatures present! encrusted more thickly than usual
with dirt, emaciated to skeletons, suffering from skin-diseases of
various kinds, with inflamed eyes—and exhaling a nauseous
effluvium. But at least they are willing to face the white man—a sign
of newly-established confidence in our rule which must not be
undervalued.
Several hours’ hard marching from Nyangao bring us to the
residence of “Sultan” Hatia. He is the fourth of his name on this tiny
throne of the Makua. The grave of his predecessor, Hatia III, lies in a
deep cave on the Unguruwe mountain. This mountain is really a
promontory of the Makonde plateau projecting far into the Lukuledi
plain. It is visible from the road for several days before we reach it,
with its gleaming red cliff-face, which might fitly be described as the
emblem of the whole Central Lukuledi region. It also plays a great
part in the myths and legends of the local tribes. The traditions of the
past had already gathered round it before the burial of Hatia III; but
now that the dead chief rests in a dark ravine forbidden to every
profane footstep, from the toil and turmoil of his life, the Unguruwe
has become in popular belief a sanctuary where, on moonlight
nights, Hatia rises from his grave, and assembles the ghosts of his
subjects round him for the dance.
Hatia IV had returned to his capital just before our arrival, having
had some months’ leisure on the coast, in which to think over the
consequences of the rising. He impressed me as a broken man,
physically in no better case than his subjects; moreover he was no
better lodged, and certainly no better provided with food than they.
On the day of our halt at his village, he was more than ordinarily
depressed. A few hours previously a lion, whose impudence has
made him famous throughout the country, had in broad daylight
dragged a woman out of a hut, not far from the chief’s dwelling. The
prints of the enormous paws were still quite clear in the sand, so that
we could track the robber right round the hut in which a man with
his wife and child had been sitting at their ease. The great brute had
suddenly sprung on the woman who was sitting next the door. Her
husband tried to hold her, but was weak from illness, and could offer
no effectual resistance. Though for some time the poor creature’s
shrieks, “Nna kufa! Nna kufa!”—“I die! I die!”—could be heard in the
bush, growing fainter and fainter, no one could come to her help, for
the people have been deprived of their guns since the rising, and
even if they had had them, there was no ammunition, the
importation of this having been stopped some time ago.
The nephew and heir of Hatia IV is to take the part of avenger. He
is a handsome, jet-black youth with a small frizzled moustache on his
upper lip, and an enviably thick growth of woolly hair on his scalp.
Armed with a rifle, of which he is unconscionably proud, he has come
with us from Lindi in order to deliver his people from the plague of
lions. Such an expression is, in truth, no exaggeration as far as this
place is concerned. It is said that the whole length of the road from
Nyangao to Masasi has been divided between four pairs of lions, each
of which patrols its own section, on the look-out for human victims.
Even the three missionaries at Nyangao are not safe; Father Clement,
when out for a walk, not long ago, suddenly found himself face to
face with a huge lion, who, however, seemed quite as much startled
by the incident as the good Father himself.
After examining the architecture of the present Wamwera huts, I
can easily understand how the lion at Hatia’s could drag the woman
out from the interior. Anyone desirous of studying the evolution of
the human dwelling-house could very well see its beginnings here.
Most of these dwellings are nothing more or less than two walls,
consisting of bundles of grass roughly tied together, and leaning
against each other in a slanting position. The addition of gable-ends
marks quite a superior class of house. Besides this, the Wamwera
have been compelled to build their huts, such as they are, in the
untouched jungle, since they have lost all they had, even the
necessary implements for tillage and for clearing the bush. Their
villages, containing their only possessions of any value, were of
course levelled with the ground by our troops. The lion is shy of open
spaces, but feels at home in the pori, which he looks upon as his
natural hunting-ground, and where he can creep unseen close up to a
hut before making his deadly spring.
One point I must not forget. Even before leaving Lindi, my mouth
had watered at the descriptions I heard of the extraordinary
appearance presented by the Wamwera women. But I find that these
descriptions come far short of the reality. The famous Botocudos of
Brazil with their labrets are nothing to the southern tribes of German
East Africa. I had long known that the Makonde plateau and the
whole surrounding country belong to the region of the pelele, or lip
ring, but I have never come across a good illustration of earlier date
than my own. The accompanying reproductions of photographs will
show the nature of this extraordinary decoration more clearly than
any description.
The pelele, or, as it is called in Kimwera, itona, is only worn by the
women, but among them it is universal. It is a peg, in older persons
even an actual disc, of ebony, or else of some light-coloured wood
bleached snow-white with argillaceous earth, inserted in the upper
lip, which is perforated and stretched to receive it. Of course, a disc
the size of a two-shilling piece is not inserted all at once: the
operation is very gradual and begins by piercing the lip, between a
girl’s seventh and ninth year, with the end of a razor which is ground
into the shape of an awl.[8] The hole is kept open by inserting a
foreign body of small size, such as a thin stalk of grass, or the like. It
is then enlarged by adding another stalk at regular intervals; and
after a time, a strip of palm-leaf rolled up into a spiral is substituted.
This, being elastic, presses against the sides of the opening, and so,
in due course renders it large enough to receive the first solid plug.
Among the Wamwera the diameter of this varies from the thickness
of a finger to the size of a florin; the older Makonde women,
however, are said to have them twice as large. Naturally I am all
impatience to see these people, whose country, moreover, is as yet a
complete terra incognita, as far as science is concerned.
Not content with the
itona, the old women
sometimes wear a pin
or peg in the lower lip,
called nigulila. It is
long and slender,
ending in a round
knob, and is intended
to divert the eye from
the withered skin and
A MWERA WOMAN faded charms of the
wearer.[9] Discs or plugs
inserted in the lobe of
the ear are also very general. Furthermore, the YOUNG MAN OF THE
countenance of these fair ones are covered MWERA TRIBE
with extraordinary scars which, at a distance,
suggest that they must have passed their
youth at a German university. On a close inspection it will be found
that these are not scars, left by straight cuts, but consist of a
multitude of small keloids arranged in various patterns. The patterns
are made by parallel rows of small cuts (usually vertical), which have
been prevented from healing by repeatedly opening them during the
process of cicatrization. Thus in the course of weeks and months they
take the form of conspicuous swellings which, in their totality, give a
distinctive character to the whole physiognomy.
Even this is not enough to satisfy the
craving of the Wamwera women for
adornment. If the cloth draping chest and
back slips aside for a moment, either through
an incautious movement on the part of the
wearer or through the inseparable baby being
shifted from its usual place on its mother’s
back to her hip—the astonished eye discovers
that the surfaces thus revealed are adorned
with markings similar to those on the face.
Even the hips and upper part of the thighs are
said to be covered with them. The
ethnographer, reflecting on these and other
queer manifestations of human vanity, may be
tempted, perhaps, to indulge in a comfortable
sense of superiority. But, after all, the fashion
of wearing earrings is not quite extinct in
Europe; and the advantages of the corset,
considered as an aid to beauty, might be quite
as much open to discussion as the African
MWERA WOMAN ornaments we have just been describing. I am
WITH PIN IN LOWER alluding, of course, to those women who think
LIP that tight lacing improves the figure.
Otherwise I am inclined to agree with Max
Buchner of Munich, who thinks that some form of this article would
be of great service to the women of all the less-clothed races among
whom appliances for supporting the bust are unknown.
Up to the present, I have been able to see but little of the real life of
the inland tribes, yet that little has been very interesting. On the
march to Masasi I noticed that wherever the natives had taken an
active part in the rebellion, the roads were in perfect order, while in
the territory of the friendly tribes they were nearly impassable with
high grass, and sometimes bushes. These allies of ours are now,
secure in the consciousness of their past services, saying to
themselves that they may take things easy for a time, as the “Mdachi”
will surely consider their loyalty and make no very severe demands
on them. Captain Ewerbeck, however, has been laying down the law
with great precision and energy to the Akidas and Jumbes, the
district chiefs and village headmen, who are responsible for order
within their own districts.
One can enjoy magnificent spectacles by night in Africa. Sitting in
front of my tent on the way here, or now, when I step out in front of
the Baraza—the rest-house in which I have taken up my abode—I
see, wherever I turn my eyes, the red glow of flames on the horizon.
This is the burning of the grass—a custom practised by the Africans
for thousands of years. It may be remembered that when Hanno, on
his voyage from Carthage, sailed down the West coast of Africa,
nothing produced such a deep and lasting impression of terror on
himself and his crew as the streams of fire seen to flow down from
the coast-ranges at night. In my opinion, which, of course, I do not
consider decisive, these streams of fire were certainly not, as has so
often been maintained, connected with any volcanic phenomena, but
resulted from the processes still put into operation by the inhabitants
of the Dark Continent every night during the dry season.
ROAD THROUGH THE BUSH IN THE NEIGHBOURHOOD OF
CHINGULUNGULU
[10]
The reader will agree that no undue amount of intellect has been
lavished on this ditty, but this is a trait common to all native songs
here in the South. Even those acknowledged virtuosi, my
Wanyamwezi, cannot do very much better in this respect. Here we
have really every right to say, “We Wazungu are better singers after
all!”
MOUNTAINS NEAR MASASI. DRAWN BY SALIM MATOLA
CHAPTER V
LOOKING ROUND