2. Dividing work on the basis of the
specialization is known as deparmentation.
Departmentation is a means of dividing a large
organization into smaller , flexible units.
3. According to Koontz and
O’Donnell, “Departmentation is a process of
dividing
the large monolithic functional
organization into smaller and flexible
administrative units.”
5. This is the simplest and most prevalent basis for
departmentation. Under this all the functions of
similar nature are divided in different units which
are called departments.
EXAMPLE: The functions of manufacturing concern can
be divided into production department,
marketing department, financial department and
personnel department. Again sub departments
can be established in each department.
6. Product departmentation involves the grouping together
of all the activities
necessary to manufacture a product or
product line.
EXAMPLE: In an automobile organization the
departmentation could be car division, truck
division, bus division.
7. *
* Departmentation by territory or geography means,
“Grouping of activities by area or territory is common in
enterprises operating over wide geographic areas.”
*Organizations which are involved in banking , insurance
, transportation.
*EXAMPLE: India could be divided into north , south , east , west
, central zones.
*Further North Zone can be divided into Chandigarh, New
Delhi, Ludhiana.
8. *In this process involved in production or various types of
equipment's used are taken as basis of departmentation.
*The basic aim to do process departmentation is to achieve
economic benefit.
*EXAMPLE: Process departmentation in case of textile
organization can be by dividing the production into spinning,
dyeing, weaving, finishing departments.
9. *Grouping of activities around marketing channels involves
making an organization structure reflect the ways an
organization reaches the ultimate customer.
*Advantage of this type is that it focuses on customer who
are the ultimate suppliers of money to the organization.
EXAMPLE: In pharmaceutical companies different customers
could be doctors , hospitals , government , retail stores.
*Further it could be wholesale , retail , export.
10. *In some organizations where work is performed through
day and night , the work is divided into shifts.
Thus when an organization may operates on three
shifts, three different departments may exist.
