Define Organization Structure and Explain elements of Organization structure?

Solution:

Organization Structure

By organization structure we means three things

1. The Location of Design Making Responsibility in the firm.

2. The Formal division of Organization into Subunits
3. Establishment of integrating mechanisms to coordinate the activities of subunits

The Elements of Structure

 Work specialization
 Unity Of command
 Span Of control
 Authority & Responsibility
 Centralization Verses Decentralization
 Departmentalization

Work specialization : The degree to which tasks in the organization are divided into separate
jobs with each step completed by a different person.

Unity Of command: The management principle that no person should report to more than one
boss.

Span Of control: The number of employees who can be effectively and efficiently supervised
by a manager.

Authority & Responsibility

Authority : The formal right of a manager to make decisions, to give orders, and expect the
orders to be carried out.

Responsibility: The manager’s duty to perform an assigned task.

Centralization Verses Decentralization

Centralized organizational structures rely on one individual to make decisions and provide
direction for the company.

Decentralized organizations rely on a team environment at different levels in the business.

Departmentalization is the grouping of jobs in one area in an organization. The grouping increases
efficiency in many organizations and allows workers to specialize in a particular area of the business