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Chapter 13, Dr. Nghia Trong Nguyen, Organizational Behaviour, Fourth Canadian Edition 13-1 Copyright © 2007 Pearson Education Canada Chapter 13 Organizational Structure
Chapter 13, Dr. Nghia Trong Nguyen, Organizational Behaviour, Fourth Canadian Edition 13-1 Copyright © 2007 Pearson Education Canada
Chapter 13
Organizational Structure
Chapter 13, Dr. Nghia Trong Nguyen, Organizational Behaviour, Fourth Canadian Edition 13-2 Copyright © 2007 Pearson Education Canada
Chapter Outline
• What Is Organizational Structure?
• Mechanistic and Organic Organizations
• Traditional Organizational Designs
• New Design Options
• What Major Forces Shape an Organization’s
Structure?
Chapter 13, Dr. Nghia Trong Nguyen, Organizational Behaviour, Fourth Canadian Edition 13-3 Copyright © 2007 Pearson Education Canada
Organizational Structure
1. What are the key elements of organizational
structure?
2. How flexible can organizational structures be?
3. What are some examples of traditional
organizational designs?
4. What do newer organizational structures look like?
5. Why do organizational structures differ?
Chapter 13, Dr. Nghia Trong Nguyen, Organizational Behaviour, Fourth Canadian Edition 13-4 Copyright © 2007 Pearson Education Canada
Exhibit 13-1 Pyramidal
Organizational Structure
Chapter 13, Dr. Nghia Trong Nguyen, Organizational Behaviour, Fourth Canadian Edition 13-5 Copyright © 2007 Pearson Education Canada
Exhibit 13-2
Flat Organizational Structure
Chapter 13, Dr. Nghia Trong Nguyen, Organizational Behaviour, Fourth Canadian Edition 13-6 Copyright © 2007 Pearson Education Canada
Exhibit 13-4 Departmentalization
by Function
Source:
www.cityofkingston.ca/pdf/cityhall/
CityOrgChart2005.pdf. Reprinted
by permission of the City og
Kingston.
Chapter 13, Dr. Nghia Trong Nguyen, Organizational Behaviour, Fourth Canadian Edition 13-7 Copyright © 2007 Pearson Education Canada
Exhibit 13-5
Departmentalization by Product
Optical
Networks
Enterprise
Networks
Wireline
Networks
Nortel Networks
Wireless
Networks
Chapter 13, Dr. Nghia Trong Nguyen, Organizational Behaviour, Fourth Canadian Edition 13-8 Copyright © 2007 Pearson Education Canada
Exhibit 13-6 Departmentalization
by Geography
Royal Bank of Canada
Canada Asia Europe United States
Chapter 13, Dr. Nghia Trong Nguyen, Organizational Behaviour, Fourth Canadian Edition 13-9 Copyright © 2007 Pearson Education Canada
Exhibit 13-7
Departmentalization by Customer
S mall Business Users
Medium/Large Business Users
Government, Education, Health Care
Dell Canada
Individual Systems
Business Systems
Chapter 13, Dr. Nghia Trong Nguyen, Organizational Behaviour, Fourth Canadian Edition 13-10 Copyright © 2007 Pearson Education Canada
Exhibit 13-8 Contrasting
Spans of Control
1
2
3
4
5
6
7
(Highest)
Assuming span of 4
Operatives
Managers (Levels 1 – 6) = 1365
= 4096 Operatives
Managers (Levels 1 – 4) = 585
= 4096
1
4
16
64
256
1024
4096
Assuming span of 8
4096
512
64
8
1
Members at each level
Org
an
iza
tio
na
l L
eve
l
Chapter 13, Dr. Nghia Trong Nguyen, Organizational Behaviour, Fourth Canadian Edition 13-11 Copyright © 2007 Pearson Education Canada
Exhibit 13-10 Mechanistic
vs. Organic Models
The mechanistic model The organic model
• High specialization • Rigid departmentalization • Clear chain of command • Narrow spans of control • Centralization • High formalization
• Cross-functional teams • Cross-hierarchical teams • Free flow of information • Wide spans of control • Decentralization • Low formalization
Chapter 13, Dr. Nghia Trong Nguyen, Organizational Behaviour, Fourth Canadian Edition 13-12 Copyright © 2007 Pearson Education Canada
Programs Academic departments
Accounting
Finance
Administrative studies
Information and decision sciences
Marketing
Organizational behaviour
Quantitative methods
Under graduate Master’s Ph.D.. Research
Executive Development
Community Service
Exhibit 13-11
Matrix Structure
Chapter 13, Dr. Nghia Trong Nguyen, Organizational Behaviour, Fourth Canadian Edition 13-13 Copyright © 2007 Pearson Education Canada
Exhibit 13-13
Modular Structure
Technology Development
Marketing and Sales
Procurement Operations
OUTSOURCED
Organizational Infrastructure
Human Resource Management
Service
Chapter 13, Dr. Nghia Trong Nguyen, Organizational Behaviour, Fourth Canadian Edition 13-14 Copyright © 2007 Pearson Education Canada
Exhibit 13-14
Virtual Structure
Management
Technology
Development
Marketing
and Sales Procurement Operations
Alliance
Partner A
Alliance
Partner B
Alliance
Partner C
Alliance
Partner D
Alliance
Partner E
Organizational Infrastructure
Human Resource Service
Chapter 13, Dr. Nghia Trong Nguyen, Organizational Behaviour, Fourth Canadian Edition 13-15 Copyright © 2007 Pearson Education Canada
Exhibit 13-16
Model of the Environment
Stable
Complex Simple
Abundant
Scarce
Dynamic
Chapter 13, Dr. Nghia Trong Nguyen, Organizational Behaviour, Fourth Canadian Edition 13-16 Copyright © 2007 Pearson Education Canada
Summary and Implications
1. What are the key elements of organizational structure?
– There are six key elements that managers need to address when they design their organization’s structure: work specialization, departmentalization, chain of command, span of control, centralization and decentralization, and formalization.
2. How flexible can organizational structures be?
– There are two models that determine how flexible an organizations can be: mechanistic and organic.
Chapter 13, Dr. Nghia Trong Nguyen, Organizational Behaviour, Fourth Canadian Edition 13-17 Copyright © 2007 Pearson Education Canada
Summary and Implications
3. What are some examples of traditional organizational designs?
– Some of the more common organizational designs found in use are the simple structure, the bureaucracy, and the matrix structure.
4. What do newer organizational structures look like?
– The new structural options for organizations involve breaking down the boundaries in some fashion, either internally, externally, or a combination of the two.
5. Why do organizational structures differ?
– Strategy, organizational size, technology, and environment determine the type of structure.
Chapter 13, Dr. Nghia Trong Nguyen, Organizational Behaviour, Fourth Canadian Edition 13-18 Copyright © 2007 Pearson Education Canada
For Review
1. Why isn’t work specialization an unending source of
increased productivity?
2. What are the different forms of departmentalize?
3. All things being equal, which is more efficient, a wide
or narrow span of control? Why?
4. What is a matrix structure? When would management
use it?
5. How does a family business differ from other
organizational structures?
Chapter 13, Dr. Nghia Trong Nguyen, Organizational Behaviour, Fourth Canadian Edition 13-19 Copyright © 2007 Pearson Education Canada
For Review
6. Contrast the virtual organization with the
boundaryless organization.
7. What type of structure works best with an innovation
strategy? A cost-minimization strategy? An imitation
strategy?
8. Summarize the size-structure relationship.
9. Define and give an example of what is meant by the
term technology.
10. Summarize the environment-structure relationship.
