Organizational structure Flashcards
organizational structure:
Formally dictates how jobs and tasks are divided and coordinated between individuals and groups within the company.
organizational chart
A drawing that represents every job in the organization and the formal reporting relationships between those jobs.
Work specialization
Represents the degree to which tasks in an organization are divided into separate jobs.
Chain of command
Answers the question of who reports to whom and signifies formal authority relationships.
Span of control
Represents how many employees each manager in the organization has responsibility for.
- narrow span of control: allows managers to be much more hands on with employees using directive leadership styles while developing close mentoring relationships
Centralization
Refers to where decisions are formally made in organizations.
Centralization
Refers to where decisions are formally made in organizations.
Formalization
Represents the degree to which rules and procedures are used to standardize behaviors and decisions in an organization.
mechanistic organizations:
Efficient, rigid, predictable, and standardized organizations that thrive in stable environments
- High levels of formalization
- A rigid and hierarchical chain of command
- High degree of work specialization
- Centralization of decision making.
- Narrow spans of control.
Organic organizations:
Flexible, adaptive, outward-focused organizations that thrive in dynamic environments.
- Low levels of formalizations
- Weak or multiple chains of command
- Low levels of work specialization
- Wide spans of control
- decentralized decision making
Organizational design:
The process of creating, selecting, or changing the structure of an organization.
Business environment:
The outside environment, including customers, competitors, suppliers, distributors, and other factors external to the firm, which all affect organizational design.
Whether it is stable or dynamic.
stable business environment
Don’t change frequently and any changes that do occur happen slowly.
Allow organizations to focus on efficiency and require little change over time.
dynamic business environment
Change on a frequent basis and require organizations to have structures that are more adaptive.
low cost producer (company strategy)
Focus on selling products at the lowest possible cost.
Need to focus on being as efficient as possible.
Mechanistic approach to organizational design.
Differentiator:
Focusing on creating a product that is unique.
Higher level of quality or offers features a low cost product doesn’t
Hinges on adjusting to a changing environment quickly, which tends to make an organic structure more appropriate.
Technology:
The method by which an organization transforms inputs to outputs.
More routine the tech → mechanistic
If technologies need to be changed or altered → organic structure.
Company size:
The number of employees in a company.
As organizations become larger, they need to rely on some combination of specialization, formalization, and centralization to control their activities, thereby becoming more mechanistic in nature.
Simple structure:
An organizational form that features one person as the central decision-making figure.
- more than 80% of employing organizations have fewer than 19 employees and have a simple structure
Bureaucratic structures:
An organizational form that exhibits many of the facets of a mechanistic organization
- High levels of work specialization.
- High level of Formalization
- High level of centralization of authority
- Rigid and well defined chains of command.
- Narrow spans of control.
Functional structure:
- An organizational form in which employees are grouped by the functions they perform for the organization.
- Ppl of the same skills are grouped together.
Multidivisional structure:
An organizational form in which employees are grouped by product, geography, or client
Product structure:
An organizational form in which employees are grouped around different products that the company produces
Geographic structure:
An organizational form in which employees are grouped around the different locations where the company does business
Client structure:
An organizational form in which employees are organized around serving customers.
Matrix structure:
A complex form of organizational structure that combines a functional and multi-divisional grouping
