What is organizing?

► Arranging
and structuring work to
accomplish organizational goals
 Purpose of Organizing
► Divides work to be done into specific jobs and
departments
► Assigns tasks and responsibilities associated
with individual jobs
► Coordinates diverse organizational tasks
► Clusters jobs into units
► Establishes relationships among individuals,
groups, and departments
► Establishes formal lines of authority
► Allocates and deploys organizational
resources
 Organizational Structure
► Itis a formal arrangement of jobs within
organization

► We can illustrate the organizational

structure by using “organizational
chart”

► When managers create or change the

structure, they’re engaged in
“organizational design”
 Common Elements of
Organization
► Common Purpose
► Coordinated Effort
Proposed by Edgar
► Division of Labor Schien, professor in
organizational
► Hierarchy of Authority development
► Span of Control
► Authority, Responsibility, & DelegationMost
► Centralization v.s. Decentralizationauthorities
of
agree on
Authority
Common Purpose
► The means for unifying members
► The common purpose unifies
employees or members and give
everyone an understanding of
organization’s reason for being

► Anorganization without purpose soon

begin to drift and become disorganized
Coordinated Effort
► Working together for common purpose
► The common purpose is realized
through coordinated effort, the
coordination of individual efforts into a
group or organization-wide effort

► Individuals
can make a difference,
however, they cannot do everything by
themselves
Division of Labor
► Work specialization for greater efficiency
► Division of labor is the arrangement of
having discrete parts of a task done by
different people

► With division of labor, an organization can

parcel out the entire complex work effort
to be performed by specialists, resulting
in greater efficiency
 Organizing Process

Organizatio
nal Authority Coordinatio
Job Design
Structure Allocation n
Design
Chain of
comman
d
Span of
control
Delegati
on
Centralized
or
Decentraliz
ed
 Job Design
► Thenumber, kind, and variety of tasks
that individual workers perform in
doing their jobs.

 Job Specialization: a job composed of a

small part of a larger task or process
Alternatives to Job Design
 Job Rotation: periodically moving workers from
specialized job to another to give them more
variety and opportunity to use different skills

 Job Enlargement: increasing the number of tasks

that a worker performs within one particular job

 Job Enrichment: increasing the number of tasks

in a particular job and giving workers the
authority and control to make meaningful
decisions about their work
 Organizing Process

Organizatio
nal Authority Coordinatio
Job Design
Structure Allocation n
Design
Chain of
comman
d
Span of
control
Delegati
on
Centralized
or
Decentraliz
ed
 8 Types of Organizational
Arrangement
► Simple Structure
► Functional Structure
► Divisional Structure
► Conglomerate Structure
► Hybrid Structure
► Matrix Structure
► Team-Based Structure
► Network Structure
 1. Simple Structure
► For a small firm
► An organization with a simple
structure has authority centralized in a
single person, a flat person, a flat
hierarchy, few rules, and low work
specialization
Owner

Simple structure: an
Administrat
ive
example
Assistant There is only one
hierarchical level of
 2. Functional Structure
► Grouping by similar work specialty
► In a functional structure, people with
similar occupational specialties are put
together in formal groups
Presiden Structure for
t a Business
Vice
Vice Vice Vice
President,
President, President, President,
Human
Marketing Finance Production
Resources
Chief
Administrat Structure for
or a hospital
Director of
Chief of Director of Director of
Nutrition &
Medical Admistrativ Outpatient
Food
Services e Services Services
Services
 3. Divisional Structure
► Grouping by similarity of purpose
► In a divisional structure, people with
diverse occupational specialties are
put together in formal groups by
similar products or services, customers
or clients, or geographic regions
Divisional Structure
Product
Presiden divisiona
t l
structur
Motion e
Internet
Pictures & Music Magazine
Product
Television Division Division
Division
Division

Presiden Custome
t r
divisional
structure
Consumer Mortgage Business Agricultural
Loans Loans Loans Loans

Presiden Geographi
t c divisional
structure
Western Northern Southern Eastern
Region Region Region Region
 4. Conglomerate Structure
► Grouping by industry
► The conglomerate structure groups
divisions or business units around
similar businesses or industries
This resemble the
structure of Tyco
International, a
Presiden
global manufacturing
t
company
Plastics & Engineered
Fire & Healthca
Electronics Adhesive Products &
Security re
s Services
 5. Hybrid Structure
► Functional & divisional used within the
same organization
► In a hybrid structure, an organization
uses functional and divisional
structures in different parts of the
same organization
 Hybrid Structure

CEO
General
Product Motors
divisional
structure President, President, President, President,
Cadilac Buick Pontiac Chevrolet

Vice Vice Vice Vice

President, President, President, President,
Production Marketing Finance Human
Resources
Function
Manager, Manager, Manager, Manager, al
Region I Region II Region III Region IV structure
Geographical
divisional
structure
 6. Matrix Structure
►A grid of functional & divisional for 2
chains of command
► In a matrix structure, an organization
combines functional and divisional
chains of commands in a grid so that
there are 2 command structures—
vertical and horizontal
Matrix Structure Presiden Functiona
An example of an arrangement t l
that Ford might use
Structure
Vice
Vice Vice Vice
President,
Project Engineerin
President, President, President,
Structure Finance Production Marketing
g
Project
Manag
er,
Taurus
Project
Manag
er,
Mustan
g
Project
Manag
er,
Explore
r
Project
Manager
,
Expediti
on
Subordinate reports to both VP of Marketing (above) and Project Manager for
 7. Team-Based Structure
► Eliminating functional barriers to solve
problems
► In a team-based structure, teams or
workgroups, either temporary or permanent,
are used to improve horizontal relations and
solve problems throughout the organization
► When managers from different functional
divisions are brought together in teams —
known as cross functional teams—to solve
particular problems, the barriers between the
divisions break down.
Team-based structure
Preside
nt
Functional
structure
Vice
Vice Vice Vice
President,
President, President, President,
Engineerin
R&D Design Marketing
g

Product Product
Product
Team Team
Project Manager,
Team
Manager,
teams Manager,
Manufacturi Manufacturi
Manufacturi
ng, Light ng, Sport
ng, Sedans
Trucks Cars

Project team
members
 8. Network Structure
► Connecting a central core to outside
firms by computer connections
► The network structure is the
organization has a central core that is
linked to outside independent firms by
computer connections, which are used
to operate as if all were a single
organization
► Corporations using this structure are
sometimes called virtual corporations
Network structure
Example of a personal computer company

Design Component
studio: assembly:
Sweden Mexico, Asia

Core of
personal
computer
company
Engineering USA Distribution
company: company:
Japan Canada

Accounting
& finance:
USA
 Organizing Process

Organizatio
nal Authority Coordinatio
Job Design
Structure Allocation n
Design
Chain of
comman
d
Span of
control
Delegati
on
Centralized
or
Decentraliz
ed
• Hierarchy of Authority
► Or the Chain of Command
► It is a control mechanism for making
sure the right people do the right things
at the right time

► Without tiers or ranks of authority, a

lone manager would have to confer with
everyone in his/her domain, making it
difficult to get things done
Example
MEIKO TRANS (THAILAND) CO.,
LTD
• Span of Control:
Narrow (or Tall) v.s. Wide (or
Flat)
► orspan of management, refers to the number
of people reporting directly to a given manager

► There are 2 kinds of spans of control:

 Narrow (or tall): manager has limited number of
people reporting — more managers are required,
managers can communicate quickly to subordinates
and control them easily
 Wide (or flat): manager has several people
reporting—less managers are required = more
efficient in terms of cost, the message reaches more
employees faster, faster decision making
 • Authority, Responsibility, &
Delegation: Line vs. Staff Position
► Authority refers to the rights inherent in a
managerial position to make decisions, give
orders, and utilize resources
► Authority means accountability—managers
must report and justify work results to the
managers above them

► Beingaccountable means you have the

responsibility for performing assigned tasks
 Authority, Responsibility, &
Delegation: Line vs. Staff Position
► Responsibility is the obligation you have
to perform the tasks assigned to you
► Example: a car assembly-line worker has
little authority but also little
responsibility: just install those
windshields over and over. Manager,
however, has greater responsibilities

► Withmore authority comes more

responsibility
 Authority, Responsibility, &
Delegation: Line vs. Staff Position
► Delegation is the process of assigning
managerial authority and
responsibility to managers and
employees lower in the hierarchy

► Tobe more efficient, most managers

are expected to delegate as much of
their work as possible
Delegation: Responsibility,
Authority, and
Accountability
 Authority, Responsibility, &
Delegation: Line vs. Staff Position
► Regarding authority and responsibility, the
organization chart distinguishes between 2
positions:

 Line position: Line managers have authority to

make decisions and usually have people
reporting to them (are indicated by solid line)

 Staff position: Staff personnel have authority

function; they provide advice,
recommendations, and research to the line
managers (are indicated by dotted line)
Line and Staff

Board of
Staff Directors
Line
Strategic
Legal
Planning CEO
Counsel
Advisor

Cost-
President Containme
nt Staff

Executive
Executive
Administra
Medical
tive
Director
Director
 • Centralization vs.
Decentralization of Authority
► With centralized authority, important
decisions are made by high-level managers
► Very small companies tend to be the most
centralized, however, Kmart and McDonald are
using this kind of authority

► Advantages:
 Less duplication of work (fewer employees perform
the same task; rather, the task is often performed by
a department of specialists)
 Procedures are uniform and thus easier to control
Centralization vs.
Decentralization
of Authority
► With decentralized authority, important
decisions are made by middle-level and
supervisory-level managers
► Here, obviously, power has been delegated
throughout the organization. General Motors and
Sears are using this kind of authority

► Advantages:
 Managers are encouraged to solve their own problems
rather than to buck the decision to a higher level
 Decision are made more quickly, which increases the
organization’s flexibility and efficiency
 Organizing Process

Organizatio
nal Authority Coordinatio
Job Design
Structure Allocation n
Design
Chain of
comman
d
Span of
control
Delegati
on
Centralized
or
Decentraliz
ed
 Coordination
Important Elements:

► Coordinator
► Roles & Responsibility
► Rules & Regulations
THANK YOU