ORGANIZING

Syllabus Content
– Definition of organizing
– The organizing process
– Types of Organizational structure
– Span of management (narrow vs. wide )
– Authority/chain of command/scalar
principles
– Delegation/ centralization and
decentralization

ORGANIZING 2
 What is Organizing?
The process of determining:
 The tasks to be done.
 Who will do them, i.e.
allocation of resources
 How those tasks will be
managed and coordinated.
 Decide span of
management
 Draw organization chart

ORGANIZING 3
 Reasons managers need to
organize
 Can divide work according to the
nature & similarity of tasks
 Can pool resources & increase efforts
efficiently
 Can build continuity & synergy

 Can stabilize & balance change

ORGANIZING 4
Figure 7.1 The Process of Organizing

ORGANIZING 5
 Job Design
 The set of tasks and activities that
are grouped together to define a
particular job.
 Jobdescriptions detail the
responsibilities and tasks associated
with a given job.

ORGANIZING 6
 Table 7.2 The Core Dimensions of a Job

Core Job Dimension Effect of Dimension

Skill variety
Task identity Meaningfulness of the work
Task significance

Autonomy Responsibility for outcomes

of the work

Feedback Knowledge of results of the

work activities

Source: Adapted from J. R. Hackman, G. Oldham, R. Janson, and K. Purdy, “A New Strategy for Job Enrichment.” Copyright © 1975
by the Regents of the University of California. Reprinted from California Management Review 17 (1975): 4. By permission of The
Regents.

ORGANIZING 7
 Core Job Dimensions
 Skill Variety
– The degree to which a job challenges the
job holder to use various skills and
abilities.
 Task Identity
– The degree to which a job requires the
completion of an identifiable piece of work.
 Task Significance
– The degree to which a job contributes to
the overall efforts of the organization.

ORGANIZING 8
Core Job Dimensions (cont’d)
 Autonomy

– The degree to which job holders have

freedom, independence, and decision-
making authority.
 Feedback

– The information provided to job holders

regarding the effectiveness of their
efforts.

ORGANIZING 9
 The Evolution of Job Design
Theory
 Theproduction worker has now
become the knowledge worker.
– Classical Perspectives
– Behavioral Management Perspectives
– Employee-Centered and Team-Centered
Perspectives

ORGANIZING 10
 Classical Perspectives
 Focus on efficiency.
 Bornof classical management and
scientific management theories
based on the concepts of division of
labor and specialization.
– Jobs are highly structured and rigidly
defined.

ORGANIZING 11
Table 7.3 Potential Advantages and Disadvantages of
Job/work Specialization

ORGANIZING 12
 Behavioral Perspectives
 Focus on motivation, satisfaction, and
productivity.
– Became popular during the movement toward
the human relations school of thought.
– Led to the development of more innovative
approaches to job design including:
 Job enlargement
 Job enrichment
 Job rotation

ORGANIZING 13
 Job Enlargement
 Programs designed to broaden job
scope.
– Job scope refers to the number of different
activities required in a job and the frequency
with which each activity is performed.
– While job enlargement programs have
typically been considered as a means of
enriching jobs, sometimes reducing job
scope has a positive impact on productivity
and job satisfaction.

ORGANIZING 14
 Job Depth and Job Enrichment
 Job Depth
– Refers to the degree of control given to a job
holder to perform their job.
– Jobs that have high job depth typically rate
more favorably on the core job dimensions
than jobs with low job design.
 Job Enrichment
– Giving greater discretion in setting schedules
& planning work activities, determining
appropriate method for completing tasks

ORGANIZING 15
 Job Rotation
 Assigning individuals to a variety of job
positions.
– Employees rotate through a number of job
positions that are at approximately the
same level and have similar skill
requirements.
– While job rotation has proven particularly
beneficial in manufacturing settings, it can
also be used effectively in service
organizations.
ORGANIZING 16
 Departmentalization Structure
 Defines the primary reporting relationships
that exist within an organization.
– The chain of command and hierarchy of
responsibility, authority, and accountability are
established through organizational structure.
 A formal diagram that shows the lines of
authority. Purpose:-
 To indicate to each employees area of
responsibility
 To coordinate the division of work & make
those division clear
 To show work to be done
 To indicate line of promotion

ORGANIZING 17
 Departmentalization Structure
(cont’d)
 Common Forms of Organizational
Structure / Departmentalization
– Functional structure
– Divisional structure (products, customer
& geographic)
– Matrix structure
– Network structure

ORGANIZING 18
 Functional Structure:
Specialization and Efficiency
 Members of the organization are
grouped according to the particular
function that they perform within the
organization.
– Appropriate when an organization’s
greatest source of complexity comes
from the diverse tasks that must be
performed

ORGANIZING 19
Figure 8.2: Functional Structure

ORGANIZING 20
 Functional Structure
 Advantages  Disadvantages
– Facilitates – Focus on
specialization departmental versus
– Cohesive work groups organizational issues
– Improved operational – Difficult to develop
efficiency generalists needed
– Supervision is easier for top-level
management
– Little need for
– Only top-level
internal coordination
management held
within department
accountable for
profitability

ORGANIZING 21
Divisional Structures: Providing
Focus
 Members of the organization are
grouped on the basis of:
– Product
– Customers
– Geographic

ORGANIZING 22
 Types of Divisional Structure
 Product Divisions
– For organizations
with relatively
diverse product
lines that require
specialized
efforts to achieve
high product
quality.

ORGANIZING 23
 Product Divisional Structure
 Advantages
– Enhanced coordination.
– Better assessment of manager performance
and responsibility.
– Development of generalist managers.
 Disadvantages
– Managers may lack expertise to operate in
wide geographic areas.
– Duplication of resources.

ORGANIZING 24
 Customer Divisional
 Customer Divisions
– For organizations that
have separate
customer groups with
very specific and
distinct needs.

ORGANIZING 25
 Customer Divisional
 Advantages
– Good structure for serving large customer groups.
– Helps allocate resources to meet demands of
specific customer groups.
– Best for growth by targeting new and distinct
groups.
 Disadvantages
– Ineffective and inefficient use of resources if most
customer groups served are small.
– Internal competition for resources to serve
customers groups may cause loss of market focus.

ORGANIZING 26
 Geographic Divisional
 Geographic Divisions
– For organizations
with limited product
lines that either have
wide geographic
coverage or desire to
grow through
geographic
expansion.

ORGANIZING 27
 Geographic Divisional
 Advantages
– Allows for focus on specific new markets.
– Good structure for growth along geographic lines.
– Adaptable to local needs.
 Disadvantages
– Duplication of product or product/technology
efforts.
– Coordination and integration are difficult.
– May be difficult to manage diverse product lines.

ORGANIZING 28
 Figure 8.4: Geographic Divisional
Structure: Canadian National Railway
Company

Source: “Illinois Central Spurs Reorganization by Canadian National,” Wall Street Journal, 15 April 1999, A4.
ORGANIZING 29
 Matrix Structure: A Dual Focus
A structure in which the tasks of the
organization are grouped along two
organizational dimensions
simultaneously.
 Examples include:
– Product/function
– Product/geographic region

ORGANIZING 30
Figure 8.5: Matrix Structure

ORGANIZING 31
 Matrix Structure (cont’d)
 Disadvantages
– Complex, leading to difficulties in implementation
– Behavioral difficulties from “two bosses”
– Time consuming from a planning/coordination
perspective
 Advantages
– Can achieve simultaneous objectives
– Managers focus on two organizational
dimensions, resulting in more specific job skills

ORGANIZING 32
Table 8.1: Potential Advantages and Disadvantages
of Organizational Structures

ORGANIZING 33
 Organizational Relationships
 The working relationships that exist
within an organization affect how its
activities are accomplished and
coordinated.
 These relationships are defined by:

– Chain of command
– Span of control
– Line and staff responsibilities
– Delegation
ORGANIZING 34
Chain of Command and Unity of
Command
 Chain of Command
– The line of authority and responsibility
that flows throughout the organization.
 Unity of Command
– A principle that each employee in the
organization is accountable to one, and
only one, supervisor.

ORGANIZING 35
 Span of Control
 Thenumber of employees reporting to
a particular manager.
– In theory, when tasks are very complex,
span of control should be relatively narrow.
– In contrast, where jobs are highly
standardized and routine (low complexity),
a manager will not need to spend as much
time supporting individual subordinates,
and the span of control may be larger.

ORGANIZING 36
 Line and Staff Responsibilities
 Line Departments
– Those organizational members that are
directly involved in delivering the products
and services of the organization.
 Staff Departments
– Those organizational members that are not
directly involved in delivering the products
and services to the organization, but
provide support for line personnel.

ORGANIZING 37
 Figure 7.2 Alternative Ways to Structure an Organization

Source:: Adapted from The Structuring of Organizations by Mintzberg, © 1991. Reprinted by permission of Prentice-Hall, Inc., Upper Saddle River, NJ.
ORGANIZING 38
 Authority and Responsibility
 Authority
– The formal right inherent in an organizational
position to make decisions.
 Formal authority
– Authority inherent in an organizational
position.
 Informal authority
– Ability to influence others that is based on
personal characteristics or skills.
 Responsibility
– The obligation to perform the duties assigned.
ORGANIZING 39
 Organizational Design
 Organizational Design Defined
– A plan for arranging and coordinating
the activities of an organization for the
purpose of fulfilling its mission and
achieving its goals.

ORGANIZING 40
 Organizational Design
 Components of Organizational
Design
– Overall organizational design is defined
by three primary components:
 Organizational structure
 Integrating mechanisms
 Locus of decision making

ORGANIZING 41
Figure 8.1 Dimensions of Organizational Design

ORGANIZING 42
 Delegation
 The process of transforming the
responsibility for a specific activity or
task to another member of the
organization, and…
 Empowering that individual to
accomplish the task effectively.

ORGANIZING 43
 Accountability
 Accountability

– Responsibility to the supervisor for

results of decisions made and actions
taken with delegated authority.

ORGANIZING 44
 Benefits of Delegation
 Leads to a more involved and empowered
workforce.
 Improved response time as a result of
decisions and information not needing to be
passed up and down the organization.
 Leads to better decision making.
 Provides opportunity for employee to develop
analytical and problem solving skills.
 Provides managers the opportunity to
accomplish more complicated, difficult, or
important tasks.

ORGANIZING 45
 Learning to Delegate Effectively
1. Match the employee to the task.
2. Be organized and communicate
clearly.
3. Transfer authority and
accountability with the task.
4. Choose the level of delegation
carefully.

ORGANIZING 46
 Figure 7.3: Degree of Delegation

Source: Adapted from M. E. Haynes, “Delegation: There’s More to It Than Letting Someone Else Do It!” 9–15. Reprinted, by permission
of publisher, from Supervisory Management, January 1980. © 1980, American Management Association, New York. All rights reserved.
ORGANIZING 47
 Reasons for Failing to Delegate
 The “time crunch.”
 Lackof confidence in the abilities of
subordinates.
 Managers try to avoid the potential
pitfalls of dual accountability.
 Managers may be insecure about
their own value to the organization.

ORGANIZING 48
Overcoming barriers to effective
delegation
 Managers allow
subordinates to develop
their own solutions and to
make mistake.
 Subordinates must learn
from mistakes
 More support and training
 Improved communication
 Gradual increase in degree
of delegation

ORGANIZING 49
 Locus of Decision Making
 The degree to which decision making
is centralized versus decentralized.

ORGANIZING 50
Centralization (concentration of
authority)
 Responsibility & authority are concentrated
in one place
 Major decisions are made by the central
controlling body
 Advantage:
 gives top-level management maximum
control.
 administratively convenient; uniform policy

 Having common standard throughout the

organization
ORGANIZING 51
Centralization (concentration of
authority)
 Disadvantages:
 limitsthe organization’s ability to respond
quickly and effectively to changes in the
environment.
 control can become autocratic and inflexible

 Managers may see themselves not as

independent decision makers but rather as

order-taking subordinates
 Does not promote development of future

manager

ORGANIZING 52
 Decentralization (dispersion of
authority)
 Responsibility for various functional and operations are
taken away from the center and rests at the points of
where operations occur
 Advantage
Organizations can respond to environmental change more
rapidly and effectively because the decision makers are the
people closest to the situation.
Manager & staff may exercise their own judgment and
initiatives
Provides good management experience to managers and
supervisors & promotes personal development

ORGANIZING 53
 Decentralization (dispersion of
authority)
 Disadvantage
Top-level managers lose some control.
More reporting and inspection may be
needed than if the control is centralized
Lead to more costly operation
May develop narrow minded view of the
organization and ,leading to difficulties in
their relationship with other sections

ORGANIZING 54
Managing Complexity Through
Integration
 Interdependence

– The degree to which work groups are

interrelated
 Coordination

– Integrating objectives & activities of

separate units to achieve organizational
goals

ORGANIZING 55
Figure 8.7: Levels of Work Group
Interdependence

ORGANIZING 56
 Pooled Interdependence
 Occurs when organizational units
have a common resource but no
interrelationship with one another.
A

F B
Head-
quarters
E C

D
ORGANIZING 57
 Sequential Interdependence
 Occurs when organizational units must
coordinate the flow of information,
resources, and tasks from one unit to
another.

A B C

ORGANIZING 58
 Reciprocal Interdependence
 Occurs when information,
resources, and tasks
must be passed back and
A B
forth between work
groups.

C D

E F
ORGANIZING 59
 Implications for Leaders:
Organizing Tips
 Identify the tasks and activities
that must be completed in order
for goals to be achieved.
 Design jobs so that job holders
will find their jobs interesting
and challenging.
 Understand the potential
advantages and disadvantages
of specialization, job
enlargement, job enrichment,
and job rotation.

ORGANIZING 60
 Implications for Leaders:
Organizing Tips (cont’d)
 Understand the
importance of chain of
command and span of
control.
 All successful
managers delegate
authority. Learn how
to delegate well and
hold people
accountable.

ORGANIZING 61