Chapter 8 Lecture

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University of Toronto Scarborough
Management (MGT)
Ingrid L.Stefanovic

Chapter 8 .ppt 01 Laurence, Hugh MGTA03, Lec. 03 Organizing the Business o How is business organized to produce goods and services and sell them o Organizational structure o Specification of the jobs to be done o How those jobs relate to one another o Organization often represented on organization charts o Each box is a job in the business o The boxes are joined to show the chain of command who reports to whom o These charts are ideal representations of the way things are SUPPOSED to work o Business organization is built on o Specialization Determining who will perform specific tasks Each job has ONLY certain tasks Tasks are assigned to those skilled in performing them o Departmentalization Determining how to group specialists o Specialization o Division of labour o Break the various jobs into components o Each component performed by a specialist who is most efficient in that component o Hire specialists most efficiently to carry out the various components o Hiring most efficiently Does not mean one person for each component You need only enough people to carry out those component that must be done at the same time If one person does step 1, and someone else step 2, and no more step 1 operations are required until step 3 is complete, the step 1 specialists can also do step 3, then return to the next round of step 1 o As the business grows, there is more specialization One person cannot handle al the steps There is more demand for each step, so one person specializes in a step and hands over the other steps to someone else o Growth In small businesses, the manager manages and does the accounting
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