FORMS OF DEPARTMENTALIZATION

& CRITERIA FOR AN

EFFECTIVE ORGANIZATIONAL DESIGN

Mariya Luz R. Fortes, R.N.

Objectives:

Describe Organizational Design and Structure and Departmentalization

Identify the common types of departmentalization

Identify the criteria of an Effective Organization Design

Identify the symptoms of an Ineffective Organizational Design

Organizational Design

•Is the process of constructing and adjusting an organization’s structure to achieve its goals.

•Management decisions and actions that result in a specific organization.

Organizational Structure

•The linking of departments and jobs within an organization.

Departmentalization

•Process in which an organization is structurally divided by combining jobs in departments according to some shared characteristics of basis.

Departmentalization

PURPOSE & OBJECTIVE

Is to subdivide the organizational structure so that managers can specialize within limited ranges of activity.

The agency can be met most easily if the group is properly organized.

Two Common Types of Departmentalization:

INPUT or PROCESS-ORIENTED

A structure emphasizes specialization of skills.

It reinforces professional skills by uniting people with similar expertise in the same department.

Orientation includes Functions, Time, and Simple Numbers as bases for departmentalization.

A structure emphasizes professional skills over organizational goals.

Departmentalization by FUNCTION activities are grouped according to similarity of skills or a set of

tasks necessary to accomplish a goal.

Logical, simple, and commonly used.

this method of departmentalization facilitates specialization that contributes to economical operations.

Chief Executive Officer

ICU Departm

ent

Medical Department

Operating Room

Department

Pedia Department

Emergency

Department

Disadvantages:

Major disadvantage of this departmental basis is that because specialists are working with and encouraging each other in their areas of expertise and interest, organizational goals may be sacrificed in favour of departmental goals.

Functional departmentalization does not provide good training for general managers. They become experts in their particular function; have a little opportunity to learn about other functions.

Departmentalization by

Time

some organizations where work is performed through day and night, the work is divided into shifts.

this method of departmentalization is generally seen among those organization who render 24 hours, emergency and/or essential public services for 365 days a year.

Departmentalization by

Number

in number departmentalization, separate departments are made after analysing and judging the maximum limit up to which number of persons can be managed or educated or supervised or taken care of. this method of departmentalization is generally used in schools and colleges for making division of classes.

2nd Type of Departmentalization

OUTPUT or GOAL-ORIENTEDstructure emphasizes service to the client.

it collects all the work for a project under one manager and reduces dependence on other units for needed resources.

systems and procedures are highly standardized.

these units may stress their own goals while deemphasizing agency goals.

Departmentalization by Product

emphasis is on the product instead on the process.

improvement, expansion and diversification of the product are possible because one manager is responsible for all activities affecting that specific product.

It is common for schools of nursing to organize according to the “products” turned out – medical, paediatric, surgical, psychiatric and community health nurses.

Departmentalization by Territories is particularly useful for physically

dispersed activities when branches provide similar services at each location.

this method serves the local clients with greatest efficiency.

it reduces delivery time and may reduce transportation costs for raw materials and finished products.

ExampleS:

Honda Corporatio

n

Honda Corp.

Quezon City

Honda Corp.

Dagupan City

Honda Corp.

Manila City

Adessa Appliances

Center

Adessa Urdaneta

City

Adessa Baguio City

Adessa Tarlac City

Departmentalization by Clients

makes sense when service is important and the welfare of the client is of primary interest.

this allows better use of facilities and is more satisfactory to the client.

Example:

A health center may have obstetric, paediatric clinics then it may be open nights and weekends for working people.

Schools of nursing may offer night classes for working students.

Disadvantage:

Pressure for special consideration and treatment of specific groups may exist, and coordination problems may exist, and coordination of problems may increase.

CRITERIA FOR AN EFFECTIVE ORGANIZATION DESIGN

Effective Organizational Design is key in long term strength and viability of an organization.

The fact is that any design of an organization takes place within the context of:

current people, their training and skills; current economy, market condition and competitors; current products, cost and competitiveness; customers, customer retention and customer satisfaction.

Organizational Design need CHANGE?

A well designed organization with an excellent strategic plan may operate effectively for 18 months to 3 years without change,

But between 3-5 years, so much change takes place, especially in today’s business environment, that plans should be addressed and adjusted on a 12 month basis, and completely renewed at least every 3 years.

An effective organization follows:

a simple but powerful vision, plans thoroughly, motivates effectively, builds leaders who know how to govern, delegate, build teams, handle conflict, and manage change, has efficient communication and has developed a climate for decision making

at the lowest possible levels:

In Short:

Build an effective plan, and build an effective organization around it –then build another effective plan…and then redesign the organization around that.

EFFECTIVE ORGANIZATION DESIGN CONSIDERS FIVE, INTERRELATED

COMPONENTS

5. CULTURE

2. DECISION MAKING &

STRUCTURE

3. PEOPLE

4. WORK PROCESSES &

SYSTEM

1. LEADERSHIP

•Clear vision & priorities•Cohesive leadership team•Clear roles & accountabilities for decisions•Organizational structure that supports objectives• Organizational & individual talent necessary for success•Performance measures & incentives aligned to objectives•Superior execution of programmatic work processes•Effective & efficient support processes & system•“High performance” values & behaviour•Capacity change

Principle of Effective Organizational Design

Consider all five components of the “wheel”: A common misstep is to focus on structure alone (boxes and reporting lines) as the solution

Align the five components to one another: One element that “doesn’t fit” can limit the performance of the whole system

Align strategy and organization to one another: Organizational strengths and weaknesses influence the range of feasible strategies; in turn, organizations should evolve with any new strategic direction

Leadership

Decision Making

& Structur

e

People

Work Process

es & System

Culture

Symptoms of an Ineffective Organizational

Conflicting communications:external stakeholders confused,complaining

x

Low staff morale: lack of confidenceor drive; poor teaming

x x

Reduced responsiveness: Slowreactions to environmental shifts

x x x

Poor work flow: Disruptions,cumbersome processes

x

LIKELY ROOT CAUSES.....

Gap in skills or misused resources:Missing or underutilized skills orResources

x x x

Unclear roles: Functions overlapand/or fall through the cracks

x

Excessive conflict: Needless frictionamong internal groups

x x x

Lack of coordination: work unfinished, teams isolated, out-of step 

x x x

Leadership

Decision Making

& Structur

e

People

Work Process

es & System

Culture

LIKELY ROOT CAUSES.....Symptoms of an Ineffective Organizational