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Management (MGT)
H Laurence

MGTA03 CHAPTER 8 11242011 81800 AM All businesses have common structural and operating components how these components look and fit together varies from company to companyOrganizational structure the specification of the jobs to be done within a business and how those jobs relate to one anotherEvery company must develop the most appropriate structure for its own unique situation THE CHAIN OF COMMAND Organization chart a physical depiction of the companys structure showing employee titles and their relationship to one anotherChain of command reporting relationships within a business the flow of decisionmaking power in a firmWhen this is unclear many problems can resultThe first step in developing the structure of any business is twofold 1 Specialization determining who will do what 2 Departmentalization determining how people performing certain tasks can best be grouped together SPECIALIZATIONIn a very small organization the owner may perform every jobJob specialization the process of identifying the specific jobs that need to be done and designating the people who will perform them o Natural part of organizational growth neither a new idea nor limited to factory work o Has advantages individual jobs can be performed more efficiently the jobs are easier to learn it is easier to replace people who leave the organization o Disadvantages if it is carried too far and jobs become too narrowly defined people get bored derive less satisfaction from their jobs and often lose sight of how their contributions fit into the overall organizationDEPARTMENTALIZATION Departmentalization the process of grouping jobs into logical units
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