Key Design Questions and Answers for Designingthe Proper OrganizationStructureTheKeyQuestionThe Answer Is Provided by1. To what degree are articlesWork specializationsubdivided into separate jobs?2.On what basis will jobs begroupedDepartmentalizationtogether?3.To whom do individuals and groupsChain ofcommandreport?4.Span of controlHow many individuals cana managerefficientlyand effectivelydirect?5.CentralizationWheredoes decision-makingand decentralizationauthority lie?6.To what degree will there be rulesFormalizationand regulations to direct employeesand managers?
Key Design Questions and Answers for Designing the Proper Organization Structure The Key Question The Answer Is Provided by 1. To what degree are articles Work specialization subdivided into separate jobs? 2. On what basis will jobs be grouped Departmentalization together? 3. To whom do individuals and groups Chain of command report? 4. How many individuals can a manager Span of control efficiently and effectively direct? 5. Where does decision-making Centralization authority lie? and decentralization 6. To what degree will there be rules Formalization and regulations to direct employees and managers?
What Is Organizational Structure?Work SpecializationThe degree to which tasks in the organization are subdivided into separatejobsMakes efficient useof employee skillsIncreasesemployeeskillsthrough repetitionDivisionLessbetween-job downtime increasesofproductivityLaborSpecialized training is more efficientAllows use ofspecializedequipment
Company Logo What Is Organizational Structure? • Increases employee skills through repetition Work Specialization The degree to which tasks in the organization are subdivided into separate jobs Division of Labor • Makes efficient use of employee skills Less between-job downtime increases productivity • Allows use of specialized equipment • Specialized training is more efficient
Economies and Diseconomies ofWork SpecializationImpactfromhuman diseconomieseconomies(High)fspecializationImpactfromoWork specialization(Low)(High)
Economies and Diseconomies of Work Specialization
What Is OrganizationalStructure?DepartmentalizationThe basis by which jobs are grouped togetherCustomerFunctionProcessGroupingProductActivitiesbyGeography
What Is Organizational Structure? • Customer • Function • Product • Geography • Process Grouping Activities by Departmentalization The basis by which jobs are grouped together
What IsOrganizationalStructure?The rights inherent in a managerial position to giveAuthorityordersandto expecttheorderstobeobeyedThe unbroken line ofauthority thatextendsfromthe top of theorganization to the lowest echelonChainofand clarifies who reports towhomCommandA subordinate should haveonlyonesuperiortowhom heorsheisdirectlyresponsibleUnityofCommand
What Is Organizational Structure? Authority The rights inherent in a managerial position to give orders and to expect the orders to be obeyed Chain of Command Unity of Command The unbroken line of authority that extends from the top of the organization to the lowest echelon and clarifies who reports to whom A subordinate should have only one superior to whom he or she is directly responsible