Organizing and the six elements of organizational design
Organizing arranges and structures work to reach goals. Structure is built from six design elements and can be mechanistic or organic.
Purposes of organizing
- Divides work into specific jobs and departments.
- Assigns tasks and responsibilities to individual jobs.
- Coordinates different organizational tasks.
- Clusters jobs into units.
- Sets relationships among people, groups and departments.
- Establishes formal lines of authority.
- Allocates and deploys organizational resources.
The six elements of organizational design
| Element | Meaning | Example |
|---|---|---|
| Work specialization | Dividing work into separate tasks, each done by a different person (division of labour) | Cutting, sewing and packing on an apparel line |
| Departmentalization | Grouping jobs: functional, product, geographic, process or customer | A bank with separate retail, corporate and SME banking units |
| Chain of command | The unbroken line of authority from the top to the lowest level; covers authority, responsibility and unity of command | Teller → branch manager → regional manager |
| Span of control | The number of employees a manager can supervise efficiently and effectively | A line supervisor with 25 machine operators |
| Centralization and decentralization | Whether decisions are made at the top or pushed down to lower levels | Branch managers approving small loans themselves (decentralized) |
| Formalization | How standardized jobs are and how far rules and procedures guide behaviour | Detailed standard operating procedures in a hotel kitchen |
Span of control and the number of managers
A firm has 4,096 operative employees. How many managers does it need if every manager supervises 8 people, compared with 4 people? Each manager costs Rs. 150,000 a month.
- Span of 8: 4,096 ÷ 8 = 512; 512 ÷ 8 = 64; 64 ÷ 8 = 8; 8 ÷ 8 = 1.
- Managers = 512 + 64 + 8 + 1 = 585, in 4 management levels.
- Span of 4: 4,096 ÷ 4 = 1,024; 1,024 ÷ 4 = 256; 256 ÷ 4 = 64; 64 ÷ 4 = 16; 16 ÷ 4 = 4; 4 ÷ 4 = 1.
- Managers = 1,024 + 256 + 64 + 16 + 4 + 1 = 1,365, in 6 management levels.
- Difference = 1,365 − 585 = 780 managers.
- Monthly saving = 780 × Rs. 150,000 = Rs. 117,000,000.
A span of 8 needs 780 fewer managers and two fewer levels, saving Rs. 117 million a month and speeding communication, but each manager has less time for each employee.
Mechanistic vs organic structure
| Feature | Mechanistic | Organic |
|---|---|---|
| Specialization | High, narrow jobs | Low; cross-functional teams |
| Departments | Rigid | Cross-hierarchical teams |
| Chain of command | Clear and strict | Free flow of information |
| Span of control | Narrow | Wide |
| Decision making | Centralized | Decentralized |
| Formalization | High: many rules | Low: few rules |
| Suits | Stable environment, routine work, cost focus | Dynamic environment, innovation |
Contingency factors: what decides the structure?
Robbins names four. Strategy: structure follows strategy (Alfred Chandler); innovation needs an organic form, cost-cutting a mechanistic one. Size: as organizations grow large they tend to add specialization, rules and levels, becoming more mechanistic. Technology: Joan Woodward found that unit, mass and process production each worked best with a different structure. Environmental uncertainty: a dynamic, uncertain environment calls for an organic structure.
A large apparel factory in Sri Lanka is fairly mechanistic: high specialization on sewing lines, narrow spans for line supervisors and detailed procedures to meet buyers' standards. Its design and product development centre works more organically, with cross-functional teams and fewer rules.
Short answer: “What is span of control?” The number of employees a manager can supervise efficiently and effectively.
Structured question: “Distinguish mechanistic and organic structures.” Mechanistic: high specialization, rigid departments, narrow spans, centralized, formal. Organic: teams, wide spans, decentralized, informal. Say when each suits.
Essay: “Explain the six elements of organizational design.” Define organizing and its purposes, then explain specialization, departmentalization (five types), chain of command, span of control (with the 4,096 example), centralization and formalization.
Six elements: 'We Don't Change Sri Cricket Fast' = Work specialization, Departmentalization, Chain of command, Span of control, Centralization, Formalization.