Management 13th edtion by schermerhorn bachrach chapter 11
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11
John R. Schermerhorn, Jr.
Daniel G. Bachrach
Management
13th edition
CHAPTER 11
ORGANIZATIONAL
STRUCTURES AND DESIGN
PLANNING AHEAD — KEY TAKEAWAYS
Describe
organizing as a management function
and the difference between formal and informal
organization structures.
Identify the traditional organizational structures,
and the strengths and weaknesses of each.
Identify newer horizontal organizational structures,
and the strengths and weaknesses of each.
Explain how organizational designs are changing
in the modern workplace.
Copyright ©2015 John Wiley & Sons, Inc.
CHAPTER 11 OUTLINE
1.
Organizing as a Management Function
a)
b)
c)
2.
What is organization structure?
Formal structures
Informal structures
Traditional Organization Structures
a)
b)
c)
Functional structures
Divisional structures
Matrix structures
Copyright ©2015 John Wiley & Sons, Inc.
CHAPTER 11 OUTLINE
3.
Horizontal Organization Structures
a)
b)
c)
4.
Team structures
Network structures
Boundaryless structures
Organizational Designs
a)
b)
c)
Contingency in organizational design
Mechanistic and organic organization
designs
Trends in organizational designs
Copyright ©2015 John Wiley & Sons, Inc.
ORGANIZING AS A MANAGEMENT
FUNCTION
Organizing
as a management function
Organizing
Arranges people and resources to work together to
accomplish a goal
Organization
structure
The system of tasks, reporting relationships, and
communication linkages
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FIGURE 11.1 ORGANIZING VIEWED IN
RELATIONSHIP WITH THE OTHER
MANAGEMENT FUNCTIONS
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ORGANIZING AS A MANAGEMENT
FUNCTION
An
organization chart is a diagram describing
reporting relationships and the formal
arrangement of work positions within an
organization. It includes:
The division of work
Supervisory
relationships
Communication
channels
Major subunits
Levels of management
Copyright ©2015 John Wiley & Sons, Inc.
ORGANIZING AS A MANAGEMENT
FUNCTION
Informal
structures
The
set of unofficial relationships between
organization members
Social network analysis
Identifies informal structures and social
relationships in the organization
Copyright ©2015 John Wiley & Sons, Inc.
ORGANIZING AS A MANAGEMENT
FUNCTION
Informal
structures and social networks
Potential
advantages of informal structures:
Allow people to make contacts with others who can
help them get things done
Stimulate learning as people work and interact
together
Sources of emotional support and friendship that
satisfy members’ social needs
Copyright ©2015 John Wiley & Sons, Inc.
ORGANIZING AS A MANAGEMENT
FUNCTION
Potential disadvantages of informal structures:
Presence of
“In and out
groups”
Susceptibility
to rumor
May carry
inaccurate
information
May breed
resistance to
change
Diversion of
work efforts
from
important
objectives
Feeling of
alienation by
outsiders
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TRADITIONAL ORGANIZATION
STRUCTURES
Traditional
Functional
organization structures
Divisional
Matrix
Copyright ©2015 John Wiley & Sons, Inc.
TRADITIONAL ORGANIZATION
STRUCTURES
Functional
structures
People
with similar skills and performing
similar tasks are grouped together into formal
work units
Members work in their functional areas of
expertise
Are not limited to businesses
Work well for small organizations producing
few products or services
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FIGURE 11.2 FUNCTIONAL STRUCTURES IN A
BUSINESS, BRANCH BANK, AND COMMUNITY
HOSPITAL
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TRADITIONAL ORGANIZATION
STRUCTURES
Potential
advantages of functional
structures:
Economies
of scale
Task assignments consistent with expertise
and training
High-quality technical problem solving
In-depth training and skill development
Clear career paths within functions
Copyright ©2015 John Wiley & Sons, Inc.
TRADITIONAL ORGANIZATION
STRUCTURES
Potential disadvantages of functional structures:
Difficulties in pinpointing
responsibilities
Functional chimneys
problem
• Sense of cooperation and common
purpose break down
• Narrow view of performance
objectives
Copyright ©2015 John Wiley & Sons, Inc.
TRADITIONAL ORGANIZATION
STRUCTURES
Divisional
structures
Group
together people who work on the same
product or process, serve similar customers,
and/or are located in the same area or
geographical region
Common in complex organizations
Avoid problems associated with functional
structures
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FIGURE 11.3 DIVISIONAL STRUCTURES BASED ON
PRODUCT, GEOGRAPHY, CUSTOMER, AND
PROCESS
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TRADITIONAL ORGANIZATION
STRUCTURES
Potential
advantages of divisional
structures:
More
flexibility in responding to environmental
changes
Improved coordination
Clear points of responsibility
Expertise focused on specific customers,
products, and regions
Greater ease in restructuring
Copyright ©2015 John Wiley & Sons, Inc.
TRADITIONAL ORGANIZATION
STRUCTURES
Potential disadvantages of divisional structures:
Duplication of
resources and
efforts across
divisions
Competition and
poor
coordination
across divisions
Emphasis on
divisional goals
at expense of
organizational
goals
Copyright ©2015 John Wiley & Sons, Inc.
TRADITIONAL ORGANIZATION
STRUCTURES
Matrix structure
Combines
functional and divisional structures
to gain advantages and minimize
disadvantages of each
Used in:
Manufacturing
Service industries Professional fields Non-profit sector
Multi-national
corporations
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FIGURE 11.4 MATRIX STRUCTURE IN A
SMALL, MULTI-PROJECT BUSINESS FIRM
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TRADITIONAL ORGANIZATION
STRUCTURES
Potential
advantages of matrix structures:
Better
cooperation across functions
Improved decision making
Increased flexibility in restructuring
Better customer service
Better performance accountability
Improved strategic management
Copyright ©2015 John Wiley & Sons, Inc.
TRADITIONAL ORGANIZATION
STRUCTURES
Potential disadvantages of matrix structures:
Two-boss
Two-boss
system can
Team
system is
create task
meetings are
susceptible to confusion and
time
power
conflict in
consuming
struggles
work
priorities
Team may
develop
“groupitis ”
Increased
costs due to
adding team
leaders to
structure
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HORIZONTAL ORGANIZATION
STRUCTURES
Team
structures
Extensively
use permanent and temporary
teams to solve problems, complete special
projects, and accomplish day-to-day tasks
Often use cross-functional teams composed
of members from different functional
departments
Project teams are convened for a specific
task or project and disbanded once
completed
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FIGURE 11.5 HOW A TEAM STRUCTURE USES
CROSS-FUNCTIONAL TEAMS FOR IMPROVED
LATERAL RELATIONS
Copyright ©2015 John Wiley & Sons, Inc.
