1. Chapter Eight Organizational Culture, Structure & Design: Building Blocks of the Organization

5. 4 Functions of Organizational Culture Sense Making Device Collective Commitment Organizational Identity Social System Stability Organizational Culture It gives members an organizational identity It facilitates collective commitment It shapes behavior by helping employees make sense of their surroundings It promotes social-system stability Article

8. The Organization Chart Director of Personnel Director of Admissions Director of Nutrition & Food Services Director of X-Ray & Laboratory Services Chief Physician Director of Pharmacy Director of Patient & Public Relations Director of Accounting Director of Surgery Director of Outpatient Services Board of Directors Strategic Planning Advisor Chief Executive Officer Legal Counsel President Cost Containment Staff Executive Administrative Director Executive Medical Director

10. Common purpose: means of unifying members Coordinated effort: working together for common purpose Elements of Organizations

15. Spans of Control: Narrow versus Wide F CEO Narrow Key: T = Top manager M = Middle manager F = First-line (supervisory) manager T M M M F F F F F F F F F T M F F F M F F F T M M M F F F F F F F F M F F F Wide CEO M F F F M F F F M F F F M F F F M F F F M F F F M F F F M F F F M F F F

16. Common Elements of Organizations Authority, responsibility & delegation refers to the rights inherent in a managerial position to make decisions, give orders and utilize resources - Two related terms: responsibility delegation Centralization vs. decentralization centralized authority important decisions are made by higher levels managers decentralized authority important decisions are made by middle level and supervisory-level managers

20. McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc. All rights reserved. Simple Structure for the small firm There is only one hierarchical level of management beneath the owner Owner Administrative Assistant

21. Functional Structure grouping by similar work specialties Structure for a business President Vice President, Marketing Vice President, Finance Vice President, Production Vice President, Human Resources

22. Divisional Structure grouping by similarity of purpose President Motion Pictures & TV Division Music Division Magazine & Book Division Internet Products Division Product Divisional Structure President Consumer Loans Mortgage Loans Business Loans Agriculture Loans Customer Divisional Structure President Western Region Northern Region Southern Region Eastern Region Geographic Divisional Structure

23. © 2006 The McGraw-Hill Companies, Inc. All rights reserved. Conglomerate Structure grouping by industry President Electronics Fire & Security Healthcare Plastics & Adhesives Engineered Products & Services This resembles the structure of Tyco International

24. Hybrid Structure functional & divisional used within the same organization Vice- President, Production Vice- President, Marketing Vice- President, Finance Vice- President, Human Resources Functional divisional structure President President Cadillac President Buick President Pontiac President Chevrolet Product Divisional Structure Manager Region I Manager Region II Manager Region III Manager Region IV Geographical divisional structure

25. McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc. All rights reserved. Matrix Structure a grid of functional & divisional for two chains of command Functional Structure Subordinate reports to both Vice President of marketing & to project Manager for Mustang Project structure Example of Ford motor company President Vice President, Engineering Vice President, Finance Vice President, Production Vice President. Marketing Project Manager, Taurus Project Manager, Mustang Project Manager, Explorer Project Manager, Expedition