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Basic Characteristics of Organizational Structure

Basic Characteristics of Organizational Structure. Division of labor: dividing up the many tasks of the organization into specialized jobs Hierarchy of authority: Who manages whom. Span of control: Who manages whom. Line vs staff positions Decentralization. Hierarchy of Authority.

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Basic Characteristics of Organizational Structure

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  1. Basic Characteristics of Organizational Structure • Division of labor: dividing up the many tasks of the organization into specialized jobs • Hierarchy of authority: Who manages whom. • Span of control: Who manages whom. • Line vs staff positions • Decentralization

  2. Hierarchy of Authority • Tall vs flat hierarchies • Autonomy and control • Communication • Size

  3. Span of Control • A wide span of control: a large number of employees reporting, • A narrow span of control: a small number employees reporting • The appropriate span of control depends on the experience, knowledge and skills of the employees and the nature of the task.

  4. Line vs Staff Positions • Line vs Staff: • Line positions are those in which people are involved in producing the main goods or service or make decisions relating to the production of the main business. • Staff positions These are positions in which people make recommendations to others but are not directly involved in the production of the good or service

  5. Decentralization • The extent to which decision making is concentrated in a few people or dispersed through out the organization • Advantage: benefits associated with greater participation and moving the decision closest towards implementation • Disadvantage: Lack of perspective and information, lack of consensus

  6. Functional Structure Advantage: efficiency, communication Disadvantage: isolation of units

  7. Product Structure Advantages: Product focus, flexibility Disadvantage: Duplication of effort

  8. Market Structure

  9. Geographic Structure

  10. Matrix Structure R & D Engineering Manufact’ing Product A Product B Product C

  11. Integration • Hierarchy of authority • Liaison roles • Teams, committees, task forces • Standardization & formalization

  12. Mechanistic & Organic Designs • Mechanistic:tallness in hierarchy, specialization, centralization in authority, formalization. Work best under stable conditions • Organic: flatness, generalization, decentralization flexibility Best fit dynamic conditions and complex technology

  13. Designs and Dimensions

  14. Effectiveness Criteria • Output approach • Internal process approach • Systems resource approach • Stakeholder approach

  15. Effectiveness & Structure • Size and structure • Complexity • Differentiation • Decentralization • Formalization • Structure and satisfaction • Decentralization • Span of control

  16. Backwards & Forwards • Summing up: Today we examined the characteristics of organizational structure, differentiation and coordination. Mechanistic and organic designs were discussed and organizational effectiveness • Looking ahead: Next time we explore environments, culture, technology and structure.

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