Six Elements Helpful or Organization Design
McAlester, Oklahoma one of the shortest distances in the south has been able to make vast products with the help of their employees for better perfection. People from this point are great at their work and can easily make 100 percent of market shares. What do they do? They manufacture bombs for US military which probably require the working environment to be interesting with mundane, discipline and also structures that include higher risk along with emotions. All work is done effectively here with great efficiency. Not only here but work is also done efficiently at Cisco in a formal manner. More than 70 percent of employee is seen working at Cisco and 20 percent are from the home. Both of the organization makes usage of different structure for working.
Many of the management have probably undergone few changes for the previous few decades as per the organizational structure. Different managers have undergone evaluation of traditional techniques for finding different methods of creating structure based designing that would support the employees for further working in organization.
Basic concept about organization designing by the writers of management for example Henri Fayol along with Max Weber had offered various structures of pipelines for easy lineup for their managers (Principles being described at pp. 31 to 32.) It had already been more than 90 years since the principle have crossed away. With the length of timing and the changes being done it had been seen as the principles are still worthless. But this had been simply a misconception as they still give you valuable space for designing a better effective and efficiently based organization. In fact, a great proposal filled with knowledge has been there for over a year.
In the Chapter 1, organizing has been described to be one kind of arrangement and structure of work to fulfill organizational goals. This process is quiet vital for any organizational manager. Organizational structure is arrangement of work within any of the organization. In fact, the structure is easily visible at the organizational chart being stated on Exhibit 10-1. Whenever a manager is seen transforming the structure of organization then this comes under organizational designing. Here a six key with specialization, chain of various commands, centralization and decentralized departmental, span of controlling and also formulization.
Footballs being used for the National Football League are all prepared at the factory of Wilson Sporting Goods that too in Ada, Ohio with the help of more than 150 workers. In fact, most of the balls are still used in the colleges and other school games. For better understanding of work specialization you can take example of how the workers work for manufacturing of a single football with their talented task of molding, sewing and stitching, also lacing work. In fact, division of the original work to different parts and then working accordingly is best citing work specialization. Every individual is good at a particular job rather than those of entire work. This simultaneously improves the output of work. With this division of labors you would understand the concept better further in this chapter.
What does specialization of work makes? This helps to make proper use of different skills in an appropriate manner. It depends upon the organization capacity which type of employees do they require, some of them may either work with highly skilled workers whereas some may be able to make usage of lower skilled workers efficiently. In case, all workers are made to work for all necessary steps then they would probably need to fulfill all works efficiently from all sections. They should be able to perform al demanding jobs along with not so demanding one too. For highly skilled work some may even work below their level of skills. Often you might have seen that highly skilled workers are paid higher than those of lower skilled employees. This leads to inefficient usage of all resources. The best example is the cardiac surgeons who hardly re seen closing up their patients after surgery. But usually surgeons are required to do stitch and also staple their patients after surgeries.
Working profitably with specialization would lead to increase in productivity. In the beginnings of 20 century all generalization has been increased. Introduction of specialization has made increase in all working organizations productivity. Any of the good things can easily be carried far distance also being stated by Exhibit 10-2. The sign of diseconomy is like boredom, stress, fatigues, lesser productivities, reduced quality of work, absent minded, etc. These all exceeds the economical advantages.
Today often top managers are seen viewing work specialization is one of the important parts it allows all employees to show their skills efficiently. Best example would be production team of McDonald’s who make usage of proper team specialization to deliver products efficiently to their customers. This makes them called as a “fast” food corner. What happens through the process? One person is appointed to take orders and other for cooking purpose. Whereas some of the people are made to work for frying, some for drinks, another one packs the order etc. This has efficiently been useful for productivity increment at a maximized level. In fact some of the McDonald’s store also flashes a clock with time taken for each customer’s order. But some of the companies including Avery-Dennison, Hallmark, American Express, Ford Australia, and many more make minimum usage of work specialty and offers more task to their employees that reduce productivity.
What is departmentalization?
You might have seen department at your college offering student care services and also with financial help department. Once it is decided which task can be performed and taken care by a group they are divided and assigned to the team with a coordinated task. This grouping of groups is called as departmentalization. Often five common techniques of departmentalization’s are seen existing with all unique classifications. For example the departments of a hotel could vary with help desk operator, sales and caterer, laundry, housekeeping and many more. Figure 10-3 will illustrate well about all departmentalization along with their advantages and disadvantages.
Almost all organization tries to make use of combination of departmentalization types. For instance, Japanese firm makes use of functional units, manufacturing units, sales units, sales for customers, etc. Whereas the Black and Décor also organize functional lining, manufacturing around various processes, geographic sales, customer sales units, etc.
Most popular use of departmentalization would be the increased use of the customer oriented departments. Keeping customers satisfied is always needed as this will approach for better success and emphasis more upon better responses and monitoring of the customer’s issues. In spite of this another point is use of various teams, in order to work upon various tasks and also to accomplish more complex tasks with improved skills as needed. Most of the organizations are seen using cross-functional team. This team comprises of singles from varied specialty. For example, the team of Ford’s at the planning and logistical division makes use of this cross functional team for work like finance, purchase, quality controlling as well as engineering, logistic supplier, several work for improved version of work. These all will be discussed well in the chapter 13.
The Chain of various commands:
If in case you were working at some work and all of a sudden you faced a problem what would be your first step then? What would been done by you to resolve them? Firstly try to learn who your boss is. This is the chain for commands and is meant for. In fact, it is a kind of authority line being extended from higher level in an organization till the lowest levels. This also clarifies the point that has to report and to whom. This will help managers in order to consider more about their employees and resolving their queries on questions like “Who should the employee report?” or else “Where should they visit to resolve their queries?” For understanding this command chain the three most vital things needs to be understood including responsibility, authority and the unity of these commands.
Authority: The early writers from management were able to discuss the concepts of authority. This was glue as per the early day’s team for any of the organization. Authority basically refers to rights that have been inherited by the managers for making their employees to know what next needs to be done and what can else be expected. Managers from this command have the ability to follow their work. The job is mostly of coordinating. Authority may go downward and give certain special privileges to other lowest level managers. Thus the writers also mentioned that the authority term was basically meant for one’s own position within organization. This doesn’t reveal anyone’s characteristics. This also showed that the rights being given to an employee in an organization needs to be taken care of and also followed carefully.
Chester Bernard, being another writer has also proposed some perspectives of authorities. This was called later as acceptance theory of authority. He also revealed this authority as all form of one’s acceptance and willingness of doing that. If any of the employees are seen not accepting the words of their manager then there is no space for authority. If these subordinates are being accepted then only the lower members would accept the authority of their managers.
- They should be able to understand the words.
- In fact, they also feel sometime that the orders are consistent and that too with organizational purpose.
- Orders should have no conflict with any of their belief.
- Should be able to do well upon any task that they are directed with.
This view of authority by Barnard makes sense especially at the point when an employee is asked of doing some work and that too they possess the ability of doing that work. For example, in case the manager comes and asks for doing open heart surgery on any one o the existing student, then the traditional views of authorities says it to be done. But as per the view of Barnard says that instead of fearing you should be able to talk with manager and find out the reason of your lack of knowledge about the work and what probability of interest it requires for following the orders. This example is a true realistic one. Viewing the authority of manager shows the total control of the working of an employee do in realistic or unreal world, just like military policies. Thus the actual belief of Barnard was that employees would follow their manager’s rule.
The early days management has discriminated in between the two most popular form of authority namely line authority secondly the staff authority. This line authority is meant to entitle the managers to help the employees directed towards their work. The relationship of employer with employee is extended from top level to the bottom of organization as per the chain of command shown in figure 10-4. With this chain of commands for line authority managers have the right to make their employees directed towards work and also to make any type of decisions. But this doesn’t mean that any manager won’t be directed by their superior’s commands.
It has been a fact that the term lining is a basis for the differentiation for line managers to that of the staffing. A manager whose work in the organization contributes straight to the success objective is referred to as the line management. In any of the manufacturing organization the line manager is present at production along with sales functional area but human resource managers are usually the staff managers. It completely depends upon the organization of how to categories the objectives into line or staff. At the Staff Builder’s who are popular for supplying temporary employee they follow up line functionality. In a similar manner the ADP firm also follows line functionality.
Though most of the organizations are seen with complex group of line managers but yet they lack time, experts, and resources for doing any work effectively. This makes them go for staff authority for better support, advice, assistance, and also to reduce the pressure of burden from their shoulders. For example, administrator of a hospital who is not able to purchase departmental necessities falls under staff functionality. Obviously the teams of purchasing head are under line authority for purchase agents those are working. If the administrator of the hospital thinks to be under pressure then that position will be described a staff authority. This is illustrated well with Exhibit 10-5.
Responsibility: managers are seen assigning task to their employees and when those employees make obligations for doing those duties then this is called as responsibility. Also the employees who are taking the duty should be responsible for their performances. Without any responsibility the work being assigned would be considered to be an opportunity that too abusing. Similarly, no one is responsible for tasks that they are made to work on.
Unity of commands: This unity of command falls under the Fayol’s 24 principles of management. This command tells that one has to report to their managers. Multiple types of commands would come from any manager and this may create a conflict. Thus this unity of command is being followed. The same conflict was experienced by Damian Birkel, a merchandise manager from Fuller Brand. He was founded reporting to the two of his boss one for the departmental store in charge and other one are for discounted charges. Birkel tried minimizing the conflicts by using techniques of combined list of work with regular updates of the tasks.
Theories from early management like Fayol, Weber, Barnard, Taylors, and many more belief the chain of commands, line as well as staff authority, unity of commands, and responsibility are essentially meant that time has transformed. These all elements have been of less importance. In Michelin plant tour the manager has been replacing the top to down command of chain with their birdhouse meeting. In this type of meeting the employees get a chance of meeting each other for just five minutes that too at a regular interval all day long and study more about the tables and products chart. The shop manager is all enabler. Now a day due to Information technology the employees could easily make matters understandable that are only present with their managers. This can be done within few seconds. This also tells that any employee can easily communicate with anyone without the use of chain of commands. Often some employees are seen reporting their bosses and thus ignoring the act of chain of commands. In this if arrangements are made well free from conflicts and problems then this is best for chain of commands.
Span for all controls:
What rate of employees can be managed by a manager? This is the point where span of control starts. Traditional view stated that managers shouldn’t manage more than that of five or six employees at a time. Span of control determining is important for better understanding of level of managers of an organization. This is done such that one can identify how efficient organization could be. Wider the span more an organization will be efficient. Learn it here.
Take for assumption two different organizations both with almost 4100 employees. As per the Exhibit 10-6, suppose an organization is having span of four whereas the other take sit to be six then it is obvious that the one with higher span is preferable. For a managers salary with $42000 per year this organization would be able to save up to $33 million. This shows that how efficient the wider span of control is. But this is not fixing as wider span may also reduce effective work if in case performance of the employee is degraded. This happens usually when managers do not lead the employees effectively.
View of today:
This view of span and control shows that no such magic number exists. Many vital factors affect the list of employees a manager usually manages. The factors might include skills and ability of every manager along with their employee. This also includes these characteristics of work been done. For example, managers that comprise of perfectly trained and experiencing employees who can function better for a perfectly wide span. Some other points that would help o determine the span of control would include similarity, complexity of all tasks, physical proximities of all subordinates, degree of standard procedures, sophistication of organizations, strength of an organizational culture, perfect styling of manager.
Recently the trend has been towards the larger span of control. This is followed with the efforts of managers and also their speed of making decisions increasing the flexibility, getting closer to their customers, employees empowerment, and also reducing the costs. Managers can now handle longer spans easily if their employees understand thejob well and the processes of organization. For example, PepsiCo’s cookies plant in the city Mexico has reported over 56 employees for each manager. Employees were given knowledge upon wider span in order to avoid performance sufferings. They were given brief details about the goal of their organization. Along with this new pay system was followed including quality of reward, services, productivity, and also team work.
Concept of centralization and decentralization:
One of those popular questionswhich needs an answer these days include “At which level of an organization the decisions are being made?” At upper level of organization the decision making that takes place is related to as Centralization. If in case the managers take any decision with the support of key decisions from lower level of employees then this is even more centralized. If this decision from lower employees gets more in number then this move towards decentralization. This needs to be kept in the mind that both are not a concept. Whatever is the decision it is seen that no organization is centralized or else decentralized.
Whatever be the degree of centralization it solely depends upon the situation. The ultimate goal of an organization is efficient usage of employee. Traditionally the organizations were structured to that of a pyramid. This concentrated the power along with authority to the top of an organization. With this structure the organization took centralized decisions but as the organization has been transformed so they have been more complex. The changing environment has made this level of complexity. Any type of decision is required to make by employees who are facing them without any consideration of the organization level. The US and Canadian organizations has moved towards decentralization. The Exhibit 10-7 wills how it clearly.
Managers today choose the level of both centralization as well as decentralization such that they can easily implement the decisions for achieving the desired goals. It is not always necessary for any work to be implemented successfully in any other organization as it was done in previous one. Managers are bound to decide the level of decentralization and work being in that limits.
Employee empowerment is a term being used especially for an organization when it becomes more flexible along with responsive for the shift towards this decentralization in environment. In fact, with this the employees get even stronger power of making decisions. This will be more elaborated in chapter 17. The lowest level of managers of any organization has the best way of being closer to the detailed analysis of problems and also how to solve those without any issue getting help from the top level managers. For example, CEO of Terex Corporation, Ron Defeo has been a great decentralized proponent who asks the managers to run that company they are been provided with. The company also generates revenue of $4 billion in the year 2009 and also had a number of 16000 employees. A similar example could be seen throughGeneral Cable plant of Mexico where each employee has to manage 6000 raw materials that too being active. These are present at the inventory and plant floors. Even the company looks for various ways in order to place more number of responsibilities upon the shoulder of its workers.
This term refers to as how well an organization’s jobs are standardized and also to the level at which employers behavior is been guided. In many of the high organization explicitly job descriptions, organizational rule, defined processes for work. Employees have to understand little about their work, when to do that work and how to do it. If the level of formalization is lower than employees will have more discretion throughout their work.
View today’s point:
Formalization is needed for better consistency and other control system and this has made most of the organizations to rely less upon their strict rules and regulations for their employee’s behavior. For example,
A customer visits the drug store with a large branch of nation and also drops another role of films on the same day of 37 minutes from the policy of that store. The sales clerk is aware of the fact that he was supposed of following those rules also he could even get film ready with no issue with their customers. This makes him accept the film against the violating policies and thinks that manager won’t be able to find all these.
Is there anything wrong done by the employee? Yes, he has broken the rule. But with this a new form of revenue generation policy has been taken into consideration with good service of customers.
Now consider for situations where it gets tough to avoid rules, some of the organization has some space for their employees by providing them with satisfactory autonomy for making better decisions for betterment. It does not mean that you should avoid all rules because rules are equally important for all employees to follow. In fact the rules should also be explained for better understanding. But for some other type of rules employees must be given liberty.
Links of Previous Main Topic:-
- management and organizations a managers dilemma
- Understanding managements context constraints and challenges
- Managing in a global environment
- Managing diversity
- What is social responsibility
- Managing change and innovation
- Managers as decision makers
- Foundations of planning
- Strategic management
- Basic organizational design
Links of Next Fundamentals of Management Topics:-
- Contrast upon mechanistic and other organic structures
- Contingency factors affecting structural choice
- Traditional designing of organizations
- Case application 1 ask chuck
- Case application 2 a new kind of structure
- Chapter ten summary by learning outcomes
- Preparation for career basic organizational design
- Adaptive organizational design
- Managing human resources
- Managing teams
- Understanding individual behavior