MGM101H5 Lecture 9: ORGANISING

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7 Nov 2018
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November 7,2018
MGM101
PROF. DAVE SWANSTON
LECTURE- ORGANIZING
organization architecture: refers to totality of firm’s organization, including formal
organization structure, control system , incentive programs, culture In the organization and
its people
organization structure”: refers to :
Location of decision making responsibilities in the firm , that is , centralisation and
decentralisation
Formal division of organization into subunits such as functions, product divisions and
national operations
establishment of integrating mechanisms coordinating the activities of subunits
“organizational culture”: refers to values shared by people in the organization.
Dimensions of organization structure:
Vertical differentiation:
location of decision making responsibilities within the organization
numbers of layers in a hierarchy
Horizontal differentiation:
Formal divisions of the organisation into subunits
Integrating mechanisms:
Coordination of subunits
Centralization and decentralization:
Vertical differentiation tells where does the decision making power in the hierarchy lies
Centralization: is concentration of power at higher level in hierarchy
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