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Chapter 8.docx

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University of Toronto Scarborough
Management (MGT)
Chris Bovaird

Chapter 8 Organizational structure the specification of the jobs to be done within a business and how those jobs relate to one another The Chain of Command Organizational charts a physical depiction of the company`s structure showing employee titles and their relationship to one another. Figure 8.1 on page 111 Chain of command reporting relationships within a business; the flow of decision making power in a firm. The Building Blocks of Organizational Structure Specialization: Determining who will do what Departmentalization determining how people performing certain tasks can best be grouped together Specialization Job specialization the process of identifying the specific jobs that need to be done and designating the people who will perform them. For example making a profit by manufacturing and selling men`s and boys` shirts Specialization and Growth In a small organization manager performs every job As firms grow so does the need of specialization jobs so that others can perform them When you start up a business the owner buys everything for the company out of their own investment. When a business grows it becomes too much of a job for one person. Thus the job that was once made by one owner is increasingly broken down into components and assigned to different individuals Advantages: individual job can be performed more efficiently, the jobs are easier to learn, and it is easier to replace people who leave the organization If job description is narrow them people get bored, derive less satisfaction from their jobs, and often lose sight of how their contributions fit into the overall organization Departmentalization Departmentalization the process of grouping jobs into logical units Profits centre a separate company unit responsible for its own costs and profits. For example men`s clothing-sears can decide whether to expand or curtail promotions in that area. Managers do not group randomly. They group them logically. In general, departmentalization may occur along functional, customer, product, geographic, or process lines ESATABLISHING THE DECISION-MAKING HIERARCHY The development of this hierarchy generally results from a three-step process: 1. Assigning tasks: determining who can make decisions and specifying how they should be made 2. Performing tasks: implementing d
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