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Transcript of bps pre wen
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An Organization Structure is the arrangement of task andsub tasks required to implement a strategy.
An organization structure specifies 3 key components thatare :-
It identifies the formal reporting relationships, includingthe number of levels in the hierarchy and the span of controlof managers.
It specifies the grouping of individuals into departmentsand of departments into the total organization.
It consists of design of system to ensure effectivecommunication, coordination and integration of effortsacross departments.
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The first two components constitute the structural
framework, which is the VERTICAL structure createdthrough the process of differentiation that involvesdivision of labour and specialization.
The third component refers to the pattern ofinteractions among members of the organization andis the HORIZONTAL structure, created though theprocess of integration that involves cross-functionalinformation systems and teamwork.
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Vertical structure have there characteristics: Specialized tasks
Hierarchy of authority Rules and regulations Vertical communication andformal reporting system
Centralized decision making Emphasis on efficiency
Horizontal structure have therecharacteristics: Shared task
Flexible authority Few rules and regulations Horizontal communication andsharing of information Decentralized decision making Emphasis on learning
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The entrepreneurial structure is the most elementary form of
structure and is appropriate for an organization that is owned
and managed by 1 person. A small-scale industrial unit, a
small proprietary concern or a mini service outlet may
exhibit the characteristics of organization which are based
on the entrepreneurial structure. Typically these are single-
business, -product, or service firms that serve local
markets. The owner-manager looks after all decisions,
whether they are day-to-day operational matters or of a
strategic nature.
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Entrepreneurial structure
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Advantages
Quick decision making, aspower is centralized;
Timely response toenvironmental changes;
Informal and simpleorganization systems.
Disadvantages
Excessive reliance on owner-manager and so proves to bedemanding for the owner-manager;
May divert attention ofowner-manger to day-to-dayoperational matters andignores strategic decisions;
Increasingly inadequate forfuture requirements ifvolume of business expands.
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As the volume of business expands, the entrepreneurial
structure may outlive its usefulness. The need arises for
specialized skills and delegation of authority to managers
who can look after the different functional areas and herecomes the usefulness of functional structure. The functional
structure seeks to distribute decision making and operational
authority along functional lines.
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Functional structure
Chief
ExecutiveOfficer
LegalPublic
Relation
Finance MarketingHumanResource
ManagementProduction
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Advantages
Effective distribution ofwork through specialization;
Delegation of day-to-day
operational functions;
Providing time for top
management to focus on
strategic decision.
Disadvantages
Creates difficulty incoordination among different
functional areas;
Leads to functional, line and
staff conflicts; Creates specialist which
results in narrow
specialization, often at the
cost of overall benefit of theorganization.
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Made by: Praveen Sharma & Apoorva Saxena