CHAPTER 4:

Organizing

FUNDAMENTALS OF
MANAGEMENT (MGT162)
 o Define organizing.
o Describe the process of organizing.
o Understand the division of work/
labour.
LEARNING o Explain the types of organizational
structure/departmentalization.
OBJECTIVE o Describe the span of management,
chain of command, authority,
S centralization and decentralization.
o Discuss delegation and its
importance.
o Understand coordination.
 Organizing is defined as the
process of:

◦ determining the tasks to be

DEFINITION done,
◦ who will do them, and
◦ how those tasks will be
managed and coordinated.
ORGANIZING PROCESS
 DIVISION OF WORK/LABOUR
◦ Breaking down of a job.
◦ The work has to be divided among the members so
that individuals are responsible for a limited set of
jobs instead doing the task as a whole
ADVANTAGES OF DIVISION OF WORK/LABOUR
-Person-to-fit (based on talents and interests) -
the job given
can be fit based on individual’s ability.
-Creates job specialization
-Increase productivity

DISADVANTAGES OF DIVISION OF WORK/LABOUR

-Higher degree of control

-Boredom
 TYPES OF ORGANIZATION
STRUCTURE (Departmentalization)
1. Functional Structure
2.Product Structure
3. Customer Structure
4.Geographic Structure
5. Matrix Structure
6. Network Structure
 TYPES OF ORGANIZATION STRUCTURE :
Functional Structure
◦ Grouping based on functions performed.

Advantages Disadvantages
Experts in job function Slow in decision
Easy supervision Difficult to monitor
performance
TYPES OF ORGANIZATION STRUCTURE :
Functional Structure
 TYPES OF ORGANIZATION STRUCTURE :
Product Structure
◦ Grouping based on the basis of products
manufactured.
Advantages Disadvantages
Easy focus Focus only on own products
Quick/speed in decision Increase costs
TYPES OF ORGANIZATION STRUCTURE :
Product Structure
 TYPES OF ORGANIZATION STRUCTURE :
Customer Structure
◦ Grouping based on the types of customers
served.
Advantages Concentration on customers’
needs
Good feeling from customers
Expert in the customer
handling
Disadvantages Difficult to coordinate
operations
Must be experts in customers’
problems
TYPES OF ORGANIZATION STRUCTURE :
Customer Structure
 TYPES OF ORGANIZATION STRUCTURE :
Geographic Structure
◦ Grouping based on geographical areas.
Advantages Better serve local needs
positive competition
Better communication with
customers
Disadvantages Duplication of jobs
Less control
TYPES OF ORGANIZATION STRUCTURE :
Geographic Structure
 TYPES OF ORGANIZATION STRUCTURE :
Matrix Structure
◦ Two different dimensions/departments grouped
simultaneously.
Advantages Disadvantages
Good use of resources Frustration and confusion

Sharing of information High conflict

TYPES OF ORGANIZATION STRUCTURE :
Matrix Structure

Manager,
Product  A
 

Manager,
Product  B
 
 TYPES OF ORGANIZATION STRUCTURE :
Network Structure
◦ Set of alliances with other organizations.

Advantages Do more with less resources

Effective
Reduce cost
Disadvantages Difficult to develop loyalty
Difficult to control
Conflict between
management
TYPES OF ORGANIZATION STRUCTURE :
Network Structure
 SPAN OF MANAGEMENT
Number of subordinates who report
directly to a manager.
 TYPES OF
SPAN OF
MANAGEMENT
 CHAIN OF COMMAND
◦Line of authority and responsibility.
◦Components:
1. Unity of Command
Suggests that each person within an organization must have a
clear reporting relationship to only one superior

2. Scalar Relationship
Suggests that there must be a clear and unbroken line of
authority that extends from the lowest to the highest
position in the organization
 AUTHORITY
◦“The right to make decisions with respect to work
assignments & to require subordinates to perform
assigned tasks in accordance with the decision made”
◦Types of authority:
1. Line authority
Those organizational members that are directly involved
in delivering the products and services of the organization

2. Staff authority
Those organizational members that are not directly
involved in delivering the products and services to the
organization, but provide support for line personnel
 DELEGATION
◦ The process of transferring the authority for a specific
activity or task to another member of the organization and
empowering that individual to accomplish the task effectively”
 STEPS IN DELEGATION
Hold
Decide
Make Grant responsibl
which goals
assignmen authorit e/ Monitor
or tasks to
ts y accountab
delegate
le
 Benefits of Delegation
1. Empowerment
2. Better decision-making
3. Provide an opportunity for the development of
analytical and problem-solving skills
4. Managers magnify their accomplishments
 Barriers of Delegation
1. Manager may refrain to delegate because they are
insecure about their value to the organization
2. Managers simply lack confidence in the abilities of their
subordinates
3. Manager experience dual accountability
4. Subordinate are reluctant to accept delegation