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The Organizing Process

Elements of Organization
Coordination of effort
A common goal or purpose
Division of labor
A hierarchy of authority

Classifications of Organizations
Businesses
Nonprofit service organizations
Mutual benefit organizations
Commonweal organizations

Organizational Charts

Theories of Organizing
Closed-system Perspective
Treats the organization as focused on
economic efficiency in a reasonably
predictable environment
a) Hierarchy of authority
b) Principle of unity of command
c) Authority should be proportionate to
responsibility
d) Authority but not responsibility may be
delegated

Open-system Perspective
Treats the organization as focused on survival
in an uncertain environment
a) Adaption to changes
b) Characterized by synergism
c) Equifinality
d) Learning organization

Organizational Effectiveness

Productivity
Societys expectations
Time
Adaptive organization

Contingency Approach

Stresses that the search for answers to


organizational design problems depends
on contingencies that can be discovered
and studied

Determines the structure that suits the


environmental uncertainty :

Stability of demand for the organizations


goods and services
Reliability of supply
Rate of technological change
Socioeconomic and political pressures

Mechanistic Organization
Most likely to succeed in stable and certain
environments

Organic Organization
Most likely to succeed in unstable and
unscertain environments

Mintzbergs Five Organizational


Structures
Simple Structure
Machine Bureaucracy
Professional Bureaucracy
Divisional Structure
Adhocracy

Departmentation

-Division of labor breaks complex


processes into their simpler components

Departmentation by Function

Departmentation by Territory

Departmentation by Product

Departmentation by Customer

Lean Production

Focuses on minimization of waste


in everything from inventories to
labor hours

Line and Staff Organization


Combines line organization with staff
departments, that support and advice line
departments
Has wide variety of positions

Line Positions and Staff Positions


Line Positions
Directly involved in day to day operations
Engage in activities that are functionally and
directly related to the principal workflow of an
organization

Staff Positions
Serves the organization by indirectly
supporting line functions
Engage in activities that are supportive

Line and Staff Authority


Line Authority
Flows down the chain command; not limited to
line personnel
Gives an INDIVIDUAL a certain degree of
power relating to the performance of an
organizational task

Staff Authority
Has the right to advice or counsel those with
the line authority

Functional Authority
Limited line authority
Gives a staff person a power over a
particular function such as safety and
accounting
Usually it is given to a specific staff
personnel with expertise in a certain area
Special type of authority for staff
personnel which must be designated by
management

Line and Staff Conflict


Caused by:
Poor human relations
Overlapping authority and responsibility
Misuse of staff personnel by top management
Excessive staff

How to MINIMIZE:
Clearly define areas of activity and authority
Use concept of completed staff work

Span of Control
a.k.a. Span of Management or Span of
Authority
An upper limit to the number of people
who can be effectively and efficiently
supervised by one person
Graicunas formula
Managers must not only manage one-to-one
direct reporting relationships but also
relationships with various groups of
subordinates and the relationships that exist
between and among invididual subordinates

Span of Control
Behavioral school states that there has to
be an expansion of control if possible
Increases autonomy and morale of individual
workers
Decreases communication problems by
reducing organizational levels

Flat Organizational Structure


Have relatively few levels from beginning
to bottom
Has wide span of control
Provides fast information flow
Disadvantages:
Poorer employee training
Lack of coordination
Behavioral problems

Tall Organizational Structure


Has many levels between top and bottom
Has relatively narrow span of control
Increased frequency of interaction
between superior and employee
More expensive because of the large
number of managers
Disadvantages:
Slow decision making, excessive supervision
and greater administrative costd

Centralization and
Decentralization
Centralization
Process where the concentration of decision
making is in a few hands
Lower level decisions are subject to approval of
the top management
Implications:
Reservation of decision making power at the top level
Reservation of operating authority with the middle
level managers
Reservation of operations at lower level at the
directions of the top level

Centralization and
Decentralization
Decentralization
Systematic delegation of authority at ALL LEVELS of
management
Authority is retained by the top management for
taking the MAJOR decisions and framing policies
Implications:
diversification and horizontal can be easily implanted
there is greater motivation and morale of the employees
since they get more independence to act and decide.
the subordinates get a chance to decide and act
independently which develops skills and capabilities. This
way the organization is able to process reserve of talents in
it

Centralization and
Decentralization
Delegation
Formal process of assigning authority
downward

Delegation versus Delegation


Responsibility
Need
Control
Good Results
Nature

FINAL COMMUNICATION

PRACTICE ADVISORY 2410-1: COMMUNICATION CRITERIA

It should contain at least the purpose,


scope and results of the engagement.
It may include Background information
and Summaries.

Purpose Statements: describe the


engagement objectives
Scope Statements: identify the reviewed
activities and include the nature and
extent of engagement work
Results: observations, conclusions,
recommendations, and action plans

Observations(findings): relevant
statement of fact
Recommendations: may suggest
approaches for correcting or improving
performance
Conclusions(opinions): evaluations of the
effects of the observations and
recommendations

Attributes of Observations and Recommendations

1. Criteria: what should be


2. Condition: what exists
3. Cause: why a difference between the
actual and expected conditions exists
4. Effect: risk or exposure resulting from
the difference

QUALITY OF COMMUNICATIONS
1.
2.
3.
4.
5.
6.
7.

Accurate
Objective
Clear
Concise
Constructive
Complete
Timely

Effective Communication

Communication is the process of


conveying and understanding
information between one person and
another.

5 Elements
Sender- the person who originates the
message.
Symbols- in which the message is encoded.
Medium- the channel through which the
message flows.
Receiver- the person who decodes the
message and interprets the senders
meaning
Feedback- acknowledging to the sender that
the message was correctly understood.

Communication is the
secret to the success of any
manager.

Written communication- provides a


permanent record of the message and tends to
be accurate but can be time consuming to
prepare.
Oral communication- less formal and less
accurate than written communication but
permits immediate feedback.
Electronic communication- better control of
information and improvement of competitiveness
due to improved technology.

Direction of Communication
Downward
Upward
Horizontal

Organizational Structure
Traditional or Classical managementone way communication.
Participative managementmultidirectional communication
Systems Theory- stresses the
importance of feedback.

Nonverbal Communication
Occurs in clusters, whether or not
accompanied by verbal communication.
Easily misunderstood
Requires establishment of the norms in a
particular persons nonverbal repertoire

Communication Strategy
1.) Spray and Pray
- receivers are showered with information in
the hope that some of it will stick.
2.) Tell and Sell
- involves communicating a more restricted
set of messages and taking time to explain their
importance and relevance.
3.) Underscore and Explore
- allowing employees the freedom to explore
the implications of those ideas in a disciplined
way.
4.) Identify and Reply
- reactive and defensive strategy. Employees
concerns about prior communications are the
central focus here.
5.) Withhold and Uphold

Problems in Communication
Poorly encoded messages
Faulty media selection
Noise
Perceptual problems
Loss in transmission
Poor retention
Nonreception
Media breakdown

Guides To More Effective Listening


Empathy- mentally putting oneself in
another persons position to understand
his or her feeling, attitudes and thoughts
Sensitivity Training- gives managers a
greater awareness of their own attitudes,
feelings and beliefs.
Interpersonal Communications
Training- give and receive information.

Effective Listening Tools


Paraphrasing what has been heard.
Being attentive physically and mentally.
Asking relevant questions.
Avoiding premature judgments.
Summarizing after the speaker has
finished.