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1、,15,CHAPTER,Organizational Structure and Design,IDENTIFY the choices which must be made in designing an organization. DEFINE what is meant by the term division of labor. DISCUSS the role of delegation of authority in design decisions. DESCRIBE several forms of departmentalization. EXPLAIN the import
2、ance of span of control. DEFINE three important dimensions of structure. COMPARE mechanistic and organic organizational design. IDENTIFY the major advantages of matrix organizational design. DISCUSS multinational organizational structure and design issues. EXPLAIN the meaning of the term virtual org
3、anization.,15-3,Organizational Structure and Design,Organizational Design Purposeful and goal-oriented process Decisions/actions to predetermine the way employees do their work Organizational Structure Relatively stable relationships and processes of the organization. “The anatomy of the organizatio
4、n, providing a foundation within which the organization functions.” Purpose is to regulate, or at least reduce, uncertainty.,15-4,Organizational Design,Decision Process Managers must decide how to divide the overall tasks of the organization into successively smaller jobs. Managers must decide the b
5、asis by which to group the individual jobs. Managers must decide the appropriate size of the group reporting to each supervisor. Managers must distribute authority among the jobs.,15-5,Organizational Design Components,Components,Design Decisions,15-6,Division of Labor,Ways that Division of Labor Can
6、 Occur: Work can be divided into different personal specialties. Occupational and professional specialties Work can be divided into different activities necessitated by the natural sequence of the work the organization does. Horizontal specialization Work can be divided along the vertical plane of a
7、n organization. Hierarchy of authority,The Extent to Which Jobs Are Specialized,15-7,Reasons to Delegate or Decentralize Authority Encourages management development Leads to a more competitive climate Enables managers to exercise more autonomy,Delegation of Authority,Extent to which managers allow s
8、ubordinates to make decisions without approval of higher management and exact obedience from others,Reasons to Centralize Authority Increases training costs Heightens fear and resistance Raises administrative costs Duplicates efforts and some functions,15-8,Functional Departmentalization,Major Advan
9、tage Creating efficiency and more cost effective units,Major Disadvantage Sacrificing organizational goals for departmental ones,15-9,Territorial Departmentalization,15-10,Product Departmentalization,Major Advantages Creating profit responsibility Fostering innovation and autonomy,Major Disadvantage
10、s Creating redundant functions Increasing administrative costs,15-11,Customer Departmentalization,15-12,Span of Control,The number of jobs to be included in a specific group determines the frequency and intensity of interpersonal relationships required of a manager.,Potentially Creates Three Types o
11、f Relationships: Direct single Between a manager and each subordinate individually Direct group Between a manager and each possible permutation of subordinates Cross Between subordinates and other subordinates,15-13,Critical Factors Affecting Span of Control,15-14,Dimensions of Structure,15-15,Dimen
12、sions of Structure,1. High specialization 2. Delegated authority 3. Functional departments 4. Wide spans of control,1. High specialization 2. Centralized authority 3. Functional departments 4. Wide spans of control,1. High specialization 2. Delegated authority 3. Territorial, customer, and product d
13、epartments 4. Narrow spans of control,15-16,Organization Design Models,15-17,The Mechanistic Model,Organizations should function in a machinelike way to accomplish the organizations goals in a highly efficient manner.,Its highly complex because of its emphasis on specialization of labor. Its highly
14、centralized because of its emphasis on authority and accountability. Its highly formalized because of its emphasis on function as the basis of departments.,15-18,The Organic Model,Its relatively simple because of its de-emphasis on specialization and its emphasis on increasing job range. Its relativ
15、ely decentralized because of its emphasis on delegation of authority and increasing job depth. Its relatively informal because of its emphasis on product and customer as bases for departments.,Organizations should seek designs that maximize satisfaction, flexibility, and development.,15-19,The Matri
16、x Model,Advantages Efficient Use of Resources Flexibility in Conditions of Change and Uncertainty Technical Excellence Freeing Top Management for Long-Range Planning Improving Motivation and Commitment Providing Opportunities for Personal Development,Organizations should combine functional and produ
17、ct departmental bases to maximize the strengths and minimize the weaknesses of each.,15-20,Multinational Structure and Design,National boundaries help define organizational environments National boundaries are of varying importance for different elements of organizational structure and processes. Su
18、bsidiaries of multinational corporations can act as conduits that introduce changes into the host countrys environment. Subsidiaries of multinational corporations can act as conduits through which features of the host countrys environment are introduced throughout the organization.,Factors with Impo
19、rtant Implications for Multinational Structure and Design:,15-21,Virtual Organizations,One of the fastest developing practices in business throughout the world. Involves firms in cooperative relationships with their suppliers, distributors, and even competitors. Virtual units are assembled and disassembled according to needs. Characterist
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