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Chapter 2

MARK 201 Chapter 2: Notes 2

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MARK 201
Steven Laing

Organizational Structure • The formal arrangement of jobs within an organization. Organizational Design A process involving decisions about six key elements: 1. Work specialization 2. Departmentalization 3. Chain of command 4. Span of control 5. Centralization and decentralization 6. Formalization Work Specialization • The degree to which tasks in the organization are divided into separate jobs with each step completed by a different person. • Overspecialization can result in human diseconomies from boredom, stress, poor quality, increased absenteeism, and higher turnover. Departmentalization • Functional Grouping jobs by functions performed • Product Grouping jobs by product line • Geographical Grouping jobs on the basis of territory or geography • Process Grouping jobs on the basis of product or customer flow • Customer Grouping jobs by type of customer and needs Chain of Command • The continuous line of authority that extends from upper levels to the lowest levels of the organization and clarifies who reports to who. • Authority The rights inherent in a managerial position to tell people what to do and to expect them to do it. • Responsibility The obligation or expectation to perform. • Unity of Command The concept that a person should have one boss and should report only to that person. Span of Control • The number of employees who can be eff
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