2. PART ONE: INTRODUCTION
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1.1 Meaning of organization
POM/Chapter 4 - Organizing
1.2 Process of Organization
1.3 Principles of Organization
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3. DEFINITION OF ORGANIZING
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Activities: Resources:
Identification of Determining the
POM/Chapter 4 - Organizing
activities
Grouping of Activities
specific need of
Assignment of jobs to resources
formal groups Allocation of
Establishing a network resources into
of authority and
responsibility specific groups
Providing framework for Evaluation and
measurement, control of use of
evaluation and control
the resources 3
4. ORGANIZING
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Organizing is the process of
arranging and allocating work,
POM/Chapter 4 - Organizing
authority, and resources
among an organization’s
members so that they can
achieve organizational goal.
Stoner, Freeman and Gilbert
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5. PROCESS OF ORGANIZING
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Division of Work
Grouping of Work
POM/Chapter 4 - Organizing
Delegation of Authority
Coordination of Work
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6. 1/23/2012 POM/Chapter 4 - Organizing
6
PROCESS OF ORGANIZING SIMPLIFIED
7. PRINCIPLES OF ORGANIZING
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1. Unity of Objective 8.Exception
2. Specialization
9.Efficiency
POM/Chapter 4 - Organizing
3. Coordination
4. Authority and 10.Balance
Responsibility
11.Homogeneity
5. Unity of Command
6. Scalar Chain 12.Continuity
7. Span of Control
13.Simplicity 7
10. ORGANIZATIONAL ARCHITECTURE -
VERTICAL INTEGRATION
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Tall Organization: Flat organization:
This type of This type of
POM/Chapter 4 - Organizing
organizational organizational
architecture has architecture
many layers and
has few layers
narrow span of
control. and wide span
of control.
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12. ORGANIZATIONAL ARCHITECTURE – HORIZONTAL
DIFFERENTIATION
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1. FUNCTIONAL STRUCTURE:
General Manager
POM/Chapter 4 - Organizing
Production Finance Marketing HR
Dept Dept Dept Deprtment
Structure is created based on the
various functions of an organization.
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13. ORGANIZATIONAL ARCHITECTURE – HORIZONTAL
DIFFERENTIATION
2. MULTI-DIVISION STRUCTURE
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General Manager
POM/Chapter 4 - Organizing
Division I Division II Division III
Multiple divisions are created in a
related industry.
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14. ORGANIZATIONAL ARCHITECTURE – HORIZONTAL
DIFFERENTIATION
Divisional or M-form (Multidivisional) Design
An organizational arrangement based on multiple
businesses in related areas operating within a larger
organizational framework; following a strategy of
related diversification.
Activities are decentralized down to the divisional
level; others are centralized at the corporate level.
The largest advantages of the M-form design are the
opportunities for coordination and sharing of
resources.
15. ORGANIZATIONAL ARCHITECTURE – HORIZONTAL
DIFFERENTIATION
3. GEOGRAPHIC STRUCTURE:
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General
POM/Chapter 4 - Organizing
Manager Departments are
created based on
geographic regions.
All the activities in one
Eastern Central Western geographic region is
Region Region Region categorized into one
unit.
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16. ORGANIZATIONAL ARCHITECTURE – HORIZONTAL
DIFFERENTIATION
4. MATRIX ORGANIZATION
CEO
Vice president, Vice president, Vice president, Vice president,
engineering production finance marketing
Employees
Project
manager A
Project
manager B
Project
manager C
6–16
17. MATRIX STRUCTURE:
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Advantages: Disadvantages:
Enhances organizational Employees are uncertain
POM/Chapter 4 - Organizing
flexibility. about reporting
Team members have the relationships.
opportunity to learn new The dynamics of group
skills. behavior may lead to
Provides an efficient way for slower decision making,
the organization to use its one-person domination,
human resources. compromise decisions, or
Team members serve as a loss of focus.
bridges to their departments More time may be required
for the team. for coordinating task-
related activities. 17
18. PART THREE: RESPONSIBILITY
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3.1 Meaning of Responsibility
POM/Chapter 4 - Organizing
3.2Establishing Task and
Reporting Relationships
3.3 Creating Accountability
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19. RESPONSIBILITY:
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Responsibility is the
POM/Chapter 4 - Organizing
obligation to perform
or
duty to carryout certain
activities
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20. ESTABLISHING TASK AND REPORTING
RELATIONSHIP:
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Task Relationship:
How activities related to each other in an
POM/Chapter 4 - Organizing
organization.
How the basic units of an organization are
formed.
Establishment of job description and job
specification
Job Specification: Prerequisites of job. Various skills and
experiences needed to perform certain job.
Job Description: The activities that have to be carried
out at certain position in a job. It describes the job.
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21. ESTABLISHING TASK AND REPORTING
RELATIONSHIP:
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Establishing Reporting Relationship:
It is finding out
POM/Chapter 4 - Organizing
Chain of command
Span of control or span of management
1. Who reports to whom?
2. How many subordinates will a supervisor have?
(Relate it to tall vs flat organizational architecture.)
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22. ACCOUNTABILITY:
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Accountability:
POM/Chapter 4 - Organizing
the state of being accountable, l
iable, or answerable
Requirement to report
It creates a mechanism of control.
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23. PART FOUR: AUTHORITY
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POM/Chapter 4 - Organizing
4.1 Line and Staff Authority
4.2 Delegation of Authority
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24. AUTHORITY:
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Right to take decisions that arises due to
position in organizational structure.
POM/Chapter 4 - Organizing
Authority is the right to perform or
command. It allows its holder to act in
certain designated ways and to directly
influence the actions of others through
orders.
Types of Authority:
Line Authority
Staff Authority 24
25. LINE AUTHORITY
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The chain of command in the
organizational structure that flows
POM/Chapter 4 - Organizing
major decision making power.
The officially
sanctioned ability to issue orders t
o subordinate employees within
an organization.
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26. STAFF AUTHORITY
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Staff authority consists of the right to
advise or assist those who possess
POM/Chapter 4 - Organizing
line authority as well as other staff
personnel.
The Advisory or Counseling
Role :
The Service Role
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The Control Role
27. DELEGATION OF AUTHORITY
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Assigning work to subordinates
and giving them necessary
POM/Chapter 4 - Organizing
authority to do the assigned work
effectively.
Simple terms,
GRANTING AUTHORITY TO SUBORDINATES
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28. FEATURES OF DELEGATION OF
AUTHORITY:
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No delegation of total authority
Delegation of only that authority a
POM/Chapter 4 - Organizing
manager has
Representation of the superior
Delegation for organizational purpose
Restoration of delegated authority
Balance of authority and responsibility
No delegation of responsibility
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29. CONFLICT BETWEEN LINE – STAFF EMPLOYEES
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Assume Line Authority
POM/Chapter 4 - Organizing
Do not give Sound Advice
Steal Credit for Success
Fail to Keep line
personnel informed of their
activities
Do not see the whole picture. 29
30. PART FIVE:
CENTRALIZATION AND DECENTRALIZATION
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Meaning : Centralization and Decentralization
POM/Chapter 4 - Organizing
Reasons: In which case which is needed
Advantages and Disadvantages: of both
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31. CENTRALIZATION
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Systematically retaining power
and authority in the hands of
POM/Chapter 4 - Organizing
higher level managers.
Not dividing authority to lower
level employees.
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32. ADVANTAGES V/S DISADVANTAGES:
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Advantages:
POM/Chapter 4 - Organizing
Facilitates unified decision.
Simplifies structure
Facilitates quicker decision
Economy in operation
Integrate operation
Suitable for small firms 32
33. ADVANTAGES V/S DISADVANTAGES:
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Disadvantages:
POM/Chapter 4 - Organizing
Unsuitable for large organization
Manager is overburdened
Possibility of power misuse
Low morale and motivation
Lack of environmental adaptation
In appropriate for routine decisions.
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34. DECENTRALIZATION:
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Delegation of authority to the lower
levels.
POM/Chapter 4 - Organizing
Decentralization
is tendency to
disperse decision making authority in
an organized structure.
• Koontz and Weihrich
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35. ADVANTAGES V/S DISADVANTAGES
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Advantages:
Relief to top management
POM/Chapter 4 - Organizing
Facilitates managers’ development
Possibility if better decisions
Effective control
High morale and motivation
Facilitates diversification
Environment adaptation 35
36. ADVANTAGES V/S DISADVANTAGES
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Disadvantages:
Increase in expenditure
POM/Chapter 4 - Organizing
Conflict
Unsuitable for emergency situations
Maximizes risk
Difficulty in communication
Unsuitable for specialized services
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37. EMERGING ISSUES IN ORGANIZATION DESIGN
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Re-engineering process
POM/Chapter 4 - Organizing
Team work
Network organization structure
Downsizing organization
Boundary-less organization
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38. STAFFING:
CONCEPT AND IMPORTANCE
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It is the process of obtaining and maintaining
competent employees to fill all positions.
POM/Chapter 4 - Organizing
Recruitment: Encouraging people to apply
Selection: Finding the right person for the job
Training: Teaching the employees certain skill
Development: Progress/advancement of career
Motivation: Encouraging the employees to work
harder.
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39. IMPORTANCE OF STAFFING:
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Managing effective staff
Utilization of physical resources
POM/Chapter 4 - Organizing
Increase in productivity
Focus on goal achievement
Helps to solve problems
Job satisfaction
Self-development of workers
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40. 1/23/2012 POM/Chapter 4 - Organizing
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