4 pom kc 13 sep. 2010
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TRANSCRIPT
PRINCIPLES OF MANAGEMENT
ORGANISING
Chain of Command
A R
AUTHORITY < RESPONSIBILITY
Chain of Command
A R
AUTHORITY > RESPONSIBILITY
A R
Chain of Command
AUTHORITY = RESPONSIBILITY
Concepts in organizing
Purpose of a structure Formal & informal structures Narrow & wide span of control Departmentalization Line & Staff Delegation - decentralization
Purpose of the Structure
Defines relationships between tasks and authority
Defines formal reporting relationships, levels of hierarchy, span of control
Defines individual departments Defines systems that affects the organization
Formal System
Planned structure Lines of responsibility, authority, and
position Establish patterned relationships among
components Can be described through:
Organizational ChartPolicy ManualDepartments
Based on needs, sentiments, and interests of people
Vulnerable to expediency, manipulation and opportunism
More subtle and invisible in the organizational chart
Can be classified as:Horizontal = same department or same levelVertical = different levelsMixed = combination of both
Informal System
Formal vs Informal Organizations
FORMAL INFORMAL
Have planned structure Deliberate attempts to
create patterned relationships
Usually shown by a chart
Advocated by traditional theory
Not formally planned Arise spontaneously as
a result of interactions Not depicted in a chart Stressed by human
relation theory
Span of Control
Span of 8
(Classical)
Span of 4
(Contemporary)
Classical Viewpoint
SPAN OF 8
Base level = 4096
Managers (levels 1-4)
= 585
1
8
64
512
4096
Contemporary Viewpoint
1
4
16
64
256
1024
4096
SPAN OF 4
Base level = 4096
Managers (levels 1-6)
= 1365
Departmentalization
Putting specialists together Direction of a manager Departmentation
ProcessSetting up and establishing departments
Departmentalization
Can be done by:FunctionGeography / TerritoryCustomersProductFlexibility (Matrix)SBUsVirtual
Organizing Process
Identify Activities
Selling
Accounting
Delivery
Quality Control
Advertising
Compensating
Training
Production
Purchasing
Budgeting
Recruitment
Maintaining Personnel
Classify Activities in Departments
>Selling>Advertising>Delivery
>Production>Purchasing>Quality control
>Accounting>Budgeting>Compensating
>Recruitment>Training>Maintaining personnel
MARKETING OPERATIONS FINANCEHUMAN
RESOURCES
Matrix Structure
Represents the most fluid system – dots are individuals or groups
Can function on different levels according to the requirements of the task – project
Matrix structure
Pluses (loaning employees) Allows to share information more readily
across task boundaries Allows for specialization that can increase
depth of knowledge
Minuses: Employees can get confused – conflicting
loyalties
To overcome: managers/parties must work closely together
Centralization & Decentralization
Centralization & Decentralization
CENTRALIZATIONDECENTRALIZATIO
N
Environment is stable Environment is complex, uncertain
Lower level managers (LLM) are not as capable or experienced at making
decisions as upper level mangers
LLM are capable and experienced a making decisions
LLM do not want to have a say in decisions
LLM want a voice in decisions
Decisions are significant Decisions are relatively minor
CENTRALIZATIONDECENTRALIZATIO
N
Organization is facing a crisis or the risk of company failure
Corporate culture is open to allowing managers to have a say in what
happens
Company is large Company is geographically dispersed
Effective implementation of company strategies depends on managers retaining say over what happens
Effective implementation of company strategies depends on managers
having involvement and flexibility to make decisions