THE ORGANIZING

FUNCTION
Chapter 4

Organizing Function is Helpful By:

1. Assuring more efficient use of the
organizations resources.
2. Improving employee understanding of
job duties and responsibilities.
3. Improving employee morale.
4. Providing a sense of direction for each of the
organizations functional areas.

Organizations Objectives

Must be clearly defined, understood, and

accepted by each individual concerned with
their attainment.

Span of Control

Refers to the number of subordinates

an individual is able to supervisor.

Factors Affecting Span of Control

Leadership style
Latitude extended to subordinates in decision
making
Nature of interpersonal
relationships inherent in
each situation

Self-directed teams and the empowerment of

employees lessen the amount of direct control
supervisors have over their subordinates

Interrelated Functions

Organizations functions have become so

interrelated that when a problem arises in one
functional area, other related functions are also
likely to be affected.

Chain of Command

Identifies who reports to whom within

an organization.

Unity of Command
Unity of Command

States that each employee

should be directly
responsible to one
supervisor.

Work Assignment
Each employees work assignments should be
based on his/her special strengths and talents.
Absence of clearly
defined job duties and
responsibilities makes
it more difficult to
hold an employee
accountable
for unsatisfactory
performance.

Commensurate
CommensurateAuthority
Authority and
and Responsibility
Responsibility

States that individuals who are given the

responsibility to undertake a task must also
be given an appropriate amount of authority to
ensure task completion.

Employee Empowerment

Empowered employees
are encouraged to
participate as much as
possible in making
decisions that affect all
aspects of their job tasks.

Organizational Structures

Determines the authority relationships among it

employees
Common structures:

Line
Line and staff
Functional
Product
Committee
Matrix

Line Structure
Is the oldest and simplest of structures.
Has direct authority flowing
vertically from the top.
Is generally found in small organizations
because support staff is needed once they
begin to grow.

Line and Staff Structure

Has line authority similar to line structure.
Specialized staff activities are added that
support line activities.
Staff employees assist the line function.

Line and Staff Organization

P re s i d e n t
V i c e P re s i d e n t
P ro d u c ti o n
P u rc h a s i n g

F o re m e n
S u p e rv i s o rs

V i c e P re s i d e n t
S a le s
S a le s M a n a g e r

A d v e rti s i n g

V i c e P re s i d e n t
C o rp .A ffa i r s
H u m a n R e s o u rc e s O ffi c e S e rv i c e s
O ffi c e W o rk e rs

Line Employees

Staff Employees

Line employees are directly

concerned with the
organizations
primary objectives.

Staff employees support

the line employees.

Functional Structure
Tends to parallel the departments in
many organizations.
Line managers have both line and
functional authority.
Most commonly found in small-and
medium-sized organizations. It tends to
centralize decision making at top levels
of the organization.

Product Structure
Companys products provide a basis
for its structure.
Each major product is given division status.
Incorporates line and staff structure into
these divisions.
Each product tends to operate independently
of other divisions.

Committee Structure
Is often used in conjunction with line,
line and staff, and functional
structures.
Some committees perform
important managerial functions;
others are advisory.

Matrix Structure
Is often used by organizations undertaking
complex projects.
Results in the formation of temporary
new units to accommodate the
undertaking of a new project.
Involves temporarily borrowing employees
from other areas of the organization and
assigning them to the new temporary unit.

Vice President Vice President Vice President

Manufacturing
Finance
Sales

Project A
Manager
Project B
Manager

Matrix Structure

Centralization

Decentralization

Places related activities under

jurisdiction of one individual.

Places related activities under

jurisdiction of several
individuals throughout the
organization.

Factors That Determine Feasibility of

Centralization

Nature of Organization

Greater the volume of work and

paper processing activities, the
more desirable centralization of
office activities becomes
Two type of organizations have
centralized most of their office activities
Insurance companies
Financial companies

The Organization Chart

Identifies lines of authority.
Gives employees a better understanding of
the formal structure of the organization.
Helps identify areas of overlapping
responsibility that should be eliminated.
Identifies promotional opportunities for job
applicants and new employees.
Identifies areas suitable for training and
orientation.

Guidelines for Preparing

Organization Charts

1. Place individuals/departments in relation to their

hierarchical level.
2. Identify vertical and horizontal authority by
solid lines.
3. Identify functional authority by dotted lines.
4. Use complete titles on the chart.
5. Include on the chart name of organization and
its date of preparation.

Informal Organization

Refers to the
spontaneous personal
and social relationships
that exist within
organizations.

Two Common Elements of

Informal Organization
Informal Communication
Patterns

The End