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Departmentation
Advantages
various activities are grouped together Furnishes means of tight control at the top. Simplifies training. It provides for fixation of standards of performance and ensures effective control Creates opportunities for the departmental heads to take initiative
Disadvantages
organization is divided into various parts Responsibilities for profits is at top only. Slow adaptation to change in environment. It increases the levels of management which is expensive and thus increases the gap between the top management and the workers Departmentation creates difficulties of communication among the various departments of the organization
Er.Sartaj Singh Bajwa
Basis Of Departmentation
Functional Departmentation
Product wise Departmentation Territorial or Geographical Departmentation Process wise Departmentation Customer wise Departmentation Time wise Departmentation
Functional Departmentation
Grouping of common or homogeneous activities to form an organization unit is known as functional departmentation Further functions in an organization are divided in two categories basic and secondary functions Basic functions are those which are necessary for the
smooth running of the business like production ,marketing , finance When span of management is too large then further departments are created within the main departments they take care of secondary functions In this case like the basic function is marketing but it may further be divided into advertisement , sales , market research Er.Sartaj Singh Bajwa
grouping together of all the activities necessary to manufacture a product or product line
Eg In an automobile organization the departmentation could be car division , truck division , bus division
Grouping of activities by area or territory is common in enterprises operating over wide geographic areas. Organizations which are involved in banking , insurance , transportation Eg India could be divided into north , south , east , west , central zones Further North zone can be divided into Chandigarh , new Delhi , Jalandhar , Ajmer divisions
Process Departmentation
In this processes involved in production or various type of equipments used are taken as basis of
departmentation The basic aim to do process departmentation is to achieve economic benefit Eg process departmentation in case of textile organization can be by dividing the production into spinning , dyeing , weaving , finishing departments
ways an organization reaches the ultimate customer Advantage of this type is that it focuses on customer who are the ultimate suppliers of money to the organization Eg in pharmaceutical companies different customers could be doctors , hospitals , government , retail stores Further it could be wholesale , retail , export
through day and night , the work is divided into shifts Thus when an organization may operates on three shifts, three different departments may exist