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Organization Organization Structure Structure

Chapter EightChapter Eight

Fundamentals of OrganizingFundamentals of Organizing

Organization chart The reporting

structure and division of labor in an organization

8-2

Conventional Organization ChartConventional Organization Chart

8-3Figure 8.1

Authority in OrganizationsAuthority in Organizations

Authority The legitimate right

to make decisions and to tell other people what to do.

8-4

Delegation Delegation

Delegation The assignment of new or additional

responsibilities to a subordinate Responsibility, Authority, and Accountability

8-5

Steps in Effective DelegationSteps in Effective Delegation

8-6

Figure 8.2

The Functional OrganizationThe Functional Organization

Functional organization Departmentalization

around specialized activities such as production, marketing, and human resources.

8-7

The Functional OrganizationThe Functional Organization

8-8Figure 8.3

Advantages of Functional OrganizationsAdvantages of Functional Organizations

1. Economies of scale can be realized2. Effective monitoring of the environment3. Performance standards better maintained4. Greater opportunity for specialized training and skill

development5. Technical specialists are relatively free of

administrative work6. Decision making and lines of communication are

simple and clearly understood

8-9

Advantages of Divisional OrganizationsAdvantages of Divisional Organizations

1. Information needs are managed more easily2. People have a full-time commitment to a

particular product line3. Task responsibilities are clear4. People receive broader training

8-10

The Divisional OrganizationThe Divisional Organization

8-11

Figure 8.4

Matrix Organizational StructureMatrix Organizational Structure

8-12Figure 8.5

The Network OrganizationThe Network Organization

8-13Figure 8.7

Coordination by StandardizationCoordination by Standardization

Standardization Establishing common

routines and procedures that apply uniformly to everyone.

Formalization The presence of rules

and regulations governing how people in the organization interact.

8-14

Managing High Information-Managing High Information-Processing DemandsProcessing Demands

8-15Figure 8.8