Concept Notes 4: Organizing

INTRODUCTION
Organizing, is the management function that follows after planning, it involves the
assignment of tasks, the grouping of tasks into departments and the assignment of
authority with adequate responsibility and allocation of resources across the
organization to achieve common goals. Organizing involves the establishment of an
intentional structure of roles through determination and enumeration of the
activities required to achieve the goals of an enterprise. These roles include, the
grouping of these activities, the assignment of such groups of activities to managers,
the delegation of authority to carry them out, and the provision for coordination of
authority and informal relationships.

OBJECTIVES
at the end of this module, you should be able to:
• Discuss the nature of organizations.
• Distinguish the various types of organization structures.
• Apply organization theories in solving business cases.
• Identify the different elements of delegation.
• Differentiate formal from informal organization.

PRE-TEST
Instructions: Write your viewpoint in the space provided after the question.
Can organizing be done without planning?

What benefit could one get if he/she is well-organized, not only in keeping
things, but also, in doing activities?
_________________________________________________________________________________________________
_________________________________________________________________________________________________
_________________________________________________________________________________________________
_________________________________________________________________________________________________
_________________________________________________________________________________________________
_____

1 | Page Organization and Management | Prof. Christian Reyes 2021

 INFORMATION

An organization has been as a coordinated unit

consisting of at least two people who functions to
achieve a common goal or set of goals. It is an entity
that enables the society to pursue accomplishment
that cannot be achieved by individuals acting alone
(Gibson, Ivancevich, and Donnelly, 2000)

Nature of Organization

Organization Structure – is the formal pattern of interactions and coordination designed

by management to link the task of individuals and groups in achieving organizational goals.
Organizational structure elements:
• The assignment of tasks and responsibilities that define the jobs of individuals and
units.
• The clustering of individual positions into units and units into departments and
larger units to form an organization’s hierarchy.
• The various mechanisms required to facilitate vertical (top-to-bottom)
coordination, such as the number of individuals reporting to any given managerial
position and the degree of delegation of authority.
• The various mechanisms needed to foster horizontal (across departments)
coordination, such as task forces and interdepartmental teams.

Types of Organizational Structure

Structure – is the means by which the organization

will attain its objectives and goals.
The determinants of organization structure are:
• Strategy or plans for achieving the company’s
objectives.
• Technology that will be used in carrying out the
strategy.
• People employed at all levels and their functions.
• Size of the organization

2 | Page Organization and Management | Prof. Christian Reyes 2021

Traditional organizational structures come in four general types – functional,
divisional, matrix and flat – but with the rise of the digital marketplace, decentralized, team-
based org structures are disrupting old business models. Before you establish an innovative
way to manage your enterprise, take some time to understand the old mold – then blaze a
trail.

Functional Organization Structure

Under a functional organization structure,

people who do similar tasks are
grouped together based on specialty. So
all the accountants are placed in the
finance department and so on for the
marketing, operations, senior
management and human resources
departments.

The advantages of this kind of structure include quick decision making, because the group
members can easily communicate. They can also learn from each other, since they already
possess similar skill sets and interests.

Divisional Structure Based on Products

In a divisional structure, your company groups workers into teams based on the
products or projects that meet the needs of a certain type of customer. For example,
a bakery with a catering operation might structure the workforce based on key
clientele, such as a wedding department and a wholesale-retail department.

The division of labor in this kind of structure ensures workers making similar
products can achieve greater efficiency and higher output.

Matrix Structure Combines Functional and Divisional Models

A matrix structure combines elements of the functional and divisional models, so it’s
more complex. It groups people into functional departments of specialization, then
further separates them into divisional projects and products.

In a matrix structure the team members are given more autonomy and expected to
take on more responsibility for their work. This increases the productivity of the
team, fosters greater innovation and creativity, and allows managers to cooperatively
solve decision-making problems through group interaction. This type of
organizational structure takes lots of planning and effort, making it appropriate for
large companies that have the resources to devote to managing a complex business
framework.

3 | Page Organization and Management | Prof. Christian Reyes 2021

Flat Organizational Structure
A flat organizational structure attempts to disrupt the traditional top-down
management system of most companies. Management is decentralized so there is no
everyday “boss.” Each employee is the boss of themselves, eliminating bureaucracy
and red tape and improving direct communication.

For example, an employee who has an idea doesn’t have to wade through three levels
of upper managers to get the idea to the key person making the decision. The
employee simply communicates directly with the target on a peer-based level.
A company adopting this type of structure for everyday purposes typically establishes
a special top-down management system for temporary projects or events.

Organization Theories and Application

1. Weber’s Ideal of Bureaucracy
a. Official jurisdiction on all areas is ordered by rules or laws already
implemented.
b. There is an office hierarchy; a system of super- and sub-ordination in which
lower offices are supervised by higher ones.
c. The management of the modern office is based upon written rules, which are
preserved in their original form.
d. Office management requires training and specialization.
e. Rules are stable and can be learned. Knowledge of these rules can be viewed
as expertise within bureaucracy (these allow for the management of society)
2. Rationalization or Scientific Management:
a. Divide work between managers and workers
b. Provide incentives system ( based on performance)
c. Scientific trained workers.
d. Create a science for each individual’s responsibilities.
e. Make sure work is done on time/efficiently
3. Division of Labor – the specialization of individual labor roles.
4. Modernization Theory – deals with the cessation of traditional methods in order to
pursue more contemporary effective methods of organization.

4 | Page Organization and Management | Prof. Christian Reyes 2021

Delegation – this involves the partial distribution of authority to subordinates for making
decisions or performing task.
1. Personnel assistance – minimum authority is delegated, where subordinates act as
advisers.
2. Participative assistance – subordinates are involved in decisions where their
expertise is needed, but they do not actually participate in making major decisions.
3. Joint decision making – this is the separating advising from decision-making.
4. Subordinate decision making – greater delegation occurs; formal positions are
created either in staff or line management.
5. Autonomy in decision making – authority is generally transferred to subordinates.
Periodic procedures are means for informing results to superiors.

Guidelines for Effective Delegation

1. The secret of delegating is determining what each member of a work unit can do.
2. Decide whether you want the subordinate to pinpoint the problem or propose a
solution.
3. Once goals are defined, consider whether the person chosen can handle the
responsibility.
4. Do not make mistake of spelling out in detail how the subordinate should approach
the task.
5. Make sure that the subordinate has the time, budget, date or equipment needed to
get the job done.
6. Unless the project is relatively simple, set up specific checkpoints to review progress
so that both you and your subordinates can be sure that work is progressing as
planned.
7. Be prepared, too, to live with a less than perfect result.

Formal and Informal Organizational

Formal Organizations – begins with the

preplanned patterns of authority and influence –
the planned authority of superior over
subordinates. It is the allocation of functions
among departments and the policies, standards,
procedures that help define the scope of each
person’s activities.

Informal Organizations – concerned with the employees’ sense of belonging to an

organization or with their alienation from the purposes of that organization.

5 | Page Organization and Management | Prof. Christian Reyes 2021