OB NOTES.docx - FOUNDATIONS OF ORGANIZATIONAL STRUCTURE...

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FOUNDATIONS OF ORGANIZATIONAL STRUCTURE After studying this chapter, you should be able to: Identify the six elements of an organization’s structure. Identify the characteristics of a bureaucracy. Describe a matrix organization. Identify the characteristics of a virtual organization. Show why managers want to create boundaryless organizations. Demonstrate how organizational structures differ, and contrast mechanistic and organic structural models. Analyze the behavioral implications of different organizational designs. Show how globalization affects organizational structure. What is ORGANIZATIONAL STRUCTURE? Organizational Structure It defines how job tasks are formally divided, grouped, and coordinated. Key Elements: Work specialization, Departmentalization, Chain of command, Span of control, Centralization and decentralization, Formalization WORK SPECIALIZATION The degree to which tasks in the organization are subdivided into separate jobs. Division of Labor Makes efficient use of employee skills Increases employee skills through repetition Less between-job downtime increases productivity Specialized training is more efficient Allows use of specialized equipment Work Specialization Economies and Diseconomies - Specialization can reach a point diminishing returns. - Then job enlargement gives greater efficiencies than does specialization. DEPARTMENTALIZATION- The basis by which jobs are grouped together, so that common tasks can be coordinated Grouping Activities by: Function - the most popular, it’s major advantage is that it obtains greater efficiency. Product - major advantage is that it increases accountability for product performance. Geography - used in those organizations that have customers scattered nationwide or globally. Process - each department specializes in one specific phase in the production. Used for processing customers as well as products. Customer - used because customers have common set of problems that needs to be best met by having specialists for each. CHAIN OF COMMAND- - basic cornerstone in the design of organizations. It is an unbroken line of authority that extends from the top of the organization to the lowest level and clarifies who reports to whom.
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