Chapter 8: Structuring Organizations for Today's Challenges Flashcards
division of labor
splitting up the workload of a company
job specialization
dividing tasks into smaller jobs
departmentalization
separating workers by their jobs in order to complete tasks within a (smaller democratic organization)
organization chart
a way to organize worker’s tasks and see who is every person within a company reports to.
Advantages of departmentalization
-workers can master the skills in their area
-centralizing resources can help to easily locate various experts in particular areas (economies of scale=company maximizes profits and creates production efficiency)
Disadvantages of departmentalization
-department may start to act on its own, not communicate effectively (isolation)
-employees may identify with the department’s goals rather than the entire corporation’s
-companies response to external change could be slow (communication and specialization of jobs)
-become narrow specialists
-members of the group mainly share the same opinions (groupthink)
economies of scale
companies reduce their production costs if they purchase their materials in bulk: average cost of goods decreases as the production level increases
bureaucracy
system of organization where ultimate decisions are made by the highest level of authority (state officials choose rather than elected officials)
Fayol’s Principles of Organization
-unity of command: report of a boss
-hierarchy of authority: who responds to who
-division of labor
-subordination of individual interest to the general interest (working as a unit and compromising for the group)
-authority: respect and authority are related
-degree of centralization: more of a flat (decentralized) or steep decision making system
-clear communication channels
-order: how materials and people are maintained in a proper location
-equity: is it just and respectful to people?
-espirt de corps: spirit of pride and loyalty among workers (managers can enfore their orders)
Max Weber
-German sociologist and economist
-proposed that there should be a triangle organizational system for the workplace
-believed that managers should be at the brute of the decision-making assuming that employees were underskilled and uneducated
-principle resmebled Fayol’s
What did Max Weber emphasize for workplace organization
-job descriptions
-written rules, decision guidelines, and detailed records
-consistent procedures, regulations, and policies
-staffing and promotion based on qualifications
chain of command
line of authority moving in descending order (highest to lowest) -buracrat=middle manager whose function=implement top manager’s orders
span of control
optimal number of employees a manager supervises or should supervise
tall organizational structures
more of a centralized system of decision making due to the variety of management levels
flat organizational structures
has few layers and there is a broad span of control (less official managements over people)
4 ways to structure an organization
-line organization
-line-and-staff organizations
-matrix-style organizations
-cross-functional self-managed teams
line organization
-direct bureaucratic authority over said people, follows Fayol’s management rules, and it pretty it’s inflexible
line personnel
responsible for achieving the corporation’s organizational goals (distributional, production, and marketing workers)
staff personnel
responsible for helping line personnel to achieve their goals. (assists through legal advising, information technology and human resources management)
matrix-style organization
a temporary work relationship of specialists from departments to complete a specific project, still use a line-and-staff organization structure
Advantages and Disadvantages of Matrix-style organizations
A:
-task assignment flexibility
-encourages inter-organizational cooperation and teamwork
-produce creative solutions to product development problems
-efficient use of organizational resources
D:
-costly and complex
-confusion among employees about where to draw the line for authority
-the need for strong interpersonal skills to avoid communication problems
-temporary to solutions to a long-term problem
cross-functional self-managed team
groups of employees from different departments who work permanently together
-if it includes suppliers, customers, and distributors=it goes beyond the organization boundaries
virtual corporation
-temporary networked organized made up of replaceable firms that join and leave and needed (form of communication)
benchmarking
comparing an organization’s practices, processes, and products against the world’s best (company’s competitiveness)
core competencies
what functions that a company can do well or the best in the world
digital natives
those who grew up utilizing the internet and newer forms of technology who may not be susceptible to a learning curve
inverted organization
-employees lead the decision making of a company and feel empowered to do so by management
-executive officer is at the bottom of the pyramid and will only intervene when it is necessary
organizational culture
widely shared values of an organization that creates unity and cooperation
formal organization
system that details the lines of authority, responsibility, and position
informal organization
system that develops spontaneously as employees form relationships and authority separates from a formal organization
networking
establishing connections (ex: via technology) between personnel and organizations to allow them to work towards a common objective
extra information to know
-regardless of the size of an organization, the principles are similar
-important decisions to be made in developing a business: degree of centralization, departmentalization, and span of control (increase this)
-hybrid organization: combines departmentalization techniques/marketing department organized geographically and a production process organized by function
-real time is the present moment or the actual time when something takes place
-corporations should have mutual trust
