Chapter 5 - Organizational Design Fundamentals

Chapter 5 - Organizational Design Fundamentals -...

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Fundamentals of rganization Design Organization Design 1. Components of organization design 2. Basic structural configurations
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Components of organization 1. Components of organization esign design a) Introduction – Basic idea • Break complex task apart & put it back together
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b) Formal structure – Represented by organizational chart ivision of labour (specialization of roles) – Division of labour (specialization of roles) – Departmentalization (unit groupings) – Reporting/authority relationships – Coordination/integration mechanisms
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– Centralization & decentralization • Control over decision-making – More centralized = decisions made higher up the hierarchy ecentralized = more delegation of decisions – Decentralized more delegation of decisions • Always a matter of degree – Degree of formalization se of formal rules procedures standardization Use of formal rules, procedures, standardization – Mechanistic vs. Organic structures
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c) Differentiation ertical Differentiation Vertical Differentiation • Hierarchical levels elated to organizational size Related to organizational size – Span of Control – Communication difficulties • Parkinson’s “Law” – Work expands to fill the time available – Hierarchy creates its own work (maintaining the hierarchy)
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– Horizontal differentiation • Specialization (individual jobs) – Division of labour • Departmentalization (unit groupings) – Functional vs. Product / service departments
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Chapter 5 - Organizational Design Fundamentals -...

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