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Ô Functional Ô Grocess
’ Grouping jobs by ’ Grouping jobs on the
functions performed basis of product or
Ô Groduct customer flow
’ Grouping jobs by Ô ½ustomer
product line ’ Grouping jobs by type
Ô Geographical of customer and needs
’ Grouping jobs on the
basis of territory or
geography
    

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Ô ½entralization
’ Lower-level managers are not as capable or
experienced at making decisions as upper-level
managers
’ Lower-level managers do not want to have a say in
decisions
’ Decisions are significant
’ Organization is facing a crisis or the risk of company
failure
’ ½ompany is large
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Ô Decentralization
’ Lower-level managers are capable and experienced at
making decisions
’ Lower-level managers want a voice in decisions
’ Decisions are relatively minor
’ ½ompany is geographically dispersed
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Ô Formalization
’ The degree to which jobs within the organization
are standardized and the extent to which employee
behaviour is guided by rules and procedures
å £ighly formalized jobs offer little discretion over what is to be
done
å Low formalization means fewer constraints on how
employees do their work
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