IO LESSON 4

• Pros of Functional Structure

  • Promotes skill specialization
  • Reduces duplication of scarce resources and uses resources full time
  • Enhances career development for specialists within large departments
  • Facilitates communication and performance because superiors share expertise with their subordinates
  • Exposes specialists to others within the same specialty
• Cons of Functional Structure

  • Emphasizes routine tasks, which encourages short – time horizons
  • Fosters parochial perspectives by managers, which limit their capabilities for top – management positions
  • Reduces communication and cooperation between departments
  • Multiplies the interdepartmental dependencies, which can make coordination and sched
• Pros of Multidimensional/Divisional Structure

  • Easily expand products or services merely by adding new division
  • Each division operates as a separate entity, thus greater accountability
  • Growth relatively easily
  • Outcome – focused
  • Direct employee attention to customers and products rather than to their own specialized knowledge
  • Recognizes sources of interdepartmental dependencies
  • Foster an orientation toward overall outcomes and clients
  • Allows diversification and expansion of skills and training
  • Ensures accountability by departmental managers and so promotes delegation of authority and responsibility
  • Heightens departmental cohesion and involvement in work
• Cons of Multidimensional/Divisional Structure


  • Offer few promotional opportunities
  • Supervision may not always be adequate since many works report to the same supervisor
  • Can threaten middle managers and staff specialists
  • Requires changes in command – and – control mindsets
  • Duplicate scarce resources
  • Requires new skills and knowledge to manage lateral relationships and teams
  • May take longer to make decisions in teams
  • Can be ineffective if wrong processes are identified
• Pros of Simple Structure

  • Minimal hierarchy
  • Highly flexible and minimizes the walls that form between employees
• Cons of Simple Structure

  • Insufficient economies of scale to assign them to specialized jobs
  • Difficult to operate as the company grows and become more complex
• Pros of Flat/Process Structure

  • Greater interaction between top and bottom of the organization
  • Focuses resources on customer satisfaction
  • Improves speed and efficiency
  • Adapts to environmental change rapidly
  • Increases ability to see total workflow
  • Enhances employee involvement
  • Lower costs because of less overhead structure
• Cons of Flat/Process Structure

  • Offer few promotional opportunities
  • Supervision may not always be adequate since many workers report to the same supervisor
  • Can threaten middle managers and staff specialists
  • Requires changes in command – and – control mindsets
  • Duplicate scarce resources
  • Requires new skills and knowledge to manage lateral relationships and teams
  • May take longer to make decisions in teams
  • Can be ineffective if wrong processes are identified
• Pros of Tall Structure

  • May offer lower – level employees many different promotional opportunities throughout their careers
  • Adequate supervision since each supervisor is only responsible for a few employees
• Cons of Tall Structure

  • Workers at the bottom level may feel cut – off from those who are above because they are separated by many levels
  • Can become "top heavy" with administrators and managers, because the ratio of line workers to supervisors is very low
  • Executives tend to receive lower – quality and less – timely information
  • High overhead costs – necessarily have more people administering the company
  • Employees feel less empowered and engaged in their work
• Pros of Matrix Structure

  • Highly flexible and adaptable
  • High levels of performance in dealing with complex, Creative work products
  • Greater work communication and job satisfaction
  • Makes very good use of resources and expertise
  • Improves communication efficiency, project flexibility, and innovation
  • Makes specialized, functional knowledge available to all projects
  • Uses people flexibly, because departments maintain reservoirs of specialists
  • Maintains consistency between different departments and projects by forcing communication between managers
  • Recognizes and provides mechanisms for dealing with legitimate, multiple sources of power in the organization
  • Can adapt to environmental changes by shifting emphasis between project and functional aspects
• Cons of Matrix Structure

  • Do not work well with all types of tasks or workers
  • Best suited for projects and products that requires creativity and innovation but less suited for routine tasks
  • Report to 2 bosses simultaneously can cause confusion and conflict among managers who share equal power
  • Can be very difficult to introduce without a preexisting supportive management climate
  • Increases role ambiguity, stress, and anxiety by assigning people to more than 1 department
  • Without power balancing between product and functional forms, lowers overall performance
  • Makes inconsistent demands, which may result in unproductive conflicts and short – term crisis management
  • May reward political skills as opposed to technical skills
• Pros of Team-Based Structure

  • Collab with other workers to get the job done
  • Each worker is viewed as knowledgeable and skilled
  • Team members have considerable input into organizational decision making
  • Less emphasis on organizational statis
  • More flexible and responsive in turbulent environments
  • Reduce costs
  • Allows quicker and more informed decision – making
• Cons of Team-Based Structure

  • Intragroup conflict arises but it could turn into productive, functional outcome
  • Costly to maintain due to the need for ongoing interpersonal skills training
• Pros of Project Task Force/Network Structure

  • Offer flexibility to realign their structure with changing environmental requirements
  • Enable flexible and adaptive response to dynamic environments
  • Creates best of the best organization to focus resources on customer and market needs
  • Enables each organization to leverage a distinctive competency
  • Permits rapid global expansion
  • Can produce synergistic results
• Cons of Project Task Force/Network Structure

  • They expose the core firm to market forces
  • Information technology makes worldwide communication much easier, but it will never replace the degree of control organizations have when manufacturing, marketing, and other functions are in – house
  • Managing lateral relations across autonomous organizations is difficult
  • Motivating members to relinquish autonomy to join the network is troublesome
  • Sustaining membership and benefits can be problematic
  • May give partners access to proprietary knowledge / technology
• Pros of Centralized Structure

  • Uniformity, each department should operate with some average level of quality and efficiency
  • More efficient operations
• Cons of Centralized Structure

  • May limit individuals to adjust to special circumstances
  • Inefficiencies in decision - making
• Pros of Decentralized Structure

  • Can make their own decisions
  • Decision making and problems are solved at lower levels, more authority to lower – level employees (sense of empowerment)
  • Quicker decisions, greater level of procedural fairness
• Cons of Decentralized Structure

  • Poor decision making could back fire
• Pros of Mechanistic Structure

  • More flexible and responsive to the changes
  • Formal comms channel
• Cons of Mechanistic Structure

  • Limited decision making at lower levels
  • Tasks are rigidly defined and are altered only by higher authorities
  • Limited autonomy and self – determination which could lower intrinsic motivation of workers
• Pros of Organic Structure

  • Emphasize information sharing and an empowered workface rather than hierarchy and status
  • Communication decentralized down to teams and individuals
  • Opportunities for creativity
  • More open comms
  • Better employee satisfaction
  • Fewer formal procedures
  • Deeper employee relationships
• Cons of Organic Structure

  • May lower productivity
  • Too many ideas
  • Slower decision – making
  • Less – regulated work
  • Slower adaptation for new employees
• Job Design


  Developing new jobs or adding responsibilities to existing jobs. Interview questions, training plans, development plans, career implications, performance reviews, and compensation, tie into the job design. Process of assigning tasks to a job, including interdependency of those tasks with other jobs. Allows a company to more easily reach its goals by having more employees perform
• Departmentation, Delegation, Span of Control, and Chain of Command are elements that create organizational structure and have distinct relationships
• Han


  • Hierarchy and status
• Communication


  • Decentralized down to teams and individuals
• Potential downsides of decentralized communication

  • May lower productivity
  • Too many ideas
  • Slower decision-making
  • Less-regulated work
  • Slower adaptation for new employees
• Benefits of decentralized communication

  • More open communications
  • Better employee satisfaction
  • Fewer formal procedures
  • Deeper employee relationships
• DESCRIBE THE ELEMENTS THAT CREATE ORGANIZATIONAL STRUCTURE AND THEIR DISTINCT RELATIONSHIPS: JOB DESIGN, DEPARTMENTATION, DELEGATION, SPAN OF CONTROL, AND CHAIN OF COMMAND
• Job design


  Developing new jobs or adding responsibilities to existing jobs
• Elements of job design

  • Interview questions
  • Training plans
  • Development plans
  • Career implications
  • Performance reviews
  • Compensation
• Job design


  Process of assigning tasks to a job, including interdependency of those tasks with other jobs
• Benefits of job design

  • Allows a company to more easily reach its goals by having more employees perform more tasks within the organization
  • Creates clear and effective communication process throughout the company since it clearly defines tasks and form them into natural work units to organize duties
  • Structuring the content and size of jobs for efficient task performance, flexibility, and worker satisfaction and defining their component tasks, conditions, and competency requirements for recruitment, appraisal, reward, and a number of other HR processes
• Job specialization


  Occurs when the work required is subdivided into separate jobs assigned to different people to improve work efficiency
• Job enrichment


  An employee assumes more responsibility over the tasks
• Benefits of job enrichment

  • Help improve motivation and morale for employees who remain following organizational downsizing
  • Combining highly interdependent tasks into one job (natural grouping)
  • Feel sense of ownership, therefore, increase job quality
  • Putting employees in direct contact with their clients rather than using another group or the supervisor as the liaison between employee and the customer (establishing client relationship)
• Job rotation


  Workers are rotated among variety of jobs, spending certain length of time at each
• Benefits of job rotation

  • Exposing workers to as many areas of organization as possible so they can gain a good knowledge of its workings and how the various jobs and departments fit together
  • Increases worker flexibility, eliminates boredom, and increases worker satisfaction