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Chapter 10
Managing Organizational Structure and Culture
MGMT 321 – Chapter 10 2
Organizational Structure
Organizational Architecture– The organizational structure, control
systems, culture, and human resource management systems that together determine how efficiently and effectively organizational resources are used
MGMT 321 – Chapter 10 3
Organizational Structure
Organizing– Establishing working relationships among
employees to achieve goals.
Organizational Structure– Formal system of task and reporting relationships
showing how workers use resources.
Organizational Design– Creating a specific type of organizational structure
and culture so that a company can operate in the most efficient and effective way
MGMT 321 – Chapter 10 4
Factors Affecting Organizational Structure
MGMT 321 – Chapter 10 5
The Organizational Environment
Organization structure depends on: How to group tasks into individual jobs How to group jobs into functions and
divisions How to allocate authority and
coordinate functions and divisions
MGMT 321 – Chapter 10 6
Job Design
Job Design– Deciding how to divide tasks into specific jobs
Job Enlargement– Increasing the number of different tasks in a
given job by changing the division of labor
Job Enrichment– Increasing the degree of a worker’s
responsibility
MGMT 321 – Chapter 10 7
The Job Characteristics Model
MGMT 321 – Chapter 10 8
Job Characteristics Model
Job Characteristic
Skill variety Employee uses a wide range of skills.
Task identity Worker is involved in all tasks of the job from beginning to end of the production process
Task significance Worker feels the task is meaningful to organization.
Autonomy Employee has freedom to schedule tasks and carry them out.
Feedback Worker gets direct information about how well the job is done.
MGMT 321 – Chapter 10 9
Grouping Jobs into Functions
Function– Group of people who possess similar skills
to perform their jobs Functional Structure
– An organizational structure composed of all the departments that an organization requires to produce its goods or services
MGMT 321 – Chapter 10 10
Divisional Structures
Divisional Structure– Managers create a series of business units
to produce a specific kind of product for a specific kind of customer
Types of Divisional Structures– Product– Market– Geographic
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Types of Divisional Structures
MGMT 321 – Chapter 10 12
Matrix Structure
MGMT 321 – Chapter 10 13
Product Team Structure
MGMT 321 – Chapter 10 14
Federated’s Hybrid Structure
MGMT 321 – Chapter 10 15
Allocating Authority
Hierarchy of Authority– An organization’s chain of command– Span of control
Line Manager Staff Manager
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Tall Organizations
MGMT 321 – Chapter 10 17
Flat Organizations
MGMT 321 – Chapter 10 18
Decentralization of Authority
Decentralizing authority Disadvantages
– Teams may begin to pursue their own goals at the expense of organizational goals
– Can result in a lack of communication among divisions
MGMT 321 – Chapter 10 19
Integrating Mechanisms
MGMT 321 – Chapter 10 20
Organizational Culture
MGMT 321 – Chapter 10 21
Adaptive and Inert Cultures
Adaptive cultures – Values and norms help an organization
grow and change as needed to be effective Inert cultures
– Values and norms that fail to motivate or inspire employees
– Lead to stagnation and often failure over time
