Organizing Mrs. Belen B. Apostol

1. Organizing Mrs. Belen B. Apostol

2. Organizing • Organizing is the process of structuring an entity’s resources and undertakings in order to efficiently and effectively accomplish established objectives.

3. Process of Organizing • Organizing must be done in line with the established goals of the entity or the business. It must be done for the primary purpose of helping the company achieve its goals and objectives. • Involves the structuring of resources and undertakings of a business.

4. Process of Organizing “resources” refers to both human and non-human resources of a business “undertakings” refers to all the activities within the organization or business. 3. Organizing should be efficient and effective, meaning; it must be done in the correct manner using the least possible resources.

5. The Organizational Structure and the Factors Affecting It • The organizational structure is the means by which an organization will be able to attain its goals and objectives. • It is affected by the following factors: • The organization’s strategies • The technology involved in implementing the strategies • The people employed at all levels and their functions; and • The size of the organization

6. The Formal Organization • This is the structure that provides the detailed lines of responsibility, authority and position within an organization. This structure aims to provide a prescribed relationship and pattern among the different components of the organization.

7. The Formal Organization It is presented through: • Organizational chart • Organizational manual • Policy manual

8. Organizational chart • organizational chart is a diagram of a graphical representation of the official positions and lines of authority within an organization.

9. Organizational manual • The organizational manual is a written document that provides the description of authority, details of functions, and job procedures.

10. Policy manual • The policy manual provides the rules and guidelines of company operations and personnel conduct within the organization.

11. Informal Groups • These are groups created by members of the organization for the purpose of friendship and belonging. Though these groups are not formally recognized in an organizations structure, they must still be monitored with proper caution for the reason that these groups may either enhance or impede the performance of the organization. It is therefore the responsibility of the management to make sure that these groups will work at the best interest of the organization.

12. Levels of Management and Supervision There are two primary types of supervision structure namely: • Flat Structure • Tall Structure

13. Flat Structure • The flat structure has few levels of management. It is also characterized by a structure that expands or extends horizontally. • The advantages of a flat structure are: • Faster and less distorted communication • Quicker decision making • Eliminations of supervisor’s salaries

14. Flat Structure • The disadvantages of a flat structure are: • Greater work load for the general manager • The manager would have less time to monitor subordinates • the groups will be left without a leader if the manager is out • the manager would have less time to anticipate problems

15. Tall Structure • The tall structure has a lot of levels of management. It is characterized by a structure that extends vertically. • The advantages of a tall structure are: • less supervisory load for each manager • more promotion opportunities for subordinates • managers have the opportunity to specialize • less demand for managers who have multiple skills • managers have more time to address problems

16. Tall Structure • The disadvantages of a tall structure are: • slower and more distorted communication • slower and less accurate decision making • more expensive to manage primarily due to compensation

17. Basic Elements of Organizational Structure • The design of an organizational structure must at least have the following basic elements: 1. Work Specialization 2. Departmentation 3. Chain of Command 4. Authority 5. Span of Control 6. Coordination of Activities

18. 1. Work Specialization • Work specialization, sometimes called division of labor, is the degree to which organizational tasks are divided into separate jobs. Employees within each department perform only the tasks related to their specialized function.

19. 2. Departmentation • This refers to the grouping of jobs based on the criteria that managers believe to help in the coordination and control of activities. Some of the common criteria used for grouping are: • Knowledge and skills • Work process and function • Time • Product • Customers • Location

20. 3. Chain of Command • The chain of command is an unbroken line of authority that links all persons in an organization and defines who reports to whom. This chain has two underlying principles: unity of command and scalar principle.

21. Unity of command • principle states that an employee should have one and only one supervisor to whom he or she is directly responsible. No employee should report to two or more people. Otherwise, the employee may receive conflicting demands or priorities from several supervisors at once, placing this employee in a no-win situation.

22. Scalar Principle. • The scalar principle refers to a clearly defined line of authority that includes all employees in the organization. • that there should be a clear and unbroken chain of command linking every person in the organization with successively higher levels of authority up to and including the top manager.

23. 4. Authority • Authority is the formal and legitimate right of a manager to make decisions, issue orders, and allocate resources to achieve organizationally desired outcomes. A manager's authority is defined in his or her job description.

24. Authority • Organizational authority has three important underlying principles: • Authority is based on the organizational position, and anyone in the same position has the same authority. • Authority is accepted by subordinates. Subordinates comply because they believe that managers have a legitimate right to issue orders..

25. Authority 3. Authority flows down the vertical hierarchy. Positions at the top of the hierarchy are vested with more formal authority than are positions at the bottom

26. Authority Three Types • Line authority gives a manager the right to direct the work of his or her employees and make many decisions without consulting others. • Staff authority supports line authority by advising, servicing, and assisting, but this type of authority is typically limited. • Functional authority is authority delegated to an individual or department over specific activities undertaken by personnel in other departments

27. Authority • Delegation Delegation is the downward transfer of authority from a manager to a subordinate. Delegation leads to empowerment, in that people have the freedom to contribute ideas and do their jobs in the best possible ways.

28. 5. Span of Control • Span of control (sometimes called span of management) refers to the number of workers who report to one manager.

29. Span of Control • A wide span of management exists when a manager has a large number of subordinates. Generally, the span of control may be wide when • The manager and the subordinates are very competent. • The organization has a well-established set of standard operating procedures. • Few new problems are anticipated.

30. Span of Control • A narrow span of management exists when the manager has only a few subordinates. The span should be narrow when • Workers are located far from one another physically. • The manager has a lot of work to do in addition to supervising workers. • A great deal of interaction is required between supervisor and workers. • New problems arise frequently.

31. 6. Coordination of Activities • This refers to the linking of activities in the organization that serve to achieve a common goal or objective.

32. Basic Organizational Design An organizational design may be: • Functional design • Divisional design • Matrix • Team design • Network Structure

33. Functional structure The functional structure groups positions into work units based on similar activities, skills, expertise, and resources (see Figure 1 for a functional organizational chart). Production, marketing, finance, and human resources are common groupings within a functional structure.

34. Divisional structure • Departments are divided according to their organizational outputs. • These departments allow managers to better focus their resources and results. Divisional structure also makes performance easier to monitor. As a result, this structure is flexible and responsive to change.

35. Divisional structure

36. Matrix structure • The matrix structure combines functional specialization with the focus of divisional structure • This structure uses permanent cross-functional teams to integrate functional expertise with a divisional focus.

37. Matrix structure

38. Matrix structure • Employees in a matrix structure belong to at least two formal groups at the same time—a functional group and a product, program, or project team. They also report to two bosses—one within the functional group and the other within the team.

39. Matrix structure Advantages • Better cooperation and problem solving. • Increased flexibility. • Better customer service. • Better performance accountability. • Improved strategic management.

40. Matrix structure Disadvantages • The two-boss system is susceptible to power struggles, as functional supervisors and team leaders vie with one another to exercise authority. • Members of the matrix may suffer task confusion when taking orders from more than one boss.

41. Matrix structure Disadvantages • Teams may develop strong team loyalties that cause a loss of focus on larger organization goals. • Adding the team leaders, a crucial component, to a matrix structure can result in increased costs.