Designing Adaptive Organizations: Posted To A Publicly Accessible Website, in Whole or in Part

9
Designing
Adaptive
Organizations
Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or
posted to a publicly accessible website, in whole or in part.
LEARNING OUTCOMES
1 Describe the departmentalization approach to

organizational structure
2 Explain organizational authority
Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MGMT8 | CH3 2
Modern Shed
1. Describe how Modern
Shed functions as a
modular organization.
2. What are the
advantages and
disadvantages of
Modern Shed’s
<click screenshot for video>
organizational
structure?
© 2015 Cengage Learning

Organizational Structure
• Vertical and horizontal configuration of

departments, authority, and jobs within a
company
• Organizational process: Collection of
activities that transform inputs into outputs
valued by customers
Departmentalization
• Subdividing work and workers into separate

organizational units responsible for completing
particular tasks
• Functional
• Product
• Customer
• Geographic
• Matrix
• Simple
• Complex
• Find a company – how are they structured
Types of Authorities and Functions
• Authority
• Line: Right to command immediate subordinates
in the chain of command
• Staff: Right to advise others who are not
subordinates in the chain of command
• Function
• Line: Contributes in creating or selling the
company’s products
• Staff: Supports line activities
Delegation of Authority
• Assignment of authority and responsibility

to a subordinate to complete a manager’s
tasks
• Transfer of full responsibility for the assignment
to the subordinate
• Transfer of full authority over budgets,
resources, and personnel
• Transfer of accountability
Degree of Centralization
• Centralization: Location of maximum

authority at the upper levels of the firm
• Decentralization: Location of a significant
authority in the lower levels of the firm
• Standardization: Solving problems by applying
similar rules, procedures, and processes
Job Design
• Number, kind, and variety of tasks that

individual workers perform in doing their jobs
• Types
• Job rotation
• Job enlargement
• Job enrichment
• Job specialization: Job composed of different
parts of a complete task
Job Characteristics
Empowering Workers
• Giving decision-making authority and

responsibility to workers by providing
resources needed to take effective decisions
• Empowerment: Motivational feeling making
workers feel competent and capable of self-
determination
- Leads to changes in the organizational process
Interorganizational Process
• Activities among companies to convert

inputs into outputs valued by customers
• Modular organizations: Outsources noncore
business activities to outside companies
- Cost effective
- Cause loss of control
- Reduce competitive advantage
SUMMARY
• Departmentalization is a method of
subdividing work and workers into separate
organizational units
• Authority is the right to give commands,
take action, and make decisions to achieve
organizational goals
• Job design is the number, kind, and variety
of tasks that individuals perform
KEY TERMS
• Organizational • Geographic
structure departmentalization
• Organizational process • Matrix
• Departmentalization departmentalization
• Functional • Simple matrix
departmentalization • Complex matrix
• Product • Authority
departmentalization • Chain of command
• Customer • Unity of command
departmentalization • Line authority
• Staff authority
KEY TERMS
• Line function • Internal motivation

• Staff function • Skill variety
• Delegation of authority • Task identity
• Centralization of • Task significance
authority
• Autonomy
• Decentralization
• Standardization • Feedback
• Job design • Empowering workers
• Job specialization • Empowerment
• Job rotation • Modular organization
• Job enlargement

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9

1 Describe the departmentalization approach to

© 2015 Cengage Learning

• Vertical and horizontal configuration of

• Subdividing work and workers into separate

• Assignment of authority and responsibility

• Centralization: Location of maximum

• Number, kind, and variety of tasks that

• Giving decision-making authority and

• Activities among companies to convert

• Line function • Internal motivation

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