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Rotman Commerce (1,103)
RSM100Y1 (287)

chapter 7

9 Pages

Rotman Commerce
Course Code
Stojanovic Dragan

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CHAPTER 7 ORGANIZING THE BUSINESS ENTERPRISEWHAT IS ORGANIZATIONAL STRUCTURE y All businesses have common structural and operating components each of which has a specific purpose y Each component must fulfill its own purpose while simultaneously fitting in with the others y How these components look and fit together varies from company to companythe specification of the jobs to be done within a business and how those y Organizational Structurejobs relate to one another y Every institutionforprofit nonprofit government agency etcmust develop a structure that is appropriate for its own unique situation Determinants of Organization Structure y Managers should carefully assess a variety of important factors as they plan for and then create a structure that will allow their organization to function efficiently but due to busyness in businesses structure may also develop without much planning y Many elements work together to determine an organizations structure major ones being organizations purpose mission and strategy y Size technology and changes in environmental circumstances also effect structure y Even after a structure is created it is rarely free from tinkering or outright recreation y Most organizations change their structures almost continually The Chain of Command y Most businesses prepare organization charts that illustrate the companys structure and show employees where they fit into the firms operations y Look at Organization Chartthe reporting relationship within the company y Chain of Commandy When the chain of command isnt clear many different problems can result THE BUILDING BLOCKS OF ORGANIZATIONAL STRUCTURE The first step in developing the structure of any business large or small is twofold y Specialization determining who will do what y Departmentalization determining how people performing certain tasks can best be grouped togetherThese two tasks are the basic building blocks of all business organizations
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