MGT160

ORGANIZING

DEFINITION
The process of determining:
The tasks to be done. Who will do them. How those tasks will be managed and coordinated.

The Organizing Process

1. REFLECT ON PLAN AND OBJECTIVES - organizing involves determining how resources will be use to achieve objectives by understanding planning
2. ESTABLISH MAJOR TASKS - designed major tasks - restaurant - serving customer and cooking food 3. DIVIDE MAJOR TASK INTO SUBTASKS - major task divided into subtasks to be done - serving customer - taking order and clearing table 4. ALLOCATE RESOURCES AND DIRECTIVES FOR SUBTASKS - who take orders/who clear tables - how they are to be set 5. EVALUATE THE RESULTS - gathers feedback on how well the strategy is working

Organizational Structure
Defines the primary reporting relationships that exist within an organization.

The chain of command and hierarchy of responsibility, authority, and accountability are established through organizational structure.

Division of Work/ Work specialization

Is the assignment of various portion of a particular task among a number of organization members. A component of organization structure that involves having each discrete step of a job done by a different individual rather than having one individual do the whole job.

Departmentalization
The way in which the activities of an organization are arranged and coordinated so that its mission can be fulfilled and its goals achieved.
Structure of organizational members The flow of information, resources, and task The locus of decision making

Departmentalization
Functional departmentalization
The grouping of activities by functions performed

Product departmentalization
The grouping of activities by product produced

Customer departmentalization
The grouping of activities by common customers

Geographic departmentalization
The grouping of activities by territory

Process departmentalization
The grouping of activities by work or customer flow

Network structure
A set of alliances with other organizations that serve a wide variety of functions.

Functional Structure
Members of the organization are grouped according to the particular function that they perform within the organization. Appropriate when an organizations greatest source of complexity comes from the diverse tasks that must be performed rather than from its products, geographic markets, or consumer groups.

Example of a Functional Structure

Functional Structure: Advantages

Facilitates specialization Advantages Cohesive work groups

Improved operational efficiency

Functional Structure: Disadvantages Focus on departmental vs.

organizational issues Disadvantages Difficult to develop generalists needed for top-level management Only top-level management held accountable for profitability

Product divisional
Most appropriate for organizations with relatively diverse product lines that require specialized efforts to achieve high product quality.

Product departmentalization

Product Divisional
Advantages
Enhanced coordination. Better assessment of manager performance and responsibility. Development of generalist managers.

Disadvantages
Managers may lack expertise to operate in wide geographic areas. Duplication of resources.

Customer divisional
Most appropriate for organizations that have separate customer groups with very specific and diverse needs.

Customer departmentalization

Geographic divisional
Most appropriate for organizations with limited product lines that either have wide geographic coverage or desire to grow through geographic expansion.

Geographic departmentalization

Geographic Divisional
Advantages
Allows for focus on specific new markets. Good structure for growth along geographic lines. Adaptable to local needs.

Disadvantages
Duplication of product or product/technology efforts. Coordination and integration are difficult. May be difficult to manage diverse product lines.

Manufacturing Process Departmentalization

A structure in which the activities of the organization are grouped according to the major phases of the process used to manufacture products.

Manufacturing Process Departmentalization

Matrix Structure
A structure in which the tasks of the organization are grouped along two organizational dimensions simultaneously. Examples include:
Product/function

Product/geographic region

A Multinational Matrix Structure

Matrix Structure: Advantages

Can achieve simultaneous objectives Advantages Managers focus on two organizational dimensions, resulting in more specific job skills

Matrix Structure: Disadvantages

Complex, leading to difficulties in implementation

Disadvantages

Behavioral difficulties from two bosses Time consuming from a planning/coordination perspective

Network Structure
A contemporary organizational structure that is founded on a set of alliances with other organizations that serve a wide variety of functions.

Types of Network Structure

Internal network
A network structure that relies on internally developed units to provide services to a core organizational unit.

Stable network
A network structure that utilizes external alliances selectively as a mechanism for gaining strategic flexibility.

Dynamic network
A network structure that makes extensive use of outsourcing through alliances with outside organizations.

Network Structure: Advantages

Maximizes the effectiveness of the core unit

Advantages

Do more with less resources

Flexibility

Network Structure: Disadvantages

Fragmentation makes it difficult to develop control systems Disadvantages Success is dependent on ability to locate sources Difficult to develop employee loyalty

Sample Network Structure