10erobbins_ppt09 - r.ppt

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Copyright © 2010 Pearson Education, Inc.Publishing as Prentice Hall

9–1

OrganizationalOrganizational

Structure andStructure andDesignDesign

Chapter Chapter

99

Management Stephen P. Robbins Mary Coulter

tenth edition


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9–2

Learning OutcomesLearning Outcomes Follow this Learning Outline as you read and study Follow this Learning Outline as you read and study

this chapter.this chapter.9.1 e!ining "rgani#ational $tructure9.1 e!ining "rgani#ational $tructure

% iscuss the traditional and conte&porary 'ie(s o!iscuss the traditional and conte&porary 'ie(s o!

(or) speciali#ation, chain o! co&&and, and span o!(or) speciali#ation, chain o! co&&and, and span o!

control.control.

% escribe each o! the !i'e !or&s o!escribe each o! the !i'e !or&s o!

depart&entali#ation.depart&entali#ation.

% i!!erentiate, authority, responsibility, and unity o!i!!erentiate, authority, responsibility, and unity o!co&&and.co&&and.

% E*plain ho( centrali#ation – decentrali#ation andE*plain ho( centrali#ation – decentrali#ation and

!or&ali#ation are used in organi#ational design.!or&ali#ation are used in organi#ational design.


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9–+

Learning OutcomesLearning Outcomes9.2 echanistic and "rganic $tructures9.2 echanistic and "rganic $tructures

% Contrast &echanistic and organic organi#ations.Contrast &echanistic and organic organi#ations.

% E*plain the contingency !actors that a!!ectE*plain the contingency !actors that a!!ect

organi#ational design.organi#ational design.

9.+ Co&&on "rgani#ational esigns9.+ Co&&on "rgani#ational esigns

% Contrast the three traditional organi#ational designs.Contrast the three traditional organi#ational designs.

% escribe the conte&porary organi#ational designs.escribe the conte&porary organi#ational designs.

% iscuss the organi#ational design challenges !acingiscuss the organi#ational design challenges !acing

&anagers today.&anagers today.


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9–-

Designing Organizational StructureDesigning Organizational Structure

% "rgani#ing"rgani#ing rranging and structuring (or) to acco&plish an organi#ation/s rranging and structuring (or) to acco&plish an organi#ation/s

goals.goals.

% "rgani#ational $tructure"rgani#ational $tructure he !or&al arrange&ent o! obs (ithin an organi#ation.he !or&al arrange&ent o! obs (ithin an organi#ation.

% "rgani#ational esign"rgani#ational esign process in'ol'ing decisions about si* )ey ele&ents process in'ol'ing decisions about si* )ey ele&ents

3or) speciali#ation3or) speciali#ation

epart&entali#ationepart&entali#ation

Chain o! co&&andChain o! co&&and $pan o! control$pan o! control

Centrali#ation and decentrali#ationCentrali#ation and decentrali#ation

4or&ali#ation4or&ali#ation


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9–5

Ehibit 9!"Ehibit 9!" Purposes o# OrganizingPurposes o# Organizing

% Di$ides %or& to be done into speci#ic 'obs anddepartments.

% (ssigns tas&s and responsibilities associated %ith

indi$idual 'obs.

% Coordinates di$erse organizational tas&s.

% Clusters 'obs into units.

% Establishes relationships among indi$iduals)

groups) and departments.

% Establishes #ormal lines o# authority.

% (llocates and deploys organizational resources.


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9–6

Organizational StructureOrganizational Structure% 3or) $peciali#ation3or) $peciali#ation

he degree to (hich tas)s in the organi#ation arehe degree to (hich tas)s in the organi#ation are

di'ided into separate obs (ith each step co&pleteddi'ided into separate obs (ith each step co&pleted

by a di!!erent person.by a di!!erent person.

"'erspeciali#ation can result in hu&an disecono&ies"'erspeciali#ation can result in hu&an disecono&ies

!ro& boredo&, !atigue, stress, poor 7uality, increased!ro& boredo&, !atigue, stress, poor 7uality, increased

absenteeis&, and higher turno'er.absenteeis&, and higher turno'er.


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9–8

Departmentalization by *ypeDepartmentalization by *ype% +unctional+unctional

,rouping 'obs by,rouping 'obs by

#unctions per#ormed#unctions per#ormed

% ProductProduct ,rouping 'obs by product,rouping 'obs by product

lineline% ,eographical,eographical ,rouping 'obs on the,rouping 'obs on the

basis o# territory orbasis o# territory or

geographygeography

% ProcessProcess

,rouping 'obs on the,rouping 'obs on the

basis o# product orbasis o# product or

customer #lo%customer #lo%

% Customer Customer

,rouping 'obs by type o#,rouping 'obs by type o#customer and needscustomer and needs


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9–9

Ehibit 9!- cont/d0 ,eographical DepartmentalizationEhibit 9!- cont/d0 ,eographical Departmentalization


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9–10

Ehibit 9!- cont/d0 Product DepartmentalizationEhibit 9!- cont/d0 Product Departmentalization


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9–11

Ehibit 9!- cont/d0 Process DepartmentalizationEhibit 9!- cont/d0 Process Departmentalization

1 More e##icient #lo% o# %or& acti$ities

! Can only be used %ith certain types o# products


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9–12

Ehibit 9!- cont/d0 Customer DepartmentalizationEhibit 9!- cont/d0 Customer Departmentalization

1 Customers/ needs and problems can be met by specialists

2 Duplication o# #unctions

2 Limited $ie% o# organizational goals


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9–1+

Organizational Structure cont/d0Organizational Structure cont/d0% Chain o! Co&&andChain o! Co&&and

he continuous line o! authority that e*tends !ro&he continuous line o! authority that e*tends !ro&

upper le'els o! an organi#ation to the lo(est le'els o!upper le'els o! an organi#ation to the lo(est le'els o!

the organi#ation and clari!ies (ho reports to (ho&.the organi#ation and clari!ies (ho reports to (ho&.


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9–1-

Organizational Structure cont/d0Organizational Structure cont/d0% uthority uthority

he rights inherent in a &anagerial position to tellhe rights inherent in a &anagerial position to tell

people (hat to do and to e*pect the& to do it.people (hat to do and to e*pect the& to do it.

% :esponsibility:esponsibility

he obligation or e*pectation to per!or&.he obligation or e*pectation to per!or&.

% ;nity o! Co&∧nity o! Co&&and

he concept that a person should ha'e one boss andhe concept that a person should ha'e one boss and

should report only to that person.should report only to that person.


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9–15

Organizational Structure cont/d0Organizational Structure cont/d0% $pan o! Control$pan o! Control

he nu&ber o! e&ployees (ho can be e!!ecti'ely and e!!icientlyhe nu&ber o! e&ployees (ho can be e!!ecti'ely and e!!icientlysuper'ised by a &anager.super'ised by a &anager.

3idth o! span is a!!ected by3idth o! span is a!!ected by

$)ills and abilities o! the &anager $)ills and abilities o! the &anager

E&ployee characteristicsE&ployee characteristics

Characteristics o! the (or) being doneCharacteristics o! the (or) being done

$i&ilarity o! tas)s$i&ilarity o! tas)s

Co&ple*ity o! tas)sCo&ple*ity o! tas)s

Physical pro*i&ity o! subordinatesPhysical pro*i&ity o! subordinates

$tandardi#ation o! tas)s$tandardi#ation o! tas)s

$ophistication o! the organi#ation/s in!or&ation syste&$ophistication o! the organi#ation/s in!or&ation syste&

$trength o! the organi#ation/s culture$trength o! the organi#ation/s culture

Pre!erred style o! the &anagerPre!erred style o! the &anager


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Copyright © 2010 Pearson Education, Inc.Publishing as Prentice Hall 9–16

Ehibit 9!3Ehibit 9!3 Contrasting Spans o# ControlContrasting Spans o# Control


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Organizational Structure cont/d0Organizational Structure cont/d0% Centrali#ationCentrali#ation

he degree to (hich decision &a)ing is concentratedhe degree to (hich decision &a)ing is concentrated

at upper le'els in the organi#ation.at upper le'els in the organi#ation. "rgani#ations in (hich top &anagers &a)e all the decisions"rgani#ations in (hich top &anagers &a)e all the decisions

and lo(er


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Ehibit 9!4Ehibit 9!4 +actors that 5n#luence the (mount o#+actors that 5n#luence the (mount o#

Centralization and Decentralization Centralization and Decentralization

% ore Centrali#ationore Centrali#ation

En'iron&ent is stable.En'iron&ent is stable.

?o(er


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Ehibit 9!4 cont/d0 +actors that 5n#luence the (mountEhibit 9!4 cont/d0 +actors that 5n#luence the (mount

o# Centralization and Decentralization o# Centralization and Decentralization

% ore ecentrali#ationore ecentrali#ation En'iron&ent is co&ple*, uncertain.En'iron&ent is co&ple*, uncertain.

?o(er


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Organizational Structure cont/d0Organizational Structure cont/d0% 4or&ali#ation4or&ali#ation

he degree to (hich obs (ithin the organi#ation arehe degree to (hich obs (ithin the organi#ation are

standardi#ed and the e*tent to (hich e&ployeestandardi#ed and the e*tent to (hich e&ployee

beha'ior is guided by rules and procedures.beha'ior is guided by rules and procedures. Highly !or&ali#ed obs o!!er little discretion o'er (hat is to beHighly !or&ali#ed obs o!!er little discretion o'er (hat is to be

done.done. ?o( !or&ali#ation &eans !e(er constraints on ho(?o( !or&ali#ation &eans !e(er constraints on ho(

e&ployees do their (or).e&ployees do their (or).


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Ehibit 9!6Ehibit 9!6 Mechanistic 7ersus Organic OrganizationMechanistic 7ersus Organic Organization

8 igh specialization

8 Rigid departmentalization

8 Clear chain o# command

8 :arro% spans o# control

8 Centralization

8 igh #ormalization

8 Cross2#unctional teams

8 Cross2hierarchical teams

8 +ree #lo% o# in#ormation

8 ;ide spans o# control

8 Decentralization

8 Lo% #ormalization


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Contingency +actorsContingency +actors% $tructural decisions are in!luenced by$tructural decisions are in!luenced by

"'erall strategy o! the organi#ation"'erall strategy o! the organi#ation "rgani#ational structure !ollo(s strategy."rgani#ational structure !ollo(s strategy.

$i#e o! the organi#ation$i#e o! the organi#ation 4ir&s change !ro& organic to &echanistic organi#ations as4ir&s change !ro& organic to &echanistic organi#ations as

they gro( in si#e.they gro( in si#e.

echnology use by the organi#ationechnology use by the organi#ation 4ir&s adapt their structure to the technology they use.4ir&s adapt their structure to the technology they use.

egree o! en'iron&ental uncertaintyegree o! en'iron&ental uncertainty yna&ic en'iron&ents re7uire organic structures@yna&ic en'iron&ents re7uire organic structures@

&echanistic structures need stable en'iron&ents.&echanistic structures need stable en'iron&ents.


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Copyright © 2010 Pearson Education, Inc.Publishing as Prentice Hall 9–2+

Contingency +actors cont/d0Contingency +actors cont/d0

% $trategy 4ra&e(or)s$trategy 4ra&e(or)s

Inno'ationInno'ation

Pursuing co&petiti'e ad'antage through &eaning!ul andPursuing co&petiti'e ad'antage through &eaning!ul anduni7ue inno'ations !a'ors an organic structuring.uni7ue inno'ations !a'ors an organic structuring.

Cost &ini&i#ationCost &ini&i#ation 4ocusing on tightly controlling costs re7uires a &echanistic4ocusing on tightly controlling costs re7uires a &echanistic

structure !or the organi#ation.structure !or the organi#ation.


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Copyright © 2010 Pearson Education, Inc.Publishing as Prentice Hall 9–2-

Contingency +actors cont/d0Contingency +actors cont/d0% $trategy and $tructure$trategy and $tructure

chie'e&ent o! strategic goals is !acilitated by chie'e&ent o! strategic goals is !acilitated by

changes in organi#ational structure thatchanges in organi#ational structure that

acco&&odate and support change.acco&&odate and support change.

% $i#e and $tructure$i#e and $tructure

s an organi#ation gro(s larger, its structure tends to s an organi#ation gro(s larger, its structure tends to

change !ro& organic to &echanistic (ith increasedchange !ro& organic to &echanistic (ith increased

speciali#ation, depart&entali#ation, centrali#ation,speciali#ation, depart&entali#ation, centrali#ation,

and rules and regulations.and rules and regulations.


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Contingency +actors cont/d0Contingency +actors cont/d0% echnology and $tructureechnology and $tructure

"rgani#ations adapt their structures to their"rgani#ations adapt their structures to their

technology.technology.

3ood(ard/s classi!ication o! !ir&s based on the3ood(ard/s classi!ication o! !ir&s based on the

co&ple*ity o! the technology e&ployedco&ple*ity o! the technology e&ployed


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Ehibit 9!=Ehibit 9!= ;ood%ard/s +indings on *echnology);ood%ard/s +indings on *echnology)

Structure) and E##ecti$eness Structure) and E##ecti$eness


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Common Organizational DesignsCommon Organizational Designs

% raditional esignsraditional esigns$i&ple structure$i&ple structure

?o( depart&entali#ation, (ide spans o! control, centrali#ed?o( depart&entali#ation, (ide spans o! control, centrali#ed

authority, little !or&ali#ationauthority, little !or&ali#ation

4unctional structure4unctional structure epart&entali#ation by !unctionepart&entali#ation by !unction

– "perations, !inance, &ar)eting, hu&an resources, and"perations, !inance, &ar)eting, hu&an resources, and

product research and de'elop&entproduct research and de'elop&ent

i'isional structurei'isional structure Co&posed o! separate business units or di'isions (ith li&itedCo&posed o! separate business units or di'isions (ith li&ited

autono&y under the coordination and control the parentautono&y under the coordination and control the parent

corporation.corporation.


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Ehibit 9!>Ehibit 9!> Strengths and ;ea&nesses o# *raditionalStrengths and ;ea&nesses o# *raditional

Organizational Designs Organizational Designs


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Copyright © 2010 Pearson Education, Inc.Publishing as Prentice Hall 9–+0

Ehibit 9!?Ehibit 9!? Contemporary Organizational DesignsContemporary Organizational Designs

*eam Structure*eam Structure

%% 3hat it is3hat it is structure in (hich the entire organi#ation is &ade up o! structure in (hich the entire organi#ation is &ade up o!(or) groups or tea&s.(or) groups or tea&s.

%% d'antages d'antages E&ployees are &ore in'ol'ed and e&po(ered. :educedE&ployees are &ore in'ol'ed and e&po(ered. :educedbarriers a&ong !unctional areas.barriers a&ong !unctional areas.

%% isad'antagesisad'antages Bo clear chain o! co&&and. Pressure on tea&s to per!or&.Bo clear chain o! co&&and. Pressure on tea&s to per!or&.

Matri2Pro'ect StructureMatri2Pro'ect Structure

3hat it is3hat it is structure that assigns specialists !ro& di!!erent !unctional structure that assigns specialists !ro& di!!erent !unctionalareas to (or) on proects but (ho return to their areas (henareas to (or) on proects but (ho return to their areas (henthe proect is co&pleted. Proect is a structure in (hichthe proect is co&pleted. Proect is a structure in (hiche&ployees continuously (or) on proects. s one proect ise&ployees continuously (or) on proects. s one proect isco&pleted, e&ployees &o'e on to the ne*t proect.co&pleted, e&ployees &o'e on to the ne*t proect.

%% d'antages d'antages 4luid and !le*ible design that can respond to en'iron&ental4luid and !le*ible design that can respond to en'iron&entalchanges. 4aster decision &a)ing.changes. 4aster decision &a)ing.

%% isad'antagesisad'antages Co&ple*ity o! assigning people to proects. as) andCo&ple*ity o! assigning people to proects. as) andpersonality con!licts.personality con!licts.


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Ehibit 9!? cont/dEhibit 9!? cont/d 0 Contemporary Organizational0 Contemporary Organizational

Designs Designs

@oundaryless Structure@oundaryless Structure

3hat it is3hat it is structure that is not de!ined by or li&ited to arti!icial structure that is not de!ined by or li&ited to arti!icialhori#ontal, 'ertical, or e*ternal boundaries@ includes 'irtualhori#ontal, 'ertical, or e*ternal boundaries@ includes 'irtualand net(or) types o! organi#ations.and net(or) types o! organi#ations.

%% d'antages d'antages Highly !le*ible and responsi'e. ra(s on talent (here'er it/sHighly !le*ible and responsi'e. ra(s on talent (here'er it/s!ound.!ound.

%% isad'antagesisad'antages ?ac) o! control. Co&&unication di!!iculties.?ac) o! control. Co&&unication di!!iculties.


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Organizational Designs cont/d0Organizational Designs cont/d0% Conte&porary "rgani#ational esignsConte&porary "rgani#ational esigns

ea& structuresea& structures

he entire organi#ation is &ade up o! (or) groups or sel!


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Copyright © 2010 Pearson Education, Inc.Publishing as Prentice Hall 9–++

Organizational Designs cont/d0Organizational Designs cont/d0% Conte&porary "rgani#ational esigns =cont/d>Conte&porary "rgani#ational esigns =cont/d>

oundaryless "rgani#ationoundaryless "rgani#ation

n !le*ible and unstructured organi#ational design that is n !le*ible and unstructured organi#ational design that is

intended to brea) do(n e*ternal barriers bet(een theintended to brea) do(n e*ternal barriers bet(een the

organi#ation and its custo&ers and suppliers.organi#ation and its custo&ers and suppliers.

:e&o'es internal =hori#ontal> boundaries:e&o'es internal =hori#ontal> boundaries

– Eli&inates the chain o! co&&andEli&inates the chain o! co&&and

– Has li&itless spans o! controlHas li&itless spans o! control

– ;ses e&po(ered tea&s rather than depart&ents;ses e&po(ered tea&s rather than depart&ents

Eli&inates e*ternal boundariesEli&inates e*ternal boundaries

– ;ses 'irtual, net(or), and &odular organi#ational;ses 'irtual, net(or), and &odular organi#ational

structures to get closer to sta)eholders.structures to get closer to sta)eholders.


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Copyright © 2010 Pearson Education, Inc.Publishing as Prentice Hall 9–+-

Remo$ing Eternal @oundariesRemo$ing Eternal @oundaries% 7irtual Organization7irtual Organization

(n organization that consists o# a small core o# #ull2time(n organization that consists o# a small core o# #ull2time

employees and that temporarily hires specialists to %or& onemployees and that temporarily hires specialists to %or& on

opportunities that arise.opportunities that arise.

% :et%or& Organization:et%or& Organization

( small core organization that outsources its ma'or( small core organization that outsources its ma'orbusiness #unctions e.g.) manu#acturing0 in order tobusiness #unctions e.g.) manu#acturing0 in order to

concentrate on %hat it does best.concentrate on %hat it does best.

% Modular OrganizationModular Organization

( manu#acturing organization that uses outside suppliers to( manu#acturing organization that uses outside suppliers topro$ide product components #or its #inal assemblypro$ide product components #or its #inal assembly

operations.operations.


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*oday/s Organizational Design*oday/s Organizational Design

ChallengesChallenges% Deeping E&ployees ConnectedDeeping E&ployees Connected

3idely dispersed and &obile e&ployees3idely dispersed and &obile e&ployees

% uilding a ?earning "rgani#ationuilding a ?earning "rgani#ation

% anaging lobal $tructural Issuesanaging lobal $tructural Issues

Cultural i&plications o! design ele&entsCultural i&plications o! design ele&ents


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Organizational Designs cont/d0Organizational Designs cont/d0% he ?earning "rgani#ationhe ?earning "rgani#ation

n organi#ation that has de'eloped the capacity to n organi#ation that has de'eloped the capacity to

continuously learn, adapt, and change through thecontinuously learn, adapt, and change through the

practice o! )no(ledge &anage&ent by e&ployees.practice o! )no(ledge &anage&ent by e&ployees.

Characteristics o! a learning organi#ationCharacteristics o! a learning organi#ation

n open tea&


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*erms to Ano%*erms to Ano%% organi#ingorgani#ing

% organi#ational structureorgani#ational structure% organi#ational chartorgani#ational chart% organi#ational designorgani#ational design% (or) speciali#ation(or) speciali#ation% depart&entali#ationdepart&entali#ation% cross

% centrali#ationcentrali#ation% decentrali#ationdecentrali#ation% e&ployee e&po(er&ente&ployee e&po(er&ent% !or&ali#ation!or&ali#ation

% &echanistic organi#ation&echanistic organi#ation

% organic organi#ationorganic organi#ation% unit productionunit production% &ass production&ass production% process productionprocess production% si&ple structuresi&ple structure%

!unctional structure!unctional structure

% di'isional structuredi'isional structure% tea& structuretea& structure% &atri* structure&atri* structure% proect structureproect structure% boundaryless organi#ationboundaryless organi#ation

% 'irtual organi#ation'irtual organi#ation% net(or) organi#ationnet(or) organi#ation% learning organi#ationlearning organi#ation


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C i ht © 2010 P Ed ti I 9 +

ll rights reser'ed. Bo part o! this publication &ay be reproduced, ll rights reser'ed. Bo part o! this publication &ay be reproduced,stored in a retrie'al syste&, or trans&itted, in any !or& or bystored in a retrie'al syste&, or trans&itted, in any !or& or by

any &eans, electronic, &echanical, photocopying, recording, orany &eans, electronic, &echanical, photocopying, recording, orother(ise, (ithout the prior (ritten per&ission o! the publisher.other(ise, (ithout the prior (ritten per&ission o! the publisher.

Printed in the ;nited $tates o! &erica.Printed in the ;nited $tates o! &erica.

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