Organizing an Effective Department IO 06

Organizing an Effective Department What is Organizing? Arranging and grouping jobs, allocating resources, and assigning work in a department so that activities can be accomplished as planned. 1 Basic Organizing Concepts Work Specialization (Division of Labor) The process of breaking down a job into a number of steps, with each step being completed by a separate individual. Span of Control The number of employees a supervisor can efficiently and effectively direct. 2 Basic Organizing Concepts Unity of Command A principle that states that an employee should have one and only one supervisor to whom he or she is directly responsible. Authority Rights inherent in a supervisory position to give orders and expect those orders to be obeyed. 3 Authority Line Authority The authority that entitles a supervisor to direct the work of his or her direct reports and to make certain decisions without consulting others. Staff Authority A limited authority that supports line authority by advising, servicing, and assisting. 4 Authority / Responsibility Functional Authority Rights over individuals outside one’s own direct areas of responsibility. Responsibility Supervisory obligations such as achieving a unit’s goals, keeping costs within budget, following organizational policies, and motivating employees. 5 Authority / Responsibility Responsibility is an obligation to perform assigned activities and it should be balanced with authority. The more ambitious and far-reaching the goals, the more authority is needed by the supervisor. 6 Where are Decisions Made? Centralization Decision-making responsibility in the hands of top management. Decentralization Pushes the decision-making process down in the organization placing it closer to the decision point. 7 How Are Employees Grouped? Departmentalization Grouping departments based on work functions, product or service, target customer or client, geographic territory, or the process used to turn inputs into outputs. 8 Departmentalization Functional Grouping activities into independent units based on functions performed. (Manufacturing, Research, Accounting, HR, Legal) Product Grouping activities into independent units based on problems or issues relating to a product. (Detergent, Toothpaste, Deodorant, Coffee, Aspirin) 9 Departmentalization Geography Grouping activities into independent units based on geography or territory. (Eastern Region, Western Region, Southern Region) Customer Grouping activities around common customer categories. (Government, Military, Corporate, Non-Profit Account) 10 Departmentalization Process Grouping activities around a process; this method provides a basis for the homogeneous categorizing of activities. (Casting, Press, Tube, Finishing, Inspect-Pact-Ship) 11 Departmentalization Matrix A structure that weaves together elements of functional and product departmentalization. This structure creates a dual chain of command -- explicitly breaking the principle of “chain of command”. 12 Departmentalization Simple Structures A non-elaborate structure low in complexity, with little formalization, and with authority centralized in a single person; a “flat” organization with only two or three levels. 13 Departmentalization Horizontal Structures Very flat structures used in small businesses as well as giant companies in which jobrelated activities cut across all parts of the organization. 14 Organizing Your Employees A job description is a written statement of what a jobholder does, how the job is done, and why it is done. It typically portrays job duties, working conditions, and operating responsibilities. 15 Empowerment Through Delegation Empowerment is increasing an employee’s involvement in his or her work through greater participation in decisions and expanded responsibility for work outcomes. 16 Empowerment Through Delegation Delegation is the allocation of duties, employee empowerment, assignment of responsibility, and creation of accountability. Accountability is the obligation to perform an assignment in a satisfactory manner. 17