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Departmentation: Organizational Structure

The document discusses different types of organizational departmentation including departmentation by simple numbers, time, enterprise function, territory/geography, customers, and products. Each type is described along with its advantages and disadvantages. Departmentation by enterprise function is noted as the most widely used approach for organizing activities in enterprises. Coordination of activities can be achieved through rules, procedures, planning, and personal contacts under this approach.

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93 views

Departmentation: Organizational Structure

The document discusses different types of organizational departmentation including departmentation by simple numbers, time, enterprise function, territory/geography, customers, and products. Each type is described along with its advantages and disadvantages. Departmentation by enterprise function is noted as the most widely used approach for organizing activities in enterprises. Coordination of activities can be achieved through rules, procedures, planning, and personal contacts under this approach.

Uploaded by

bikhod bikhod
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPT, PDF, TXT or read online on Scribd
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Departmentation

Organizational Structure
What is Departmentation
 Grouping activities and people into
departments.
 It must be emphasized that there is no
single way of departmentizing that is
applicable to all organization and
situations.
Type of Departmentation
 Departmentation by simple numbers: This was
an important method in organization of tribes
and armies in the past.
 The simple numbers method of departmentizing
is achieved by grouping persons who are to
perform the same duties under the supervision
of one manager
 There are some reasons for the decline of
departmentizing purely by numbers are as
follow:
 Advancement in the technologies , demanding
specialized and different skills.
 Groups composed of specialized
personnel are frequently more efficient
then those based merely on numbers.
 It is useful at lowest level of management
only.
Departmentation by Time
 Grouping activities on the basis of time ,
and mostly applicable to lower levels.
 The use of shift is common where the
economical , social and technological
reasons affect the normal workday.
 Example can found in the hospital where
around the clock patients care is
essential or fire department to respond to
emergencies at any time.
Advantages
 Services can be rendered that go beyond
the typical 8-hours workday.
 It is possible to use processes that can
not be interrupted and require a
continuing cycle.
 Expensive capital equipment can be used
more then 8 hours a day when workers in
several shifts use the same machine.
Disadvantages
 Supervision
 People
 Coordination and communication
Departmentation by Enterprise
Function
 Grouping activities in accordance with the
functions of an enterprise, or it is also called
functional Departmentation.
 Functional Departmentation is the most
widely employed basis for organizing
activities and is present in almost every
enterprise at some level in organization.
 Coordination of activities may be achieved
through rules and procedures , planning and
goal setting , personal contacts
Advantages
 Is logical reflection of functions
 Maintain power and prestige of major
functions by top management.
 Follows principles of occupational
specialization.
 Simplifies training
 Tight control at the top,
Disadvantages
 Requires more persons with general managers
abilities,
 Functional Departmentation may tend to de-
emphasize overall enterprise objectives.
 Achieving coordination would be a challenge.
 Overspecialization and narrows viewpoints of
key personnel.
 Responsibility for profits is at the top only.
 Slow adaptation to changes in environment.
 Limited development of general manager.
Departmentation by Territory or
Geography

 This type of Departmentation is


common in enterprises that operate
over wide geographic areas , in this
case activities in a given area or
territory may be grouped and assigned
to a manager.
 It is more attractive in large scale firms
covering wide geographic area.
Advantages
 Places responsibility at a lower level.
 Places emphasis on local markets and
problems.
 Improve coordination in a region.
 Takes advantages of economics of local
operations.
 Better face to face communication with local
interests.
 Furnishes measurable training background
for general mangers.
Disadvantages
 Requires more persons with general
manager abilities.
 Increase problem of top management
control.
Customer Departmentation
 Groping activities so that they reflect a
primary interest in customers.
 Customer Departmentation address
the special and widely varied needs of
customers for clearly defined services.
Advantages
 Encourage concentration on
customers needs.
 Gives customers felling that they have
an understanding suppliers.
 Develop expertness in customers
areas.
Disadvantages

 May be difficult to coordinate


operations between competing
customer demands.
 Requires managers and staff expert in
customers’ problems.
 Customer groups may not always be
clearly defined.
Departmentation by product
 Grouping activities on the basis of
products or product lines.
 It is important for large scale
enterprises.
 Products can be distributed between
different functions as production , sale ,
services and engineering as different
departments.
Advantages
 Achieve economic advantages
 Uses specialized technology
 Utilizes special skills.
 Simplifies training
Disadvantages
 Coordination of departments is difficult.
 Responsibility of the profit is at the top.
 Is unsuitable for developing general
managers.

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