Departmentalization is the grouping of activities and responsibilities by sub-units of the organization. These sub-units are called departments. The division of labor or degree of departmentalization is driven by the need for specialization whether by process or purpose within an organization. The most common way of process departmentalization is the division of the firm into business functions, such as purchasing, manufacturing, sales, accounting, etc. Show
Departmentalization specifies how employees and their activities are grouped together. It is a fundamental strategy for coordinating organizational activities, because it influences organizational behavior in the following ways:
Departmentalization by function is a method of organizing work by grouping together people who perform similar or closely related tasks. One of the main advantages of departmentalizing by function is the development of localized expertise, or unit specialization. Each person within a functional unit gains knowledge and experience from working on one task for a long period of time. For example, a manufacturing company may create a production department, sales and marketing department, an accounting department, and a human resources department. Departmentalization by purpose is a method of organizing work by grouping together people who are responsible for achieving a single purpose. The employees in a given department are not necessarily doing the same tasks, but all of their work focuses on a common objective. Such departments are usually set up (1) to cater to a particular geographic region; (2) to produce, market and sell one particular product from a broaden family of products; (3) to serve one particular client or group of clients.
A disadvantage of departmentalization by purpose is that because each department is somewhat self-contained, stuff is often duplicated. This is an added cost. Matrix organization is a departmentalization by two dimensions such as function and purpose, simultaneously. Matrix organizations are found in all types of settings. Originally developed in aerospace companies, the idea of the matrix spread rapidly to such diverse companies as General Electric, Citibank, and Shell Oil and is used in government agencies as well. One of its most prevalent uses has been in universities, where academic departments such as accounting, marketing and finance often form a “matrix” with undergraduate, masters, doctoral or executive programs. Faculty members in such a university are responsible to both the department chair and the program director or administrator. Matrix organizations are not limited to the combination of function and purpose. Any two dimensions could be combined. The primary advantage of the matrix organization is that it takes advantage of the best aspects of the other methods of departmentalization. The matrix organization is not without problems. Because each employee reports to two supervisors, he or she may receive conflicting directives. Because of this, many managers prefer the one-boss reporting relationships in simpler organization structures. Related Posts:
What are the forms of departmentalization?The primary forms of departmentalization are by function, process, product, market, customer, geographic area, and sometimes matrix (also called project organization). In many organizations, a combination of these forms is used.
What is the functional departmentalization?What is functional departmentalization? Functional departmentalization is an organizational structure where business leaders divide teams according to the professionals' areas of specialization.
What type of departmentalization is common in manufacturing where workers are grouped according to the type of work they perform?Functional departmentalization defines departments by the functions each one performs such as accounting or purchasing. Every Organization must perform certain jobs in order to do its work. For example, Manufacturing, Production, R & D, Purchasing etc. Same kinds of jobs are grouped together in departments.
Which type of Departmentalisation group together the jobs which are involving the similar activities?Once work has been divided into small and manageable activities, then those activities which are similar in nature, are grouped together. This process is called departmentalization.
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