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MGTA03 Chapter 8.doc

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Management (MGT)
H Laurence

Chapter 8 Organizing the Business Enterprise 1. The elements that influence a firm’s organizational structure. Organizational Structure: The specification of the jobs to be done within a business and how those jobs relate to one another. (Each firm has its own unique situation) Organization chart A physical depiction(묘사) of the company’s structure showing employee titles and their relationship to one another. (Refer to p111 diagram) Chain of Command Reporting relationships within a business; the flow of decision-making power in a firm The first step in developing the structure (for all businesses) - Specialization: Determining who will do what - Departmentalization: determining how people performing certain tasks can best be grouped together. A. Job Specialization: The process of identifying the specific jobs that need to be done and designating the people who will perform them. Job Specialization becomes necessary when the firm grows. Advantages: more efficient, easier to learn, easier to replace. DISA: simple-bored, lose sight of contributions. B. Departmentalization: After jobs are specialized, must be grouped. Advantage: Division of Activities, Control/coordination easier, good view for top managers. This allows firms to treat each department as profit centre [A separate company unit responsible for its won costs and profits]. (Managers group jobs logically: Functional, customer, product, geographic, process line) After specialization/departmentalization -> decision-making hierarchy (Reporting relationships) [who makes which decisions?] 3 steps 1) Assigning tasks: who can make decisions/ and the ways Responsibility: The duty to perform an assigned task. Authority: power to make the decisions necessary to complete a task. 2) performing tasks: implementing decisions made. Delegation: Assignment of a task, a responsibility, or authority by a manager to a subordinate. Fear of Delegation – Because: “Employees can’t do it as well as me” “I haven’t got time to show them how” “They’ll make me look bad if they do it well” Accountability: Liability of subordinates for accomplishing tasks assigned by managers. 3) distributing authority: choose [centralized or decentralized] Centralised Organisations e.g. Military Discipline and obedience are critical Top managers retain most decision-making rights for themselves. Decentralised Organisations e.g. Universities Creativity and independent thinking critical Lower-and middle-level managers are allowed to make significant decisions. (delegated) Tall and Flat organizations Tall organizational structure Many layers of management. (Growth related) Flat organiza
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