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Recommended textbook solutionsHuman Resource Management15th EditionJohn David Jackson, Patricia Meglich, Robert Mathis, Sean Valentine 249 solutions
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Human Resource Management15th EditionJohn David Jackson, Patricia Meglich, Robert Mathis, Sean Valentine 249 solutions
Information Technology Project Management: Providing Measurable Organizational Value5th EditionJack T. Marchewka 346 solutions Departmentalization is defined as a process that groups activities into different departments. These departments are created so that tasks can be performed by specialization within the organization. You will find it in both private and public organizations. Departmentalize also refers to an organization’s formal structure that includes several departments and positions and their respective relationship with each other.
What is Departmentalization?To achieve the common goal of an organization, the company combines teams under different departments. These have several employees who carry out a similar type of activities for the betterment of their company. It groups individuals as per the functions and activities they will be performing in a single department. If you see a corporate ladder, you will find that all the levels that come under the top and all the subsequent ones have been departmentalized. The departments are headed by senior executives who are also known as managers in some cases of their department. They are responsible for delegating duties and tasks to the employees in their department. The employees of every department are accountable to their department head for their performance. The objectives of departmentalization are as follows-
Examples of departmentalizationABC Company is a multinational Company with its offices in the United States and India. It has created several departments because of the different geographical locations and because it needs to carry out systematic and specific work functions. These are examples of Geographical Departmentalization and Functional Departmentalization, respectively. Types of departmentalizationSome popular types of departmentalization are as follows- #1. Functional departmentalizationIn this kind of departmentalization, the company creates departments based on the functions; they perform for the company. For example, you will head together all the specialists related to finance under a finance department and with marketing under that department and not vice-versa. Functional departmentalization is beneficial for the company as it integrates expertise and maximizes efficiency and productivity. As all related activities are conducted by a group of like-minded and shared knowledge and skilled people in one place, you can expect specialized activities and great results. Some of the common and popular functional departments are Logistics, finance, manufacturing, accounting, marketing, IT, and human resource. All important positions are filled with experts that facilitate better integration and coordination. #2. Geographic departmentalizeWhen a company organizes departments along geographic lines, it is called geographic departmentalization. Multinational firms have their offices all around the world, and they have created departments based on the regions to handle company activities. The geographical departmentalization ensures that a cultural, social, and political need of the region is met. When managers are sent from one location to another, they also gain expert training to handle different scenarios. This type of departmentalization allows the company to benefit from the low cost of operations as they can easily capitalize on the local conditions as per their requirements. #3. Product departmentalizeThis type of departmentalization is perfect for a large-scale company that deals with multi-products. It groups all the activities related to the delivery and development of products in a specific department. Product departmentalization becomes vital when manufacturing, marketing, and handling of each product hold due significance for the company. It gives full onus to every product and ensures specialized production facilities. #4. Process departmentalizeWhen a company groups activities by the production processes, it is known as Process Departmentalization. The departments will need adequate material and manpower to conduct their operations and tasks smoothly. #5. Customer departmentalizationWhen a company puts its focus on customer needs and wants, it creates departments in accordance with different class or type of clients and customers. This is known as customer departmentalization. It pays attention to customer satisfaction to enhance the sales figure and brand image of a company. #6. Divisional departmentalizeWhen a corporation starts independent lines that operate as separate entities, it is known as divisional departmentalization. #7. Matrix departmentalizeThis type of departmentalization integrates project and functional departmentalization to improve economies of scale. #8. Planning Task ForceThis type of departmentalization is created in extreme conditions when the organization needs to address a particular and special circumstance. For example, if there is a sudden natural disaster in your area the company will create a special task force department to handle the related. Here is a video by Marketing91 on Departmentalization. Advantages of using itThe numerous advantages of departmentalization are as follows-
Disadvantages of departmentalizationThe disadvantages of departmentalization are as follows-
Factors to be considered in departmentalizationAn organization encourages departmentalization to increase its efficiency and productivity. The factors that are considered to create suitable departments are as follows- #1. SpecializationSpecialization helps the workers to become experts in their field so that it can maximize efficiency. It is important to group employees and activities in such a way that it can result in work specialization and thus ensure economy of operations. #2. ControlEffective control will help a company to achieve the objectives of a company inefficient and economic Create departments in such a way that timely action can be taken to ensure optimal performance. #3. Co-ordinationSeveral activities are in urgent need of coordination and should be grouped together in one department #4. Proper AttentionProper attention is an important factor in creating departments. It ensures special attention to vital areas and no duplication of any activities #5. Human ConsiderationDepartments should be created after giving emphasis to human consideration like aspiration, attitude and cultural pattern of the employees #6. Local ConditionAttention to local conditions and make adjustments as per the available resources is important before creating necessary departments. The conditions of geographical areas vary from one to another hence be aware of local conditions beforehand. #7. EconomyWhen you create separate departments, it increases the cost of a company in terms of personnel, equipment, and additional space. The number one priority of an organization is to utilize its physical amenities to achieve maximum economy while creating necessary departments. What type of departmentalization in which jobs are grouped on the basis of product or customer flow?Process departmentalization - Grouping activities on the basis of product or service or customer flow. Because each process requires different skills, process departmentalization allows homogeneous activities to be grouped together.
What are the four types of departmentalization?The primary forms of departmentalization are by function, process, product, market, customer, geographic area, and sometimes matrix (also called project organization).
What is product based departmentalization?Product departmentalization is an organizational strategy that divides employees into teams to work on all aspects of a particular project or product line. Every product line has an individual department or team, and department members all specialize in different aspects of product development and distribution.
What type of Departmentalisation involves grouping employees based on their work duties?Functional departmentalization
Functional departmentalization is the most common type of departmentalization. It groups together employees based on the functions they perform. The most common functional departments are finance, marketing, logistics, human resources, and operations.
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