Chapter 8 - Chapter 8 Organizational Theory I Building an...

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Chapter 8: Organizational Theory I. Building an organization from the bottom up a. Division of labor a.i. Determining what needs to be done and then dividing up the tasks b. Job specialization : b.i. Dividing tasks into smaller jobs, often based on specific skills c. Departmentalization c.i. Process of setting up individual departments to do specialized tasks d. OVERALL PROCESS: d.i. Devising a division of labor d.ii. Setting up teams or departments to do specific tasks d.iii. Assigning responsibility and authority to people d.iv. Part of process is allocating resources, assigning specific tasks, and establishing procedures for accomplishing the organizational objectives d.v. Monitor environment to see what competitors are doing II. The Changing Organization a. Managing change is a critical managerial function that may involve changing the whoel organization structure III. Functional areas of business a. Operations a.i. Transformation of resources into goods and services b. Marketing b.i. The process of determining customers’ wants and needs and then providing those customers with products or services that match or exceed their expectations c. Finance c.i. The process of acquisition of funds for a firm and management of this funds within the firm d. Others d.i. Human resources d.ii. Research and development d.iii. Public relations d.iv. Legal d.v. Etc. IV. The Development of organization design a. Business growth as a result of mass production led to economies of scale a.i. 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 b. Fayor’s principles of organization ( TEN) b.i. Unity of command b.i.1. each worker is to report to one boss
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b.i.2. f there are m 2 differnet bosses giving you two different assignments, then you have a problem b.i.3. so: each person reports to only one manager b.ii. Hierarchy of authority b.ii.1. all workers should know to whom they should report b.ii.2. amangers should have right ot give orders and expect others to follow b.iii. Division of labor b.iii.1. functions are to be divided into areas of specialization like production, marketing, and finance b.iv. Subordination of individual interests to the general interest b.iv.1. workers are to think of themselves as a coordinated team b.iv.2. goals fo the team rare more important than the goals of individual members b.v. Authority b.v.1. managers have the right to give orders and the power to enforce obedience b.v.2. authority and responsibility are related: whenever authority is exercised, responsibility arises Degree of centralization the amount of decision-making power vested in top management should vary be circumstances. In a large rorganization, some decision-maig power should be elegated to lower-level managers and employees on both major and minor issues b.vii. clear communication channels b.vii.1.
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This note was uploaded on 02/23/2012 for the course MGT 101 taught by Professor Staff during the Fall '10 term at Texas State.

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Chapter 8 - Chapter 8 Organizational Theory I Building an...

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