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ORGANIZING/STRUCTURING an
ORGANIZATION
Create a division of labor; Specialization Set up teams/departments Assign tasks/responsibility Allocate resources Develop procedures/org chart Adjust to new realities TERM 2
Economies of Scale
DEFINITION 2 Companies can reduce their production costs by purchasing raw materials in bulk TERM 3
FAYOLS PRINCIPLES OF ORGANIZATION
DEFINITION 3 Unity of command, Hierarchy of authority, Division of labor, Subordination of individual interests to the general interest, Authority, Degree of centralization, Clear communication channels, Order, Equity, Esprit de corps TERM 4
WEBERS PRINCIPLES
DEFINITION 4 Employees just need to do what theyre told. In addition to Fayols principles, Weber emphasized: Job descriptions, Written rules, decision guidelines and detailed records, Consistent procedures, regulations and policies, Staffing and promotion based on qualifications TERM 5
Hierarchy
DEFINITION 5 A system in which one person is at the top of an organization and there is a ranked or sequential ordering from the top down
Chain of Command
The line of authority that moves from the top of the hierarchy to the lowest level TERM 7
Bureaucracy
DEFINITION 7 An organization with many layers of managers who set rules and regulations and oversee all decisions TERM 8
Decentralized Authority
DEFINITION 8 When decision-making is delegated to lower-level managers and employees more familiar with local conditions than headquarters TERM 9
Centralized Authority
DEFINITION 9 When decision-making is concentrated at the top level of management TERM 10
Span of Control
DEFINITION 10 The optimal number of subordinates a manager supervises or should supervise. When work is standardized, broad spans of control are possible. Appropriate span narrows at higher levels of the organization. The trend today is to reduce middle managers and hire better low-level employees
Staff Personnel
Employees who advise and assist line personnel in meeting their goals, and include marketing research, legal advising, IT and human resource employees TERM 17
Matrix Organization
DEFINITION 17 Specialists from different parts of the organization work together temporarily on specific projects, but still remain part of a line-and-staff structure. Emphasis is on product development, creativity, teamwork, and communication TERM 18
ADVANTAGES of the MATRIX STYLE
DEFINITION 18 Managers have flexibility in assigning people to projects Inter-organizational cooperation and teamwork is encouraged Creative solutions to product development problems are produced Efficient use of organizational resources TERM 19
DISADVANTAGES of the MATRIX STYLE
DEFINITION 19 Its costly and complex Employees may be confused about where their loyalty belongs Good interpersonal skills and cooperative employees are a must Its a temporary solution to a possible long-term problem Teams are not permanent TERM 20
Cross-Functional Self-Managed Teams
DEFINITION 20 Groups of employees from different departments who work together on a long-term basis A way to fix the problem of matrix-style teams is to establish long-term teams Empower teams to work closely with suppliers, customers and others to figure out how to create better products
Benchmarking
Compares an organizations practices, processes and products against the worlds best TERM 22
Core Competencies
DEFINITION 22 The functions an organization can do as well as or better than any other organization in the world. Virtual corporations are one result of a focus on core competencies TERM 23
Restructuring
DEFINITION 23 Redesigning an organization so it can more effectively and efficiently serve its customers (we fear change!) TERM 24
Inverted Organization
DEFINITION 24 An organization that has contact people at the top and the CEO at the bottom of the organizational chart TERM 25
Organizational or Corporate Culture
DEFINITION 25 The widely shared values within an organization that foster unity and cooperation to achieve common goals
