ORGANIZATION AND MANAGEMENT :

ORGANIZING
C H A P T E R 4
 Once a plan has been created, a manager can begin to
organize. Organizing involves assigning tasks, grouping tasks
into departments, delegating authority, and allocating
resources across the organization. During the organizing
process, managers coordinate employees, resources, policies,
and procedures to facilitate the goals identified in the plan.
Organizing is highly complex and often involves a systematic
review of human resources, finances, and priorities.
 Chapter 4: Organizing

Lesson 1 Lesson 2 Lesson 3 Lesson 4 Lesson 5

Natures of Types of Organization Delegation Formal and
Organization organization theories and Informal
structure applications organization
Natures of
Organization
Differentiation of the Organization's Internal
Environment

Differentiation in organizations involves division

of labor and specialization according to Bateman
and Snell (2008). These necessarily result from
the organization's composition-many different
work units with different kinds of tasks, using
different skills and work activities coordinating
with one another for a common end.
 Division of labor involves
assigning different tasks to different
people in the organization's
different work units. Related to it is
specialization, the process in which
different individuals and units
perform different tasks.

the bigger the organization, the more work units or work

divisions and specializations are to be expected.
Integration is another process in
the organization's internal
environment which involves the
collaboration and coordination of
its different work units or work
divisions.

Coordination refers to the procedures

that connect the work activities of the
different work divisions/units of the
firm in order to achieve its overall goal.
 01. Process

02. Structure
Dividing and
03. Grouping the 04.
Accomplishments of
goals and objectives
activities

S 05.
Authority-
Responsibility

ome common features Relationship

of organization 06. Human Material

Aspects
 Lesson 2: Types of Organization
Structures
An organization structure is a system made up of tasks to be
accomplished, work movements from one work level to other
work level in the system, reporting relationships, and
communication passageways that unite the work of different
individual persons and groups.
The types of organizational
structures include:

A. VERTICAL STRUCTURE

B. HORIZONTAL STRUCTURE

C. NETWORK STRUCTURE
The vertical organizational structure is
a strict hierarchical structure with powe
r emanating from the top to the bottom
.

According to Bateman and Snell (2008), a vertical

structure clean out issues related to authority rights,
responsibilities, and reporting relationships.

Authority rights refer to the legitimate rights of

individuals, appointed in positions like president,
vice president, manager, and the like, to give orders
to their subordinates, who in turn, report to them
what they have done
Owners of private business
companies are said to have
absolute authority, even if other
persons are appointed as
managers in their companies.

In corporations, the owners are

the stockholders and they elect a
board of directors to manage the
organization's activities.
The board has a chairman who acts as the
leader, while the members act as the
corporation's authority figures,
responsible for making major decisions
affecting their organizations, subject to the
corporation's constitution and by-law
provisions.

a chief executive officer (CEO) is appointed to occupy

the top post in the organization pyramid and is
personally accountable to the members of the board and
ather owners for the organizational performance.
 Under the middle-level managers are the
Below the top-level managers are the
lower-level managers which include office
middle-level managers in charge of
managers, sales managers, and supervisors
departments who, as earlier mentioned,
who directly report to the former.
report to them.

Example:
Amazon is a company with a vertical structure
having 12 levels, in which Jeff Bezos is the
pyramid’s summit at level 12 and distributors and
packagers are at level 1.
Employees under the lower level managers
also have reporting relationships with their
respective department managers.
 A horizontal structure refers to the
departmentalization of an organization into
smaller work units as tasks become increasingly
varied
Horizontal organizational structures, also called flat organizational stru
ctures, outline reporting expectations for employees with only a few hi
erarchical levels. For example, they may include the owner at the top l
evel, managers or leaders in the middle and the remaining employees o
ccupying the same level within the rest of the business
Types of Department
Line Departments— deal directly
with the firm's primary goods and
services, responsible for
manufacturing, selling, and
providing services to clients.

Staff departments— support the

activities of the line departments by
doing research, attending to legal
matters, performing public relations
duties, etc.
Meanwhile, departmentalization
may be done using three approaches:

Functional approach— where the

subdivisions are formed based on
specialized activities such as
marketing, production, financial
management, and human resources
management.
Divisional approach— where
departments are formed based on
management of their products,
customers, or geographic areas
covered

Matrix approach— is a hybrid form

of departmentalization where
managers and staff personnel report
to the superiors, the functional
manager, and the divisional manager.
A matrix organization is a work st
ructure where team members repo
rt to multiple leaders. In a matrix
organization, team members (whe
ther remote or in-house) report to
a project manager as well as thei
r department head. This managem
ent structure can help your compa
ny create new products and servic
es without realigning teams.
Network structure is a collection
of independent, usually single
function organizations/companies
work together to produce a
product or service.

Often their communication is by

electronic means where sharing
of information is speedy. This
results to their ability to respond
at once to their customers'
demands.
Lesson 3: Organization Theories and
Applications
 Definition of Terms
01. 02. 03.
Organizational
design—the manner
Traditional Modern Theories
in which a
—are
management achieves Theories—
the right combination contemporary or
of differentiation and are the usual, new design
integration of the
organization's
old fashioned theories
operations, in ways
response to the level
of uncertainty In its
external environment
Simple
This organizational design has few
departments, wide spans of control,
or a big number of subordinates
directly reporting to a manager, has a
centralized authority figure and has
very little formalization of work;
usually used by companies that start
out as entrepreneurial ventures.
Traditional Theories
Functional
This organizational design groups
together similar or related
specialties. Generally, functional
departmentalization is utilized and
put into practice in an entire
organization. For example: A
marketing firm that markets cars and
related products like tires, car
batteries, and accessories. Traditional Theories
Divisional
This organizational design is made
up of separate business divisions or
units, where the parent corporation
acts as overseer to coordinate and
con- trol the different divisions and
provide financial and legal support
services.

Traditional Theories
 Team Design
In team design, the entire
organization is made up of work
groups or teams. Its advantages
include empowerment of team
members and reduced barriers among
functional areas. It also has
disadvantages, including clear chain
of command and great pressure on
Modern Theories teams to perform.
 Team Design
In team design, the entire
organization is made up of work
groups or teams. Its advantages
include empowerment of team
members and reduced barriers among
functional areas. It also has
disadvantages, including clear chain
of command and great pressure on
Modern Theories teams to perform.
 Matrix-Project Design
Matrix design refers to an
organization design where specialists
from different departments work on
projects that are supervised by a
project manager. This design results
in a double chain of command
wherein workers have two managers
their functional area manager and
Modern Theories their project manager who share
authority over them.
 Boundary-less Design
This is another modern
organizational design where the
design is not limited by vertical,
horizontal, and external boundaries.
In other words, there is no
hierarchical levels that separates
workers, there is no
departmentalization, there is no
Modern Theories boundaries.
Lesson 4: Delegation
 Delegation refers to assigning a
new or additional tasks to a
subordi nate; it may also refer to
getting work done through others
by giving them the right to make
decisions and take action. Elements
of delegation include: authority or
the right to set officially or legally,
responsibility or the state of being
answerable legally/morally for the
discharge of a duty, and
accountability is to be liable to be
called to explain.
Steps in delegation include:
• Defining the goal clearly
• Selecting the person who will be
given the task.
• Assigning of responsibility
• Asking the person assigned about
his or her planned approaches to
accomplish the task objectives.
• Granting the assigned person the
authority to act.
• Giving the assigned person enough
time and resources to do the talk,
while at the same time emphasizing
his her accountability
7. Checking the task
accomplishment progress A D VA N T A G E S &
8. Making sure that the task D I S A D VA N T A G E S
objective has been achieved of delegation

It prevents work overload among organization

It may cause laziness among organization managers
managers
provides opportunities for employee or subordinates assigned
to do the task to fully utilize their talents on the job
may encourage too much dependence on others

leads to empowerment of employees or

subordinates assigned to do the task, as it allows It may cause lack of control over
them freedom to contribute ideas and to perform priority management problems
their job in the best possible way

It increases job satisfaction among the assigned employees or

It may cause low self-confidence among managers.
subordinates, that may lead to better job performance
Lesson 5: Formal
and Informal
Organization
 Definition of Terms
01. 02.
Formal organizations—
refer to organizations Informal
formed by the company organizations—refer
owner or manager to help to organizations that
the firm accomplish its exist because of
goals: made up of formal friendship or common
groups (workgroups/ interest made up of
project team/committee) informal groups
similarly formed by which exist for the
company authorities to members' need for
support their activities
and achieve their
objectives
A formal organization is a type of group that is deliberat
ely constructed and whose members are organized to a
chieve a specific goal. Churches, schools, hospitals, an
d companies are just a few examples. Modern formal o
rganizations allow us to accomplish tasks in the most ef
ficient way possible. Could you imagine how our socie
ty would run without government, businesses, and heal
thcare institutions?

Formal organizations are

characterized by hierarchical and
reporting relationships among
groups or members.
An informal organization is a gr
oup of people who share a com
mon identity and are committed
to achieving a common purpose

informal organizations consist of informal

groups born out of the need for social
affiliation.
Formal organizations have the following
function:
1. Accomplish goals that require
cooperation or collaboration among
formal groups in the organization;
2. Produce or bring about new and
creative ideas and solutions to com pany
problems;
3. Coordinate interdepartmental activities: 4. Lessen individual members' insecurities,
4. Implement company rules/regulations
and policies; and
5. Orient/train new employees.
Meanwhile, informal organizations'
function include the following:
1. Satisfy the members' need for affiliation;
2. Give the individual members a chance to
develop their self-esteem: 3. Give
individual members an opportunity to
share their ideas;
and
5. Provide a mechanism to solve members'
personal and interpersonal problems.
 ORGANIZATION AND MANAGEMENT :

Thank You for Listening

Group 5: Sabina Macarandang—Mechaella
Aslor—Aravel Alvarez—Bea Gabayno—
Christian Jaz Mendonez