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Business in a
Changing World

Chapter 8
Organization, Teamwork, and
Communication

McGraw-Hill/Irwin Copyright © 2009 by the McGraw-Hill Companies, Inc. All rights reserved.
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 PetConnection.com

An organization based on blogging providing a

unique competitive advantage.

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Organization, Teamwork, & Communication

Importance of Organizational Structure

Structure Impacts:
•Decision making
•Costs & efficiencies
•Overall success and sustainability

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Organization, Teamwork, & Communication

Organizational Culture

A firm’s shared values, beliefs, traditions,

philosophies, rules, and role models for behavior.

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Organization, Teamwork, & Communication

Organizational Culture –
•Formal expression
•Informal expression

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Organization, Teamwork, & Communication

Organizational Culture –
•Formal expression
•Mission statement
•Code of ethics
•Manuals
•Ceremonies
•memoranda

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Organization, Teamwork, & Communication

Organizational Culture –
•Informal Expression
•Dress code
•Work habits
•Extracurricular activities
•Stories

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Organization, Teamwork & Communication

Organizational Culture –
satisfying the needs &
expectations of stakeholders

Ensures that organizational members:

•share values
•observe common rules
•share problem solving approaches

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Organization, Teamwork & Communication

The most important drivers of innovation in companies.

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Organization, Teamwork & Communication

Developing
Organizational Structure

Organizational Structure – The arrangement or

relationship of positions within an organization.

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Organization, Teamwork & Communication

Developing
Organizational Structure

Structure Develops –
•Managers assign work tasks to individuals & groups
•Coordination of diverse activities to attain objectives

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Organization, Teamwork & Communication

Organizational Chart

What the Organizational Chart Shows –

•Organizational structure
•Chain of command (lines of authority)
•Other relationships (staff, committees, etc.)
•Lines of communication
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Organizational Structure

The Evolution of a Clothing Store

Phases 1, 2, and 3

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Organization, Teamwork & Communication

Organizational Growth

What does organizational growth require?

•Structuring of resources (human, physical, financial)
•Hiring specialized talent & skills
•Formalized structure (as workforce & specialization grows)
•Assign work tasks to individuals & departments
•Assign responsibility for organizational objectives

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Assigning Tasks – Organizational Structure

Celestial Seasonings – Determining

activities required to meet objectives

 Purchase herbs from suppliers

 Dry the herbs
 Place in tea bags
 Package and label tea bags
 Ship packages to retail outlets
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Assigning Tasks

Specialization
Managers divide the labor into small, specific
tasks and assign to employees to accomplish
individual tasks.

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Assigning Tasks

Why Specialize?
•Efficiency
•Ease of training
•Activities too numerous
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Assigning Tasks

Overspecialization

•Employees become bored

•Job dissatisfaction
•Poor quality work
•Increased injuries
•Increased employee turnover

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Organizational Structure –
Assigning Tasks

Departmentalization

Grouping of jobs into working units

(departments, units, groups, divisions)

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Assigning Tasks – Organizational Structure

Departmentalization is the grouping of jobs

into working units usually called departments,
units, groups, or divisions.
•Functional departmentalization
•Product departmentalization
•Geographical departmentalization
•Customer departmentalization
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Retailing & Wholesaling
Selling directly to the consumer

• Music stores
• Sporting-goods shops
• Dry cleaners
• Boutiques
• Drugstores
• Restaurants
• Hardware stores

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Functional Departmentalization

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Product Departmentalization

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Geographical Departmentalization

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Customer Departmentalization

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Assigning Responsibility

Delegation creates a responsibility

•Delegation of authority
•Assigning responsibility
•Employee accountability

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Assigning Responsibility

Delegation of Authority

Giving employees tasks and power to make

commitments, use resources, and take action to
carry out tasks.

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Assigning Responsibility

Responsibility

Obligation placed on employees to perform

assigned tasks and be held accountable for
proper execution.

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Assigning Responsibility

Accountability

Employees are answerable to a superior for work

outcomes.

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Centralization

Centralized organizations
•Authority is concentrated at the top level.
Decentralized organizations
•Decision-making authority is delegated as far
down the chain of command as possible.
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Span of Management

Span of Management – the number of

subordinates who report to a particular manager.

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Span of Management

•A wide span of management exists when a

manager directly supervises a very large number
of employees.

•A narrow span of management exists when a

manager directly supervises only a few
subordinates.
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Advantages of Small Business Ownership

•Costs
•Flexibility
•Focus
•Reputation

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Span of Management – Organizational layers

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Span of Management – Organizational layers

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Forms of Organizational Structure

Line Structure
Line-and-staff structure
Multidivisional structure
Matrix structure
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Forms of Organizational Structure

Line Structure – Convenience Store as an example

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Forms of Organizational Structure

Line-and-staff Structure
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Forms of Organizational Structure

Matrix Structure
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Groups & Teams in Organizations

Group – two or more individuals who

communicate with one another, share a common
identity, and have a common goal

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Groups & Teams in Organizations

Team – a small group whose members have

complementary skills, have a common purposes,
goals, and approach; hold themselves mutually
accountable.
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Groups & Teams

Differences between Groups & Teams

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Groups & Teams

Committee – permanent, formal group

performing a specific task.

Task force – temporary group responsible for a

particular change activity
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Groups & Teams

Teams
•Project teams
•Product development teams
•Quality assurance teams (quality circles)
•Self-directed work teams (SDWT)

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Communications in Organizations

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Communications in Organizations

Formal Communication – flow of communication

within the formal organizational structure as
depicted on organizational charts.

•Upward communication
•Downward communication
•Horizontal communication
•Diagonal communication

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Communications in Organizations

Informal Communication – separate from

management’s formal, official communication
channels.

•Grapevine

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