Organizational design and structure
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Transcript of Organizational design and structure
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Organization Design & StructureOrganization Design & Structure
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Organizational structureOrganizational structure
The formal configuration between individuals and groups with respect to the allocation of tasks, responsibilities, and authorities within organizations.
The pattern of jobs and groups of jobs in an organization.
A diagram representing the connections between the various departments within an organization: a graphic representation of organizational design –
Organizational Chart
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Organizational DesignOrganizational Design
The process of coordinating the structural elements of an organization in the most appropriate manner.
The process by which managers create a specific type of organizational structure and culture so that a company can operate in the most efficient and effective way.
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Factors affecting Organizational Factors affecting Organizational StructureStructure
Organizational Structure
Environment
Technology
StrategyHuman
Resources
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Key Design DecisionsKey Design Decisions
Division of Labor - Low
- HighDepartmentalization - Homogeneous
- Heterogeneous Span of Control - Less
- MoreAuthority - High
-Low
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DIFFERENTIATIONDIFFERENTIATION Process of deciding how to divide the work in an organization.Ensures that essential tasks are assigned to one or more jobs. Four Dimensions of Differentiation by Lawrence and Lorsch
1.Manager’s goal orientation
2.Time orientation
3.Interpersonal orientation
4.Formality of struscture
FORMS OF DIFFERENTIATION:Horizontal Differentiation Vertical Differentiation Spatial Differentiation
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HORIZONTAL DIFFERENTIATIONHORIZONTAL DIFFERENTIATION Differentiation between organizational subunits Based on employees’ specialization Increases with specialization and departmentalization
DEPARTMENTALIZATIONThe process of breaking up organizations into coherent units. Functional OrganizationFunctional Organization: The type of departmentalization based
on the activities or functions performed (e.g., sales, finance). Product OrganizationProduct Organization: The type of departmentalization based on
the products (or product lines) produced. Matrix OrganizationMatrix Organization: The type of departmentalization in which a
product or project form is superimposed on a functional form.
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VERTICAL DIFFERENTIATIONVERTICAL DIFFERENTIATION Difference in authority and responsibility in
organizational hierarchy Tall, narrow organizations-greater vertical
differentiation Flat, wide organizations-less vertical
differentiationTall structures have many levels of authority
relative to the organization’s size.Flat structures have few levels but wide
spans of control.
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SPATIAL SPATIAL DIFFERENTIATIONDIFFERENTIATION
Geographic dispersion of offices, plants and personnel
Increase in no. of locations-increases complexity but necessary
May give organization political and legal advantages in a country
Horizontal, vertical and spatial differentiation indicate the width, height and breadth of an organizational structural needs
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INTEGRATIONINTEGRATIONDefinition- The process of coordinating the
different parts of an organization.
Designed to achieve unity among individuals and groups .
Supports a state of dynamic equilibrium - elements of organization are integrated, balanced.
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VERTICAL INTEGRATIONVERTICAL INTEGRATION
Hierarchical referralRules and proceduresPlans and schedulesPositions add to the organization structureManagement information system
HORIZONTAL INTEGRATIONHORIZONTAL INTEGRATIONLiaison rolesTask forces Integrator positionsTeams
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DESIGN DIMENSIONSDESIGN DIMENSIONS
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Guide to designing structuresGuide to designing structures How many tasks should a position contain? How specialized should each task be? Skills, ability, knowledge and training needed
for work? Basis for grouping positions? What should be the span of control? How centralized or de-centralized should the
decision making power be? How standardized should the work content be? How large should each unit be?
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ORGANIZATION IMPLICATIONSORGANIZATION IMPLICATIONS
External environmentDynamic vs Stable environmentsComplex vs Simple environmentsDiverse vs Integrated environmentsHostile vs Munificent environments
Organizational size Technology Organizational Strategy
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MINTZBERG’S MODEL – ORGANISATIONAL MINTZBERG’S MODEL – ORGANISATIONAL STRUCTURESTRUCTURE
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5 Generic Structures – Simple 5 Generic Structures – Simple StructureStructure
Little or no techno structureFew support staffersLoose division of LaborMinimal differentiation among its unitsSmall managerial hierarchy
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MACHINE BUREAUCRACYMACHINE BUREAUCRACY Highly specialized, routine operating tasks Very formalized procedures in the operating core Proliferation of rules, regulations, & formalized
communication Reliance on the functional basis for grouping tasks Relatively centralized power for decision making Elaborate administrative structure with sharp
distinctions
between line and staff.
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PROFESSIONAL BUREAUCRACYPROFESSIONAL BUREAUCRACY
Relies for Coordination onStandardization of SkillsProfessionals are hired for the operating core.Coordination between operating professionals is
handled by standardardization of skills and knowledge.
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DIVISIONALISED FORMDIVISIONALISED FORM
Semi Autonomous unitsHorizontally Diversified Products and Services In a straight forward, stable environmentWhere Large economies of Scale do not apply
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ADHOCRACYADHOCRACY
Highly Organised structure with,Little formalization of Behaviour Job SpecializationGroup the Specialists into functional unitsReliance on liaison devices to encourage mutual
adjustment
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