Unit one ORGANIZATION STRUCTURES “It’s all about working together” What is organizing as a managerial responsibility? What are the most common types of organization structures?

ORGANIZATION STRUCTURES Organizing As A Management Responsibility MODULE GUIDE 13.1 Organizing is one of the management functions. Organization charts describe the formal structures of organizations. Organizations also operate with important informal structures. Informal structures have good points and bad points.

INTRODUCTION An organizational structure consists of activities such as task allocation, coordination and supervision, which are directed towards the achievement of organizational aims. There is six organizational structure type and three type still have been developing.

HISTORY Organizational structures developed from the ancient times of hunters and collectors in tribal organizations through highly royal and clerical power structures to industrial structures and today's post-industrial structures. Some of prominent names in organizational structure theory are Mohr, Taylor, Fayol, and Weber.

ORGANIZATION STRUCTURES Organizing As A Management Responsibility Organizing process of arranging people and resources to work toward a common goal.

ORGANIZATION STRUCTURES Organizing As A Management Responsibility Structure system of tasks, reporting relationships, and communication that links people and positions within an organization. Organization Charts describe the formal structure, how an organization should ideally work.

ORGANIZATION STRUCTURES Organizing As A Management Responsibility What You Can Learn from an Organization Chart Division of work - Positions and titles show work responsibilities. Supervisory relationships - Lines between positions show who reports to whom in the chain of command. Span of control - The number of persons reporting to a supervisor. Communication channels - Lines between positions show routes for formal communication flows. Major subunits - Which job titles are grouped together in work units, departments, or divisions. Staff positions - Staff specialists that support other positions and parts of the organization. Levels of management - The number of management layers from top to bottom.

ORGANIZATION STRUCTURES Organizing As A Management Responsibility Division of Labor People and groups performing different jobs Formal Structure The official structure of the organization Informal Structure the unofficial relationships that develop among an organization’s members.

ORGANIZATION STRUCTURES Organizing As A Management Responsibility

ORGANIZATION STRUCTURES Organization Structures Functional structures group together people using similar skills. Divisional structures group together people by products, customers, or locations. Matrix structures combine the functional and divisional structures. Team structures use many permanent and temporary teams. Network structures extensively use strategic alliances

ORGANIZATION STRUCTURES Functional Structures Departmentalization Grouping together people and jobs into one unit Functional Structures group together people using similar skills to perform similar activities. Potential Advantages of Functional Structures Economies of scale make efficient use of human resources. Functional experts are good at solving technical problems. Training within functions promotes skill development. Career paths are available within each function.

ORGANIZATION STRUCTURES Functional Structures

Functional Chimneys Problem A lack of communication and coordination across functional organizations

ORGANIZATION STRUCTURES Divisional Structures Divisional structures group together people who work on a similar product, work in the same geographical region, or serve the same customers. Potential Advantages of Divisional Structures Expertise focused on special products, customers, regions Better coordination across functions within divisions Better accountability for product or service delivery Easier to grow or shrink in size as conditions change

ORGANIZATION STRUCTURES Divisional Structures

ORGANIZATION STRUCTURES Customer & Matrix Structures Customer Structure Groups together people and jobs that serve the same customers or clients Matrix Structure uses permanent cross functional teams to try to gain the advantages of both the functional and divisional approaches.

ORGANIZATION STRUCTURES Matrix Structures Potential Advantages of Matrix Structures Performance accountability rests with program, product, or project managers. Teams enable better communication and cooperation across functions. Teams make more decisions and solve more problems at their levels. Top managers spend more time on strategic issues. A cross-functional team brings together members from different functional departments.

ORGANIZATION STRUCTURES Team Structures Team Structures make extensive use of permanent and temporary teams, often cross functional, to improve communication, cooperation, and problem solving. Potential Advantages of Team Structures Team assignments improve communication, cooperation, and decision-making. Team members get to know each other as persons, not just job titles. Team memberships boost morale, and increase enthusiasm and task involvement.

ORGANIZATION STRUCTURES Team Structures

ORGANIZATION STRUCTURES Network Structures Network structures maintain a staff of core fulltime employees and use contracted services and strategic alliances to accomplish many business needs.

ORGANIZATION STRUCTURES Virtual Structures Virtual Structure Uses information technologies to operate as a shifting network of alliances. MANAGEMENT TIPS Seven deadly sins of outsourcing: 1.Outsourcing activities that are part of the core competency 2. Outsourcing to untrustworthy vendors 3. Agreeing to unfavorable contracts with the vendor 4.Overlooking impact on existing employees 5. Not maintaining oversight; losing control to vendors 6. Overlooking hidden costs of managing contracts 7. Failing to anticipate need to change vendors or cease outsourcing

ORGANIZATIONAL STRUCTURE TYPES 1 Pre-bureaucratic Structures This structure is most common in smaller organizations and is best used to solve simple tasks. The structure is totally centralized. The strategic leader makes all key decisions and most communication is done by one on one conversations. It is particularly useful for new business as it enables the founder to control growth and development.

ORGANIZATIONAL STRUCTURE TYPES 2. Bureaucratic Structures Bureaucratic structures have a certain degree of standardization. They are better suited for more complex or larger scale organizations. They usually adopt a tall structure. It is very much complex and useful for hierarchical structures organization.

ORGANIZATIONAL STRUCTURE TYPES 3. Post-bureaucratic Structures The term of post bureaucratic is used in two senses in the organizational literature: one generic and one much more specific. In the generic sense the term post bureaucratic is often used to describe a range of ideas. A smaller group of theorists have developed the theory of the Post-Bureaucratic Organization, provide a detailed discussion which attempts to describe an organization that is fundamentally not bureaucratic.

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