OB With Park: Org. Structure

Defines how jobs are formally divided, grouped, and coordinated.

work specialization chain of command span of control centralization and decentralisetion formalization

The degree to which activities in the organization are subdivided into separate jobs Highly specialized jobs

lack variety

work efficiency

o Extreme job specialization adversely affects employee attitudes and motivation. o Job specialization often reduces work quality because employees see only a small part of the process. o As work becomes specialized, it tends to become easier to perform but less interesting. Maximum job performance occurs somewhere between the two extremes.

A line of authority that extends from the top of the organization to the lowest echelon and clarifies who reports to whom

• Not agile for coordination in complex situations • More supervisors and layers of management result in a costly bureaucracy. • Less autonomy for employees

= How many employees can a manager efficiently and effectively direct? Determines the number of levels and managers an organization has. Narrow spans of control (= tall organizational structures)

• Can maintain close control • Encourages overly tight supervision and discourage employee autonomy and empowerment. • Taller organizations are expensive.

The added levels of hierarchy slow down decision making. The trend in recent years has been toward wide spans of control (flatter structures). But if supervisors have too many employees to provide leadership and support, effectiveness will decrease.

employees perform routine jobs because there is less frequent need for direction or advice from supervisors.

employees perform nonroutine tasks. AND WHEN employees perform highly interdependent work with others because: o Employees experience more conflict, which requires more supervision to resolve it.

an organization's productivity.

= The degree to which decision making is concentrated at a single point in the organization

• = Top managers make all the decisions, and lower-level managers merely carry out their directives.

• = Decision making is pushed down to the mangers closest to the action.

the founder makes most of the decisions.

• organizations can be more flexible and responsive, act more quickly to solve problems • employees feel more engaged in the decision making

Standardizing work activities through job descriptions and procedures.

o Employees have a minimal amount of discretion over what to do and when and how to do it. • Rules and procedures reduce organizational flexibility o Undermines organizational learning and creativity

Mechanistic structure and organic structures

Environment Company strategy technology company sze employees skills

o Mechanistic structures operate better in stable environments because they rely on efficiency and routine behaviors.

Rely on selling products at the lowest possible cost and being as efficient as they can

Focus on providing high quality or unusual products and adapting to their environment quickly

o Organic structures work better in rapidly changing (= dynamic) environments because they are more flexible and responsive to changes.

is perferred - Organizations engaged in routine technology

Organizations engaged in non-routine technology Organic structure is preferred.

As the number of employees increases, job specialization increases, which in turn requires more elaborate coordinating mechanisms.

o Thus larger firms make greater use of standardization to coordinate work activities. o These coordinating mechanisms create an administrative hierarchy and greater formalization.

Organic structures work better than mechanistic structures only when employees have high levels of experience and expertise. o Without these conditions employees are unable to coordinate effectively with one another.

simple struture functional structure Divistional structure Matrix structure

= Specifies how employees and their activities are grouped together

= A drawing that represents every job in the organization, and the formal relationship between jobs

Most companies, including Merritt's Bakery, begin with a simple structure. The manager and owner are the same.

Minimal hierarchy Flexible Depends on the owner's direct supervision to coordinate work activities

Simple, fast, flexible, inexpensive to operate

Is very difficult to operate as the company grows and becomes more complex.

= Groups employees around their skills and specialized pools of talent

Increases employee identity with the specialization Direct supervision is easier because managers oversee people with issues and expertise.

Grouping employees around their skills tends to focus attention on those skills rather than on the company's product, service, or client needs. Employees might not develop a broader understanding of the business. Usually produces higher dysfunctional conflict and poorer coordination in serving clients or developing products

Groups employees around geographical areas, outputs (products or service), or clients

geaographic disvisional product/service divistional client divistional

Organizes employees around distinct regions of the country or world Best structure if an organization has one type of product and customers have different needs across regions

Organizes employees around distinct outputs Best structure if the company sells several types of products and customer preferences are similar everywhere

Organizes employees around specific customer groups

Aims to gain the benefits of both functional and divisional structures (or project-based structures)

Functional structure head Divisional structure head

Encourages knowledge sharing • Improves communication efficiency, flexibility, and innovation Closer coordination • Resources are used more efficiently. • Focuses employees on serving clients or creating products yet keeps people organized around their specialization

Increases conflict between managers who equally share power. Because of the existence of two bosses, accountability may be blurred.

the easier people blame some else. and High stress levels for employees because of a dual chain of command