Course: BBASubject: Principles of Management

Unit: II

i. Functional ii. Productiii. Processiv. Territory v. Customer vi. Time vii. Matrix

Positions are grouped according to their main functional (or specialized) area.

MD

Prod. HR Fin Marketing

Advertising sales MR

Product divisions are divisions created to concentrate on asingle product or service

CEO

Car division

Truck division

marketing Fin prod

Bus division

Activities are subdivided on the basis of their processes of production

Similar machines are grouped into separate sections

Geographic divisions are divisions designed to serve different geographic areas.

HQ (Bombay)

East Zone (Kolkata)

Central Zone(Kanpur)

Ajmer Division

Branch Branch

Chandigarh division

Jalandhar division

North Zone (Delhi)

Customer divisions are divisions set up to service particular types of clients or customers.

Ex. Pharma company supplies their products to hospitals, govt., retail stores, other company etc

HQ (Bombay)

GovtRetail store

hospitalsOther

company

departments are separated based on the division of their working time or job shifts.

Matrix management is a type oforganizational management in which peoplewith similar skills are pooled for workassignments.

An organization with a matrix structure has afunctional and a divisional structure at thesame time.

Report to two bosses

For example, all engineers may be in oneengineering department and report to anengineering manager, but these sameengineers may be assigned to differentprojects and report to a different engineeringmanager or a project manager while workingon that project. Therefore, each engineermay have to work under several managers toget their job done.

Multiple command-and-control structure in whichsome employees have dual responsibilities anddual bosses. These employee report toone boss (a project manager, for example)for day to day operations, and to another boss (thedepartmental head, for example)for functional responsibilities.

This approach is most suited to situations withfluctuating workloads, suchas managing large projects or productdevelopment processes.

1

3

All the powers of decision making areconcentrated in top management

CEO

Marketing manager

Finance manager

HR manager

Production manager

R & D manager

Power and authority are delegated to lowerlevels.

When org is so large, to reduce burden of topmanagement, operations are geographicallyisolated

- Advantages:- Faster decision- Development of lower level- Top manager can concentrate on other issues- Lower level can make good decision as they

are close to the problem

HQ (Bombay)

East Zone (Kolkata)

Central Zone(Kanpur)

Ajmer Division

Branch Branch

Chandigarh division

Jalandhar division

North Zone (Delhi)

1. Determining the results expected:- According to the results expected from that

position- Person should have proper ability to

accomplish results expected2. Assigning the duties:- Set of activities- Performance expected/target given

3. Authorization for action:- Granting of permission to take actions like

making commitments, use of resources andother actions necessary to get the assignedwork done.

4.Creation of obligation:- Subordinate is responsible for the total

activities assigned to him

Effect of loss of power ‘I can do better myself’ belief Lack of confidence in subordinate Difficult in briefing Inability to establish proper controls

Give positive incentive to subordinate Create a climate of mutual trust Train the subordinate properly Assign authority proportionate to the task Make the subordinate clearly understand the

limits of his authority

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