Fundamentals of Organizing
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Fundamentals of Organizing. Organizing arranging the activities of the enterprise in such a way that they systematically contribute to the enterprise’s goals the process of determining how resources are allocated and prepared to accomplish an organization’s mission

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Fundamentals of organizing

Fundamentals of Organizing

  • Organizing

    • arranging the activities of the enterprise in such a way that they systematically contribute to the enterprise’s goals

    • the process of determining how resources are allocated and prepared to accomplish an organization’s mission

    • the process by which managers establish working relationships among employees to achieve goals

  • Results of Organizing

    • tasks and authority, reporting relationships, grouping of jobs, and systems of coordination


Fundamentals of organizing

Nature of organisational structure

Formal pattern of interactions and co-ordination designed by management to link the tasks of individuals and groups in achieving organisational goals.

OR

Layout of jobs and their linkage to one another for the completion of tasks and successful achievement of organizational goals.


Fundamentals of organizing

organizational structure

Four elements:

  • Assignment of tasks and responsibilities to individuals and units.

  • Clustering these to form a hierarchy.

  • Mechanisms for vertical co-ordination.

  • Mechanisms for horizontal co-ordination.


Fundamentals of organizing

Nature of organisational structure

  • The organisation chart

    • Line diagram depicting broad outlines of an organisation’s structure. They indicate, how jobs are grouped and who manages the relationships.

    • Developing an organizational chart is the overall responsibility of the management.

  • Principles of developing a goog chart design

    • Charts should show who has authority over who.

    • Charts should show official lines responsibility & communication.


Fundamentals of organizing

Chairperson,

M.D., and C.E.O.

Secretary’s Office

GM

Marketing

General

Counsel

GM

Operations

GM

H.R.

GM

Finance

Communication

Insurance Operations

H.R. Develop

Internal Audit

Market Support

Actuarial

Health Unit

Investment

Field Mgmt Region 1

IMS

Training

Real Estate

Field Mgmt Region 2

Financial Analysis

Tax


Fundamentals of organizing

Organization Chart


Chain of command

Chain of Command

  • Unbroken line of authority that ultimately links each individual with the top position in the organization.

  • Chain of command also shows the connection at every successive layer.


Fundamentals of organizing

The Chain of Command

Chief Executive

Officer

Executive

Vice President

Executive

Vice President

President

Vice

President

Vice

President

Vice

President

Vice

President

Vice

President

Region

1

Region

2

Region

3

Region

4

Region

5

District

A

District

B

District

C

District

D

District

E

District

F

District

G


Methods of vertical co ordination how people communicate vertically

Methods of vertical co-ordination:How People communicate ‘vertically’


Fundamentals of organizing

Formalisation:

  • Degree to which written policies, rules, procedures, job descriptions and other documents specify what actions are(not) to be taken under a given set of circumstances. (written policies and procedures)

  • It is all about having a formal base for your organization.

  • For Example: written policy of how to conduct elections, how to organize a meeting; how to deal with a problem in the finance department etc.


Small v s big businesses

Small V/S BIG businesses


Span of management

Span of Management

  • Number of subordinates reporting to a specific manager.

  • It is an important element, that affects the shape and height of an organizational structure.

  • More levels in the organization means more chances of ineffective communication and management.


Fundamentals of organizing

  • In order to make effective, management, communication and control from top to bottom, it is essential that there not too many or very few levels

    BUT WHY??????


Can we put more people under the supervision of every manager depends upon the following

Can we put more people under the supervision of every manager depends upon the following:

Factors influencing span of management:

  • Low interaction requirements.

  • High competencelevels.

  • Work similarity (between organisational peers).

  • Low problem frequency and seriousness.

  • Physical proximity.

  • Few non-supervisory duties of managers.

  • Considerable available assistance.

  • Highmotivational possibilities of work.


Levels in the hierarchy

Levels in the Hierarchy

  • Tall Structure

  • Flat Structure


Fundamentals of organizing

T

A

L

L

S

T

R

U

C

T

U

R

E


Fundamentals of organizing

T

A

L

L

S

T

R

U

C

T

U

R

E


F l a t s t r u c t u r e

F L A T S T R U C T U R E


Tall v s flat

Tall V/S Flat


What if you have to go from tall to flat

What if you have to go from Tall to Flat????

  • Downsizing

  • Rightsizing


Decision making and authority who makes decisions in irganizations

Decision Making and AuthorityWho makes decisions in irganizations


Fundamentals of organizing

Centralisation

Extent to which power & authority are retained at the top organisational levels.

De-centralisation

Extent to which power & authority are delegated to lower levels.

Factors favouring De-centralisation

  • Large organisational size

  • Geographic dispersion

  • Technological complexity

  • Environmental uncertainty.


Fundamentals of organizing

Methods of vertical co-ordination

‘… extent to which power and authority will be retained at upper levels’. Influenced by:

Large size: larger

organisations

likely to be more

Decentralised.

Geographic dispersion:

more dispersed likely to be

decentralised, to enable

control at a number of sites.

Environmental uncertainty:

with rapid change, need for more

employees to be involved in

responding to challenges.

Technological complexity:

with more complex

technology,need to devolve

authority to lower levels.


Fundamentals of organizing

Delegation

Assignment of part of a manager’s work to others, along with both responsibility & authority necessary to achieve expected results.

Factors restraining delegation

  • Fear subordinate failure.

  • Time to train subordinates.

  • Enjoy doing tasks.


Authorities in an organization

Authorities in an Organization:

Configuration of line and staff positions:

  • Line authority

    Authority following the chain of command established by the formal hierarchy.

  • Functional authority

    Authority of staff over others in the organisation in matters related directly to their respective functions e.g. HRM dept.


Methods of horizontal co ordination

Methods of horizontal co-ordination

Horizontal co-ordination:

Linking of activities across departments at similar levels.

  • Need for information processing across the organisation.

  • Promotes innovation through dissemination of ideas & information.


Methods of horizontal co ordination1

Methods of horizontal co-ordination

Horizontal co-ordination promoted by:

  • Slack resources

    Cushion of resources that facilitates adaptations to internal/external pressures, as well as initiation of changes.

  • Information systems

    One information source for many users.

  • Lateral relations

    Direct contact, liaison roles, task forces, teams.


Lecture summary

Lecture summary

  • Methods of vertical co-ordination

    • Formalisation

    • Span of management

    • Centralisation vs de-centralisation

    • Delegation

    • Line & staff authority.

  • Methods of horizontal co-ordination

    • Slack resources

    • Information systems

    • Lateral relations.


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