Transcript PowerPoint chp 7

Slide 16.1
• Define organisational structure
• Discuss the purpose of structure and identify some of the
consequences of structural deficiencies
• Describe the structure of an organisation using the
dimensions of configuration, centralisation, specialisation,
formalisation and standardisation
• Describe recent developments in the structural features of
organisations.
Learning Outcomes Chapter 16
© Pearson Education Limited, 2005
Slide 16.2
1.
2.
3.
4.
5.
Vocabulary of Structures
Centralisation – decentralisation
Differentiation
Integration
Specialisation
Span of control
© Pearson Education Limited, 2005
1. Centralization and Decentralization
Slide 16.3
• The hierarchical level at which decisions are
made.
NASA
© Pearson Education Limited, 2005
Slide 16.4
Decentralization
• Facilities at different locations.
• Decision authority is pushed down the
chain of command to lower levels.
© Pearson Education Limited, 2005
Slide 16.5
Decentralization Tends to---
• Make greater use of human resources.
• Reduce burdens of top managers.
• Cause decisions to be made close to the
action.
• Permit rapid response to changes.
© Pearson Education Limited, 2005
Centralization versus Decentralization
Slide 16.6
• Greater change and uncertainty in the
environment are usually associated with
decentralization.
• The amount of centralization or
decentralization should fit the firm’s strategy.
• In times of crisis or risk of company failure,
authority may be centralized at the top.
© Pearson Education Limited, 2005
Factors that Influence
Centralization/Decentralization
Slide 16.7
•
•
•
•
•
Amount of change and uncertainty.
Corporate culture.
Size of organization.
Cost and risk of failure.
Efficiency of communication and control
systems.
© Pearson Education Limited, 2005
Slide 16.8
2. + 3. Differentiating/Integrating
Differentiating
Dividing the main task into sub-tasks
The more you differentiate the greater
is the need af intefration
Integrating
Coordinating the performance of
the sub-tasks, to ensure that
they fulfil the main task
Typically this is a managers job
© Pearson Education Limited, 2005
The story of how a Youth Hostel is
expanding!
Slide 16.9
Mand
Børn
mellemleder
EDB-tekniker
Rengøringsfolk
Kone
mellemleder
mellemleder
Kok
Vicevært
Receptionist
Gæster
Opvaskere
Tjenere
© Pearson Education Limited, 2005
Slide 16.10
The Circle of Differentiating and
Integrating
Differentiating
Integrating
”After the task has been divided into specialist subtasks, the problem is to
integrate the subtasks around the completion of the global task. This is the
problem of organization design.”
Jay Galbraith (1974), Organization Design – An Information Processing View
© Pearson Education Limited, 2005
Slide 16.11
4. Specialization
• Tasks are subdivided into individual jobs.
• Division of labor concept.
• Employees perform only the tasks relevant to
their specialized function.
• Jobs tend to be small, but they can be
performed efficiently.
• Many organizations are moving away from
this principle.
© Pearson Education Limited, 2005
Slide 16.12
5. Span of Control
• The number of employees
reporting to a supervisor.
• Traditional view, seven or so
per manager.
• Many organizations today, 30
or more per manager.
• Generally if supervisors must
be closely involved with
employees span should be
small.
© Pearson Education Limited, 2005
Factors associated with
a large Span of Control
Slide 16.13
•
•
•
•
•
•
Work is stable or routine.
Similar task is performed by everyone.
A single location.
Employees are highly trained.
Rules and procedures are available.
Support systems and personnel are available for
supervisor.
• Little time is required in nonsupervisory activities.
• Personal preferences and styles of management favor a
large span.
© Pearson Education Limited, 2005
Slide 16.14
Characteristics
of an Organisation
1. Departmentalisation
– Vertical
– Horisontal
2. Tall or Flat:
– Span of Control (number of employees under the
managers authority)
– Number of levels of command
© Pearson Education Limited, 2005
Slide 16.15
© Pearson Education Limited, 2005
Slide 16.16
1. Departmentalization
The basis on which individuals are grouped into
• Five structural alternatives
departments
Multi-Functional (Vertical) structure. People are grouped
together in departments by common skills.
Multi-Divisional structure. Grouped together based on a
common product, program, or geographical region.
Matrix structure. Functional and divisional chains of
command. Some employees report to two bosses.
Team-based structure. Created to accomplish specific tasks.
Network structure. Small, central hub electronically connected
to their other organizations that perform vital functions.
Departments are independent, and can be located anywhere.
© Pearson Education Limited, 2005
Approaches To Structural Design
Slide 16.17
Slide 1 of 2
© Pearson Education Limited, 2005
Approaches To Structural Design
Slide 16.18
Slide 2 of 2
© Pearson Education Limited, 2005
Slide 16.19
1. Multi-Functional Structure
(Vertical Functional)
© Pearson Education Limited, 2005
Slide 16.20
2. Multi-Divisional Structure
© Pearson Education Limited, 2005
Slide 16.21
2. Multi-Divisional Structure
© Pearson Education Limited, 2005
Slide 16.22
2. Multi-Divisional Structure
© Pearson Education Limited, 2005
Slide 16.23
2. Multi-Divisional Structure
© Pearson Education Limited, 2005
Slide 16.24
3. Matrix Structure
© Pearson Education Limited, 2005
Slide 16.25
3. Matrix Structure
General Electric
• Functional and divisional chains of
command simultaneously.
• Dual lines of authority.
• Functional hierarchy of authority runs
vertically.
• Divisional hierarchy runs laterally.
• Violates the unity of command concept.
© Pearson Education Limited, 2005
Slide 16.26
4. Team Structure
American Express
• Cross-functional teams consist of employees
from various functional departments.
• Interdisciplinary approach to management.
• Permanent team solve ongoing problems.
• Reengineering radical redesign for
improvements in cost, quality, service and
speed.
© Pearson Education Limited, 2005
Slide 16.27
5. Network Structure
• Organization divides major functions into
separate companies brokered by a small
headquarters organization.
• "Where is the organization?"
• Especially appropriate for international
operations.
• Held together with phones, faxes, and other
electronic technology.
© Pearson Education Limited, 2005
Slide 16.28
2. Tall versus Flat Structure
• Span of control used in an organization determines
whether the structure is tall or flat.
• Tall structure has a narrow span and more
hierarchical levels.
• Flat structure has a wide span, is horizontally
dispersed and fewer hierarchical levels.
• The trend has been toward wider spans of control.
© Pearson Education Limited, 2005
Slide 16.29
2. Tall vs. Flat Structure
© Pearson Education Limited, 2005
Slide 16.30
2. Tall vs. Flat Structure
© Pearson Education Limited, 2005
Slide 16.31
2. Tall vs. Flat Structure
© Pearson Education Limited, 2005
Slide 16.32
Woodward’s Manufacturing
Work Flow Technology
Technical Complexity . . . represents the differences among the three work flow
technologies.
• Small batch and unit production
• Large batch and mass production
• Continuous process production
© Pearson Education Limited, 2005
Slide 17.33
16.33
Woodward’s Manufacturing
Work Flow Technology
© Pearson Education Limited, 2005
Slide 17.34
16.34
© Pearson Education Limited, 2005