MANAGEMENT SCIENCE UNIT-II

BASIC CONCEPTS RELATED TO ORGANISATION
ORGANISATIONAL HIERARCHY TOP MANAGEMENT MIDDLE MANAGEMENT LOWER MANAGEMENT AUTHORITY AND RESPONSIBILITY --AUTHORITY IS POWER TO GIVE COMMANDS --AUTHORITY VESTED IN POSITION OR JOB --JOB IS REMOVED THE AUTHORITY ALSO REMOVED --AUTHORITY CAN BE TRANSFERED --RESPONSIBILITY IS THE OBLIGATION ON A SUBORDINATE --RESPONSIBILITY IS HELD FOR END RESULTS --RESPONSIBILITY CANNOT BE TRANSFERED --RESPONSIBILITY EXCEEDS AUTHORITY DELEGATION OF AUTHORITY PROCESS OF TRNASFERING AUTHORITY FROM THE TOP TO LOWER LEVELS IN THE ORGANISATION IS CALLED DELEGATION OF AUTHORITY. SPAN OF MANAGEMENT --IT IS ALSO CALLED SPAN OF CONTROL --NO. OF SUBORDINATED EFFECTIVELY CONTROLLED BY A MANAGER AT A GIVEN POINT OF TIME

TYPES OF MECHANISTIC AND ORGANIC STRUCTURES OF ORGANISATION
FLAT AND TALL ORGANISATIONS  MIN. OF ONE LEVEL OF MANAGEMENT  3 EQUAL PARTNERS AND 30 EMPLOYEES IS BEST SAID AS FLAT STRUCTURE.  IT IS A WIDER SPAN OF CONTROL AND HORIZONTAL COMMUNICATION  HT. OF ORG., IS MORE , THE SMALLER IS THE SPAN OF CONTROL AND VICE VERSA.

 TALL ORG... IS MORE --TOO MUCH SUPERVISION DECREASES MORALE MANAGING DIRECTOR MANAGER [SALES] MANAGER [PRODUCTION] MANAGER [PERSONNEL] MANAGER [FINANCE] FLAT ORGANISATION . WILL HAVE MANY LEVELS OF ORG.  IT IS A VERTICAL COMMUNICATION  TALL ORG... HAVE NARROW SPAN OF CONTROL WIDE SPAN OF CONTROL ADVANTAGES --LESS LEVELS AND FAST DECISION MAKING --LESS SUPERVISION COSTS DISADVANTAGES --DIFFICULT TO SUPERVISE THE SUBORDINATES DIRECTLY --FLAT STRUCTURES MAY NOT WORK AS BUSINESS EXPANDS NARROW SPAN OF CONTROL ADVANTAGES --ALLOWS FOR TIGHT CONTROL AND SUPERVISION --COMMUNICATION WITH SUBORDINATES IS EASIER DISADVANTAGES --SUBORDINATES ARE LEFT OUT OF DECISION MAKING AND MAY LACK MOTIVATION --COSTS OF ADMIN.

 Planning task – route clerk [identifies the route for the materials to pass on]  Instruction clerk [gives instructions to the workers about what to do and what not] . persons  foremen involved divided into two groups. 4 involved planning task and 4 involved in dealing with the implementation of task.  divide work according to the function  assign work according the function to diff.MANAGING DIRECTOR ADDITIONAL MANAGING DIRECTOR MANAGER [SALES] MANAGER [PRODUCTION] MANAGER [PERSONNEL] MANAGER [FINANCE] TALL ORGANISATION LINE ORGANISATION --IT IS MORE SIMILAR TO THE FLAT ORGANISATION LINE & STAFF ORGANISATION ENGINEER ________ LINE ------------.STAFF ADMISTRATION OFFICER ACCOUNTANT DRAUGHTSMAN I [DESIGN AND DRAWINGS] DRAUGHTSMAN II DRAUGHTSMAN II1 [PLANS] [SPECIFICATIONS] FUNCTIONAL ORGANISATION FW Taylor suggested functional organization in his theory of scientific management in support of his „one best way‟ of doing things..

     Time and cost clerk [identifies the time and cost for each job] Shop disciplinarian [maintains the discipline on the shop floor] Implementation task –gang boss [assembles the machinery needed for the worker] Speed boss [repairs the machinery in case of breakdown] Quality inspector [responsible for the matters relating to quality] DEMERITS 1. Merits: Pools up the organization resources in terms of knowledge.INEFFECTIVE CONTROLS AS WORKERS HAVE MORE THAN ONE BOSS 2.APPROPRIATE WHEN THERE IS A SINGLE PROUCT OR SERVICE 6.THE DISCIPLINARY CONTROLS ARE WELL DEFINED 5.CALLS FOR MORE COORDINATION 4. .LESS APPROPRIATE WHEN AN ORGANISAION DIVERSIFIES 5. KNOWLEDGE AND EXPERIENCE OF ALL THE MEMBERS.SEPARATE ACTIVITIES RELATED TO PLANNING AND CONTROL 3.FACILITIATES LARGE SCALE PRODUCTION THROUGH STANDARDISATION 4. TALENTS.VERY COSTLY 3.PLANNED SPECIALISATION 2. skills and experience.OFFERS CLEAR CAREER PATHS FOR FUNCTIONAL SPECIALISTS COMMITTEE ORGANISATION A COMMITTEE IS A GROUP OF „TWO OR MORE PERSONS‟ WHO ARE APPOINTED TO WORK AS A TEAM TO ARRIVE AT A DECISION ON THE MATTERS AND PROBLEMS WHICH CANNOT BE SOLVED BY SINGLE EXPERT AND IS INTENDED TO UTILISE THE SKILLS.NO CLEAR LINE OF AUTHORITY MERITS 1.

 It calls for high degree of coordination. It holds an employee responsible for management of resources Demerits: Very complex to manage.  Violates unity of command. It is a combination of all relationships in the organization vertical.  It maintains professional identity. but its effect is felt.  It focus on end results.  Seeks to optimize the utilization of resources. It provides a high degree of operational freedom Merits: Offers operational freedom and flexibility.  Employee may find it frustrating to work with two bosses. Virtual Organization:  Virtual organization structure does not physically exist.  It involves high cost in terms of time and money. facilitates group decisions  It yields good results  It reduces the fear of two much authority  It motivates all the concerned Demerits: Responsibility for decisions cannot be fixed on a particular person. horizontal and diagonal. Matrix organization: Also called Project organization.  Example: Bata Shoes Merits: Enable for doing business with less capital. less HR and other inputs.  Requires too much time for meeting and collaboration. Represents groups.It is mostly used in complex projects. .

customers and 'stakeholders'" defines Finance. The employee is empowered with greater decision-making authority and freedom of action. Larger bureaucratic organizations can benefit from the flexibility of teams as well.  Failure in network results in the failure of the entire organization. Employees who are closest to clients or production processes are placed at the top and managers at the bottom. While an organization is constituted as a set of people who synergize individual competencies to achieve newer dimensions. the team structure can define the entire organization. For example. . the quality of organizational structure revolves around the competencies of teams in totality. INVERTED PYRAMID The inverted pyramid is a metaphor for a reversal of traditional management practices. while team leaders in each store and each region are also a team. Teams can be both horizontal and vertical. In small businesses. BOUNDARYLESS ORGANISATION STRUCTURE The concept of a boundaryless organization was invented at General Electric and explained in the book The Boundaryless Organization: Breaking the Chains of Organizational Structure.  React to the environment demands most efficiently. these organic structures welcome and thrive on change. The informal managerial style is well suited for intricate and “non-standard” work. success depends on trusting employees and demonstrating a genuine willingness to share authority. Xerox. Finally. To successfully invert the organizational pyramid and empower employees. the largest natural-foods grocer in the US developing a focused strategy. Team Organization Structure: One of the newest organizational structures developed in the 20th century is team. Provide flexibility of operations. management has to be consistent when shifting decision making to employees. overall organizational performance becomes faster. Boundaryless organizations “transcend the rigid lines of bureaucracy and divisional boundaries within a corporation and ignore the borders where the corporation itself is separated from its markets. The resources needed to develop the necessary skill set must be allocated. is an autonomous profit centre composed of an average of 10 self-managed teams. and DaimlerChrysler are all among the companies that actively use teams to perform tasks. The manager becomes a facilitator spearheading a team effort. In theory. Demerits: Companies do not have strong foundations or strengths in their operations. and the manager should take on the role of mentor or coach. Motorola. They are perfect for rapid innovation. and therefore ideal for companies in the growing technology industry. Focusing on fluid and adaptive behavior.  Organizations have to heavily depend on out sourcing. more adaptable and more effective. every one of the Whole Foods Market stores.