Key Terms
- authority
- Legitimate power, granted by the organization and acknowledged by employees, that allows an individual to request action and expect compliance.
- centralization
- The degree to which formal authority is concentrated in one area or level of an organization. Top management makes most of the decisions.
- chain of command
- The line of authority that extends from one level of an organization’s hierarchy to the next, from top to bottom, and makes clear who reports to whom.
- committee structure
- An organizational structure in which authority and responsibility are held by a group rather than an individual.
- cross-functional team
- Members from the same organizational level but from different functional areas.
- customer departmentalization
- Departmentalization that is based on the primary type of customer served by the organizational unit.
- decentralization
- The process of pushing decision-making authority down the organizational hierarchy.
- delegation of authority
- The assignment of some degree of authority and responsibility to persons lower in the chain of command.
- departmentalization
- The process of grouping jobs together so that similar or associated tasks and activities can be coordinated.
- division of labor
- The process of dividing work into separate jobs and assigning tasks to workers.
- formal organization
- The order and design of relationships within a firm; consists of two or more people working together with a common objective and clarity of purpose.
- functional departmentalization
- Departmentalization that is based on the primary functions performed within an organizational unit.
- geographic departmentalization
- Departmentalization that is based on the geographic segmentation of the organizational units.
- group cohesiveness
- The degree to which group members want to stay in the group and tend to resist outside influences.
- informal organization
- The network of connections and channels of communication based on the informal relationships of individuals inside an organization.
- line organization
- An organizational structure with direct, clear lines of authority and communication flowing from the top managers downward.
- line positions
- All positions in the organization directly concerned with producing goods and services and that are directly connected from top to bottom.
- line-and-staff organization
- An organizational structure that includes both line and staff positions.
- managerial hierarchy
- The levels of management within an organization; typically includes top, middle, and supervisory management.
- matrix structure (project management)
- An organizational structure that combines functional and product departmentalization by bringing together people from different functional areas of the organization to work on a special project.
- mechanistic organization
- An organizational structure that is characterized by a relatively high degree of job specialization, rigid departmentalization, many layers of management, narrow spans of control, centralized decision-making, and a long chain of command.
- organic organization
- An organizational structure that is characterized by a relatively low degree of job specialization, loose departmentalization, few levels of management, wide spans of control, decentralized decision-making, and a short chain of command.
- organization
- The order and design of relationships within a firm; consists of two or more people working together with a common objective and clarity of purpose.
- organization chart
- A visual representation of the structured relationships among tasks and the people given the authority to do those tasks.
- problem-solving teams
- Usually members of the same department who meet regularly to suggest ways to improve operations and solve specific problems.
- process departmentalization
- Departmentalization that is based on the production process used by the organizational unit.
- product departmentalization
- Departmentalization that is based on the goods or services produced or sold by the organizational unit.
- reengineering
- The complete redesign of business structures and processes in order to improve operations.
- self-managed work teams
- Teams without formal supervision that plan, select alternatives, and evaluate their own performance.
- span of control
- The number of employees a manager directly supervises; also called span of management.
- specialization
- The degree to which tasks are subdivided into smaller jobs.
- staff positions
- Positions in an organization held by individuals who provide the administrative and support services that line employees need to achieve the firm’s goals.
- virtual corporation
- A network of independent companies linked by information technology to share skills, costs, and access to one another’s markets; allows the companies to come together quickly to exploit rapidly changing opportunities.
- work groups
- The groups that share resources and coordinate efforts to help members better perform their individual jobs.
- work teams
- Like a work group but also requires the pooling of knowledge, skills, abilities, and resources to achieve a common goal.