Designing Organizational Structures

Degree of Centralization

100

What is centralization in an organization?

Centralization is when decision-making authority is concentrated at the top levels of management, with little input from lower-level employees.

200

What is one benefit of decentralization?

One benefit is faster decision-making because lower-level employees can make decisions without waiting for approval from top management.

-Fester decision-making

-Flexibility

-Innovation/Creativity

300

Give two advantages of a centralized organization.

Two advantages are:

• Top managers can maintain tight financial control.
• It reduces duplication of effort and can lower costs. 

400

What are two risks or disadvantages of decentralization?

Two risks are:

• Lower-level employees may make costly mistakes if they lack skills or training.
• It can lead to poor communication, duplicated efforts, or conflicting goals. 

500

What factors should managers consider when deciding the degree of centralization in an organization? (With at least 3 is okay)

Managers should consider:

• The size of the organization
• The speed of change in the environment
• Managers’ willingness to delegate authority
• Employees’ willingness and ability to take responsibility
• The organization’s geographic dispersion

Organizational design considerations

100

What is a mechanistic organization?

A mechanistic organization has high specialization, rigid structure, many management levels, centralized decision-making, and a long chain of command.

200

What is one key characteristic of an organic organization?

An organic organization has decentralized decision-making, meaning lower-level employees have more authority to make decisions.

300

Give two differences between mechanistic and organic structures.

Two differences would be:

• Mechanistic structures have many levels of management (tall), while organic structures have few (flat).
• Mechanistic organizations are centralized, while organic organizations are decentralized. 

400

How does company size influence whether a structure is mechanistic or organic?

Smaller companies tend to be more organic because they can operate flexibly, while larger companies often become more mechanistic to manage more employees through rules and systems.

500

What factors determine whether an organization should adopt a mechanistic or organic structure?

Key factors include:

• Strategy: Innovation strategies favor organic structures, while cost-control strategies favor mechanistic ones.
• Size: Small firms lean organic; large firms tend to be mechanistic.
• Environment: Dynamic, changing environments require organic structures, while stable environments favor mechanistic structures.

The informal organization

100

What is the informal organization?

The informal organization is the network of personal relationships and communication channels that develop naturally among employees, outside the formal structure.

200

What is the “grapevine” in an organization?

The grapevine is the informal communication system through which information, rumors, and news spread quickly among employees.

300

Give two functions of the informal organization

Two functions are:

• It provides social connections and friendships for employees.
• It helps employees feel informed and connected to what is happening in the company.

400

How can the informal organization help new employees?

It helps socialize new employees by informally sharing rules, expectations, responsibilities, and how things really work in the company.

500

How can managers use informal communication channels to improve organizational performance? (Give 2)

 Managers can improve performance by:

• Paying attention to the grapevine to understand employee concerns and attitudes
• Including informal leaders in decision-making to spread accurate information
• Using informal networks to communicate quickly and reach areas the formal system may miss
• Leveraging relationships to improve teamwork, motivation, and productivity

Trends in Organizational structure

100

What is reengineering in organizations?

Reengineering is the complete redesign of business structures and processes to improve efficiency, quality, service, and speed.

200

What is a virtual corporation

A virtual corporation is a network of independent companies connected by technology that share skills, costs, and markets to take advantage of opportunities.

300

What are two benefits of virtual teams?

2 benefits are:

• They reduce travel and relocation costs.
• They allow companies to use skilled employees from anywhere in the world. 

400

Why do companies outsource work?

Companies outsource to reduce costs, meet labor needs, access specialized skills, and sometimes to increase innovation and maintain a competitive advantage.

500

What major organizational issues must be addressed when companies merge globally? Give 2

Key issues include:

• Integrating different corporate cultures
• Deciding on centralized vs. decentralized decision-making
• Choosing how to structure the organization (by product, geography, etc.)
• Establishing strong communication across the new organization
• Redefining the company’s mission, vision, and values 

Mini games

100

How many minutes does the movie "Despicable Me" (2010) have? (closest wins)

95 minutes!!!

200

Silent Charades!!!(First team to get the word right wins)

Did you get it right??? Hint:Related to today's lesson

300

Guess the song we will play!!! (If you don't get it next team goes)

The song is "California Girls"

400

Guess one number from 1 to 100!!! (The closest team gets the point!)

The number is: 1!

Who got closer???

500

Do the "Wordle" as a team! (All at the same time, first one wins!)

April fools! You don't get the points. Haha...