Functional organization

It utilizes the pure services of experts or specialists. The develop­

ment of staff departments and positions led quite naturally to attempt complete reorganization on a functional basis. This removed the staff specialist from his "assisting" capacity and gave him the pure authority and responsibility for supervision and administration of the function, replacing the operating foreman. The movement as indicated in Figure 4.3, each worker in the production department has eight supervisors.

The Gang boss prepares for the production and the worker has to ap­

proach him for direction in this area. The Speed boss is assigned with the responsibilities of introducing men and getting the set standards of production. The Inspector is in charge of checking the quality of work.

The Repair boss takes care of the equipment and tool repairs. The job of Order-of-Work Clerk is to plan and schedule order. The Instruction Card Clerk determines the best way to do the job. The information relating to cost and production is maintained by the Time and Cost Clerk. The Personnel Activities are handled by the Shop Disciplinarian.

Figure 4.3 Functional type

Taylor felt that the advantage of functional specialization will ^{b e} achieved to a great extent under this method of organization. But this type of organization violates one of the traditional principles of organi­

zation, namely, the "Unity of Command." According to this principle, no one subordinate can have more than one supervisor. Reporting to several bosses may create organizational problems such as lack of clar­

ity of authority, inadequate control, confusion, and conflicts.

4. Committees

Committee is another common organizational form u s e d .in sifeu- 114 Management for Filipinos

ations where group participation and decision are required. Two types of thinking seem to be common when it comes to the use of the com­

mittee form of organization. On one side, the committee approach has been taken for granted and committees are automatically set up with­

out even considering the purpose and the need for such committees. On the other side, managers are totally reluctant to use committees because of a fear of diverse opinions.

These are created to undertake special activities rather than routinary activities. Any manager or supervisor has the right to form a committee if it is needed by his department or company.

In order to facilitate a cooperative relationship within a large industrial enterprise, many companies add a network of committees to the line and staff organization. Committees may be classified as:

a. Ad Hoc Committee. This undertakes temporary activities; or b. Standing Committee. This is sometimes called permanent com­

mittee which undertakes permanent activities, such as the budget com­

mittee.

A committee is a tool for the development of ideas and proce­

dures. It is a means by which ideas can be pooled and offered for criticism. It is the strong right arm of a tactful administration that real­

izes the importance of getting its people to work together in the solu­

tion of its own problems.

Committees, like other phases of organization, should be varied in terms of the needs of a given enterprise. However, there are at least four basic principles to be considered.

1. The organization of a committee should grow out of a need

3. Duties, authority, and responsibility must be clearly defined.

4. The organization and operation of a committee should be a cooperative development.

O R G A N I Z A T I O N C H A R T ________________________________

An organization chart is a diagram or drawing showing the im­

portant aspects of an organizational structure. It shows the re-ationship unong positions as to authority, responsibility and accountability, and the people who occupy them.

As defined by George Terry:

"An organization chart is a diagrammatical form which shows important aspects of an organization including the major functions and

Organizing

their respective relationships, the channels of supervision, and the rela­

tive authority of each employee who is in charge of each function."

Purpose of an Organization Chart

An organization chart assists one to view the firm's structure as a whole. It shows the principal divisions and lines of formal authority and responsibility.

It assists management to divide the different duties or functions in the business establishment so that they will be pe. formed effectively and efficiently. A well-prepared chart shows all of those involved in any undertaking, what each of them is to do and to whom each is responsible. It shows the grouping of departments for easier direction, and control of activities. It is a way of sorting the responsibilities of the positions so that time and effort are not duplicated and, therefore, wasted.

Types of Organization Chart

Some organization charts show positions and/or departments;

others show only the functions to be performed. Others would show either, both positions and functions, or departments, individuals, and functions.

1. M aster Chart or Chart o f Authority. The master chart shows the entire organizational structure. It is a master plan of the principal departments, with lines of authority and responsibility and the mutual relationships of all departments or major components.

2. Functional Chart. The functional chart shows at a glance the functions and activities of the positions and/or departments. It shows the m ajor responsibilities of departments or positions. Listed below each job title are brief statements of the responsibilities.

3. Personnel Chart. The personnel chart shows the departments in the same relative manner as the functional chart. But instead of list­

ing the functions, the titles of the positions of the names of persons are indicated. The chart also shows the class titles of all positions in the department together with their locations in the organization.

How to Draw an Organization Chart

An organization chart may consist of an entire business, for each department or for each section of a business.

Before drawing an organization chart, one should observe the following procedures.

First, gather the necessary information on the following:

1. existing positions and/or departments;

2. objectives, functions, and activities of positions and/or departments;

3. organization;

4 . lin es o f a u th o rity an d resp o n sib ility fro m top m a n a g e m e n t

Figure 4.4 Typical example of an Organization Chart

organization should be grouped and placed according to their levels (top management, middle management, rank and file) in the organiza­

tion.

2. The boxes indicating the organizational functions on the same level should be of the same sizes, i.e., top management level, 3/8" x 2 1/2".

3. Solid/block lines should connect boxes or rectangles to desig­

nate managerial control or line of authority. Lines of authority do not pass through a box or rectangle. Each box should have lines indicating its relation to the organizational units above and below it. These lines should connect the box at the top center and then either at the bottom center or at the side of the box or rectangle. Dotted/broken lines should indicate service in staff relationship.

4. When an assistant to the head of an organizational position acts in the capacity of a staff or technical assistant without exercising managerial authority over the line organization, the box should be drawn to the side of the line organization. It could either be on the right or left side.

5. Staff and service functions are placed under the office or units served, usually to the right using the dotted lines. They should be drawn of the same sizes.

,118 Management for Filipinos

R E O R G A N I Z A T I O N

Reorganization is the process by which an existing organization undergoes changes in the size and shape of the organization structure.

The change may range from simple to complex.

Figure 4.5 Matrix Structure

In Figure 4.5 the organization is structured along two dimen­

sions. In one dimension, the structure shows basic functional depart­

ments such as Research and Development, Engineering, Manufactur­

ing, and Marketing. The Department Head in each of these functional areas plans and controls the dimension, a Project Director plans and controls the efforts for all projects currently in that phase of develop­

ment. In the other dimension, a Project Director plans and controls an entire project currently in that phase of development. In the other di­

mension, a Project Director plans and controls an entire project through all the functional areas necessary to its completion by placing personnel from each of the appropriate functional departments. Thus, two hierar- chal structures intersect one another. While the former is functionally oriented, the latter is often project-oriented.

D E PA R TM EN TA TIO N ______________________________

Departmentation results from the grouping of work, the desire to obtain organization units of manageable size, and to utilize managerial ability An organization structure and design are shaped significantly by the departmentation followed. Examples of departments are Account­

ing Department, Personnel Department, Sales Department, etc.

Organizing 119

It se e m s q u ite a p p a re n t th a t if the sta te d g o a ls an d o b jectives o f a n o rg a n iz a tio n a re to b e a tta in e d , ce rta in activ itie s h a v e to b e p e r ­ fo rm e d . A n d it w o u ld a lso se e m th a t th e o rg a n iz in g fu n ctio n o f a man­

a g e r w o u ld in v o lv e g ro u p in g th e fu n ctio n s a n d activ itie s n e c e s s a ry to a t ta i n th e g o a ls o f a n e n te r p r is e . T h e t e r m f o r t h a t p r o c e s s is D e p a rtm e n ta tio n (o r D iv isio n o f O rg a n iz a tio n ). A s sta te d a b o v e , the p ro ce ss o f g ro u p in g th e fu n ctio n s a n d a ctiv itie s in an o rg a n iz a tio n is k n o w n as D e p a rtm e n ta tio n . It g iv e s a h o riz o n ta l d im e n sio n to a n o rg a ­ n iz a tio n . G ullick sets u p fo u r b a se s fo r d e p a rtm e n ta liz in g a n o rg a n iz a ­ tion . T h e y are D e p a rtm e n ta tio n b y fu n ctio n , p ro d u c t, p ro c e s s , a n d g e o ­ g ra p h ica l lo catio n . D e p a rtm e n ta tio n by- fu n ctio n in v o lv e s id en tify in g m a jo r fu n ctio n s to b e p e rfo rm e d in a ch ie v in g th e g o a ls o f a n o rg a n iz a ­ tio n a n d g ro u p in g th e o th e r re la te d fu n ctio n s an d activ itie s a cco rd in g ly . F ig u re 4 .6 sh o w s D e p a rtm e n ta tio n b y fu n ction .

M a n a g in g D ire c to r

P ro d u c tio n M a rk e tin g F in a n c e P e rs o n n e l L e g a l R & D 'M a n a g e r M a n a g e r M a n a g e r M a n a g e r A d v is e r D ire c to r

Figure 4.6 Departmentation by function

T h e p rim a ry o r m a jo r fu n c^ o n s u se d in this e x a m p le a re : P ro d u c ­ tio n , M a rk e tin g , F in a n ce , P e rso n n e l, L e g a l, a n d R e se a rc h a n d D e v e lo p ­ m e n t. A fte r th e p rim a ry fu n ctio n s are id en tified , th e n e x t ste p is to id en tify s e c o n d a ry fu n ctio n s a n d g ro u p th e m a cco rd in g ly . A t th e n e x t ste p , e a c h o f th ese s e c o n d a ry fu n ctio n s m a y be fu rth e r s u b d iv id e d in to n a r r o w e r w o rk a reas. T h is n a rro w d iv isio n of fu n ctio n h e lp s to a ch ie v e th e a d v a n ta g e o f sp e cia liz a tio n b y fu n ctio n . D e p a rtm e n ta tio n b y p ro d ­ u c t in v o lv e s g ro u p in g th e a ctiv itie s a n d fu n ctio n s o n th e b a sis o f p ro d ­ u c ts m a n u fa c tu re d b y tfye co m p a n y . F o r e x a m p le , a n e le c tric a l m a n u fa c ­ tu rin g c o m p a n y m a y h a v e th e stru c tu re sh o w n in F ig u re 4 .7 .

Figure 4.7 Departmentation by product

Each of these divisions may be further divided into departments based on the components of these products or by functions performed.

Likewise, a service organization may structure its work by the service it offers. According to Dale, an industrial engineer, grouping by product or service has the advantage of bringing together and coordinating in one place major activities required to make a particular product. Of course, this method of grouping involves duplication of some of the activities and hence for this reason it may be costly.

In some organizations the grouping of activities is done on the basis of the nature of work being done, that is by process. For example, a textile manufacturing company may have to go through the process of receiving raw material, separating, spinning, weaving, bleaching, dyeing, inspecting, packaging and transporting in marketing its prod­

uct The figure for this type of organization is shown in Figure 4.8.

Figure 4.8 Departmentatlon by process

Finally, the grouping may be done on the basis of geographical location. In this method, the entire service area of the organization is divided into geographical locations or territories. For instance, a sales organization may have groupings like: NCR DIVISION, LUZON DIVI­

SION, VISAYAS DIVISION, and MINDANAO DIVISION. In many in­

stances, it may be practical to bring together all operations performed in a particular geographical location, or any of the other methods dis­

cussed above. The figure for departmentation by geographical location is shown in Figure AS.

Figure 4.9 Departmentatlon by geographical location

Organizing 121

RESULTS OF G O O D O R G A N IZ A T IO N