Revision for Organizing
What is organising?
What are tasks/who is to do the tasks/how tasks will be grouped/ who reports to whom/ who
makes decisions and how and where the decisions will be made
Organising is influenced by following factors:
Nature of the organisations’ operations/organising structure/resources
The main part of the purposes of organising is to allocate and deploy organizational resources. /because we have to utilize the limited resources to accomplish the organizational goals.
Organizational design guarantees organizational goals to be achieved in a manner of effectiveness and efficiency. .
In brief, Organisational design is to determine the best ways of structuring the organisation to address environmental demands and achieve strategic goals, i.e. structure follows strategy or
structure fits strategy
What is organisation structure?
• the arrangements used to divide work among people and co-ordinate it effectively
• the formal arrangement of jobs within an organisation
Organizational structure elements include
• the set of formal tasks (what people will do)
• assigned to individuals and departments (who will do it)
• Formal reporting relationships (who will direct and supervise whom)
• the design of systems to ensure the effective coordination of employees (how we will
ensure our organizational task is effectively implemented.)
Six key elements of organisational design
• Formalisation: The degree to which an organization relies on rules and procedures
• De/Centralisation: (De)Concentration of decision-making in (lower)upper management
• Chain of Command: Line of authority and clarifies who reports to whom • Span of Control: The number of subordinates a manager can direct efficiently and effectively
• Work specialisation: Tasks are divided into separate jobs(for each individual)
• Departmentalisation: Jobs are grouped to accomplish organizational goals(for an
organization as a whole)
Centralisation VS decentralisation
More centralization /more decentralization
– environment is stable/ environment is complex and uncertain
– lower-level managers not as capable/experienced/ lower-level managers are
capable and experienced
– decisions are significant/ decisions are relatively minor
1 / 9
– organization is facing a crisis/ corporate culture is open to allowing managers to
have a say in what happens
– company is geographically concentrated around one place/company is
– effective implementation of company strategies depends on managers retaining
a say over what happens./ effective implementation of company strategies
depends on managers having involvement and flexibility
Work specialisation also known as “division of labour”
Its main focus is that an entire job is broken down into steps and each is completed by a different person. Individuals specialize in doing part of rather than the whole activity.
Is the basis on which jobs are grouped in order to accomplish organizational goals (whole activity). Every organization will have its own unique way of classifying and grouping work activities.
• Functional: Jobs by functions performed
• Geographic: Jobs by geographic location
• Product: Jobs by product line
• Process: Jobs by product or customer flow
• Customer: Jobs by unique/specific customer
• The divisional approach is used when departments are grouped together based on
organizational outputs. Example: the University has a divisional structure: Teaching &
Learning; Research; Ethics; Higher Degrees etc
defining the tasks, knowledge, skills and abilities required to perform the job”
a list of duties and capabilities required for the job
a statement of the skills, experience and education a person should have in order to perform the job
For example, see lecture PPT Manager Accounts
Functional Structure - this is the traditional structure where the organisation is divided into functional areas, divisions or departments
E.g. finance, HR, marketing, operations.
• in-depth skill specialisation and development
• excellent coordination within functions
• efficient use of resources, able to take advantage of economies of scale
2 / 9
• career progress within the department
• top manager direction and control
• high-quality technical problem solving
• simplifies training
• poor communication among functional departments can occur quite easily
• slow response to external changes
• decisions concentrated at top of hierarchy, creating delays
• responsibility for problems is difficult to pinpoint
• employees have limited view of organisational goals
• limited general management training for employees
The divisional approach is used when departments are grouped together based on organisational
Example: the University has a divisional structure: Teaching & Learning; Research; Ethics; Higher
Diverse departments are brought together to produce a single (with a clear organizational
purpose) organizational output.
– fast response, flexibility in an unstable environment
– Allows greater coordination across functional departments
– easy pinpointing(finding or describing) of responsibility
– emphasis on overall product and division goals
– development of general management skills
– Increased costs incurred (as a result) through duplication of personnel,
operations, and investment
– Dysfunctional competition among divisions may detract from corporate
– Difficulty in maintaining uniform corporate image
– Overemphasis on short-term performance
The matrix approach
combines aspects of both functional and divisional structures simultaneously.
– The matrix has dual lines of authority.
– The functional hierarchy of authority runs vertically.
– The divisional hierarchy runs laterally.
• more efficient use of resources than single hierarchy
• flexibility, adaptability to changing environment
• development of both general and specialist management skills
• interdisciplinary expertise available to all divisions
3 / 9
• enlarged tasks for employees
• frustration and confusion from dual chain of command
• high conflict between two sides of matrix
• many meetings, more discussion than action
• human relations training needed
• power domination by one side of matrix
The network approach
divides major functions into separate companies brokered (partly controlled, in a manner a
broker does business) by a small headquarters organisation.
It makes it difficult to answer the question ‘Where is the organisation?’
The network approach is especially appropriate for international operations.
It is held together with phones, faxes and other electronic technology.
reduced administrative overhead
no hands-on control
can lose organisational part
employee loyalty weakened
Mechanistic v organic