Unit -3 : Organizing and Organizations

02/01/2024 set by mulugeta M 1

What is organizing?
Why do we need organizing?
What is organization?

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 Organizing
 Organizing is assigning the tasks developed during planning
to various individuals or groups within the organization
thereby creating a mechanism to put plans into action.
 Organizing is the process by which managers establish
working relationships among resources.
 It deals with all those activities that result in:

- the formal assignment of tasks and authority.

- coordination of effort.
- differentiation and integration of tasks.
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Organizational Design

Organizational structure

Organizational design

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 Organizational Structure

 Organizational Structure :- is the formal decision-

making framework by which job tasks are divided,

grouped, and coordinated.
 The process of arranging jobs within an organization to
achieve the mission.
 Formal system of task and reporting relationship.
 It usually represented in a chart form called an
Organizational Chart.

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An organization chart displays the organizational structure
and shows:
◦ job titles
◦ lines of authority
◦ relationships between departments/units/processes

 Representing the organization's structural

skeleton, charts have dimensions representing:

Vertical hierarchy: the chain of command.
Horizontal specialization : the division of labor.

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Organizational Structure Cont…

 Forms of organizational structure

Mechanistic structure
Organic structure

Contingency organization

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 Mechanistic Organization

◦ A rigid and tightly controlled structure

 It is rigid in that it consist of very clearly delineated
jobs and rely heavily on the formal chain of command
for control.
High specialization
Rigid departmentalization
Narrow spans of control

• High formalization/Bureaucratic
Unidirectional communication(downward)
 Low decision participation
 Have tall structures
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- have a well-defined hierarchical structure,
and consisting of hierarchies with many
levels of management.

Tall structure
 people become relatively confined to their

own area of specialization (functional

division of labour)
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 Organic structure

 Highly flexible and adaptable structure

 characterized by:
 informality, working in groups and open communication
 more adaptable to a participative form of management,
and
 less concerned with a clearly defined structure.
 The organic organization is open to the environment in
order to capitalize upon new opportunities.
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 Organic structures………

 have a flat structure with only one or two levels of

management.

 Flat structure

 Emphasize a decentralized approach to management that

encourage high employee involvement in decisions.

 The purpose of flat structure is to create independent

small businesses or enterprises that can rapidly respond to
customers' needs or changes in the business environment
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• High specialization • Cross-functional teams
• Rigid departmentalization • Cross-hierarchical teams
• Clear chain of command • Free flow of information
• Narrow spans of control • Wide spans of control
• Centralization • Decentralization
• High formalization • Low formalization

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Contingency organization means
Contingency organization means that the
most appropriate organizational structure for
each situation depends on upon
Technology
Organizational size
Goals and strategy
environmental stability and
characteristics of the employee

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 Overall

 In contrast , a less bureaucratic or more organic form of

organization is likely to be more effective when the
environment is more complex and dynamic tasks and
technologies are not routine and relatively high parentage of
professionals are involved .
 Mechanistic organizations are rigid in design, rely on formal
communications, and have strong bureaucratic qualities
 Organic organizations have flexible structures, participative
communication patterns

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Organizational design

The process by which managers create a specific type of organizational

structure , so that the organization can operate in the most efficient and

effective way.

Organizational design refers to the process of coordinating the structural

elements of organizations in the most appropriate manner.

It is about the decisions and actions that result in organizational structure.

Organizational design is the creation of an organization's structure, traditionally

classified as:
• Functional organization
• Divisional organization
• Matrix structures 15
Departmentalization
After reviewing plans, usually the first step in

the organizing process is departmentalization.

Once jobs have been classified through work
specialization, they are grouped so that
common tasks can be coordinated.
– Departmentalization – Grouping of related
activities into similar units.
–Departmentalization is the basis on which
work or individuals are grouped into manageable
units.
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Methods for grouping work activities
Departmentalization cont…
◦ Departmentalization by function
◦ Departmentalization by product
◦ Departmentalization by geographical regions
◦ Departmentalization by process
◦ Departmentalization by customer

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 Departmentalization by function
Organizes by the functions to be performed
Functions reflect the nature of the work.

The advantage of this type of grouping is

obtaining efficiencies from consolidating

similar specialties and people with common
skills, knowledge and orientations together in
common units.

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Departmentalization by function

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Departmentalization by product
Grouping jobs by product line assembles all functions needed to
make and market a particular product/service under one executive.
 For instance, a pharmaceutical company’s stores can be
structured around product groups such as:
◦ Vaccines
◦ Antibiotics
◦ Vitamins
◦ Hormones
◦ Others
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 . Departmentalization by Product
Grouping jobs by product line

Pharmaceutics Factory

Antipsy Antihyper Antibiotic

Laxative
chotic tensive

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 Departmentalization by geographical regions

Grouping jobs on the basis of territory

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Departmentalization by process

Groups jobs on the basis of customer flow.

A patient preparing for an operation would first engage in
preliminary diagnostic tests, then go through the
admitting process, undergo a procedure in surgery,
receive post operative care, be discharged and perhaps
receive out-patient attention.
This approach tries to bring different activities in a
process to be performed under the sight of a process
owner.
BPR in the current Ethiopian health system is trying to
establish this type of organization at all level
An example for a hospital service:
◦ Registration
◦ Consultation
◦ Investigation
◦ Treatment 23
Departmentalization by customer

groups jobs on the basis of a common set of

needs or problems of specific customers.

For instance, a hospital may group its patients

as:
◦ Emergency patients
◦ Stable patients
◦ Follow up cases
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Some important terms in Organizing
◦ Work Specialization

◦ Chain of Command

◦ Authority, Responsibility, and Accountability

◦ Delegation

◦ Span of Management

◦ Tall vs. Flat Structure

◦ Centralization, Decentralization, and

Formalization
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Work Specialization
 The degree to which organizational tasks are sub-

divided into individual jobs. Also called division of labor

 With too much specialization, employees are isolated

and do only a single, tiny, boring job.

◦ Solution:
 enlarge jobs to provide greater challenges

 assign workers to tasks that are rotated

 With too little specialization, employees may not

develop the appropriate skills.

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 Chain of Command
 Continuous line of authority from top to bottom of an
organization, clarifies who reports to whom.
 Tells you who your boss is, where to go for help.
 An unbroken line of authority that links all individuals in the

organization and specifies who reports to whom.

 Two important concepts

◦ Unity of Command - one employee is held accountable to only one supervisor

(sometimes not applicable – in mixed structure)

◦ It the concept that a person should have one boss

and should report only to that person
◦ Scalar principle - clearly defined line of authority in the organization that
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 CONT…..…

Span of Control
◦ Is the size of subordinates/supervisees
working under a manager
◦ It is the number of employees reporting to a
manager.
◦ The number of employees reporting to one
manager affects the number of levels of
managers.
◦ Downsizing increases the span of management.

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 Span of Management
 Larger span of management is required when:

◦ Work performed by subordinates is stable and routine.

◦ Subordinates perform similar work tasks.

◦ Subordinates are concentrated in a single location.

◦ Subordinates are highly trained and need little direction in performing

tasks.

◦ Rules and procedures defining task activities are available.

◦ Support systems and personnel are available for the managers.

◦ Little time is required in non supervisory activities such as coordination

with other departments or planning..

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Narrow and Wide Spans of Control

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 Tall vs. Flat Structure
Tall - A management structure characterized by an overall
narrow span of management and a relatively large number
of hierarchical levels.
◦ Tight control
◦ Delays decision making

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 Tall and Flat Organizations
 Flat - A management structure characterized by a wide span of
control and relatively few hierarchical levels.
◦ Structure results in quick communications but can lead to
overworked managers.
◦ Loose control
◦ Facilitates delegation
◦ Facilitates timely decision making

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Centralization : Centralization is the location of
decision making authority near top organizational
levels
Organizations in which only top managers make
all decisions and employees simply perform
those orders.

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Centralization, Decentralization, and Formalization
 Decentralization
 The location of decision making authority near lower
organizational levels.
 Organizations in which decision-making is
pushed down to the managers who are closest to
the action.
 Employee Empowerment
– Increasing the decision-making authority
(power) of employees.
Formalization
◦ Availing written documentation used to direct and
control employees.
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 Authority - formal and legitimate right of a
Authority, Responsibility, and Accountability
manager to make decisions, issue orders, and
allocate resources to achieve organizationally
desired outcomes.
Responsibility - duty to perform, the task or

activity an employee has been assigned

Accountability - the fact that the people with
authority and responsibility are subject to
reporting and justifying task outcomes to those
above them in the chain of command 36
 Delegation
Delegation
is the process managers use to
transfer authority and responsibility to positions
below them in the hierarchy.
Organizations today tend to encourage delegation
from highest to lowest possible levels.
Can improve flexibility to meet customers needs
and adaptation to competitive environments.

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 Supervision
Supervision is a process of guiding, helping,
training, and encouraging staff to improve their
performance in order to provide high-quality
health services.
It is the overall range of measures to ensure that
personnel and their organization carry out their
activities effectively and become more competent
at work.
It helps to maintain and improve the quality of
health care

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 Styles of supervision

Supervision could be conducted in three different styles each

having their own strengths and weaknesses.
Autocratic
Democratic
Anarchic
Autocratic – characterized by the supervisors approach “Do
what I say!”
Communication is usually one way – the supervisor speaks and
supervisee are expected to listen
Improvement actions are forwarded as orders rather than agreed
upon recommendations
When applied to the health sector, it is humiliating and dries up
workers initiatives.
workers feel insecure 39