BUSI 1800 Chapter Notes - Chapter 9: Total Quality Management
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Chapter 9: Adapting Organizations to Today’s Markets
Decisions to Make in Structuring Organizations:
•Centralized authority is an organization structure in which decision-making authority is
maintained at the top level of management at the company’s headquarters.
Greater top-management control
Consistent brand/corporate image
Less responsive to customers
Lower morale away from headquarters
•Decentralized authority is an organization structure in which decision-making authority
is delegated to lower-level managers more familiar with local conditions than
headquarters management could be.
Better adaption to customer wants
Faster decision making
More empowerment of workers
Complex distribution system
Less top-management control
•Span of control the optimum number of subordinates a manager supervises or should
•Tall organization structures are an organization structure in which the pyramidal
organization chart would be quite tall because of the various levels of management.
•Flat organization structures are an organization structure that has few layers of
management and a broad span of control.
•Departmentalization the dividing of an organization into separate units. This groups
workers according to their skills, expertise, or resource.
Employees can develop skills in depth and can progress within the
Employees can coordinate work within the function, and top management
can easily direct and control various departments’ activities.
Departments may not communicate well.
Employees may identify with their department’s goals rather than the
The company response to external changes may be slow.
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