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Organizations as Abstractions

Organizations are concepts, abstractions and ideas; these 5 concepts are ways we think about the relationships which "form" our organizations

Five Concepts of Organizational Structure

1) Span of control
2) Chain of command
3) Delegation, authority, responsibility, accountability, social responsibility
4) Centralization vs. decentralization
5) Strategic business unit

Span of Control/Management: Tall structure

Span of 4, managers are levels 5 & 6 and workers are level 7

Span of Control/Management: Flat structure

Span of 8, managers are levels 3 & 4, workers are level 5

Factors influencing span of control

1) Interaction requirements
2) competence levels
3) work similarity
4) problem frequency and seriousness
5) physical proximity
6) non-supervisory duties of manager
7) available assistance
8) motivational possibilities of work

Chain of Command

Unbroken line of authority that links each individual with top organizational position through managerial position at each successive organizational layer (Structure of organization charts)


Chief executive officer


Chief financial officer


Chief operating officer


Chief information officer


Chief medical officer


Vice president

Delegation, authority, responsibility, accountability: Delegation

Assignment of part of work to others, along with responsibility and authority necessary to achieve results

Levels of Delegation

1) You are responsible, you have authority, go do it
2) You have the authority to go do it, after the fact tell me what happened, report the results
3) You go out and scope the problem, build a plan to solve it, review the plan with me, and upon approval from me, proceed
4) Think about the problem with me, jointly formulate a plan. You execute under my supervision and report progress as it proceeds with my corrective input as we go

Barriers to Delegation

1) They can't do it as well as I can
2) Fear subordinate failure
3) Lack time to train
4) Hold tightly to authority and power
5) Enjoy task themselves
6) Threatened by subordinate competency
7) Want work done "my way"

The Authority Idea

Right to make decisions, carry out actions and direct others in matters related to duties and goals of a position (Acceptance of instructions or requests of others, formal vs. informal, circumstantial)

Authority Relationships: Line Position

Responsible for achieving major goals of organization

Authority Relationships: Staff Position

Provide specialized expertise and assistance to line positions

Authority Relationships: Personal Assistant

Provide assistance to particular person

The Responsibility Idea

Obligation to carry out duties and achieve goals related to a position (Who has the duty?, Is it imperative?, Is a value implied?)

Delegation, authority, responsibility, accountability: Accountability

Requirement to provide performance feedback or satisfactory reasons for significant deviations from duties or expected results

Delegation, authority, responsibility, accountability: Social responsibility

Obligations of an organization to protect and improve the welfare of society, owners, employees and itself

Centralization vs. Decentralization: Factors

Size, Geographics, Technology and Environment

Advantages of Centralization

1) economies of scale
2) consistency of presentation

Advantages of Decentralization

1) inspires innovation
2) accommodates to local market conditions
3) provides personal growth

Strategic Business Unit Idea

Unit of an organizational structure which may have one or more of its own: products/services, customers, marketing/distribution channels, profits, and strategy

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