Departmentalization

departmentaion ppt

1. Departmentalization
By
Chandarkant Goyal
Hitesh Goyal
Mba -1 B

2. Meaning
•Departmentalization is defined as the
process of grouping individual jobs into
departments.
•It involves grouping of activities and
employees into departments so as to
achieve the organisational objectives.
•The grouping into departments of work
activities that are SIMILAR and
LOGICALLY connected

4. Importance
specialization
Expansion
Autonomy
Fixation of responsibility
Appraisal
Management development
Administrative control

5. Types of departmentalization

7. 1.Functional departmentalization
A form of departmentalization in which
individuals engaged in one functional
activity,such as marketing or finance, are
grouped into one unit.
Under functional departmentalization each
major function is organised as a separate
department.
For example: production, sales, financing
and personnel are basic functions in a
manufacturing enterprise . on the other
hand in a retail store buying , selling and
finance are the major function.

8. functional
departmentalization
president
product-
ion
marketing finance

9. Advantages
makes supervision easier
efficient use of resources
Occupational specialization
Optimum utilisation of manpower
Increases managerial efficiency
Facilitates delegation of authority
Eliminates duplication of efforts
Lower cost
Promotes control and coordination within a
department

10. Disadvantages
difficult to get quick decision
harder to determine accountability
Too much emphasis on specialization
May lead to conflicts
Coordination problem
Delay in decision making

11. Suitability
It is most suitable when the size of the
organization is small,has a diversified
activities and operations require a high
degree of specialization and offers a limited
line of products.

12. Lets discuss
In an electrical goods manufacturing
company,there are four main activities
marketing
production
finance
personnel
the general manager is planning to structure
the organisation.
Which organisational departmentaion would
MAIT future managers would suggest
him???why?

13. Answer
I would suggest functional
departmentatlization
Reasons are :
each functional area of business is
controlled by expert
makes supervison easier

14. 2.Territorial /geographical departmentation
Territorial Organization is especially attractive to large scale
firms or rather enterprises whose activities are physically or
geographically dispersed.
All the activities of given area of operation are grouped into
zone ,division ,branches
This structure is suitable for large scale organization or whose
activities are physically or geographically spread.
This structure is most often used in sales & in production

15. Territorial /geographical departmentation
Eastern Zone
Kolkata
Central Zone
Kolhapur
Northern zone
Delhi
Southern zone
Chennai
Western zone
Mumbai
Head Office
Mumbai
jalandhar
chandigarh
New delhi ajmer
branch branch branch branch

16. Advantages
Place emphasis on local market & problem
Take advantage of economic of local operations
Place responsibility at lower level
Better face to face communication with local interest
Improve coordination in a region
Serve local needs better

17. Disadvantages
Require more person with general
manager abilities .
Increases problem of top management
control
Require good caliber managers
Increase problems of control

18. 3. Departmentation by customer
Customer based departmentation is basically market –
oriented in which department are created around the market
served or around marketing channel
CUSTOMERS ARE THE KEY TO THE WAY ACTIVITIES
ARE GROUPED
wholesale Retail Hire purchase
export
Marketing Manager

19. •Advantage
•It fulfils the expectation & needs of customer
•Better service to customer
•Fully focus on customer
•Disadvantages
•Their may be duplication of activities
•Co-ordination is difficult
•Conflict
19

20. Choosing a basis for departmentation
1.Specialisation:
The activity of an organization should be grouped in
such a way that it leads to the specialization of work. It
helps to improve efficiency and economy of operations.
2.Coordination:
Coordination in the performance of different activities is
necessary so that they contribute maximum towards
the organizational goals.

21. 3.Control:
The departmentation should ensure that effective
control helps to achieve organizational goals
efficiently & economically.
4.Attention:
The various activities should be given adequate
attention so that each necessary activity is
performed & there is no unnecessary duplication of
activities.

22. Thank you