0TPR

Session 4 : Dimensions of Organization

Structure

COORDINATOR & FACILITATOR

Prof. Manoj Ghadge

Structural Dimensions - Types

1. Complexity

2. Formalization
3. Centralization

Differentiation
Differentiation is the degree to which task and the work of

individuals, groups and units are divided within an organization.

Differentiation helps the different unit within an organization to

concentrate on different part of the organization. For example

universities have their departments to cope with various functions.

These departments have their own norms and values to share.

Integration
Integration is the coordination of the work of previously

performed

under

various

departments.

So

as

university

differentiate the department, there is a need to integrate the work

of various departments to achieve high quality research, teaching

and consultancy funds.

As the environmental uncertainty is low, we need to differentiate
less and vice versa. As the environment become uncertain,
organization need to respond by differentiating more and more.

When we differentiate more; we need to integrate also more.

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1. Complexity
Complexity is the degree of differentiation and
integration within an organization.
Horizontal differentiation
Vertical differentiation

Spatial differentiation

A. Horizontal Differentiation
Degree of differentiation between units based on
Nature of the task
Education and training
Orientation of members
Specialization and Departmentation
Specialization is particular grouping of activities
performed by an individual
Specialization functional specialization ( division of
labor) and social specialization
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What it means!
It means if we have more number of jobs within an

organization that requires skills and knowledge, than more

complex that organization is.
Example - if the organization requires to focus more on R & D
as well as marketing than there is more complexity

Increase specialization results in increased complexity

Functional specialization
Jobs are broken down into simple and repetitive
task

Why does division of labor still work ?

No one person can perform all the task
Limiting knowledge act as a constraint
Poor usage resources in paying individuals

Efficiency
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Departmentation
The process of grouping together activities and employees

who share a common supervisor and resources, who are

jointly responsible for performance, and who tend to
identify and collaborate with each other.

Coordinate activities that have been horizontally

differentiated.

How is Departmentation different that of Teams

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B. Vertical Differentiation
Refers to depth in the structure

Tall and Flat organization

Hierarchy number of levels of authority to be found in an
organization
Span-of-control - number of subordinates who report to a
single supervisor or manager and for whose work that person

is responsible

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Flat Organization

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Tall Organization

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Span of Control
Factors determining the choice of span-of-control

Similarity of task
Geographic proximity
Subordinate characteristics
Interaction requirement
Standardized procedures
New problems
Knowledge gap
Task complexity
Managers job
Planning and co-ordination
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C. Spatial Differentiation
Spatial Differentiation is degree to which the location of

an organizations office, plants and personnel are

dispersed geographically.

Why complexity is important for managers ?

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Line staff and functional relationship

Authority
Responsibility
Accountability

Line employees directly responsible for manufacturing

goods and services
Staff employees take advisory position and use specialized
expertise to support

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Line Staff Functional Relationship

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2. Formalization
The extent to which jobs within organization are standardized
Formalization can be explicit or implicit
Range of formalization can vary within and among
organization
Depends on nature of skill required for the job, level within
the organization

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Why to have Formalization

Why to have formalization?
To regulate employee behavior
To promote coordination

Formalize job or people?

Externalize behavior
Professionalization

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Formalization Techniques

Selection
Role Requirement
Rule, Procedures and Policies
Trainings
Rituals

Complexity and Formalization : Nature of

relationship ?
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3. Centralization
The concentration of authority and responsibility for
decision-making power in the hands of managers at
the top of an organizations hierarchy.

The degree to which the formal authority to make

discretionary choices is concentrated in an
individual, unit, or level (usually high in
organization), thus permitting employees (usually
low in organization) minimum input into their work.
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Why is Centralization Important

Managers have limited ability to give attention to
every detail
Decentralization can provide detail input into the
decision
Facilitates speedy action
Provide motivation to employees
Create training opportunity

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Nature of Relationships!
Complexity and Formalization
Centralization and Complexity

Centralization and Formalization

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