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Unformatted text preview: CHAPTER 8: ADAPTING ORGANIZATIONS TO TODAY’S MARKETS EV E R Y O N E IS DO I N G I T BU I L D I N G AN ORGAN IZAT I O N FROM THE BOTTOM UP Division of labor- organizing, or structuring, begins with determining what work needs to be done and then dividing up the tasks among everyone Job specialization- dividing tasks into smaller jobs Departmentalization- the process of setting up individual departments to do specialized tasks *Structuring an organization consists of devising a division of labor, setting up teams or departments to do specific tasks and assigning responsibility and authority to people T H E C HA N G I N G ORGA N I Z A T I O N THE DEVE LOPM E N T OF ORGAN IZA T I O N DESIGN Mass production- efficiently producing large quantities of goods Economies of scale- the situation in which companies can reduce their production costs if they can purchase raw materials in bulk; the average cost of goods goes down as production levels increase FAYOL’S PRINC IP L ES OF ORGANIZAT I O N Unity of Command- each worker is to report to one boss Hierarchy of authority- all workers should know to whom they should report Division of labor- functions are to be divided into areas of specialization such as production, marketing, and finance Subordination of individual interests to the general interest- workers to think of themselves as a coordinated team Authority- managers have the right to give orders and the power to enforce obedience Degree of centralization- the amount of decision making power vested in top management should vary by circumstances Clear communication channels- all workers should be able to reach others in the firm quickly and easily Order- materials and people should be placed and maintained in the proper location Equity- a manager should treat employees and peers with respect and justice Esprit de corps- a spirit of pride and loyalty should be created among people in the firm MAX WEBER AND ORGAN IZA T I O N A L THEORY Weber Emphasized:- Job descriptions- Written rules, decision guidelines, and detailed records- Consistent procedures, regulations, and policies- Staffing and promotion based on qualifications TURN I NG PRINC IP L ES I N TO ORGAN IZA T IO N DESIGN Hierarchy- a system in which one person is at the top of the organization and there is a ranked or...
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- Fall '07
- Management, Organizational studies and human resource management, flat organization structures, pyramidal organization chart