CHAPTER 7 Flashcards
(17 cards)
Organising can be defined as
combining activities in an orderly
manner so that goals that were set out in planning can be achieved.
THE Organising function INCLUDES…
classifying activities, allocating activities to
specific divisions, creating job roles in these divisions, assigning
employees the applicable responsibilities for their specific jobs and
giving them the necessary authority to help execute plans.
Why is organising important?
• It clarifies who reports to whom and a person’s
responsibility.
• It makes employees accountable for their actions.
• It divides the total workload into divisions, and clarifies
what activities should be performed by whom.
• It creates synergy since everyone knows what his or her role
is.
• It enhances efficient resource deployment.
• Departmentalisation is created - ensuring that people with
the needed skills perform specific assigned duties.
• It ensures coordination which results in activities taking
place in harmony
• Increase in size of the organisation = increase in the complexity of managing the organisation.
• Organising simplifies management
• Organising must be seen as an ongoing process throughout the organisation through which managers create structure in the organisation
Basic elements of organising
– Specialisation
– Division of work (see video)
– Centralisation and decentralisation (see video)
– Authority
– Chain of command
– Span of control (see video)
– Coordination
Specialisation
• Work is divided into areas of experience or expertise
to improve how goals are achieved.
• This ensures that employees with distinct skills or
knowledge fit for a specific division
• Through specialisation, jobs are broken down into
steps and each step is completed by a different
person who is fit to do that specific task.
Division of work
• Dividing work into specific divisions will make it easier
to manage a wide variety of products, customers and
geographical areas.
• Creating divisions for work means creating selfmanaging units within an organisation.
• This is also called departmentalisation.
centralisation and Decentralisation
• The way decisions are made, differs from organisation to
organisation.
• Centralised organisation: decision-making authority
remains with top management.
• Decentralised organisation: decision-making power lies
with managers and lower level employees and not solely
with top management. delegation
• As an organisation grows, it may need to decentralise
some of the decision-making power to lower levels of
the organisation.
• Advantages of decentralisation and Drawbacks of decentralisation:
• Advantages of decentralisation:
Faster decision-making.
Quality of decisions improves.
Less workload on top-level management.
Improving the sense of responsibility and initiative amongst lower
level management.
• Drawbacks of decentralisation:
Managers need to be trained more intensively to make decisions
themselves.
Too much decentralisation might cause top management to lose
control over some aspects.
Constant feedback must still be given to top management since
they are still accountable for the decisions being made and goals
being attained.
Basic elements of organising
Authority
= The right to make a decision and act in situations.
• To give authority, responsibility must also be delegated
• With delegated authority, productivity may increase and work
can be coordinated more effectively.
• Different types of authority in organising:
Line authority: Direct right to give orders (top down)
Staff authority: Mid levels. Advise (support), not command
(equal)
Line-and-staff authority: Combined partnership, indirect
support
• Delegation of authority
– Delegation of authority means that a manager assigns
direct authority and responsibility to a subordinate to
complete tasks.
– Successful delegation = Authority + Responsibility +
Accountability.
– Ultimate / final accountability can never be delegated
• Guidelines for effective delegation:
• Set SMART goals and ensure that subordinates support and
understand the goals and their role in it.
• Make it clear what the amount of authority and responsibility is.
• Involve the subordinate in decision-making and daily activities.
• Trust and encourage employees to complete their tasks and
responsibilities on their own.
• Give the needed training to subordinates to empower them to
take responsibility.
• Give regular and accurate feedback to enable the subordinate to
compare his/her performance against the set standard and to
improve his or her actions where needed
Basic elements of organising
Chain of command
• The chain of command = the line of authority that clarifies
who reports to whom throughout the organisation
• An important aspect is unity of command - Unity of
command entails that each employee should have only
one immediate supervisor that he or she is managed by
(only report to 1 boss).
Basic elements of organising
Span of control
= the number of subordinates a supervisor or manager has.
• The larger the span of control in the organisation, the
more efficient (cost effective) the organisation will be.
• The type of work that takes place in an organisation will
determine the span of control needed to be more
effective and efficient.
Key factors that influence the span of control in an
organisation:
– The competence of the managers and the employees
– The complexity of tasks being supervised
– The frequency of new problems in the manager’s
department, and the skills and knowledge of the
manager regarding how to deal with the problems
– The clarity of procedures, rules and standards
– The complexity of the subordinate’s jobs itself
Basic elements of organising
Coordination
• Coordination forms part of structuring the organisation.
• Coordination ensures that the right employees are doing the right job in
the right way and to also avoid duplication.
• Coordination can be seen as an attempt by management to create
congruence through organising.
• Managers should integrate goals and tasks throughout the whole
organisation.
• Departments need each other to share resources, information and work
together towards the common goal of the organisation.
• The bigger the interdependence between departments the more
important effective coordination will be.
Contingency factors influencing the organisational
structure
– Strategy and structure – structure follows strategy
– Size and structure - scale, scope and complexity of operations in an
organisation
– Technology and structure - technology constantly changes the way
organisation operate
– Environmental uncertainty and structure – structure must match the
uncertain environmental situation
– Communication and structure - structure of the organisation must
enable and ensure the fast and efficient flow of information
Organisational designs
• Organisational design refers to the creation of the
organisational structure for the organisation.
• There are a lot of challenges that go along with
organisation design.
• Methods of control must be decided on + coordination
of tasks through the different departments must take
place.
• It is important that managers must re-evaluate the
design of the organisation based on changes in the
environment and technology
Organisational designs Simple structure
• Managers have a very large span of control
• Authority is usually centralized to a single person
• It is oftentimes a flat structure where direct control and
supervision is found.
• It is most widely practiced in smaller businesses where the
coordination of work is easily structured.
• The simplicity of a simple structure makes it easier to predict
and react to changes in the environment and to coordinate
activities within the organisation.
• As the organisation grows bigger, this structure becomes less
effective.
Organisational designs Departmentalisation
• Departmentalisation is created where the activities of
employees are grouped together according to the needed
skills to perform specific assigned duties.
= Organising action where jobs (based on their characteristics
and specific skills required) are grouped together to accomplish organisational goals
Functional departmentalisation - The different business functions or
expertise are the foundation
Product departmentalisation -The specific skill needed to produce
different products form the basis for this form of departmentalisation
Customer departmentalisation - Different customers groups have different
needs
Geographic departmentalisation - Focus is on serving different geographical
areas
Matrix departmentalisation - Combines different departmentalisation
methods
Advantages + disadvantages of functional departmentalisation
Advantages :
-Reducing duplication and directly reduces cost
-Superiors and subordinates have the opportunity to share expertise
-Makes communication and coordination easier
-Centralises decision making
-Allows work done by highly qualified
specialists
Disadvantages:
-Cross-department coordination can be difficult
-Possible conflict regarding product priorities
-May lead to slower decision making
-Manager become specialists in specific fields
-Emphasis is on routine tasks
