A matrix organisation is a complex structure because it depends upon both vertical and horizontal flows of authority and communication. Key areas should be given special attention. The basic enterprise functions are production, selling, and financing functional departmentation is bases for organizing activities and in organizational structure. Major divisions that determine the organisaion structure are 1. Every single member of the department needs … to be aware of the departmental objectives. Instead they'll probably have to export.
Combined departmentalization In combined departmentalization, a company or an organization uses a mixture or combination or union of two or more different bases of departmentalization. This form of departmentation is suitable for medium and large-sized organisations where goods are produced through a series of operations. You'll also find many products to be cheaper, for examples Walmart has many products cheaper than most stores although may vary because they can afford to place it to be cheaper because the demand is higher. Clarity of plans and Definiteness of Responsibilities supervision becomes easy and span may become wider. However, this type of departmentation is not found in business concerns. Slow adaptation to changes in environment.
Departmentalization based on the division of an area of operation into different zones is shown in the following image. Similarly, a printing press may have composing, proof reading, printing and binding departments. The instances of functional departmentation are production office, purchase office, sales office and accounts section. It should enable the managers to hold the employees accountable for results. The classical theorists were in favour of narrow span. Structure is a means to an end and therefore, must aid and facilitate the organistic members to carry out the organisation work. Territorial grouping may sometime cause some problems if authority over financial matters is also decentralized.
The top-level executives, groups activities in various departments, such as production, marketing, finance, human resource, research and development, etc. There is a lower potential for manager development. Lesson Summary Departmentalization is a method of dividing an organization into different departments, which performs certain tasks in accordance with the department's specialization. Qualities of subordinates educated technically competent, trained and experienced do not need much guidance. It helps in coordinating the activities of different products. Functional Departmentalization- Putting jobs that do similar activities together into a single department.
After reviewing the plan, usually the first step in the organization process is departmentalization. The more commonly used bases are—function, product, territory, process, customer, time etc. This method is highly suitable when the needs of the local customers are to be satisfied effectively. Diagram Credits © Moon Rodriguez. Each department or division is a distinct area of activities over which a manager will be given authority and for which he is responsible.
Organisation Chart Showing Process Departmentation : Merits of Process Departmentation : The merits of process departmentation are as follows: i Specialisation: As work is divided into different processes, the process manager and his team specialise in that process by constantly carrying out activities related to that process only. Might be developed by the departmental heads in conjunction with those who set organizational objectives. For each process, departments are created and headed by people skilled and competent to carry that process. This makes it necessary to appoint regional managers for different regions. The followings are the premise of departmentation : Departmentation is a procedure coming about out of decision to gathering assignments as per some standard. Lack of Leadership Managers leading functional departments can succumb to the same isolationist forces as their subordinates, narrowing focus to departmental rather than company concerns.
Each department tends to increasingly communicate based on its own practices and experiences. Proximity will reduce costs of operation and administration. The special feature of the matrix is that employees have two bosses — the functional boss parent department and the project pass host department. Places emphasis on local markets and problems. This structure may be advantageous because it allows its personnel to specialize in developing products and serving the needs of particular markets and classes of customers. So production, distribution, marketing and finance departments come to picture.
Decentralization is not the same as delegation. The same product may be of industrial use for one buyer and personal use for another. This pattern is not a best training ground for promotable top management people. Dividing and grouping of activities is of paramount importance to all developing organizations. An effective organization structure has two basic purposes: a Contributing towards achievement of institution objectives, and.