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Organizational Structure and Design. Chapter 5 BUSM 12 Ms. Stewart. Organizational Structure. How job tasks are formally divided, grouped, and coordinated within an organization When managers develop or change the structure, they are engaged in organizational design. Purposes of Organizing.

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Organizational Structure and Design


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    1. Organizational Structure and Design Chapter 5 BUSM 12 Ms. Stewart

    2. Organizational Structure • How job tasks are formally divided, grouped, and coordinated within an organization • When managers develop or change the structure, they are engaged in organizational design

    3. Purposes of Organizing

    4. Departmentalization • This is the basis on which jobs are grouped together • Common forms: • Functional • Geographical • Product • Process • Customer

    5. Functional Departmentalization • Groups jobs by functions performed

    6. Geographical Departmentalization • Groups jobs on the basis of territory or geography

    7. Product Departmentalization • Groups jobs by product line

    8. Process Departmentalization • Groups jobs on the basis of product or customer flow

    9. Customer Departmentalization • Groups jobs on the basis of customer who have common needs or problems

    10. Traditional Organization Structure

    11. Line and Staff Managers • Line managers are responsible for essential activities of the organization, including production and sales • Staff Managers work in supporting activities of the organizations (such as Human Resources or Accounting)

    12. Centralization • The degree to which decision making is concentrated at a single point in the organization • Example: If the top managers make the organization's key decisions with little to no input from below

    13. Decentralization • The degree to which lower level employees provide input or actually make decisions