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General Management In Business I

General Management In Business I. Ass . Prof. Dr. Özgür KÖKALAN İstanbul Sabahattin Zaim University. Chapter Objectives. D efine what organizing function is D escribe fundemental concepts of organizing Indentify the factors that affect organizational structure

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General Management In Business I

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  1. General Management In Business I Ass. Prof. Dr. Özgür KÖKALAN İstanbul Sabahattin Zaim University

  2. Chapter Objectives • Definewhatorganizingfunctionis • Describefundementalconcepts of organizing • Indentifythefactorsthataffectorganizationalstructure • Describetypes of departmentalization

  3. Defination of Organizing • Organizing is a processforgroupingandstructuringactitivities, assigningdutiesandcoordinatingtheefforts of personnel in theirattainment of organizationalgoals.

  4. When a structure is set up, manythingsshould be consideren as follows: • Towhatextendshouldmanagersencouragespecilization in organizing? • Whatwould be lineandlevels of authoritythatmanagersshouldestablish? • How muchformalizationshould be encouraged? • Towhatextendshoulddecisionmaking be centralizedordecentralized?

  5. Fundamentals of Organizing • Specilization (Division of Work); it is concernedwithdivision of laborwithinorganization. It is referredto as subdividingthewidevariety of taskswithintheorganizationintoindividiualjobsto be performedefficientlybytheskilledemployees. • Chain of Command; whoordersandreportstowhom. Thechain of commandshowstheauthoritystructure of an organization.

  6. Authority; it is formalandlegitimateright of a managerstomakedecisions, issueorders, andallocateresorces. • Therearethreecategories of authoritywithintheorganization. • Lineauthority; managersworking in thelinedepartmentshavefullanddirectauthority • Staffauthority; it is a limitedauthorityusedbymanagersonlytoadvisewithinthescope of theirfield of expertise. • Functionalauthority; somemanagersmayhavefullanddirectauthorityoverotherdepartmentsthantheirown in respecttotheirspecialistfunction.

  7. Type Of AuthorityWithinTheOrganization LineAuthority StaffAuthority FunctionalAuthority

  8. Delegation; Theright of managersto transfer part of theirlegitimateauthorityto a subordinate is called as delegation. • Span of Control (Span of Management); Thenumber of subordinatesthat a manager can effectivelycontrol. • Factorsaffectingthespan of control can be described as follows: • Characteristics of taskperformed • Degree of standardization in theworkplace • Qualification of subordinates • Availability of supportandstaffserviceswithintheorganization • Complexitylevel of tasks • Mangerspersonalpreferences • Localcharacteristics (single / numerousworkstations) • Degree of formalization (writtenrulesandproceduresdefiningorganization)

  9. NarrowSpan of Management LargeSpanof Management • 1 • 2

  10. ExamplesforSpan of Control, • Ifthetaskarestandardizedand not complexandsubordinatesareeducatedandexperienced in theirtask • Span of controlwould be set ……………………. • If a manager is responsibleforseperateanddifferentunitslocated in numerousandgeographicallydispersedplaces, andwhenthetasksareverycomplexandneedstrictcontrol • Span of controlwould be set …………………….

  11. Formalization; it is referredto as thedegree of writtendocumentationusedtodirectandcontrolemployees. Thesedocumentsmayprovidesuchinformation as descriptions of taks, procedures in taskperforming, responsibilitiesanddecisionmaking. • CentralizationorDecentralization; Thedecision at the top organizationleveldescribescentralization. Thedecisionsaremadebylowerorganizationallevelthat is called as decentralization.

  12. FactorsAffectingOrganizationalStructure • Managersshouldstudysomecontingencyfactorswhentheyattempttodesign an organization. • Somecontingecyfactorsthatinfluencetheorganizationstructure as fallows: • Strategic GoalsandStrategy • The Environment • Technology • Departmental Interdependence

  13. Strategic GoalsandStrategy; strategicgoalspertainto an organization as whole. An organization’sstructure is verymuchrelatedwithstrategy. Therearemainlytwokinds of strategyappliedbyorganizations • Costleadershipstrategy; thegoal is to minimize thecoststoaccomplishmoreappropriatepricesfororganizastion’sstandardproduct. • Differentationstrategy; thegoal is toproducedifferentproductswithpremiumpriceschargedtocustomerstoservetheiruniqueneeds

  14. The Environment; theenvorimentcreatesuncertainty. Thesturucturedesign of an organizations is veymuchdependent on thelevel of uncertainty in theenvironment in which it operates. • Whentheenvironment is stable, organizationshouldhave a mechanisticstructurethatemphasizesrigidmanagerialcontrol in traditionalverticalchain of command. • In an environmentwithuncertainty, thebeststructure is likelytheorganicstructurethatemphasizesflexible, loosemanagerialcontrolandlateralrelationshipwithinthehierarchicalpositions.

  15. Technology, technologyaffectsorganizationalstructuredirectly. Therethreesignificantmanufacturingtechnologies; smallbatch, massandcontinuousprocessmanufacturing. Thedifferencesamongthesetechnologiesarecalled as technologicalcomplexity. Thedegree of tecnologicalcomplexitydeterminestheorganizationalstructure. • Departmental Interdependence; Thedegreetowhichdepartmentsdepend on oneanotherfororganizationalresources in theirtaskaccomplishment

  16. Type of Departmentalization • Thegrouping of tasksandpositionsintodepartmentsanddepartmentsintoorganization is called as departmentalization.

  17. TridationalApproachestoDepartmentalization • Therearetwo main type of deparmentalization in traditionalapproaches. • Functionaldepartmentalization; Thegrouping of peopleandtaks is madeand put together in departmentsaccordingtotheircommonskills, experiencesandworkactivities.

  18. DivisionalDepartmentalization; Inthisapproach, diversedepartmentsarebroughttogethertocreate self- containedunitsforproducing a singleorganizationaloutput. • Somecommondivisionalstructuresare as follows: • Departmentalizationby Product; Thedepartmentsaregroupedintoseperate self containedproduct. • DepartmentalizationbyGeographicalRegions; Thedepartments’ groupinginto self- containeddivisionsservingcustomerswhoarephysicallydispersed in spesificgeographicalregions. • DepartmentalizationbyCustomer; divisionalstructuregroupsthedepartmentsinto self-containedunitstoservevariousneeds of differentcustomergroups

  19. Modern ApproachtoDepartmentalization: MatrixStructure • Matrixstructureblendsthefunctionalanddivisionaldepartmentalization. Themosttypicalarrangementsareproduct- functionmatrix, project-functionmatrixandproduct – regionmatrix. • Inmatrixstructure, there is a dualcommandsystem in whichsubordinateshavetwobossestoreportto. • It is moreflexiblethantraditionalstructure.

  20. ContemporaryApproachtoDepartmentalization • Thenewcontemporaryapproach do not rely on verticalchain on command. • Organizationalstructureare set upbased on competitive global andfastchangingenvironment • Therearetwotypes of structure • Team-basedorganization; theorganizationestablishseries of teamstoachievespecifictasks. Organizationstructureare set upbased on theseteams • Network organization; theorganization’sdisaggregatingitsmajorfuctions, activitiesandresourcesintoseperatecompaniesthatproducethegoodsandservicesforthem.

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