The formal reporting relationships within an organization, including the number of levels in the hierarchy and the span of control of managers and supervisors: 2. The grouping of individuals into departments and the fit of the departments into the organization as a whole: 3. One disadvantage of formalization is that it may prevent members from responding to problems in an effective way, especially when the problem is not one that was anticipated by the rule makers. People with similar abilities working together on specialized tasks for major forms of departmentalization: 1. Function: departments are set up in our organization according to the function being carried out ex. Process: people and jobs are grouped together which is needed to implement a certain process ex. Departments organized around machines or data processing equipment: 3. Location: segregation by territories, regions, districts, or countries: 4. Product or service: the grouping of jobs and activities that are associated with the specific product: 5.