Chapter 10 - Chapter 10 Organizing the process through...

Chapter 10
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Organizing: the process through which managers design an organization’s
structure
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Six key elements of organizational design that involves decision making: work
specialization, departmentalization, chain of command, span of control,
centralization and decentralization, and formalization
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Work specialization: an entire work activity is not done by one individual, but
instead is broken down into tasks with each task completed by a different
person
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Adam Smith: first identified division of labor and concluded that it
contributed to increased employee productivity
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Departmentalization: after work activities have been divided up through work
specialization into separate job tasks, common job tasks need to be grouped
back together so the work can be done in a coordinated, integrated way
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Process Departmentalization: work activities follow a natural processing
flow of products or even of customers
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Customer Departmentalization: Helps managers better monitor customers’
needs and respond to changes in those needs
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Chain of command: less important today, but managers still need to consider
its implications when deciding how best to structure their organization
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Three concepts of chain of command: authority, responsibility, and unit of
command
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An organization’s managers are given a certain degree to do their job of
coordinating and overseeing the work of other people (authority); as
managers assign work to employees, those employees assume an
obligation to perform any assigned duties (responsibility)
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Unity of command: preserves the concept of a continuous line of authority;
without it, conflicting demands and priorities from multiple bosses can
create problems
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Span of control: to a large degree, it determines the number of levels and
managers an organization has
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All things being equal, the wider or larger the span, the more efficient the
organization (mostly in terms of cost)
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Influenced by the skills and abilities of the manager and the employees and