Foundations of Organizing

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Chapter 10
Foundations of Organizing Ninth Edition Samuel C.
Certo
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Chapter Objectives(1 of 2)

• An understanding of the organizing function.
• An appreciation for the complexities of
  determining appropriate organizational structure.
• Insights into the advantages and disadvantages of
  division of labor.
• A working knowledge of the relationship between
  division of labor and coordination.
• An understanding of span of management and the
  factors that influence its appropriateness.

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Chapter Objectives(2 of 2)

• 6. An understanding of scalar relationships.

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A Definition of Organizing

• Organizing
• Is the process of establishing orderly uses for
  all resources within the management system.
• A primary focus of organizing is determining both
  what individual employees will do in an
  organization and how their individual efforts
  should best be combined to advance the attainment
  of organizational objectives.
• Organization refers to the results of the
  organizing process.

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An Aside..
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Fayols Guidelines
1. Judiciously prepare and execute the
operating plan 2. Organize the human and
material facets 3. Establish a single competent,
energetic guiding authority 4. Coordinate all
activities and efforts 5. Formulate clear,
distinct, and precise decisions 6. Arrange for
efficient selection 7. Define duties 8. Encourag
e initiative and responsibility 9. Offer fair
and suitable rewards for services
rendered 10. Make use of sanctions against
faults and errors 11. Maintain
discipline 12. Ensure that individual interests
are consistent 13. Recognize the unity of
command 14. Promote both material and human
coordination 15. Institute and effect
controls 16. Avoid regulations, red tape, and
paperwork
16 General Guidelines for Organizational Resources
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The Importance of Organizing

• Organizing
• The organizing function is extremely important to
  the management system because it is the primary
  mechanism managers use to activate plans.
• Organizing creates and maintains relationships
  between all organizational resources by
  indicating which resources are to be used for
  specific activities and when, where, and how they
  are to be used.

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The Organizational Process
The five main steps of the organizing process
Figure 10.1
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The Organizational Subsystem(1 of 2)
Relationships between overall management
system and organizing subsystem
Figure 10.2
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The Organizational Subsystem(2 of 2)
Organizing subsystem
Figure 10.3
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Classical Organizational Theory

• Classical Organizational Theory
• Comprises the cumulative insights of early
  management writers on how organizational
  resources can best be used to enhance goal
  attainment.
• Webers Bureaucratic Model
• Structure
• Authority and responsibility
• Structure and gender
• Formal and informal structure
• Departmentalization and Formal Structure
• A contingency viewpoint

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Sample Organizational Chart
Sample organization chart for a small restaurant
Figure 10.4
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Structure

• Departmentalization and Formal Structure
• The most common method of instituting formal
  relationships among resources is to establish
  departments.
• A department is a unique group of resources
  established by management to perform some
  organizational task.
• The process of establishing departments within
  the management system is called
  departmentalization.
• Functional Departmentalization
• Product Departmentalization
• Geographic Departmentalization
• Customer Departmentalization
• Manufacturing Process Departmentalization

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Functional Departmentalization
Organization structure based primarily on function
Figure 10.5
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Product Departmentalization
Organization structure based primarily on product
Figure 10.6
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Geographic Departmentalization
Organization structure based primarily on
territory
Figure 10.7
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Customer Departmentalization
Organization structure based primarily on
customers
Figure 10.8
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Manufacturing Process Departmentalization
Organization structure based primarily on
manufacturing process
Figure 10.9
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Combined Organizational Chart
Combined organization chart for Greene Furniture
Company
Figure 10.10
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Division of Labor

• Division of Labor
• Is the assignment of various portions of a
  particular task among a number of organizational
  members.
• Division of labor calls for specialization.
• A commonly used illustration of division of labor
  is the automobile production line.
• Rather than having one person assembling an
  entire car, specific portions of the car are
  assembled by various workers.

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Advantages of Division of Labor

• Advantages of Division of Labor
• First, when workers specialize in a particular
  task, their skill at performing that task tends
  to increase.
• Second, workers who have one job and one place in
  which to do it do not lose valuable time changing
  tools or locations.
• Third, when workers concentrate on performing
  only one job, they naturally try to make the job
  easier and more efficient.
• Lastly, division of labor creates a situation in
  which workers need only to know how perform their
  part of the work rather than the entire process
  for producing the end product.

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Span of Management

• Span of Management
• The span of management is the number of
  individuals a manager supervises.
• The more individuals a manager supervises, the
  greater the span of management.
• Conversely, the fewer individuals a manager
  supervises, the smaller the span of management.

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Major Factors That Influence Span of Management
Major Factors that Influence the Span of
Management
Table 10.1
Factor Has Tendency to Increase Factor Has
Tendency to Decrease Factor Span of Management
When Span of Management When 1. Similarity of
functions 1. Subordinates have 1. Subordinates
have similar functions different functions 2.
Geographic contiguity 2. Subordinates are
2. Subordinates are physically close
physically distant 3. Complexity of
functions 3. Subordinates have 3. Subordinates
have simple tasks complex tasks 4.
Coordination 4. Work of subordinates
needs 4. Work of subordinates needs little
coordination much coordination 5.
Planning 5. Manager spends 5. Manager
spends little time planning much time planning
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Height of Organizational Chart

• Flat Organizational Chart
• Is an organizational chart characterized by few
  levels and a relatively broad span of management.
• Tall Organizational Chart
• Is an organizational chart characterized by many
  levels and a relatively narrow span of management.

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Scalar Relationships

• Scalar Relationships
• Refer to the chain-of-command positioning of
  individuals on an organizational chart.
• Unity of Command
• Is the management principle that recommends that
  an individual have only one boss.

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Span of Management

• Span of Management
• The span of management is the number of
  individuals a manager supervises.
• The more individuals a manager supervises, the
  greater the span of management.
• Conversely, the fewer individuals a manager
  supervises, the smaller the span of management.

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Span of Management

• Span of Management
• The span of management is the number of
  individuals a manager supervises.
• The more individuals a manager supervises, the
  greater the span of management.
• Conversely, the fewer individuals a manager
  supervises, the smaller the span of management.