Organization Structure and Design

Topics: Organizational structure, Management, Organizational studies and human resource management Pages: 8 (1263 words) Published: March 18, 2013
Organization Structure and Design
Organizing: Arranging and structuring work to accomplish organizational goals. Organizational Structure is the formal arrangement of jobs within an organization. Organization chart: Organization structure shown visually in the form of a chart. Organizational Design: A process that involves decisions about six key elements : Work specialization, Departmentalization, Chain of command , Span of control, Centralization and decentralization and Formalization.

Purpose of Organizing
• Dividing work to be done into specific jobs and departments. • Assigning tasks and responsibilities associated with individual jobs • Coordinating diverse organizational tasks. • Clustering jobs into units • Establishing relationships among individuals, groups and departments • Establishing formal lines of authority • Allocating and deploys organizational resources.

Work Specialization which is dividing work activities into separate jobs tasks. Individual employees specialize in doing part of an activity rather than the entire activity in order to increase work output. It is also known as division of labour. Problems with work specialization when stretched to an extreme:  Boredom  Fatigue  Stress  Poor Quality  Increased absenteeism  Reduced performance  Increased turnover Some companies, due to these problems, use job enrichment multi skilling and broadening job range to sustain the worker’s interest in work.

Five Departmentalization : A system of grouping together the jobs. There are ways of departmentation. 1. Functional Departmentalization – Groups jobs According to Function President

Manager, Marketing

Manager, Finance

Manager, Manager, Manufacturing Human Resource

Manager, RED

+ Efficiencies from putting together similar specialties and people with common skills, knowledge, and orientation. + Coordination with functional area + In-depth specialization - Poor communication across functional areas - Limited view of organizational goals

2. Geographical Departmentalization – Groups jobs according to Region President

Director, Western Region

Director, Southern Region

Director, Midwestern Region

Director, Eastern Region

+ More effective and efficient handling of specific regional issues that arise + Serve needs of unique geographic markets better - Duplication of functions - Can feel isolated from other organizational areas

3. Product Departmentalization – Groups jobs by Product Line President

Director Mass Transit Sector

Director Recreational and Utility Vehicles Sector

Director Rail and Diesel products Division

Mass Transit, Division Recreational Products Division

Bombardier – Rotax (Vienna) Logistic Equipment Division

Rail and Diesel Product Division Bobardier – Rotax (Gunskirchen)

Industrial Equipment Division

+ Allows specialization in particular products and services + Managers can become experts in their industry + Closer to customer + Duplication of functions - Limited view of organizational goals

4. Process Departmentalization – Groups jobs on the Basis of Product or Customer Flow. Plant Superintendent

Sawing Department Manager

Planning And Milling Department Manager

Assembling Department Manager

Lacquering and Sanding Department Manager

Finishing Department Manager

Inspection and Shipping Department manager

+ More efficient flow of work activities - Can only be used with certain types of Products

5. Customer Departmentalization – Groups jobs on the Basis of Specific and Unique Customers


Manger Retail Accounts

Manager, Wholesale Accounts

Manager Government Accounts

+ Customers’ needs and problems can be met by specialists - Duplication of functions - Limited view of organizational goals

Contemporary Developments in Departmentation:
Instead of One specialization - Cross functional teams to achieve results are used. - Cross functional teams to reduce transport etc. -...
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • Organization Structure Essay
  • Organization Structure and Design Essay
  • The Organization Structure and Design of a Bakery Essay
  • Organization Structure Essay
  • Essay about Organization Design
  • Structure of an Organization Essay
  • Organization Structure Essay
  • Organization Structure Research Paper

Become a StudyMode Member

Sign Up - It's Free