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Principles of Organizational Structure

This document presents an overview of key principles of organizational structure, including specialization, coordination, decentralization and centralization, and line and staff relationships. Specialization can be horizontal or vertical and involves dividing work into separate tasks. Coordination principles ensure unity of command, clear lines of authority and responsibility, and an appropriate span of control. Departmentalization organizes jobs into functional, product, geographic, process, or customer-based groups. Centralization and decentralization determine where decision-making power resides within an organization. Line employees achieve strategic objectives while staff provides support services.

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331 views15 pages

Principles of Organizational Structure

This document presents an overview of key principles of organizational structure, including specialization, coordination, decentralization and centralization, and line and staff relationships. Specialization can be horizontal or vertical and involves dividing work into separate tasks. Coordination principles ensure unity of command, clear lines of authority and responsibility, and an appropriate span of control. Departmentalization organizes jobs into functional, product, geographic, process, or customer-based groups. Centralization and decentralization determine where decision-making power resides within an organization. Line employees achieve strategic objectives while staff provides support services.

Uploaded by

Shashi Bhagat
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Shivalik Institute Of Management

Education And Research

Presentation On:
Principles Of Organizational Structure

Presented By:
Rashmi nidhi sahu
Principles of organizational structure
1) Specialization
Horizontal
Vertical

2) Coordination
1. Unity of command
2. Scalar principle
3. Responsibility and authority principle
4. Span of control
5. Departmentalization
6. Functional
7. Product
8. Users
9. Territory
10.Process or equipment
3 ) De-centralization and centralization
4) Line and staff relationships
Specialization
It is the degree to which tasks in an organization are
divided into separate jobs. The main idea of this
organizational design is that an entire job is not done
by one individual. It is broken down into steps, and a
different person completes each step. Individual
employees specialize in doing part of an activity rather
than the entire activity.

Work can be specialized both horizontally and vertically


(Anderson, 1988)
1) Horizontal
2) Vertical
Co-ordination
1) Chain of command: It is defined as a continuous
line of authority that extends from upper
organizational levels to the lowest levels and clarifies
who reports to whom. There are three important
concepts attached to this theory:
Authority: Refers to the rights inherent in a
managerial position to tell people what to do and to
expect them to do it.
Responsibility: The obligation to perform any
assigned duties.
Unity of command: The management principle that
each person should report to only one manager
Contd….
2) Scalar Principle: Decision making authority and the chain
of command in an organization should flow in a straight line
from the highest level to the lowest.

3) The Responsibility and Authority Principle: For
successfully performing certain tasks, responsibility must be
accompanied by proper authority. Those responsible for
performance of tasks should also have the appropriate level of
influence on decision making.

4) Span of Control: It is important to a large degree because it


determines the number of levels and managers an organization
has. Also, determines the number of employees a manager can
efficiently and effectively manage.
Contd….
5) Departmentalization: It is the basis by which
jobs are grouped together. For instance every
organization has its own specific way of classifying and
grouping work activities.
There are five common forms of departmentalization.
A) Functional Departmentalization
B) Product Departmentalization.
C) Geographical Departmentalization.
D) Process Departmentalization.
E) Customer Departmentalization.
A) Functional Departmentalization:It groups jobs
by functions performed. It can be used in all kinds of
organizations and it depends on the goals each of
them wants to achieve.
B) Product Departmentalization: It groups jobs by
product line. Each manager is responsible of an area
within the organization depending of his/her
specialization.
C) Geographical Departmentalization: It groups
jobs on the basis of territory or geography.

D) Process Departmentalization: It groups on the
basis of product.
E) Customer Departmentalization: It groups jobs
on the basis of common customers.
Centralization and Decentralization

Centralization
Formal decision making authority is
held by a few people, usually at the
top

Decision making authority is


dispersed throughout the organization

Decentralization
Line and staff relationship
Line employees are responsible for achieving the basic
or strategic objectives of the organization, while staff
plays a supporting role to line employees and provides
services.

The relationship between line and staff is crucial in


organizational structure, design and efficiency. It is
also an important aid to information processing and
coordination.
Reference
Jayant Isaac sir
www.ask.com
www.google.com

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