ORGANIZING
What I need to know?
AFTER PLANNING, organizing follows. The goals and objectives established
during planning will all go to waste without effective organizing, through the
development of a designed structure of roles for effective performance. It requires an
interlacing of decision and communication work units to coordinate efforts toward the
organizational goals and objectives that were set in planning. To function well,
organization structures and their specific roles must be understood by all members
of the organization. Rules and regulation principles must also be put into practice.
However, that organizing depends on the specific situation of the firm.
You will be able to:
(1) Analyze the nature of organizations and types of organization structures; and
(2) Apply organization theories for effective business management.
Organization
A group of individuals who are interacting with each other.
A cooperative and healthy relationship amongst the groups
Organizing
A process of ensuring healthy relationship among the department.
It is the process of arranging and allocating work, authority, and resources
among an organization’s members so that they can achieve organizational goal
Process of Organizing
Division of Work
This involves assigning different tasks to different people in the organization’s
different work units. Related to it is specialization, the process in which different
individuals and units perform different tasks.
Integration of Work
Integration is another process in the organization’s internal environment which
involves the collaboration and coordination of its different work units or work
divisions
Delegation of Authority
This refers to assigning in a new or additional task to a subordinate; or getting
the work done through others by giving them the right to make decisions or take
action
Elements of Delegation:
- authority or the right to set officially or legally
- responsibility or the state of being answerable legally/morally for the
discharge of a duty
- accountability is to be liable to be called to explain.
Coordination of Work
Coordination refers to the procedures that connect the work activities of the
different work divisions/units of the firm in order to achieve its overall goal.
Types of Organization Structures
An organization structure is a system made up of tasks to be accomplished, work
movements from one work level to other work levels in the system, reporting
relationships, and communication passageways that unite the work of different
individual persons and groups.
a. vertical structure
b. horizontal structure
c. network structure
Vertical Organization Structure
q Clears out issues related to authority rights, responsibilities, and reporting
relationships
q Has a structure with power emanating from the up to down.
q Well- defined chain of command.
q Employees report to the person directly above them.
Advantages
1. It have clear lines of authority, with quicker decision making and better designation
of tasks to employees.
2. Staffs have well-defined roles and responsibilities, which reduces duty ambiguity
and encourages high production efficiency.
3.For employees who are seeking for a job promotion, there is a clear path to career
planning.
4. Employees are motivated to work hard to achieve a higher level.
Disadvantages
1. Due to the lack of autonomy, employees from the bottom may have lots of
limitations to share their constructive ideas or creative proposals.
2. It is likely to be rigid, which might hamper the company from accepting innovative
concepts and trap a company in outdated techniques.
3. Because of multiple layers of powers, it will take more time to respond a problem
or implementing decisions
Horizontal Organization Structure
q Refers to a selection of independent, usually single-function organizations that
work together to produce a product or service.
q Refers to the departmentalization of an organization into smaller work units as
tasks become increasingly varied and numerous.
Network structure
q It is a collection of independent, usually single function
organizations/companies that work together in order to produce a product or
service
q They are capable of doing their own specialized work activities independently,
like producing, distributing, designing, etc., but are capable of working
effectively at the same time with other network members
Types of Department
Line Departments – deal directly with the firm’s primary goods and services;
responsible for manufacturing, selling, and providing services to clients.
Staff departments – support the activities of the line departments by doing
research, attending to legal matters, performing public relations duties, etc.
3 Approaches in Departmentalization
Functional approach – where the subdivisions are formed based on specialized
activities such as marketing, production, financial management, and human
resources management.
Divisional approach – where departments are formed based on management of
their products, customers, or geographic areas covered.
Matrix approach – is a hybrid form of departmentalization where managers and
staff personnel report to the superiors, the functional manager, and the divisional
manager.
