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Organizing
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What is organizing ?
Is the management function that usually
follows after planning. And it involves the
assignment of tasks, the grouping of tasksinto departments and the assignment of
authority and allocation of resources across
the organization.
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Identify the five basic organizingconcepts.
n Job Specialization creating anddesigning jobs
n
Grouping Jobs - combining jobs intomeaningful categories
n Delegating Responsibility withAuthority
n Establishing Span of Managementn Managing Line and Staff positions
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Importance of Organising
Organisations are often troubled by how to
organise, particularly when a new strategyis developed Changing market conditions or new
technology requires change
Organisations seek efficiencies throughimprovements in organising
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DEPARTMENTATION
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Departmentation
The assignment of jobs to departments is
called departmentation, and it represents
one of the core aspects of the horizontaldivision of labour.
Methods of departmentation include:
Functional, product, matrix, geographic,
customer, and hybrid.
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FUNCTIONAL DEPARTMENTATION
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Functional Departmentation
Employees with closely related skills and
responsibilities are assigned to the same
department. Advantages:
Efficiency.
Enhanced communication.
Enhanced career ladders and training
opportunities.
Easier to measure and evaluate performance.
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Functional Departmentation
Disadvantages: A high degree of differentiation.
Poor communication and slow responseto organizational problems.
Conflicts between departments.
Department empires build at expense of
organizational goals.
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PRODUCT DEPARTMENTATION
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Product Departmentation
Departments are formed on the basis of a
particular product, product line, or service.
Advantages: Better coordination and communication among
functional specialists who work on a particular
product line.
Flexibility.
Departments can be evaluated as profit centres.
Timely response to customers.
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Product Departmentation
Disadvantages: Professional development might suffer.
Economies of scale might suffer. Inefficiency.
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MATRIX DEPARTMENTATION
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Matrix Departmentation
Employees remain members of a functional
department while also reporting to a
product or project manager. Advantages:
Balance.
Flexibility.
Better communication.
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Matrix Departmentation
Disadvantages: Conflict between product or project
managers and functional managers.
Role conflict and stress because
employees must report to two managers.
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GEOGRAPHIC DEPARTMENTATION
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Geographic Departmentation
Relatively self-contained units deliver an
organizations products or services in a
specific geographic territory. Advantages:
Shortens communication channels.
Caters to regional tastes.
Some local control to clients and customers.
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CUSTOMER DEPARTMENTATION
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Customer Departmentation
Relatively self-contained units deliver an
organizations products or services to
specific customer groups. Advantages:
Better service to customers.
The disadvantages of geographic andcustomer departmentation parallel those for
production departmentation.
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SPAN OF
MANAGEMENT
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Span of Management Decentralization - structure in which power and
control are systematically delegated to lowerlevels in the organization.
Span of Management - number of subordinateswho report directly to a manager. Affects the total
number of relationships within an organization.
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Types of Relationships
Direct - supervisor over subordinates
Cross - relationships among
subordinates
Group - relationships between groups ofsubordinates
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Factors that Influence theSpan of Management
Competence of Manager
Competence of Subordinates
Staff Assistance
Activities Performed
Physical Dispersion
Performance Standards
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Narrow and Wide Spans of Control
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Situational Determinants of Span of Control
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AUTHORITY &
RESPONSIBILITY
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Authority - formal and legitimate right of amanager to make decisions, issue orders, andallocate resources to achieve organisationally
desired outcomes. Responsibility - duty to perform the task or
activity an employee has been assigned Accountability - the fact that the people with
authority and responsibility are subject toreporting and justifying task outcomes to thoseabove them in the chain of command
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Allocating FormalAuthority Where is decision-making power in the organization? Centralization = authority to make decisions is restricted
to higher levels of management
Preferred when facing a major threat Decentralization = authority to make decisions is given
to lower levels in an organizations hierarchy Leads to higher satisfaction in subordinates, quicker
response to problems, easier training for promotion Linked to idea of participation; many want to be
involved in decisions that affect their work
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Types of Authority
Line Authority - right to direct the work of
others and to require them to conform to
decisions, rules, policies, and goals.
Functional Authority - special right authorized
by Top Executive to a staff position based on
specialized knowledge, expertise, position(e.g. Legal Counsel)
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DELEGATION
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Effective Delegation
Delegation
Assigning various degrees of decision-making
authority to lower-level employees.
The Advantages of Delegation Frees up managerial time for other important tasks.
Serves as a training and development tool for lower-
level managers.
Increases subordinates commitment by giving them
challenging assignments.
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Review the need for delegation withresponsibility and authority
Delegation- process of assigning tasks and
responsibilities to subordinates.
Three aspects of delegation: Responsibility - assigning a task to a subordinate.
Authority - granting the subordinate the necessary power
to complete the task.
Accountability - acknowledging the subordinate is
obligated to complete the task.
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Barriers to Effective Delegation:
1. Manager is too disorganized to assign tasks.
2. Manager doesnt want to be outdone by asubordinate.
3. Manager afraid the subordinate wont do the jobas well.
4. Subordinate may be unwilling or unable toperform the task.
5. Task may be one that should not be delegated.6. Manager unwilling to relinquish control.
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DECENTRALIZATION
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Centralization, Decentralization,and Formalization
Centralization - The location of decision making
authority near top organizational levels.
Decentralization - The location of decision
making authority near lower organizational levels.
Formalization - The written documentation used
to direct and control employees.
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Decentralization
Transfer of responsibility for
Planning
Management Raising resources
from central government to other bodies
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Types of decentralization
Decentralization
Political
decentralization
Administrative
decentralization
Management
decentralization
Fiscal
decentralization
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LINE & STAFF
ORGANIZATION
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Line and Staff Authority
Line authority - in which individuals in
management positions have the formal power to
direct and control immediate subordinates.
Staff authority - granted to staff specialists in
their areas of expertise. Narrrower than line
authority and includes the right to advise,recommend, and counsel in the staff specialists'
area of expertise..
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Line and Staff Units
Line units = work groups that conduct the major
business of the organization
Internal line units (e.g., production)
External line units (e.g., marketing) Staff units = groups that assist the line units by
performing specialized services in the
organization
Internal staff units (e.g., accounting) External staff units (e.g., public relations)
Figure 10 6 A Line and Staff
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Figure 10.6 A Line and Staff
Organization
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Differentiate between Lineand Staff positions
Line Positions - positions in the direct
chain of command which the
supervisor has direct authority andspecific responsibility.
Staff Positions - positions which are
outside of the direct chain ofcommand that are primarily advisory
or supportive in nature.
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Principal distinction between line &staff Line manager is
generalist Line manager
directs others Line manager
trains his or hersubordinates Line managers
make operatingdecision
Line managersbear finalresponsibility
Staff manager is a specialistwhose knowledge is limited onlyto his field
Staff manager assists others Staff managers serves authority
Staff manager investigates theproblem related to his/her field ofspecialization
Staff manager provide ideas toline managers
Staff managers have expertise inspecialized field
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Placement of Staff Units
Staff units can be assigned at any level of theorganization, offering their specialized help atmostly the senior level, the middle management
level, or to lower-level managers Increasing interest in outsourcing many staff
functions Also interest in decreasing need for some
internal staff through greater use of informationtechnology by managers, enhancing theiranalytical and decision-making capabilities
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Directing
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Directing is influencing people's behavior throughmotivation, communication, group dynamics,leadership and discipline. The purpose of directing is
to channel the behavior of all personnel to accomplishthe organization's mission and objectives. The directing function gives the manager an active
rather than a passive role in employee performance,conduct and accomplishments. Managers accomplish
their objectives through people. The directing function gives managers a secondresponsibility: helping people in the organizationaccomplish their individual career goals.Organizations do not succeed while their people are
failing. Helping people in the organization with careerplanning and professional development is an integralpart of the directing function.
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Motivation
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Selection, training, evaluation and discipline cannotguarantee a high level of employee performance.Motivation, the inner force that directs employee behavior,also plays an important role.
Highly motivated people perform better than unmotivatedpeople. Motivation covers up ability and skill deficiencies inemployees. Such truisms about motivation leave employerswanting to be surrounded by highly motivated people but
unequipped to motivate their employees. Employers and supervisors want easily applied motivation
models but such models are unavailable. Motivation probably tops the list of complex activities with
which labor managers deal. Their intuition suggests an easy
answer, "I want everyone around here to be motivated."
Th ft bl l f th i l k f ti ti d
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They often blame employees for their lack of motivation andperformance problems. Employees on the other hand oftenblame any performance problems they may have on externalfactors - their supervisors, equipment, training, co-workers,weather, unrealistic demands made on them, pressures athome, lack of recognition etc., etc.
Despite the conflicting perceptions held by employers andemployees, employers must deal with employee motivation.
Three ways of looking at motivation are: needs, rewards andeffort.
The needs approach stems from the notion that peoples'unsatisfied needs drive their behavior. Figure out a person'sneeds, satisfy the needs and the person will be motivated. Forexample, a person with a high need to satisfy goals is motivatedby production targets.
The rewards approach is based on the expectation thatrewarded behavior is repeated. Giving a person a bonus forexcellent performance during a difficult harvest periodencourages the person to make a special effort during the nextdifficult harvest.
The effort approach to motivation is based on the expectation
that effort brings the worker what he or she wants.
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The most effective motivation for employees comes fromwithin each employee, i.e., self-motivation. Possibleindicators of self-motivation include: past accomplishmentsin school, sports, organizations and work; stated careergoals and other kinds of goals; expertise in one or moreareas that shows evidence of craftsmanship, pride inknowledge and abilities, and self-confidence; an evidentdesire to continue to learn; and a general enthusiasm forlife.
Threats, bribery, manipulation and coercion have onlylimited usefulness beyond the very short-run in changingbehavior in the farm environment. More effective employeraction responds to employee needs, making their workuseful to satisfying their needs, helping employees
understand the relationship between their contribution tosuccess of the farm and rewards received, and creating anatmosphere of equity and fairness.
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Communication
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Prentice Hall, 2000 Chapter 9 52
Chain Wheel All-Channel
Three Common Small-Group Networks
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Three types of small-group networks are the chain, wheel,and all-channel.
The chain rigidly follows the chain of command.
The wheelrelies on the leader to act as the central conduitfor all the groups communication. The all-channelpermits all group members to actively
communicate with one another. The all-channel networkcharacterizes the problem-solving task force, in which all
group members are free to contribute. The effectiveness of each type of network depends on the
goals of the group. If speed is important, for example, thewheel and all-channel networks are best. For accuracy,choose the chain or wheel. The wheel is best for allowing
leaders to emerge. And if member satisfaction is important,the all-channel network is the best choice and the wheel isthe worst choice.
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Prentice Hall, 2000 Chapter 9 54
AccuracyAccuracy AnxietyAnxiety
AmbiguityAmbiguity
Th e G rap evi ne
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The formal system is not the only communicationsystem in an organization or a group. There is also aninformal system--where information flows along the well-
known grapevine and rumors can flourish. Is the information that flows along the grapevine
accurate? Evidence indicates that about 75 percent theinformation is accurate. But what conditions foster thegrapevine?
It is frequently assumed that rumors start because theymake titillating gossip. This is rarely the case. Rumorsemerge as a response to situations that are important tous, where there is ambiguity, and under conditions that
arouse anxiety. The fact that workplace situationsfrequently contain these elements explains why rumorsflourish in organizations.
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Prentice Hall, 2000 Chapter 9 56
Cross-Cultural Communication
Assume differences until similarity is proved
Emphasize description over interpretation
and evaluation
Cultivate the art of being empathetic
Treat your interpretation as a working
hypothesis
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Prentice Hall, 2000 Chapter 9 57
Managers Should Be
Active Listeners
Make eye contact
Avoid distractions
Ask questions
Exhibit appropriate
expressions
Paraphrase
Avoid interrupting
Dont talk too much
Combine speaking and
listening
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Prentice Hall, 2000 Chapter 9 58
Use theUse theGrapevineGrapevine
ObserveObserveNonverbal CuesNonverbal Cues
More CommunicationMore CommunicationSkills for ManagersSkills for Managers
ConstrainConstrain
EmotionsEmotions
SimplifySimplify
LanguageLanguage
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Because language can be a barrier, managers shouldstructure messages in ways that will make them clear andunderstandable. Words should be chosen carefully. Amanager must simplify his or her language and consider the
audience for whom the message is intended. It would be nave to assume that a manager is always
rational when he or she is communicating. Since emotion candistort the transference of meaning, the best approach for amanager who is upset is to wait before trying to send amessage.
Since actions can speak louder than words, managers mustwatch their actions to be sure that they align with andreinforce their verbal messages.
The grapevine cannot be eliminated. So managers shouldmake it work for them. They can transmit information over the
grapevine to test the reaction of employees before they makedecisions. To minimize the impact of damaging rumors on thegrapevine, managers should use formal channels byensuring that they carry relevant, accurate information thatwill be of interest to employees.
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LeadingLeadership style
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The Directing Leader
Sets goals. Identifies the problems.
Comes up with solutions. Decides who does what work. Gives specific directions.
Announces decisions. Closely supervises and evaluates employees'
work.
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Sets the goals. Identifies the problems. Develops a plan to solve problems and consults with
employees. Makes the final decision about procedures or solutions
after hearing employees' ideas, opinions, and feelings. Explains decisions to employees and asks for their ideas. Praises employees' work efforts. Continues to direct employees' work. Evaluates employees' work.
The Coaching Leader
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Involves employees in problem-solving and goal-setting.
Takes the lead in defining how to do a job or solve a
problem. Provides support, resources, and ideas if requested. Shares responsibility for problem-solving with
employees. Listens to employees and guides them as they make
decisions. Evaluates an employees work with that person.
The Supporting Leader
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Identifies problems with employees. Sets goals with employees. Develops plans and makes decisions with
employees. Lets employees decide who does the tasks. Accepts employees' decisions and monitors their
performance. Lets employees evaluate their own work. Lets employees take responsibility and credit for their
work.
The Delegating Leader
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Autocratic leader:
Leader makes decisions without reference to anyone
else
High degree of dependency on the leader
Can create de-motivation and alienationof staff
May be valuable in some types of business where
decisions need to be made quickly and decisively
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Democratic leader:
Encourages decision makingfrom different perspectives leadershipmay be emphasised throughout
the organisation Consultative: process of consultation before
decisions are taken Persuasive: Leader takes decision and seeks to
persuade others that the decisionis correct
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Democratic:
May help motivation and involvement
Workers feel ownership of the firm and
its ideas Improves the sharing of ideas
and experiences within the business
Can delay decision making
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Paternalistic leaders:
Leader acts as a father figure
Paternalistic leader makes decision but
may consult Believes in the need to support staff
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Coordination
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Basic Methods of Coordinating
Coordination is a process of facilitating
timing, communication, and feedback
among work tasks.
There are five basic methods of
coordination.
The methods can be ordered in terms of
the degree ofdiscretion they permit in
terms of task performance.
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Basic Methods of Coordinating
From least to most work discretion,
the five methods are: Direct supervision
Standardization of work processes
Standardization of work outputs
Standardization of skills
Mutual adjustment
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Basic Methods of Coordinating
The method of coordination affects
the design of jobs.
The use of the various methods ofcoordination tends to vary across
different parts of the organization.
Methods of coordination may
change as task demands change.
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Other Methods of Coordination
Lateral coordination across highly
differentiated departments often requires
more elaborate forms of coordination.
Integrationis the process of attaining
coordination across differentiated
departments.
Th th d f hi i
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Three methods of achievingintegration
Liaison roles
Task forces
Full-time integrators
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Liaison Role
A person is assigned to help achieve
coordination between his or her department
and another department.
One person serves as a part-time link
between two departments.
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Task Forces
Temporary groups set up to solve
coordination problems across several
departments.
Self-managed and cross-functional teams
are also an effective means of achieving
coordination.
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Integrators
Organizational members permanently
assigned to facilitate coordination between
departments.
They are especially useful for dealing with
conflict between highly interdependent
departments with diverse goals in an
ambiguous environment.
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Controlling
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Control
Set of mechanisms an organization
uses to ensure that actions and outputs
respect predetermined limits
Involves setting standards, measuring
results, and taking corrective actions
Types of controls: Output controls
Process controls
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Output Controls Controls that focus on desired targets and allow managers
to use their own methods for reaching these targets
Steps in developing output controls: Developing targets or standards Measuring results against targets Taking corrective action
Part of a management by exception approach
Promotes flexibility as only goals are defined; methods stillopen to creativity
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Process Controls
Controls that try to specify how tasks are to
be accomplished
Represent use of experience to preventrecurring problems
Three types of process controls: Policies, procedures, and rules
Formalization and standardization
Total quality management controls
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Policies, procedures, and rules
A policy is a guideline for action, noting importantobjectives and broad indication of performanceapproach
A procedure indicates the best method for performing atask, shows which aspects of a task are mostimportant, or outlines how an individual is to berewarded
A rule is a specific, rigid guideline for action, typicallyindicating how something should be done or whatshould not be done
Are often used as substitutes for directmanagerial supervision
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Formalization and standardization
: Formalization refers to the written documentation
of work rules, policies, and procedures Simplifies jobs, ensures consistency
Standardization is the degree to which the range
of actions in a job or series of jobs is limited
Guidelines are created so that similar workactivities are repeatedly performed in a similar
manner
Total Quality
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Total QualityManagement (TQM)
Demings process approach
focused on continual improvement
through use of statistical analyses
of all firms operations Emphasizes managers and
employees collaborating in search
of quality improvements
Often uses empowerment andparticipative management
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Techniques of controlling
Centralization and decentralization.Centralization.
Decision making responsibility is moved upward in
the hierarchy of authority.
Decentralization.
Decision making responsibility is moved
downward in the hierarchy of authority.
Greater centralization is often used by firms
facing a single major threat to its survival.
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Benefits of decentralization.
Higher subordinate satisfaction. Quicker response to a series of unrelated
problems. Assists in on-the-job training of
subordinates for higher level positions Participation is closely related to
decentralization.