Lim Sei Kee @ cK
 Process
of arranging people and resources to
work toward a common goal.
 Organizing
decisions divide up the work that
needs to be done, allocate people and
resources to do it, and coordinate results to
achieve productivity.
 Divide
up the work
 Arrange resources
 Coordinate activities
 The
organization chart is a diagram that
illustrates the reporting lines between units
and people within the organization.
 The organization chart conveys four kinds of
information:
The boxes represent different units.
 The titles in each box show the work performed by
that person.
 Reporting relationships are shown by the lines
connecting superiors and subordinates.
 Levels of the organization are indicated by the
number of vertical layers in the chart

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Chairman of
Board and CEO
Executive
Vice President,
Chief Financial
Officer
Executive
Vice President,
Legal
Executive
Vice President,
Marketing
Vice President,
Investor
Relations
Executive
Vice President,
International
Technology
Executive
Vice President,
Human
Resources
Senior
Vice President,
Real Estate
President,
Mexico
Executive
Vice President,
Operations
Executive
Vice President,
Merchandising
Senior
Vice President,
Operations
Senior
Vice President,
Customer
Service
President,
Atlantic
President,
Western
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 Differentiation
means that the organization
is composed of units that work on specialized
task using different work methods and
requiring employees with unique
competencies.
Division of labor means that the work of the
organization is divided into smaller tasks.
 Specialization is the process of identifying
particular tasks and assigning them to departments,
teams, or divisions.

 Integration
means that the various units must
be put back together so that work is
coordinated.
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

Hierarchy is a pyramid showing
relationships among levels.
Span of control refers to the number
of employees directly reporting to a
person.

Factors influencing span of control
include:
1.
2.
3.
4.
The competence of both the manager
and the employee.
The similarity or dissimilarity of tasks
being supervised.
The incidence of new problems in the
manager’s department.
The extent of clear operating
standards and rules.
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
Authority, Responsibility, and
Accountability



Authority is the right to make a decision.
Responsibility is an employee’s duty to
perform the assigned task.
Accountability is the manager’s expectation
that the employee will accept credit or blame
for his work.
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 Delegation
is the process of giving authority
to a person (or group or team) to make
decisions and act in certain situations.
 Practices useful in effective delegation
include:






Establish goals and standard
Ensure clarity
Involvement
Expect completed work
Provide training
Timely feedback
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 Centralization


and Decentralization
Centralization is the concentration of authority
at the top of an organization or department.
Decentralization is the delegation of authority
to lower level employees or departments.
 Key
factors affecting decision to
centralization or decentralization.





Cost of decisions
Uniformity of policy
Competency levels
Control mechanisms
Environmental influences
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 Functional
Design
 Product Design
 Geographical Design
 Network Design
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 Function
design means grouping
managers and employees according
to their areas of expertise and the
resources they use to perform their
jobs.
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Potential Benefits
Potential Pitfalls

Supports skill specialization

Inadequate communication

Reduces duplication of
resources & increases
coordination

Conflicts over product
priorities

Difficulties with interunit
coordination

Focus on departmental
rather than organizational
issues and goals

Develops managers who are
experts in a narrow field



Enhances career
development & training
within functional area
Allows superiors and
subordinates to share
common expertise
Promotes high-quality
technical
decision making
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CEO
General
Counsel
Controller
Owners Groups
(HOGS)
Manufacturing
Strategic
Planning
Merchandise
Human
Resources
Engineering
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 Product
design means that all
functions that contribute to a
product are organized under one
manager.
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Potential Benefits





Permits fast changes in a
product line
Allows greater product
line visibility
Fosters a concern for
customer demand
Clearly defines
responsibilities for each
product line
Develops managers who
can think across functional
lines
Potential Pitfalls




Not allowing efficient
utilization of skills and
resources
Not fostering coordination
of activities across
product
Encourages politics and
conflicts in resource
allocation across product
lines
Limits career mobility for
personnel outside their
own product lines
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Chairman & Chief
Executive Officer
Information
Systems &
Technology
Land
Systems
Combat
Systems
Armament
Systems
Marine
Systems
Aerospace
Ordnance &
Tactical
Systems
Bath
Iron
Works
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Aviation
Services
Electric
Boat
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 Geographical
design organizes
activities around location.
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Potential Benefits




Has facilities and the
equipment used for
production and/or
distribution all in one
place, saving time and costs
Able to develop expertise in
solving problems unique to
one location
Gaining an understanding of
customers’ problems and
desires
Getting production closer
to raw materials and
suppliers
Potential Pitfalls



Duplication of functions, to
varying degrees, at each
regional or individual unit
location
Conflict between each
location's goals and the
organization's goals
Adds levels of management
and extensive use of rules
and regulations to
coordinate and ensure
uniformity of quality among
locations
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CEO
President
Executive VP,
Legal
Executive VP,
Executive VP,
Executive VP,
Supply Chain & Coffee
Partner Resources Chief Financial Officer
Senior VP,
Coffee
President,
Japan
President, Europe,
Middle East, Africa
President,
North America
VP,
Southwest
VP,
South Central
VP,
Northwest
President,
International
United Kingdom
Australia
Thailand
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 Network
design subcontracts some
or many of its operations to other
firms and coordinates them to
accomplish specific goals.
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Potential Benefits



Ability to gain special
knowledge and skills of
others without having to
hire employees
Brings together people with
different insights
Allows managers the
flexibility to work with a
wide variety of different
suppliers, customers, and
other organizations
Potential Pitfalls



Other organizations may
fail to live up to established
deadlines
Managers must constantly
monitor the quality of work
provided by other
organizations
Employees in the
outsourced organization
may not commit to the
same values and sense of
time urgency to which
employees in the
networked organization are
committed
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Legal
Computer
Hardware/
Software
Marketing
Makeup
Artists
Costume
Designers
Spielberg
(Films)
Katzenberg
(Animation)
Technicians
Agents
Actors
Talent
Scouts
Future
Games
Geffen
(Music)
Media
Relations
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