CHAPTER 6 SLIDE 1 BUSINESS ORGANIZATI Philippine Copyright 2013 Rex Book Store, Ine. All Rights Reserved. No part ofthis Learning Device may be reproduced or istibuled in any form of by any means, or stored ina dalabaseretieval system without prior emission fom Rex Book Store, ine. REX(CHAPTER 6 SLIDE 2 Chapter 6 ORGANIZING BUSINESS ACTIVITIES(CHAPTER 6 SLIDE 3 Reasons for Organizing * Organizing is undertaken to facilitate the implementation of plans. * In effective organizing, steps are undertaken to break up the total job into more manageable man-size jobs. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, Inc(CHAPTER 6 SLIDE 4 Organizing Defined * Organizing is that management function which relates to the structuring of resources and activities to accomplish objectives in an efficient and effective manner. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, Inc(CHAPTER 6 SLIDES The Organizational Structure and Its Determinants * The structure is the means by which the organization will attain its objectives and goals. * The structure must be one that considers, apart from the organization’s goals and objectives, its resources, and its environment, both internal and external. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior(CHAPTER 6 SLIDES * The determinants of organization structure are: 1. strategy, or plans for achieving the company’s objectives; 2. the technology that will be used in carrying out the strategy; 3. the people employed at all levels and their functions; and 4. the size of the organization. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, Inc(CHAPTER 6 SLIDE 7 The Formal Organization * The formal organization is the structure that details lines of responsibility, authority, and position. * What is depicted in the organization chart is the formal organization. * Itis the planned structure and it represents the deliberate attempt to establish patterned relationships among components that will meet the objectives effectively. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 8 * The formal structure is described by management through: 1. organizational chart; 2. organizational manual; and 3. policy manual. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 9 ¢ The organizational chart is a diagram of the organization’s official positions and formal lines of authority. * The organizational manual provides written descriptions of authority relationships, details the functions of major organizational units, and describes job procedures. * The policy manual describes personnel activities and company policies. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 10 Informal Groups * There are instances, however, when members of an organization spontaneously form a group with friendship as a principal reason for belonging. * This group is referred to as an informal group. * It is not a part of the formal organization and it does not have a formal performance purpose. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 11. An Informal ; : le to fe Friendship AE propels people to form or join oe Common a , An Informal nee AE propels people to form or join A= ntae like: concern for environment or love for classical music An Informal imi pels people to f i Proximity A= propels people to form or join aoe which gives people the chance to share ideas, opinions, and feelings Figure 19. Reasons or Factors for Joining or Forming an Informal Group Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, Inc 2CHAPTER 6 SLIDE 12 Needs Satisfaction An Informal 1s people to f joi AAC propels people to form or join aan which is derived from joining unions, cultural societies, fraternities Collective soi An Informal ollective AF propels people to form or join AA ae which is derived from joining unions, fraternities aeee AL propels people to form or join eae which attract persons to join groups like consumer society, sports club Figure 19. Reasons or Factors for Joining or Forming an Informal Group Prilppine Copyight 2019 Rex Book Stor ne. All Rohs Reserved. No pro his Leaming Devi may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 13 Levels of Management and Supervision * The management and supervision of an organization may be done through levels of hierarchy which may be flat or tall. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior from Rex Book Store, IncCHAPTER 6 SLIDE 14 Flat Structure * The flat organization has few levels of management. * This characteristic provides it with the following advantages: 1. Communication is generally faster and less distorted. 2. Decisions can be made more quickly. 3. Supervisor’s salaries are eliminated. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 15 + Flat structures, however, have the following distinct disadvantages: 1. They require managers with experience in the various tasks. 2. Amanager may have little time for all subordinates. 3. When the manager is out, the group is without a leader. 4. Managers may have little time to anticipate problems. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 16 Tall Structure ¢ The tall structure has many levels of management. * It has the following advantages: 1. Since the average span of control is narrower, the supervisory load is less for each manager. 2. There are more opportunities for promotion because there are more levels of positions. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 17 Managers are provided with opportunities to specialize. There is less demand for managers with multiple skills. Managers are afforded with more time to attend to other important problems. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 18. * Tall structures are also saddled with disadvantages such as the following: 1. Communication tends to be slower and distorted because of the number of levels it has to pass through. 2. The number of management levels also hinders effective decision-making rendering such activity slower and less accurate. 3. It is more expensive to maintain as there are more managers to compensate. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 19 FLAT STRUCTURE ‘MANAGER Driver Sales Documents Mechanic Parts Cashier Collector Clerk Clerk Clerk a GENERAL MANAGER TALL STRUCTURE —— : ees Manager Branch Branch Manager Manager Great and Sales Collection Supeeiieoe Supenvieon Sales esa Cienk Clerk Figure 20. An Illustration of the Flat and Tall Structure Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 20 Basic Elements of Organizational Structure * In designing the organizational structure, certain basic elements are considered. These are as follows: 1. work specialization 2. Departmentalization 3. pattern of authority 4. span of control 5. coordination of activities Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior mn ReCHAPTER 6 SLIDE 21. Work Specialization * The degree to which tasks are divided in the organization is referred to as work specialization. * Adecision must be made regarding this element and it should be reflected in the organizational structure. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncWhy Specialization? * Specialization promotes efficiency. * This is so because it is presumed that people can perform more efficiently if they master just one task rather than many tasks. * When an organization is efficient, it means it can perform its function with the least amount of resources. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 23 Departmentation * Departmentation refers to the grouping of jobs based on criteria that managers believe help in the coordination and control of activities. * Adecision must also be made on whether the organization would be departmentalized or not. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCriteria for Grouping of Jobs * These are as follows: 1. knowledge and skills 2. work process and function 3. time 4. product 5. customers 6. location Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 25 MANAGER Sales, Credit Sales, Credit and Collection and Collection Supervisor Supervisor SSC Clerk SSC Clerk SSC Clerk SSC Clerk STRUCTURE A - no specialization Figure 21. Work Specialization: To What Extent? Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 26 MANAGER Credit and Sales a Supervisor Collection Supervisor Credit ania cae Investigator Collector STRUCTURE B - with specialization Figure 21. Work Specialization: To What Extent? Prilppine Copyight 2019 Rex Book Stor ne. All Rohs Reserved. No pro his Leaming Devi may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 27 without specialization MPLOYEE B. EMPLOYEE A Credit Investigator / Collector Credit Investigator /Collector Work output for one day: Work output for one da: a. investigated three 1. investigated three credit applications credit applications 2. collected three accounts 2. collected three accounts TOTAL OUTPUT 6 investigations and 6 collections with specialization EMPLOYEE B EMPLOYEE A Collector Credit Investigator Work output for one day: Work output for one day: = investigated eight = collected eight accounts credit applications TOTAL OUTPUT: 8 investigations and 8 collections Figure 22. An Example of the Effect of Specialization Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, Inc REXCHAPTER 6 SLIDE 28. Advantages of Grouping Jobs * These are the following: 1. Supervision is made easier. 2. The sharing of resources, such as men, machines, and materials results to maximum use of such resources. 3. Common measures of performance is established. 4. Communication is encouraged. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 29 Pattern of Authority * The pattern of authority as an element in designing organizational structure refers to the extent by which organization members are allowed to make decisions without getting the approval of another member. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 30 + Authority patterns may either be: 1. Centralized — when decision-making is concentrated in the hands of higher-level managers. 2. Decentralized — when decision-making authority is granted to middle and lower management positions. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 31. The Appropriate Pattern of Authority ¢ The environments of organizations differ and so no single pattern of authority is appropriate for all. ¢ Instead, the pattern of authority must match the organization’s environment. * Centralized authority is better suited for stable environments, while decentralized authority is for complex and changing environments. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 32. * Decentralized authority offers the following advantages: 1. Efficiency — red tapes and bottlenecks are reduced. 2. Flexibility— managers can cope with situations as they come. 3. Initiative — managers are highly motivated by the challenge. 4, Motivation— managers are highly motivated by the challenge. 5. Development — managers are provided with opportunity for training. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 33. ¢ Decentralized authority has also some disadvantages. These are as follows: 1. Control — coordinating overall activities is more difficult. 2. Duplication— there is a great chance of efforts duplicated between departments. 3. Centralized expertise — home office experts may be overlooked or disregarded. 4. Competency -—the organization may not be able to produce competent managers at all levels. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 34 UNIVERSITY Nursing Engineering Business Figure 23. A Sample Grouping of Jobs According to Knowledge and Skills Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 35, COMPANY Credit and Collection Service Sales Figure 24. A Sample Grouping of Jobs According to Work Process and Function Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 36. COMPANY —+— First Shift Second Shift Third Shift 6:00 AM to 2:00PM 2:00 PM to 10:00 PM 10:00 PM to 6:00 AM Figure 25. A Sample Grouping of Jobs According to Time reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior Prine Copyright 2013 Rex Book Str ne Al Rights Resere4 No pa of his Learing Die maybe oe permission from Rex Book Store, Inc BCHAPTER 6 SLIDE 37 COMPANY Motorcycle Appliance Lubricants Figure 26. A Sample Grouping of Jobs According to Products Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 38. COMPANY -——— Cash Credit COMPANY feces ageauasausscueeaaed Government Consumers Figure 27. A Sample Grouping of Jobs According to Customers Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 39 COMPANY Luzon Visayas Mindanao Division Division Division Figure 28. A Sample Grouping of Jobs According to Location Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 40 Span of Control Span of control is another consideration in designing the organizational structure. It refers to the number of subordinates reporting to a single supervisor. The span of control may either be narrow or wide. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 41. * It is narrow when there are few subordinates reporting to a supervisor. The narrow span of control is characterized by the following: 1. oo Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, Inc there is closer relationship between manager and subordinates; here is less delegation of authority; controlling activities are more tight; and there is more time for rewarding behavior.CHAPTER 6 SLIDE 42. * Span of control is wide when there are many subordinates reporting to a supervisor. The following characteristics are inherent to an organization with wide span of control: 1. employees work with little supervision; 2. there is a high level of delegation of authority; 3. controlling is lighter; and 4. there is less time for rewarding behavior. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 43. The Appropriate Span of Control * Neither the narrow or the wide span of control is applicable to all types of situations. * There are also situations appropriate for the wide span of control. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 44 Coordination * This term refers to the linking of activities in the organization that serve to achieve a common goal or objective. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, Inc6 Figure 29, Situations Appropriate for Narrow Span of Control CHAPTER 6 SLIDE 45, Tasks performed subordinates contain frequent and hard-to Solve problems: Non-Professional i Subordinates Subordinates have little training, Subordinates are NARROW SPAN seattered through- outa wide area ——__, More interaction is required between Superior and Subordinate When tasks among ae Subordinates are Ot similar When tasks are performed without Specific and uni- form procedures 7 Tasks of subordinates require integration Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, Inc 2CHAPTER 6 SLIDE 46, i: Professional asks performed are Suboreinates, 2 PGubrte anc simple , _ Sarasa Fully trained tL WIDE SPAN Subordinates arc 4 located in one Siice IL LC ILI ] Cee nermeionie) t 5 required between Supervisors anc Bubordinates, Tasks amon: © [inates mre sir Tasks are per formed with Tasks of subordi— 7 Uniform and So nates do not require specific procedures integration Figure 30. Situations Appropriate for Wide Span of Control Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 47 Basic Organizational Design * These are the four basic organizational designs: 1. functional design; 2. divisional design; 3. hybrid; and 4. matrix. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book StoCHAPTER 6 SLIDE 48. Functional Design * An organization may be designed basically according to function. ¢ In organizations with functional design, employees are grouped together in separate departments on the basis of common tasks, skills, or activities. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 49, PRESIDENT Audit Finance Sales Production Human eee Resources Figure 31. An Organization with Functional Design Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 50 Strengths of the Functional Design ¢ Using the functional design offers some advantages consisting of the following: 1. efficient use of resources 2. in-depth skill development 3. clear career paths 4. unity of direction 5. enhanced coordination within function Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 51. Weaknesses of the Functional Design * There are certain weaknesses inherent to the functional design. These are as follows: 1. slow decision-making 2. less innovation 3. unclear performance responsibility 4. limited management training 5. poor coordination across functions Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 52. Divisional Design The organization with divisional design is that type where all activities needed to produce a good or service are grouped together into an independent unit. Priipine Copy 2013 Rex Book Soe ne All Rahs Reser No prt fh Leaming Daves may be oe reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 53. PRESIDENT Division A Division B Division C Audit Audit Audit Sales Sales Sales Legal Legal Legal Finance Finance Finance Production Production Production Human Human Human Resources Resources Resources Figure 32. Organization with Divisional Design Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 54 Strengths of the Divisional Design + The divisional design is strong on certain points pertaining to the following: 1. adaptation to unstable environment 2. high customer satisfaction 3. high task coordination 4. clear performance responsibility 5. general management training Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, Inc 2CHAPTER 6 SLIDE SS. Weaknesses of the Divisional Design * The weaknesses of the divisional design are as follows: 1. inefficient use of resources 2. low in-depth training for personnel 3. focus is on division objectives 4. loss of control Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE S6. Hybrid Design * The hybrid design is a combination of divisional units and functional departments located at corporate headquarters. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 57 PRESIDENT Human Finance Production Resources Sales Legal Audit Area 1 Area 2 Area 3 Area 4 Area 5 Figure 33. The Hybrid Design Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 58. Strengths of the Hybrid Design ¢ The hybrid-designed organization is strong in terms of the following: 1. simultaneous coordination 2. integration of goals with objectives 3. efficient and highly adaptable Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 59. Weaknesses of the Hybrid Design * The organization with a hybrid design is weak on the following points: 1. slow response to exceptional situations 2. conflict between headquarters and divisions 3. administrative overhead Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 60 Matrix Design An organization with a matrix design is one that implements functional and divisional structures simultaneously in each department. The employee is supervised by the functional manager in his work as a specialist. The divisional manager integrates the activities of the specialists. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 61. * The following conditions favor the use of matrix design: 1. Environmental pressures exist for a dual focus, such as innovation and quality. 2. Large quantities of information must be processed. 3. Efficiency is needed in the use of resources. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, Inc 2CHAPTER 6 SLIDE 62 Strengths of the Matrix Design * The matrix-designed organization has an array of strengths which are as follows: 1. It allows demands from the environment to be met simultaneously. 2. It provides flexibility. 3. It encourages resource efficiency. 4. It enhances skill development. 5. It increases motivation and commitment among employees. 6. It aids top management in planning. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 63 Weaknesses of the Matrix Design ¢ The matrix designed organization has its own share of weaknesses. They are the following: 1. It creates dual-authority confusion. 2. It spawns power struggle. 3. It is time-consuming. 4. It requires interpersonal skills training. 5. It generates high implementation cost. Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, IncCHAPTER 6 SLIDE 64 PRESIDENT Project Sales Accounting HRD Finance Management Project ___ Sales ___ Accounting HRD Finance Manager A Unit Unit Unit Unit Project Sales Accounting HRD Finance Manager B Unit Unit Unit Unit Project Sales Accounting, HRD Finance Manager C Unit Unit Unit Unit Figure 34. The Matrix-Designed Organization Philippine Copyright 2013 Rex Book Store Inc.All Rights Reserved. No par of this Leaming Device may be reproduced or distrbuted in any form or by any means, or stored ina database retrieval system without prior permission from Rex Book Store, Inc &