Management is concerned with how an organization achieves its performance. The procedures that must be followed to establish the organizational structure, develop strategies, and take managerial actions are all related to management. This assignment is based on two topics: a) Analyze Organizational Design’s six key components critically; and b) Describe the roles of managers in the Strategic Management Process. Using organizational design, a business can launch, compete in the market, and accomplish its objective. Work specialization, departmentalization, chain of command, span of control, centralization vs. decentralization, and formalization are the six components that make up this process. The Strategic Management Process, which has nine steps, can help with these. They are: Identify the organization’s current mission, objectives, and strategies; Examine the environment; Examine the organization’s resources; Find opportunities and threats; Recognize strengths and weaknesses; Reassess the organization’s mission and objectives; Formulate strategies; Implement strategies; and Evaluate results.
What are the benefits of organizational design?
Organizational design can motivate staff to participate in management, enabling the company to promote leaders from within. Organizational design is another tool that businesses can use to communicate the leadership hierarchy and daily goals for each employee. Other benefits of implementing an effective organizational design may include:
What is organizational design?
An organization’s workflow, production, and systems are identified step-by-step using organizational design, also known as organizational structure. This approach enables companies to review their procedures and identify better and more efficient ways to meet their objectives. A company can benefit from the organizational design process in a number of ways, including:
What are the elements of organizational design?
In order to create the best strategy for their company, management teams take into account the distinctive components of organizational design. There are six organizational design factors that can influence how managers and employees interact and assign primary responsibilities. The six elements are:
1. Work specialization
Each professional is assigned to a particular task through the process of “work specialization.” Each employee can concentrate on their task and gain specialized knowledge and experience that can help them improve because the company management is clear about what they expect of their employees.
Management experts frequently assign tasks to the employee who is most qualified for them when using work specialization. This indicates that the professional’s training, experience, and education are appropriate for the job. Work specialization enables an employer to shift its attention and resources away from training and toward other company needs.
Work specialization, for instance, is used by factories and warehouses to hire assembly line workers. In a facility that produces gift baskets, one worker might arrange the decorative paper while a different worker fills the basket with fruits.
2. Departmentalization and compartments
Teams of professionals work in departments and compartments within a larger company. This element of organizational structure enables each compartment or department to concentrate on a particular task that the experts in each group collaborate to complete.
Teams of professionals known as compartments come from various career paths and specialties. These experts each contribute their unique skills to the project’s completion. For instance, a movie studio will hire a director, a casting director, a costume designer, and other experts to produce a new movie.
Within a company, groups of experts with a similar skill set are referred to as departments. Each of these professionals typically performs the same primary responsibilities in order to accomplish the same objective. For instance, the accounting team at a company uses the same procedures and methodologies to manage the company’s finances and tax records.
3. Formalization of elements
Formalization specifies the relationships and roles within a company. Compared to smaller companies, larger companies frequently have a clearer formalization of primary roles. In a smaller company, employees might serve in multiple capacities. For instance, the manager of a local pizzeria might also be in charge of food preparation in addition to their other duties.
Clarifying rules at work, such as how many breaks an employee is allowed during a shift, can also benefit from formalization. When creating a company’s organizational design plan, it’s crucial to take these factors into careful consideration as they have the power to influence workplace culture.
4. Centralization and decentralization
The senior levels of employees who have the power to affect business decisions are referred to as centralization and decentralization. Each company rests somewhere on a scale of centralization.
For instance, with centralization, some businesses give senior-level employees complete control over the decision-making process, whereas with decentralization, a business may also ask lower-level employees for their input. Employee pride and satisfaction in their work may increase if more employees are given the opportunity to influence company policies. However, it may be more time efficient to only allow senior staff members to offer their opinions.
5. Span of control
When a leader has the right number of employees under their control, they can achieve greater success. A component of organizational design called span of control takes into account how many people and tasks a leader oversees. For instance, a publishing company’s acquisitions division is probably going to receive a lot of book pitches. If the department hires numerous readers to meet this demand, the department might require numerous managers to oversee and direct the readers’ work.
Establishing a clear scope of control can help managers manage all of their responsibilities while also overseeing daily operations and keeping an eye on the performance of the members of their designated teams. A number of variables can affect the ideal span of control, including:
6. Chain of command
A company’s chain of command identifies its organizational structure and can have an impact on workplace morale and productivity levels. A company may have a rigid or flexible chain of command, and an organizational chart can show each employee’s position in the hierarchy.
Each employee has a direct supervisor under a rigid chain of command, with the CEO being the sole exception. In a more flexible chain of command, the owner might be the first point of contact, followed by one or two managers in the middle, and the remaining workers would report to the managers. In this case, the managers would report to the business owner, and the lowest level of employee would report to the managers.
Principles of Management: Organizational Design
FAQ
What are the six elements of organizational design?
- Work specialization. Each professional is assigned to a particular task through the process of “work specialization.”
- Departmentalization and compartments. …
- Formalization of elements. …
- Centralization and decentralization. …
- Span of control. …
- Chain of command.
What are the elements of organizational design and structure?
An organizational structure is made up of five components: job design, departmentation, delegation, span of control, and chain of command. These components make up an organizational chart and establish the actual organizational structure.
What are the 4 types of organizational design?
Functional, divisional, flatarchical, and matrix structures are the four types of organizational structures.
What are the basic elements of an organization?
- Work specialization.
- Departmentation.
- Chain of command.
- Span of control.
- Centralization/Decentralization.
- Formalization.
