Matakuliah
Tahun
: J0712 - Pengantar Bisnis
: 2009
Organizational Structure
Pertemuan 06
Organizational Structure
•Outlines:
What is Organizational Structure?
The Building Blocks of Organizational Structure
Establishing The Decision-Making Hierarchy
Basic Forms of Organizational Structure
Informal Organization
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What Is Organizational Structure?
• Specification of the jobs to be done within an
organization and the ways in which they relate to
one another.
• Organizational structure thus influenced by:
– Jobs to be done
– How jobs relate to one another
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Determinants of Organization
• The organization’s purpose,
mission and strategy work
together to determine an
organization's structure.
• Size, technology and changes in
the organization’s environment
affect structure.
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Organization chart
• Organization chart is a diagram depicting a
company’s structure and showing employees
where they fit into its operations
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The Building Blocks of Organizational Structure
• Specialization: determining who will do what.
• Departmentalization: determining how people performing certain
tasks can best be grouped together.
• Chain of command: The continuous line of authority that extends
from upper levels of an organization to the lowest levels of the
organization and clarifies who reports to who.
• Span of control: The number of employees who can be effectively
and efficiently supervised by a manager.
• Centralization and decentralization
• Formalization: The degree to which jobs within the organization
are standardized and the extent to which employee behavior is
guided by rules and procedures.
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Specialization
• Job specialization is the process of identifying the specific jobs
that need to be done and designating the people who will perform
them.
• Specialization and Growth
– Job specialization is a natural part of organization.
– However, overspecialization can result in human diseconomies from stress,
boredom, fatigue, poor quality, increased absenteeism, and higher turnover.
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Departmentalization
• Types of Departmentalization:
– Customer
– Product
– Process
– Geographic
– Functional
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Customer Departmentalization
Customer departmentalization divides a firm according to
types of customers likely to buy a given product
Metro
Dept.Store
Men’s
Department
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Women’s
Department
Luggage
Department
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Product Departmentalization
Product departmentalization divides a firm according to
specific products or services being created.
Lucent
Technology
Wireless
Communication
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Optical
Networking
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Process Departmentalization
Process departmentalization divides a firm according to
production processes used to create a good or service.
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Geographic Departmentalization
Geographic departmentalization divides a firm according to
areas served by a business.
Levi
Strauss
U.S.
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Europe
Asia
Pacific
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Functional Departmentalization
Functional departmentalization divides a firm according to a
group’s functions or activities.
Small
Business
Production
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Marketing
&
Sales
Human
Resources
Accounting
&
Finance
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Multiple Forms of Departmentalization
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Chain Of Command
Chain of command are reporting relationships
within a company
CEO
Division V.P.
Store
Manager
Department
Supervisor
Frontline
Employee
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Centralization
Centralized
organization is a
pattern in which most
decision-making
authority is held by
upper-level
management.
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Boss (Makes All Decisions)
Subordinate
Subordinate
Subordinate
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Decentralization
• Decentralized
organization is a
pattern in which a
great deal of
decision-making
authority is
delegated to levels
of management at
points below the top.
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Supervisor
Employee
Employee
Customer
Customer
Employee
Employee
Customer
Customer
Makes Some Decisions
(Empowered)
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Flat and Tall Organization
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Span Of Control
Number of people supervised by one manager.
Narrow
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Wide
Formalization
• The degree to which jobs within the organization
are standardized and the extent to which
employee behavior is guided by rules and
procedures.
– Highly formalized jobs offer little discretion over what
is to be done.
– Low formalization means fewer constraints on how
employees do their work.
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Basic Forms of Organizational Structure
• Functional organization is usually structured around
basic business functions
• Divisional organization relies on product
departmentalization
– Division
• Matrix organization is a structure in which teams are
formed and team members report to two or more
managers
• International organization is a structure developed in
response to the need to manufacture, purchase and sell in
global markets
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Functional Organization
Marketing
HQ
Finance
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Operations
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Divisional Organization
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Matrix Organization
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International Division Structure
CEO
Retail
Division
A
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Retail
Division
B
Retail
Division
C
Latin
America
Europe
Asia
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Organizational Design for the 21st Century
• Boundaryless organization is one in which
traditional boundaries and structures are minimized or
eliminated altogether.
• Team organization relies almost exclusively on
project-type teams.
• Virtual organization has little or no formal structure
• Learning organization works to integrate continuous
improvement with continuous employee learning and
development.
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What Is an Informal Organization?
• Everyday social interactions
among employees that
transcend formal jobs and
job interrelationships.
– Informal Groups- Interact
Among Themselves
– Grapevine
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What Is Intrapreneuring?
Process of creating and maintaining the innovation and
flexibility of a small-business environment within the confines
of a large corporation.
Intrapreneur
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