Scribd
Upload
5 views

Lesson 4

Uploaded by

makathleene.manuel
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
5 views

Lesson 4

Uploaded by

makathleene.manuel
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
You are on page 1/ 17

LESSON 4 : ORGANIZING

NATURE OF ORGANIZATIONS
DIFFERENTIATION OF THE
ORGANIZATION’S INTERNAL
ENVIRONMENT
Differentiation in organizations division of labor and
specialization according to Bateman and Snell (2008).
These necessarily result from the organization’s
composition-many different work units with different kinds
of tasks, using different skills and work activities
coordinating with one another for a common end.
 Division of labor involves assigning different tasks to
different people in the organization’s different work units.
Related to specialization, the process in which different
individuals and units perform different tasks.
TYPES OF
ORGANIZATION
STRUCTURES
Vertical structure
Horizontal structure
Network structure
1.

VERTICAL STRUCTURE
According to Bateman and Shell (2008) , a
vertical structure clears out issues related to
authority rights, responsibilities, and reporting
relationships. Authority rights refer to the
legitimate rights of individual, appointed in
positions like president, vice president,
manager, and the like, to give orders to their
subordinates, who in turn, report to them what
2. HORIZONTAL STRUCTURE
Refers to the
departmentalization of an
organization into smaller work
units as tasks become
increasingly varied and
numerous.
TYPES OF DEPARTMENT
1. Line departments
2. Staff departments
Three approaches of Staff departments
1.1 Functional approach
1.2 Divisional approach
1.3 Matrix approach
1. LINE DEPARTMENTS
Deal directly with the firm’s primary goods and
services; responsible for manufacturing, selling, and
providing services to the client.

2. STAFF DEPARTMENTS
Support the activities of the line departments by doing
research, attending to legal matters , performing
public relations duties etc. Meanwhile ,
departmentalization may be done using the three
approaches :
THREE APPROACHES
 Functional approach – where the subdivisions are formed
based on specialized activities such as marketing ,
production , financial management , and human resources
management .
 Divisional approach – where departments are formed
based on management of their products, customers, or
geographic areas covered.
 Matrix approach – is a hybrid form of departmentalization
where managers and staff personnel report to the
superiors , the functional manager, and the divisional
manager.
3.IsNETWORK
 STRUCTURE
a collection of
independent, usually single
function
organizations/companies
that work together in order
to produce a product or
ORGANIZATION THEORIES
AND APPLICATIONS
According to Robbins and Coulter (2009) there are TWO (2)
classifications of theories regarding to organizational design .
1. Traditional Theories
1.1 Simple Organizational Design
1.2 Functional Organizational Design
1.3 Divisional Organizational Design
2. Modern Theories
1.1 Team Design
TRADITIONAL THEORIES
 Are the usual , old fashioned ways.
1.1 Simple Organizational Design
This design has few departments, wide spans of control, or a big number
of subordinates directly reporting to a manager; has a centralized
authority figure and has very little formalization of work; usually used by
companies that start out as entrepreneurial ventures.

Strengths Weaknesses
• Flexible • Risk that overdependence
• Fast decision-making with over-dependence on a
and results single person
• No longer appropriate as
• Clear accountability the company grows
1.2 Functional Organizational Design
This organizational design groups together similar or related
specialties. For example a marketing firm that markets cars
and related products like tires , cars batteries , and
accessories.
Strengths Weaknesses
• Cost saving • Managers have little
advantages knowledge of other
• Management is unit’s functions
facilitated because
workers with similar
tasks are grouped
1.3 Divisional Organizational Design

This organization design is made up of separate


business divisions or units, where the parent
corporation acts as overseer to coordinate and
control the different divisions provide financial and
legal support services.
Strengths Weaknesses
• Focused on results • Possible duplication of
• Managers are activities and resources
responsible for what • Increase cost and
happens to their reduced efficiency
products and services
2. MODERN THEORIES
Are contemporary or new design theories.
1.1 Team Design
In team design , the entire organization is made up of work groups or teams. Its
advantages include empowerment of team members and reduced barriers among
functional areas. It has also disadvantages , including a clear chain of command and
great pressure on teams to perform,
1.2 Matrix-Project Design
• Matrix Design refers to an organization design where specialist from different
departments work on projects that are supervised by a project manager. This design
results in a double chain of command wherein workers have two managers-their
functional area manager and their project manager-who share authority over them.
Advantage : specialists are involved in the project. Disadvantage: task and
personality conflicts.
• Project Design refers to an organizational design where employees continuously work
on a project . Advantages : flexible designs and fast decision-making. Disadvantages:
1.3 Boundary –Less Design
Design is not defined or limited by vertical , horizontal or
external boundaries. In other words , there are no
hierarchical levels that separate employees , no
departmentalization , no boundaries that separate the
organization from customers, suppliers, and other
stakeholders. Virtual organization designs are often used in
this design ;small groups of full-time employment and
outside specialists are temporarily hired to work on projects.
Its advantages include being highly flexible and responsive,
while disadvantages are lack of control and problems in
communication.

You might also like