Types of organisation and principles of management
VishalShinde10
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Sep 11, 2017
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About This Presentation
14 principles of managements,importance of managements,types of organization
Slide Content
Industrial Engineering
UNIT -I
Introduction to Industrial Engineering and Productivity
Prepared By
Prof. Shinde Vishal Vasant
Assistant Professor
Dept. of Mechanical Engg.
NDMVP’S Karmaveer Baburao Thakare
College of Engg. Nashik
Contact No- 8928461713
E mail:- shinde.vishal @kbtcoe.org
Website:- www. vishalshindeblog.wordpress.com
01/01/2017 PROF.VV.SHINDE NDMVP'S KBTCOE NASHIK
UNIT -I
Introduction to Industrial Engineering and Productivity
Prepared By
Prof. Shinde Vishal Vasant
Assistant Professor
Dept. of Mechanical Engg.
NDMVP’S Karmaveer Baburao Thakare
College of Engg. Nashik
Contact No- 8928461713
E mail:- shinde.vishal @kbtcoe.org
Website:- www. vishalshindeblog.wordpress.com
01/01/2017 PROF.VV.SHINDE NDMVP'S KBTCOE NASHIK
Industrial Engineering
Industrial and systems engineering is concerned with the design,
improvement and installation of integrated systems of people,
materials, information, equipment and energy.
It draws upon specialized knowledge and skill in the
mathematical, physical, and social sciences together with the
principles and methods of engineering analysis and design, to
specify, predict, and evaluate the results to be obtained from such
systems.
+ The branch of engineering that deals with the creation and
management of systems that integrate people, materials and
energy in productive ways.
+ Industrial engineers determine the most effective ways to use
the basic factors of production—people, machines, materials,
information, and energy -- to make a product or provide a
service.
01/01/2017 PROFV.V.SHINDE NDMVP'S KBTCOE NASHIK
Industrial and systems engineering is concerned with the design,
improvement and installation of integrated systems of people,
materials, information, equipment and energy.
It draws upon specialized knowledge and skill in the
mathematical, physical, and social sciences together with the
principles and methods of engineering analysis and design, to
specify, predict, and evaluate the results to be obtained from such
systems.
+ The branch of engineering that deals with the creation and
management of systems that integrate people, materials and
energy in productive ways.
+ Industrial engineers determine the most effective ways to use
the basic factors of production—people, machines, materials,
information, and energy -- to make a product or provide a
service.
01/01/2017 PROFV.V.SHINDE NDMVP'S KBTCOE NASHIK
Broad areas of IE
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Typical focuse areas includes
Project Management
Manufacturing, Production and Distribution
Supply Chain Management
Productivity, Methods and Process Engineering
Quality Measurement and Improvement
Program Management
Ergonomics/Human Factors
Technology Development and Transfer
Strategic Planning
Management of Change
Financial Engineering
01/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Project Management
Manufacturing, Production and Distribution
Supply Chain Management
Productivity, Methods and Process Engineering
Quality Measurement and Improvement
Program Management
Ergonomics/Human Factors
Technology Development and Transfer
Strategic Planning
Management of Change
Financial Engineering
01/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Objectives of Industrial Engineering
PRODUCTIVITY
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
PRODUCTIVITY
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Application areas of TE
« Aerospace & Airplanes « Materials Testing
« Aluminum & Steel « Medical Services
« Banking + Military
« Ceramics « Mining
« Construction + Oil & Gas
« Consulting « Plastics & Forming
« Electronics Assembly + Retail
« Energy « Shipbuilding
« Entertainment » State 8 Federal
. Forestry & Logging Government
+ Insurance « Transportation
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
« Aerospace & Airplanes « Materials Testing
« Aluminum & Steel « Medical Services
« Banking + Military
« Ceramics « Mining
« Construction + Oil & Gas
« Consulting « Plastics & Forming
« Electronics Assembly + Retail
« Energy « Shipbuilding
« Entertainment » State 8 Federal
. Forestry & Logging Government
+ Insurance « Transportation
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Mass Customization Era
1995-2005
Globalization
Internet
Enterprise Resource Planning
Learning Organization
International Quality Standards
Finite Scheduling
Supply Chain Management
Agile Manufacturing
Lean Production Era
1980-1995
Early Concepts Mass Production Era Ann nr Alded Design
ere 1210-1980 ¿ne Electronic Data Interchange
abor Specialization Moving Assembly Line Total Quality Management
(Smith, Babbage) (Ford/Sorensen) Baldrige Award g
Standardized Parts (Whitney) Se Sampling Empowerment
jewhart)
Scientific Management Era Economic Order Kanbans
1880-1910 Quantity (Harris)
Gantt Charts (Gantt) Linear Programming
Motion & Time Studies (Dantzig) PERT/CPM
(Gilbreth) (DuPont)
Process Analysis (Taylor) Material Requirements
Queuing Theory (Erlang) Planning
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 7
1995-2005
Globalization
Internet
Enterprise Resource Planning
Learning Organization
International Quality Standards
Finite Scheduling
Supply Chain Management
Agile Manufacturing
Lean Production Era
1980-1995
Early Concepts Mass Production Era Ann nr Alded Design
ere 1210-1980 ¿ne Electronic Data Interchange
abor Specialization Moving Assembly Line Total Quality Management
(Smith, Babbage) (Ford/Sorensen) Baldrige Award g
Standardized Parts (Whitney) Se Sampling Empowerment
jewhart)
Scientific Management Era Economic Order Kanbans
1880-1910 Quantity (Harris)
Gantt Charts (Gantt) Linear Programming
Motion & Time Studies (Dantzig) PERT/CPM
(Gilbreth) (DuPont)
Process Analysis (Taylor) Material Requirements
Queuing Theory (Erlang) Planning
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 7
Taylor’s contribution to management
+ Frederick Winslow Taylor (20 March 1856-21 March 1915),
widely known as F. W. Taylor, was an American mechanical
engineer who sought to improve industrial efficiency.
+ He is regarded as the father of scientific management, and
was one of the first management consultants.
+ He is sometimes called as “Father of Scientific
Management”.
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
+ Frederick Winslow Taylor (20 March 1856-21 March 1915),
widely known as F. W. Taylor, was an American mechanical
engineer who sought to improve industrial efficiency.
+ He is regarded as the father of scientific management, and
was one of the first management consultants.
+ He is sometimes called as “Father of Scientific
Management”.
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Scientific management
It is the art of knowing what exactly you want from
your men to do & then seeing that it is done in best
possible manner.
In simple words it is just an application of science to
management.
Management theory by taylor
Analyzing the work — One best way to do it.
He is remembered for developing time and motion
study.
He would break a job into parts and measure each of
100 of a minute.
The efforts of his disciples made the industry to
implement these ideas.
01/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
It is the art of knowing what exactly you want from
your men to do & then seeing that it is done in best
possible manner.
In simple words it is just an application of science to
management.
Management theory by taylor
Analyzing the work — One best way to do it.
He is remembered for developing time and motion
study.
He would break a job into parts and measure each of
100 of a minute.
The efforts of his disciples made the industry to
implement these ideas.
01/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Taylors principles of management
+ The four principles of management.
1. The development of a true science.
2. The scientific selection of the workman.
3. The scientific education and development of the
workman.
4. Intimate and friendly cooperation between the
management and the men.
+ Taylor created planning departments, staffed them with
engineers, and gave them the responsibility to:
1. Develop scientific methods for doing work.
2. Establish goals for productivity.
3. Establish systems of rewards for meeting the goals.
4. Train the personnel in how to use the methods and
thereby meet the goals.
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
+ The four principles of management.
1. The development of a true science.
2. The scientific selection of the workman.
3. The scientific education and development of the
workman.
4. Intimate and friendly cooperation between the
management and the men.
+ Taylor created planning departments, staffed them with
engineers, and gave them the responsibility to:
1. Develop scientific methods for doing work.
2. Establish goals for productivity.
3. Establish systems of rewards for meeting the goals.
4. Train the personnel in how to use the methods and
thereby meet the goals.
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Frank & Lillian Gilbreth
Contribution
Time and motion efficiency experts
> Developed therbligs, breakdown of manual skills into 16
actions
> Frank was a lazy bricklayer looking for an easier way
and Lillian was a psychologist.
Endorsed piece-work and suggested a higher rate per
unit if his directions were followed.
> Disagreed with Taylor’s idea that management should
choose which workers took which jobs.
01/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 11
Contribution
Time and motion efficiency experts
> Developed therbligs, breakdown of manual skills into 16
actions
> Frank was a lazy bricklayer looking for an easier way
and Lillian was a psychologist.
Endorsed piece-work and suggested a higher rate per
unit if his directions were followed.
> Disagreed with Taylor’s idea that management should
choose which workers took which jobs.
01/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 11
What is Management?
Definition: Coordinating work activities so that
they are completed efficiently and effectively
with and through other people
Efficiency: getting the most output from the
least input
Effectiveness: completing activities so that the
organization’s goals are attained.
OR
“Management is the process of designing and
maintaining an environment in which individuals
working together in groups, efficiently
accomplish selected item”
PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 12
Definition: Coordinating work activities so that
they are completed efficiently and effectively
with and through other people
Efficiency: getting the most output from the
least input
Effectiveness: completing activities so that the
organization’s goals are attained.
OR
“Management is the process of designing and
maintaining an environment in which individuals
working together in groups, efficiently
accomplish selected item”
PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 12
Henri Fayol
management strategy
- First came up with the five basic functions of
management— Planning, Organizing, Staffing,
Directing, Communicating, and Controlling
- First wrote that management is a set of
principles which can be learned.
+ Developed Fourteen Principles of Management
management strategy
- First came up with the five basic functions of
management— Planning, Organizing, Staffing,
Directing, Communicating, and Controlling
- First wrote that management is a set of
principles which can be learned.
+ Developed Fourteen Principles of Management
Management functions (or) Process of
Management:
There are five types of functions in management. They
are,
Planning- Defines the goal & establishing strategy.
Organizing- Includes determining what task has to be
done, who is to do them.
Staffing- Includes recruitment of people and training
them towards the project.
Leading- Includes the motivating the employees and
directing the activities.
Controlling- It is the process of monitoring the
performance.
01/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Management:
There are five types of functions in management. They
are,
Planning- Defines the goal & establishing strategy.
Organizing- Includes determining what task has to be
done, who is to do them.
Staffing- Includes recruitment of people and training
them towards the project.
Leading- Includes the motivating the employees and
directing the activities.
Controlling- It is the process of monitoring the
performance.
01/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
14 Principles of Management
1. Specialization of labor. Specializing encourages
continuous improvement in skills and the development
of improvements in methods.
2. Authority. The right to give orders and the power to
exact obedience.
3. Discipline. No slacking, bending of rules.
4. Unity of command. Each employee has one and only
one boss.
5. Unity of direction. A single mind generates a single
plan and all play their part in that plan.
6. Subordination of Individual Interests. When at work,
only work things should be pursued or thought about.
7. Remuneration. Employees receive fair payment for
services, not what the company can get away with.
01/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 15
1. Specialization of labor. Specializing encourages
continuous improvement in skills and the development
of improvements in methods.
2. Authority. The right to give orders and the power to
exact obedience.
3. Discipline. No slacking, bending of rules.
4. Unity of command. Each employee has one and only
one boss.
5. Unity of direction. A single mind generates a single
plan and all play their part in that plan.
6. Subordination of Individual Interests. When at work,
only work things should be pursued or thought about.
7. Remuneration. Employees receive fair payment for
services, not what the company can get away with.
01/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 15
8. Centralization. Consolidation of management functions.
Decisions are made from the top.
9. Scalar Chain (line of authority). Formal chain of command
running from top to bottom of the organization, like military
10. Order. All materials and personnel have a prescribed place, and
they must remain there.
11. Equity. Equality of treatment (but not necessarily identical
treatment)
12. Personnel Tenure. Limited turnover of personnel. Lifetime
employment for good workers.
13. Initiative. Thinking out a plan and do what it takes to make it
happen.
14. Esprit de corps. Harmony, cohesion among personnel.
This is principle that “in union there is strength” as well as an
extension of the principle of unity of command, emphasizing the
need for teamwork and the importance of communication in
ovo Obtaining it. PROFVV.SHINDE NDMVP'S KBTCOE NASHIK 1
Decisions are made from the top.
9. Scalar Chain (line of authority). Formal chain of command
running from top to bottom of the organization, like military
10. Order. All materials and personnel have a prescribed place, and
they must remain there.
11. Equity. Equality of treatment (but not necessarily identical
treatment)
12. Personnel Tenure. Limited turnover of personnel. Lifetime
employment for good workers.
13. Initiative. Thinking out a plan and do what it takes to make it
happen.
14. Esprit de corps. Harmony, cohesion among personnel.
This is principle that “in union there is strength” as well as an
extension of the principle of unity of command, emphasizing the
need for teamwork and the importance of communication in
ovo Obtaining it. PROFVV.SHINDE NDMVP'S KBTCOE NASHIK 1
Manager
A
Top managers
> relatively small group of executives
> manage the overall organization
> establish its goals, overall strategy, and operating policies
> represent the organization in external environment
\.> bear major responsibilities
Middle managers
> largest group of manager
> primarily responsible for implementing the policies and plans
\ > supervise and coordinate the activities of lower level managers.
First Line managers
> coordinate and supervise the activities of operating employees
| > spend a large proportion of their time supervising subordinates
01/01/2017 u u . u u u Mm u | 17
A
Top managers
> relatively small group of executives
> manage the overall organization
> establish its goals, overall strategy, and operating policies
> represent the organization in external environment
\.> bear major responsibilities
Middle managers
> largest group of manager
> primarily responsible for implementing the policies and plans
\ > supervise and coordinate the activities of lower level managers.
First Line managers
> coordinate and supervise the activities of operating employees
| > spend a large proportion of their time supervising subordinates
01/01/2017 u u . u u u Mm u | 17
01/01/2017
Manager
Management
Lower-Level
Management
PROFV.V.SHINDE NDMVP'S KBTCOE NASHIK
Manager
Management
Lower-Level
Management
PROFV.V.SHINDE NDMVP'S KBTCOE NASHIK
Organisation
“Organisation is refers to a social groups designed to achieve certain
goals. Organisation involves creating a structure of relationship among
people working for the desired results”.
OR
Organisation is a system of co-operative activities of two or more
persons
— CONCEPT OF ORGANISATION
+ Organisation refers to the institution
+ Organising is one of the functions of management
Planning (N... Ñ Organising
Directing
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 19
“Organisation is refers to a social groups designed to achieve certain
goals. Organisation involves creating a structure of relationship among
people working for the desired results”.
OR
Organisation is a system of co-operative activities of two or more
persons
— CONCEPT OF ORGANISATION
+ Organisation refers to the institution
+ Organising is one of the functions of management
Planning (N... Ñ Organising
Directing
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 19
According to keith Davis, “Organisation may be
defined as a group of individuals, large of small, that is
cooperating under the direction of executive leadership
in accomplishment of certain common object.”
According to Chester I. Barnard, “Organisation is a
system of co-operative activities of two or more
persons.”
According to Louis A. Allen, “Organisation is the
process of identifying and grouping the work to be
performed, defining and delegating responsibility and
authority, and establishing relationship for the purpose
of enabling people to work most effectively together in
accomplishing objectives.”
According to Mooney and Railey, “Organisation is the
form of every human association for the attainment of a
common purpose.”
/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
defined as a group of individuals, large of small, that is
cooperating under the direction of executive leadership
in accomplishment of certain common object.”
According to Chester I. Barnard, “Organisation is a
system of co-operative activities of two or more
persons.”
According to Louis A. Allen, “Organisation is the
process of identifying and grouping the work to be
performed, defining and delegating responsibility and
authority, and establishing relationship for the purpose
of enabling people to work most effectively together in
accomplishing objectives.”
According to Mooney and Railey, “Organisation is the
form of every human association for the attainment of a
common purpose.”
/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Organising process
> Determining, grouping and structuring the activities.
> Creating rules for effective performance at work.
> Allocation of necessary authority and responsibility.
> Determining detailed procedures and systems for different
problems areas such as coordination, communication
motivation etc.
01/01/2017 pl
ROFV.V.SHINDE NDMVP'S KBTCOE NASHIK 21
> Determining, grouping and structuring the activities.
> Creating rules for effective performance at work.
> Allocation of necessary authority and responsibility.
> Determining detailed procedures and systems for different
problems areas such as coordination, communication
motivation etc.
01/01/2017 pl
ROFV.V.SHINDE NDMVP'S KBTCOE NASHIK 21
Characteristics / Features of Organisation
+ Outlining the Objectives:
Born with the enterprise are its long-life objectives of
profitable manufacturing and selling its products. Other
objectives must be established by the administration
from time to time to aid and support this main
objective.
¢ Identifying and Enumerating the Activities:
After the objective is selected, the management has to
identify total task involved and its break-up closely
related component activities that are to be performed by
and individual or division or a department.
01/01/2017 PROFV.SI
+ Outlining the Objectives:
Born with the enterprise are its long-life objectives of
profitable manufacturing and selling its products. Other
objectives must be established by the administration
from time to time to aid and support this main
objective.
¢ Identifying and Enumerating the Activities:
After the objective is selected, the management has to
identify total task involved and its break-up closely
related component activities that are to be performed by
and individual or division or a department.
01/01/2017 PROFV.SI
01/01/2017 pl
Assigning the Duties:
When activities have been grouped according to similarities
and common purposes, they should be organized by a
particular department. Within the department, the functional
duties should be allotted to particular individuals.
Defining and Granting the Authority:
The authority and responsibility should be well defined and
should correspond to each other. A close relationship
between authority and responsibility should be established.
Creating Authority Relationship:
After assigning the duties and delegations of authority, the
establishment of relationship is done. It involves deciding
who will act under whom, who will be his subordinates,
what will be his span of control and what will be his status
in the organisation. Besides these formal relationships,
some informal organizations should also be developed.
ROFV.V.SHINDE NDMVP'S KBTCOE NASHIK 23
Assigning the Duties:
When activities have been grouped according to similarities
and common purposes, they should be organized by a
particular department. Within the department, the functional
duties should be allotted to particular individuals.
Defining and Granting the Authority:
The authority and responsibility should be well defined and
should correspond to each other. A close relationship
between authority and responsibility should be established.
Creating Authority Relationship:
After assigning the duties and delegations of authority, the
establishment of relationship is done. It involves deciding
who will act under whom, who will be his subordinates,
what will be his span of control and what will be his status
in the organisation. Besides these formal relationships,
some informal organizations should also be developed.
ROFV.V.SHINDE NDMVP'S KBTCOE NASHIK 23
Importance / Need / Advantages / Significance of
1.
01/01/2017 pl
Organisation
It Facilitated Administration and management:
Organisation is an important and the only tool to
achieve enterprise goals set b administration and
explained by management. A sound organisation
increases efficiency, avoids delay and duplication of
work, increases managerial efficiency, increases
promptness, motivates employees to perform their
responsibility.
It Help in the Growth of Enterprise: Good
organisation is helpful to the growth, expansion and
diversifications of the enterprise.
ROFV.V.SHINDE NDMVP'S KBTCOE NASHIK 24
1.
01/01/2017 pl
Organisation
It Facilitated Administration and management:
Organisation is an important and the only tool to
achieve enterprise goals set b administration and
explained by management. A sound organisation
increases efficiency, avoids delay and duplication of
work, increases managerial efficiency, increases
promptness, motivates employees to perform their
responsibility.
It Help in the Growth of Enterprise: Good
organisation is helpful to the growth, expansion and
diversifications of the enterprise.
ROFV.V.SHINDE NDMVP'S KBTCOE NASHIK 24
3 It Ensures Optimum Use of Human Resources:
Good organisation establishes persons with different
interests, skills, knowledge and viewpoints.
4 It Stimulates Creativity:
A sound and well-conceived organisation structure is the
source of creative thinking and initiation of new ideas.
5 A Tool of Achieving Objectives:
Organisation is a vital tool in the hands of the management
for achieving set objectives of the business enterprise.
6 Prevents Corruption:
Usually corruption exists in those enterprises which lack
sound organisation. Sound organization prevents corruption
by raising the morale of employees. They are motivated to
work with greater efficiency, honesty and devotion.
7 Co-ordination in the Enterprises:
8 Eliminates Overlapping and Duplication or work:
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 25
Good organisation establishes persons with different
interests, skills, knowledge and viewpoints.
4 It Stimulates Creativity:
A sound and well-conceived organisation structure is the
source of creative thinking and initiation of new ideas.
5 A Tool of Achieving Objectives:
Organisation is a vital tool in the hands of the management
for achieving set objectives of the business enterprise.
6 Prevents Corruption:
Usually corruption exists in those enterprises which lack
sound organisation. Sound organization prevents corruption
by raising the morale of employees. They are motivated to
work with greater efficiency, honesty and devotion.
7 Co-ordination in the Enterprises:
8 Eliminates Overlapping and Duplication or work:
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 25
Principles of organisation
Consideration of Objectives
Combination of Line and Staff Functions
Division of Labour or Specialisation
Departmentation
Decentralisation
Principle of Scalar Chain
Principle of Span of control
Principle of Unity of Command
Principle of Balance
Principle of Flexibility
Authority and Responsibility
01/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Consideration of Objectives
Combination of Line and Staff Functions
Division of Labour or Specialisation
Departmentation
Decentralisation
Principle of Scalar Chain
Principle of Span of control
Principle of Unity of Command
Principle of Balance
Principle of Flexibility
Authority and Responsibility
01/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
+ The Principle of Objective
Every enterprise, big or small, prescribes certain basic objectives.
Organisation serves as a tool in attaining these prescribed objectives
+ Principle of Specialization
Precise division of work facilitates specialization. According to this
principles division of work between the employees must be based on
their ability, capability, tasks, knowledge and interest. This will
ensure specialization and specialization will lead to efficiency,
quality and elimination of wastage etc.
+ The Scalar Principle
This principle is sometimes known as the “chain command’. There
must be clear lines of authority running from the top to the bottom
of the organisation.
+ The Principle of Authority
It is the tool by which a manager is able to create an environment
for individual performance.
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 27
Every enterprise, big or small, prescribes certain basic objectives.
Organisation serves as a tool in attaining these prescribed objectives
+ Principle of Specialization
Precise division of work facilitates specialization. According to this
principles division of work between the employees must be based on
their ability, capability, tasks, knowledge and interest. This will
ensure specialization and specialization will lead to efficiency,
quality and elimination of wastage etc.
+ The Scalar Principle
This principle is sometimes known as the “chain command’. There
must be clear lines of authority running from the top to the bottom
of the organisation.
+ The Principle of Authority
It is the tool by which a manager is able to create an environment
for individual performance.
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 27
The Principle of Unity of Command
One subordinate should be kept in the supervision of one boss only.
This principle avoids the possibility of conflicts in instructions and
develops the feeling of personnel responsibility for the work.
The Principal Span of Control
It is also known as “span of management’, ‘span of supervision’ or
‘levels of organisation’, etc.
The Principle of the Unity of Direction
The basic rationale for the very existence of organisation is the
attainment of certain objectives. Major objective should be split into
functional activities and there should be one objective and one plan
for each group of people.
The Principle of Balance
In every organisation structure there is need for balance. For
effective grouping and assigning activities, this principle calls for
putting balance on all types of factors human, technical as well as
financial.
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 28
One subordinate should be kept in the supervision of one boss only.
This principle avoids the possibility of conflicts in instructions and
develops the feeling of personnel responsibility for the work.
The Principal Span of Control
It is also known as “span of management’, ‘span of supervision’ or
‘levels of organisation’, etc.
The Principle of the Unity of Direction
The basic rationale for the very existence of organisation is the
attainment of certain objectives. Major objective should be split into
functional activities and there should be one objective and one plan
for each group of people.
The Principle of Balance
In every organisation structure there is need for balance. For
effective grouping and assigning activities, this principle calls for
putting balance on all types of factors human, technical as well as
financial.
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 28
Elements of Organisation
Organizational design is engaged when managers develop
or change an organization's structure. Organizational Design
is a process that involves decisions about the following six
key elements:
Work Specialization
- Describes the degree to which tasks in an organization
are divided into separate jobs.
- The main idea of this organizational design is that an
entire job is not done by one individual.
- It is broken down into steps, and a different person
completes each step. Individual employees specialize in
doing part of an activity rather than the entire activity.
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 29
Organizational design is engaged when managers develop
or change an organization's structure. Organizational Design
is a process that involves decisions about the following six
key elements:
Work Specialization
- Describes the degree to which tasks in an organization
are divided into separate jobs.
- The main idea of this organizational design is that an
entire job is not done by one individual.
- It is broken down into steps, and a different person
completes each step. Individual employees specialize in
doing part of an activity rather than the entire activity.
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 29
II.Departmentalization
+ The process of grouping the activities is commonly known as
“Departmentation”
+ Departmentation is useful for specialization and fixation of
responsibility
+ Patterns used in Departmentation OR
Common forms of departmentalization
> Departmentation By Function
> Departmentation by Product or services
> Grouping by location or Territories
> Departmentation by time
> Grouping by process and equipment
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
+ The process of grouping the activities is commonly known as
“Departmentation”
+ Departmentation is useful for specialization and fixation of
responsibility
+ Patterns used in Departmentation OR
Common forms of departmentalization
> Departmentation By Function
> Departmentation by Product or services
> Grouping by location or Territories
> Departmentation by time
> Grouping by process and equipment
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
1.Functional Departmentalization
* it groups jobs by functions performed. It can be used in all
kinds of organizations; it depends on the goals each of them
wants to achieve.
Board of Dirctors
Managing Director
T
Production) Marketing] Finance Personal
Market Research Advertising Sales
Radio & T.V
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
* it groups jobs by functions performed. It can be used in all
kinds of organizations; it depends on the goals each of them
wants to achieve.
Board of Dirctors
Managing Director
T
Production) Marketing] Finance Personal
Market Research Advertising Sales
Radio & T.V
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Different aspects on this type of departmentalization:
Positive Aspects Negative Aspects
o Efficiencies from putting together © Poor communication across
similar specialties and people functional areas
with common skills, knowledge, a Limited view of organizational
and orientations goals
© Coordination within functional
area
© In-depth specialization
2. Product Departmentalization.
- It groups jobs by product line. Each manager is responsible of an area within the
organization depending of his/her specialization
Board of Dirctors =, -
‘Managing Director’
Product-A Product-B
T T
Production| [Sales] [Services] [Accounting Production) [Sales] [Services
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Accounting
32
Positive Aspects Negative Aspects
o Efficiencies from putting together © Poor communication across
similar specialties and people functional areas
with common skills, knowledge, a Limited view of organizational
and orientations goals
© Coordination within functional
area
© In-depth specialization
2. Product Departmentalization.
- It groups jobs by product line. Each manager is responsible of an area within the
organization depending of his/her specialization
Board of Dirctors =, -
‘Managing Director’
Product-A Product-B
T T
Production| [Sales] [Services] [Accounting Production) [Sales] [Services
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Accounting
32
Different aspects on this type of departmentalization:
Positive Aspects Negative Aspects
o Allows specialization in particular o Duplication of functions
products and services © Limited view of organizational
o Managers can become experts goals
in their industry
o Closerto customers
3. Geographical Departmentalization/Grouping by
location or Territories
- It groups jobs on the basis of territory or geography.
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 33
Positive Aspects Negative Aspects
o Allows specialization in particular o Duplication of functions
products and services © Limited view of organizational
o Managers can become experts goals
in their industry
o Closerto customers
3. Geographical Departmentalization/Grouping by
location or Territories
- It groups jobs on the basis of territory or geography.
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 33
Head Office
(Kolkata)
Eatern Soze| Central Zone Northern Sone Sourthein Zone
(Kanpur) (New Delhi) (Chennai) (Mumbai)
Jalandhar| Chandigarh New Delhi Ajmer
Division Division Division [Division
Branch Branch [Branch Branch
Different aspects on this type of departmentalization:
Positive Aspects Negative Aspects
o More effective and efficient o Duplication of functions
handling of specific regional o Can feel isolated from other
issues that arise organizational areas
o Serve needs of unique
geographic markets better
01/01/2017
PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 34
(Kolkata)
Eatern Soze| Central Zone Northern Sone Sourthein Zone
(Kanpur) (New Delhi) (Chennai) (Mumbai)
Jalandhar| Chandigarh New Delhi Ajmer
Division Division Division [Division
Branch Branch [Branch Branch
Different aspects on this type of departmentalization:
Positive Aspects Negative Aspects
o More effective and efficient o Duplication of functions
handling of specific regional o Can feel isolated from other
issues that arise organizational areas
o Serve needs of unique
geographic markets better
01/01/2017
PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 34
4. Process Departmentalization./Grouping by
process and equipment
Process Departmentalization
Weaving
Department
Different aspects on this type of departmentalization:
o More efficient flow of work o Can only be used with certain
activities types of products
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 35
process and equipment
Process Departmentalization
Weaving
Department
Different aspects on this type of departmentalization:
o More efficient flow of work o Can only be used with certain
activities types of products
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 35
5.Customer departmentalization
» It groups on the basis of common customers
Customer Departmentalization
Department to MIN: a | Department to
handle | handle handle
Domestic Cs Wholesale Customers} | Retail Customers
Foreign Customers
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
» It groups on the basis of common customers
Customer Departmentalization
Department to MIN: a | Department to
handle | handle handle
Domestic Cs Wholesale Customers} | Retail Customers
Foreign Customers
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
III. Chain of command
It is defined as a continuous line of authority that
extends from upper organizational levels to the lowest
levels and clarifies who reports to whom. There are three
important concepts attached to this theory:
Authority: Refers to the rights inherent in a managerial
position to tell people what to do and to expect them to
do it.
Responsibility: The obligation to perform any assigned
duties.
Unity of command: The management principle that
each person should report to only one manager.
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
It is defined as a continuous line of authority that
extends from upper organizational levels to the lowest
levels and clarifies who reports to whom. There are three
important concepts attached to this theory:
Authority: Refers to the rights inherent in a managerial
position to tell people what to do and to expect them to
do it.
Responsibility: The obligation to perform any assigned
duties.
Unity of command: The management principle that
each person should report to only one manager.
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
IV. Span of Control
It is important to a large degree because it determines
the number of levels and managers an organization has.
Also, determines the number of employees a manager
can efficiently and effectively manage.
V. Formalization
It refers to the degree to which jobs within the
organization are standardized and the extent to which
employee behavior is guided by rules and procedures.
01/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
It is important to a large degree because it determines
the number of levels and managers an organization has.
Also, determines the number of employees a manager
can efficiently and effectively manage.
V. Formalization
It refers to the degree to which jobs within the
organization are standardized and the extent to which
employee behavior is guided by rules and procedures.
01/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Centralization & Decentralization
° Centralized organization: the authority to make
important decisions is retained by top level managers
° Decentralized organization: the authority to make
important decisions is delegated to managers at all
levels in the hierarchy
A 558
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
° Centralized organization: the authority to make
important decisions is retained by top level managers
° Decentralized organization: the authority to make
important decisions is delegated to managers at all
levels in the hierarchy
A 558
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Key points of Centralization
Centralization can facilitate coordination.
Centralization can help ensure that decisions are
consistent with organizational objectives.
Centralization can avoid duplication of activities by
various subunits within the organization.
By concentrating power and authority in one
individual or a management team, centralization can
give top-level managers the means to bring about
needed major organizational changes.
(01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 40
Centralization can facilitate coordination.
Centralization can help ensure that decisions are
consistent with organizational objectives.
Centralization can avoid duplication of activities by
various subunits within the organization.
By concentrating power and authority in one
individual or a management team, centralization can
give top-level managers the means to bring about
needed major organizational changes.
(01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 40
Key points of Decentralization
Top management can become overburdened when
decision-making authority is centralized.
Motivational research favors decentralization.
Decentralization permits greater flexibility—more
rapid response to environmental changes.
Decentralization can result in better decisions.
Decentralization can increase control.
(01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 41
Top management can become overburdened when
decision-making authority is centralized.
Motivational research favors decentralization.
Decentralization permits greater flexibility—more
rapid response to environmental changes.
Decentralization can result in better decisions.
Decentralization can increase control.
(01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 41
Limitations of Centralization
Development of low level managers are hampered.
Opportunity given to exercise initiative and judgment
is negligible .
It is a costly affair and delays decision making .
It creates problems of effective communication
No scope of specialization as a person may have to
look into many things
01/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Development of low level managers are hampered.
Opportunity given to exercise initiative and judgment
is negligible .
It is a costly affair and delays decision making .
It creates problems of effective communication
No scope of specialization as a person may have to
look into many things
01/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Limitations of Decentralization
+ It creates problems in coordination between different units
of the organization.
+ May result in higher administrative expenses as qualified
managers a needed for different divisions
+ Due to different policies and procedures of each unit in a
decentralized organization inconsistencies may arise in
organizational activities
OM tn
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 43
+ It creates problems in coordination between different units
of the organization.
+ May result in higher administrative expenses as qualified
managers a needed for different divisions
+ Due to different policies and procedures of each unit in a
decentralized organization inconsistencies may arise in
organizational activities
OM tn
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 43
What is organizational structure ?
Organizational structure is a system used to define a
hierarchy within an organization.
It identifies each job, its function and where it reports to
within the organization.
This structure is developed to establish how an
organization operates and assists an organization in
obtaining its goals to allow for future growth.
The structure is illustrated using an organizational chart.
1/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 44
Organizational structure is a system used to define a
hierarchy within an organization.
It identifies each job, its function and where it reports to
within the organization.
This structure is developed to establish how an
organization operates and assists an organization in
obtaining its goals to allow for future growth.
The structure is illustrated using an organizational chart.
1/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 44
Why do we need organizational structure ?
Evaluating Employee Performance
Achieving Goals
Function
Communication
Prevention/Solution
01/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Evaluating Employee Performance
Achieving Goals
Function
Communication
Prevention/Solution
01/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Organizational structure
Types of organizational structure
(i) Line/military/scaler organizational structure.
(ii) Staff or functional authority organizational structure.
(iii) Line and staff organizational structure.
(iv) Committee organizational structure.
(v) Divisional organizational structure.
(vi) Matrix organizational structure
(vii) Project organizational structure.
(viii) Hybrid organizational structure.
01/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Types of organizational structure
(i) Line/military/scaler organizational structure.
(ii) Staff or functional authority organizational structure.
(iii) Line and staff organizational structure.
(iv) Committee organizational structure.
(v) Divisional organizational structure.
(vi) Matrix organizational structure
(vii) Project organizational structure.
(viii) Hybrid organizational structure.
01/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Line/military/scaler organizational structure
+ Itis also known as scalar, military, or vertical
organization and perhaps is the oldest form
1. Pure line Organization
2. Departmental Line Organization
Pure Line Organisation Departmental Line Organisation
Production Manager
(Spinning)
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 47
+ Itis also known as scalar, military, or vertical
organization and perhaps is the oldest form
1. Pure line Organization
2. Departmental Line Organization
Pure Line Organisation Departmental Line Organisation
Production Manager
(Spinning)
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 47
+ Characteristics:
+ Line authority and instructions are vertical, that is, they flow
from the top to the bottom.
+ The unity of command is maintained in a straight line.
+ All persons at the same level of organization are independent of
each other.
+ This structure specifies responsibility and authority for all the
positions limiting the area of action.
“Merits: + Demerits:
+ Simplicity + Lack of Specialisation
+ Discipline + Absence of Conceptual
+ Prompt Decisions Thinking
+ Orderly Communication +» Autocratic Approach
+ Easy Supervision & Economical « Problems of coordination
Suitability:-
It is suitable to small — scale organizations where the number of subordinates is quite
smalla/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 48
+ Line authority and instructions are vertical, that is, they flow
from the top to the bottom.
+ The unity of command is maintained in a straight line.
+ All persons at the same level of organization are independent of
each other.
+ This structure specifies responsibility and authority for all the
positions limiting the area of action.
“Merits: + Demerits:
+ Simplicity + Lack of Specialisation
+ Discipline + Absence of Conceptual
+ Prompt Decisions Thinking
+ Orderly Communication +» Autocratic Approach
+ Easy Supervision & Economical « Problems of coordination
Suitability:-
It is suitable to small — scale organizations where the number of subordinates is quite
smalla/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 48
Functional organizational structure
+ Functional structure is created by grouping the activities on the
basis of functional required for the achievement of organizational
objectives.
+ For this purpose all the functions required are classified into
basic, secondary and supporting functions.
+ Features:
+ The whole activities of an organization are divided into various
functions
+ Each functional area is put under the charge of one executive
+ For any decision, one has to consult the functional specialist
+ Limited span of control is there.
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 49
+ Functional structure is created by grouping the activities on the
basis of functional required for the achievement of organizational
objectives.
+ For this purpose all the functions required are classified into
basic, secondary and supporting functions.
+ Features:
+ The whole activities of an organization are divided into various
functions
+ Each functional area is put under the charge of one executive
+ For any decision, one has to consult the functional specialist
+ Limited span of control is there.
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 49
* Merits: + Demerits:
* High Specialisation * Calls for more coordination
* Clarity in functioning » Clear line of authority
* No duplication - Slow decision making
+ Satisfactions
+ Control and Coordinate
Suitability:
The establishment of functional organisation structure becomes
necessary as a small organisation grows and business activity
becomes more and more complete
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 50
* High Specialisation * Calls for more coordination
* Clarity in functioning » Clear line of authority
* No duplication - Slow decision making
+ Satisfactions
+ Control and Coordinate
Suitability:
The establishment of functional organisation structure becomes
necessary as a small organisation grows and business activity
becomes more and more complete
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 50
Functional organizational structure
| I | |
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 51
| I | |
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 51
Line and staff organizational structure
Characteristics:
It refers to a pattern in which staff specialists advise line
managers to perform their duties.
Line people will give advices
The staff people have the right to recommend, but have no
authority to enforce their preference on other departments
Features:-
This origin structure clearly distinguishes between two aspects of
administration viz., planning and execution.
Staff officers provide advice only to the line officers; they do not
have any power of command over them.
.
The staff supplements the line members.
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 52
Characteristics:
It refers to a pattern in which staff specialists advise line
managers to perform their duties.
Line people will give advices
The staff people have the right to recommend, but have no
authority to enforce their preference on other departments
Features:-
This origin structure clearly distinguishes between two aspects of
administration viz., planning and execution.
Staff officers provide advice only to the line officers; they do not
have any power of command over them.
.
The staff supplements the line members.
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 52
LINE & STAFF ORGANISATION STRUCTURE
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
.
ADVANTAGES:-
+ It adds functional specialists to the pure line organisation and thus
aims at combining the merits of the two.
+ It brings expert knowledge to bear upon management.
+ Functional specialists provide expert advice to the management
on wide-ranging matters.
+ It provides for better placement and utilization of personnel and
leads to more skill development
.
.
DEMERITS:-
The line and staff relationship often lead to many frictions and
Jealousies
Line mangers may depend too much on staff experts and thus
lose much of their judgment and initiatives
The staff experts may remain ineffective because they do not get
the authority to implement their recommendation.
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 54
ADVANTAGES:-
+ It adds functional specialists to the pure line organisation and thus
aims at combining the merits of the two.
+ It brings expert knowledge to bear upon management.
+ Functional specialists provide expert advice to the management
on wide-ranging matters.
+ It provides for better placement and utilization of personnel and
leads to more skill development
.
.
DEMERITS:-
The line and staff relationship often lead to many frictions and
Jealousies
Line mangers may depend too much on staff experts and thus
lose much of their judgment and initiatives
The staff experts may remain ineffective because they do not get
the authority to implement their recommendation.
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 54
Matrix organizational structure
+ Matrix organization structure is essentially a violation of unity
of command
+ Matrix structure is the realization of two-dimensional structure
which emanates directly from two dimensions of authority.
+ In matrix organization structure, a project manager is
appointed to co-ordinate the activities of the project.
+ Personnel are drawn from their respective functional
departments.
+ Each functional staff has two bosses his administrative head
and his project manager.
Matrix = Matrix , Matrix , Matrix, Matrix -
Organisation Structure System Culture Behaviour
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
+ Matrix organization structure is essentially a violation of unity
of command
+ Matrix structure is the realization of two-dimensional structure
which emanates directly from two dimensions of authority.
+ In matrix organization structure, a project manager is
appointed to co-ordinate the activities of the project.
+ Personnel are drawn from their respective functional
departments.
+ Each functional staff has two bosses his administrative head
and his project manager.
Matrix = Matrix , Matrix , Matrix, Matrix -
Organisation Structure System Culture Behaviour
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Design of Matrix organizational structure
General Manager
Project-A
Proeict-B
01/01/2017
Production Marketing Finance Personel
Production *— Mktg *—| Finanance «— Pascual
so nn eu
Production *—I Mktg *— Finanance 4«—| Pasas
PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
56
General Manager
Project-A
Proeict-B
01/01/2017
Production Marketing Finance Personel
Production *— Mktg *—| Finanance «— Pascual
so nn eu
Production *—I Mktg *— Finanance 4«—| Pasas
PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
56
Merits:-
It offers operational freedom & flexibility
It focuses on end results.
It maintenance professional Identity.
It holds an employee responsible for management of resources
Demerits:-
It calls for greater degree of coordination,
It violates unity of command.
Difficult to define authority & responsibility.
Employee may be de motivated.
Suitability
It can be applicable where there is a pressure for dual focus,
pressure for high information processing, and pressure for shred
resources.
Ex:- Aerospace, chemicals, Banking, Brokerage, Advertising etc.
01/01/2017 PRC SHINDE NDMVP'S KBTCOE NASHIK
It offers operational freedom & flexibility
It focuses on end results.
It maintenance professional Identity.
It holds an employee responsible for management of resources
Demerits:-
It calls for greater degree of coordination,
It violates unity of command.
Difficult to define authority & responsibility.
Employee may be de motivated.
Suitability
It can be applicable where there is a pressure for dual focus,
pressure for high information processing, and pressure for shred
resources.
Ex:- Aerospace, chemicals, Banking, Brokerage, Advertising etc.
01/01/2017 PRC SHINDE NDMVP'S KBTCOE NASHIK
Committee organizational structure.
A committee does not represent a separate type of organization
like line and staff, or functional.
A committee may be defined as a group of people performing
some aspects of Managerial functions.
Definitions:
“A committee consists of a group of people specifically
designated to perform some administrative work”
W.H. Newman
“ A committee is a body of persons appointed or elected to meet
on an organised basis for the consideration of matters brought
before it”. Allen
1/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
A committee does not represent a separate type of organization
like line and staff, or functional.
A committee may be defined as a group of people performing
some aspects of Managerial functions.
Definitions:
“A committee consists of a group of people specifically
designated to perform some administrative work”
W.H. Newman
“ A committee is a body of persons appointed or elected to meet
on an organised basis for the consideration of matters brought
before it”. Allen
1/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
COMMITTEE ORGANISATION STRUCTURE
*— Executive Committee
Purchase Committee General Manager Purchase Committee
I
Types of Committees
Formal Informal} | Executive) | Advisory Standing | | Line Committee
Committee Committee | Committee | [Committee
01/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 59
*— Executive Committee
Purchase Committee General Manager Purchase Committee
I
Types of Committees
Formal Informal} | Executive) | Advisory Standing | | Line Committee
Committee Committee | Committee | [Committee
01/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 59
Committee organizational structure
MERITS DEMERITS
* Pooling of Knowledge * Slow decisions
+ Effective co-ordination is available |* Most Expensive
+ Effective Communication + Difficult to maintain secrecy
+ Motivation through participation of |* Compromise
employees
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
MERITS DEMERITS
* Pooling of Knowledge * Slow decisions
+ Effective co-ordination is available |* Most Expensive
+ Effective Communication + Difficult to maintain secrecy
+ Motivation through participation of |* Compromise
employees
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Project organizational structure
A project organization is a temporary organization
designed to achieve specific results by using teams of
specialists from different functional areas in the
organization.
The project team focuses all its energies, resources and
results on the assigned project.
Once the project has been completed, the team members
from various cross functional departments may go back to
their previous positions or may be assigned to a new
project.
Some of the examples of projects are: research and
development projects, product development, construction
of a new plant, housing complex, shopping complex,
bridge etc.
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 61
A project organization is a temporary organization
designed to achieve specific results by using teams of
specialists from different functional areas in the
organization.
The project team focuses all its energies, resources and
results on the assigned project.
Once the project has been completed, the team members
from various cross functional departments may go back to
their previous positions or may be assigned to a new
project.
Some of the examples of projects are: research and
development projects, product development, construction
of a new plant, housing complex, shopping complex,
bridge etc.
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 61
+ Importance of Project Organizational Structure:
Project organizational structure is most valuable when:
(i) Work is defined by a specific goal and target date for completion.
(ii) Work is unique and unfamiliar to the organization.
(iii) Work is complex having independent activities and specialized
skills are necessary for accomplishment.
(iv) Work is critical in terms of possible gains or losses.
(v) Work is not repetitive in nature.
+ Characteristics of project organization:
1. Personnel are assigned to a project from the existing permanent
organization and are under the direction and control of the project
manager.
2. The project manager specifies what effort is needed and when work
will be performed whereas the concerned department manager
executes the work using his resources.
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Project organizational structure is most valuable when:
(i) Work is defined by a specific goal and target date for completion.
(ii) Work is unique and unfamiliar to the organization.
(iii) Work is complex having independent activities and specialized
skills are necessary for accomplishment.
(iv) Work is critical in terms of possible gains or losses.
(v) Work is not repetitive in nature.
+ Characteristics of project organization:
1. Personnel are assigned to a project from the existing permanent
organization and are under the direction and control of the project
manager.
2. The project manager specifies what effort is needed and when work
will be performed whereas the concerned department manager
executes the work using his resources.
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
3. The project manager gets the needed support from production,
quality control, engineering etc. for completion of the project.
4. The authority over the project team members is shared by project
manager and the respective functional managers in the permanent
organization.
5. The services of the specialists (project team members) are
temporarily loaned to the project manager till the completion of the
project.
6. There may be conflict between the project manager and the
departmental manager on the issue of exercising authority over team
members.
7. Since authority relationships are overlapping with possibilities of
conflicts, informal relationships between project manager and
departmental managers (functional managers) become more
important than formal prescription of authority.
8. Full and free communication is essential among those working on
the project.
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
quality control, engineering etc. for completion of the project.
4. The authority over the project team members is shared by project
manager and the respective functional managers in the permanent
organization.
5. The services of the specialists (project team members) are
temporarily loaned to the project manager till the completion of the
project.
6. There may be conflict between the project manager and the
departmental manager on the issue of exercising authority over team
members.
7. Since authority relationships are overlapping with possibilities of
conflicts, informal relationships between project manager and
departmental managers (functional managers) become more
important than formal prescription of authority.
8. Full and free communication is essential among those working on
the project.
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Project organizational structure
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 64
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 64
Divisional Organizational Structure:
* In this type of structure, the organization can have
different basis on which departments are formed.
They are:
(i) Function (ii) Product (111) Geographic territory,
(iv) Project and
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
* In this type of structure, the organization can have
different basis on which departments are formed.
They are:
(i) Function (ii) Product (111) Geographic territory,
(iv) Project and
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Exhibit 10.6 : Divisional Organisational Structure (Departmentation)
Features : Structure based on division of work based on a functional activi
‚uch as finance, marketing etc., or based on type of products manufactured os
d on geographic location of the units or based on projects undertaken.
(a) Departmentation by Function
[o] M.D.-Managing Director
G.M--Generai Manager
=| | I |
GM GM GM GM GM
(Fin) (Mktg) (Prodn.) (R&D) (Per)
(b) Departmentation by Product
DIR
CMktg.)
Mtg. Mgr Mgr. Mktg. Mgr. Mktg. (Entertainment
| (a Products) | | (Video Products) Electronics Products)
(<) Departmentation by Geographic territory
om
ait)
[ Mor. Sales Js Mgr. Sales I Mor. Sales Mor. Sales.
(Northern Region) yn Region) (Westen (Easton Region)
(4) Departmentation by Project
Chief Executive
Project Mgr | Project Mar. Project Mgr |
(Project A) (Project B) (Project C)
(e) Departmentation by combination approach (Combination of any two or more
bases discussed above).
01/01/2017
Features : Structure based on division of work based on a functional activi
‚uch as finance, marketing etc., or based on type of products manufactured os
d on geographic location of the units or based on projects undertaken.
(a) Departmentation by Function
[o] M.D.-Managing Director
G.M--Generai Manager
=| | I |
GM GM GM GM GM
(Fin) (Mktg) (Prodn.) (R&D) (Per)
(b) Departmentation by Product
DIR
CMktg.)
Mtg. Mgr Mgr. Mktg. Mgr. Mktg. (Entertainment
| (a Products) | | (Video Products) Electronics Products)
(<) Departmentation by Geographic territory
om
ait)
[ Mor. Sales Js Mgr. Sales I Mor. Sales Mor. Sales.
(Northern Region) yn Region) (Westen (Easton Region)
(4) Departmentation by Project
Chief Executive
Project Mgr | Project Mar. Project Mgr |
(Project A) (Project B) (Project C)
(e) Departmentation by combination approach (Combination of any two or more
bases discussed above).
01/01/2017
Hybrid organizational structure
° A structure adopting both functional and divisional
structures at the same management levels.
Advantages:
+ Alignment of corporate and divisional goals
+ Functional expertise and/or efficiency
¢ Adaptability and flexibility in divisions
Disadvantages:
+ Conflicts between corporate departments and divisions
+ Excessive administration overhead
¢ Slow response to exceptional situations
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
° A structure adopting both functional and divisional
structures at the same management levels.
Advantages:
+ Alignment of corporate and divisional goals
+ Functional expertise and/or efficiency
¢ Adaptability and flexibility in divisions
Disadvantages:
+ Conflicts between corporate departments and divisions
+ Excessive administration overhead
¢ Slow response to exceptional situations
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Organizational Chart
Organizational chart is a line drawing that shows how
the parts of an organization are linked.
The organization chart establishes the following:
* Formal lines of authority—the official power to act
+ Responsibility—the duty or assignment
+ Accountability—the moral responsibility
01/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Organizational chart is a line drawing that shows how
the parts of an organization are linked.
The organization chart establishes the following:
* Formal lines of authority—the official power to act
+ Responsibility—the duty or assignment
+ Accountability—the moral responsibility
01/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
pl
Types Of Organizational Charts
. Vertical charts
It shows high-level management at the top with formal lines of
authority down the hierarchy, are most common.
2. A left-to-right (horizontal) charts:
01,
It shows the high-level management at the left with lower positions
to the right. Shows relative length of formal lines of authority,
helps simplify understanding the lines of authority and
responsibility.
Circular charts
It shows the high-level management in the center with successive
positions in circles. It shows the outward flow of formal authority
from the high-level management. It reduces status implications.
[01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 69
Types Of Organizational Charts
. Vertical charts
It shows high-level management at the top with formal lines of
authority down the hierarchy, are most common.
2. A left-to-right (horizontal) charts:
01,
It shows the high-level management at the left with lower positions
to the right. Shows relative length of formal lines of authority,
helps simplify understanding the lines of authority and
responsibility.
Circular charts
It shows the high-level management in the center with successive
positions in circles. It shows the outward flow of formal authority
from the high-level management. It reduces status implications.
[01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 69
Vertical Chart
Board of directors
Hospital administration
Director of Nursing
‘Supervisor of Nursing ‘Supervisor of Nursing
[Head wr lea Head Nurse] lH ad Nuse| Head Nurse
01/01/2017 PROFVV.SHINDE NDMVP'S KBTCOE NASHIK 70
Board of directors
Hospital administration
Director of Nursing
‘Supervisor of Nursing ‘Supervisor of Nursing
[Head wr lea Head Nurse] lH ad Nuse| Head Nurse
01/01/2017 PROFVV.SHINDE NDMVP'S KBTCOE NASHIK 70
01/01/2017
Circular Chart
Star Star
Nurse Nurse
PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 71
Circular Chart
Star Star
Nurse Nurse
PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 71
A Left-to-right (Horizontal) Chart
Staff
Nurse
Staff
Supervisor Head Nurse
Nurse Staff
Head q Ne
Board of Hospital Director of Nurse Staff
Directors ~ Administrator” Nursing Nurse
Staff
Head Nurse
Nurse Staff
Supervisor Nurse
Staff
Head _ Nurse
Nurse Staff
Nurse
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Staff
Nurse
Staff
Supervisor Head Nurse
Nurse Staff
Head q Ne
Board of Hospital Director of Nurse Staff
Directors ~ Administrator” Nursing Nurse
Staff
Head Nurse
Nurse Staff
Supervisor Nurse
Staff
Head _ Nurse
Nurse Staff
Nurse
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Advantages of an Organizational Chart:
. It provides a quick visual illustration of the organizational structure.
. It provides help in organizational planning.
. It shows lines of formal authority, responsibility and accountability.
. It clarifies who supervises whom and to whom one is responsible.
. It emphasizes the important aspect of each position.
. It facilitates management development and training.
. It is used to evaluate strengths and weakness of current structure.
. It provides starting points for planning organizational changes.
C©OAN DNA À © D —
. It describes channels of communication.
Disadvantages:
1. Charts become outdated quickly.
2. Does not show informal relationship.
3. Does not show duties and responsibilities.
4. Poorly prepared charts might create misleading effects.
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
. It provides a quick visual illustration of the organizational structure.
. It provides help in organizational planning.
. It shows lines of formal authority, responsibility and accountability.
. It clarifies who supervises whom and to whom one is responsible.
. It emphasizes the important aspect of each position.
. It facilitates management development and training.
. It is used to evaluate strengths and weakness of current structure.
. It provides starting points for planning organizational changes.
C©OAN DNA À © D —
. It describes channels of communication.
Disadvantages:
1. Charts become outdated quickly.
2. Does not show informal relationship.
3. Does not show duties and responsibilities.
4. Poorly prepared charts might create misleading effects.
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Productivity
For any type of organization
Productivity = Output
Input
Definition: Productivity is the relationship
between the outputs generated from a system and
the inputs that are used to create those outputs.
01/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
For any type of organization
Productivity = Output
Input
Definition: Productivity is the relationship
between the outputs generated from a system and
the inputs that are used to create those outputs.
01/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Factors affecting Productivity
Standardization
Technology
Use of Internet, fax machines, e-mail,
computerized billing, software
Searching for lost or misplaced items
Scrap rates
Labor turnover, layoffs, new workers
Safety
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Standardization
Technology
Use of Internet, fax machines, e-mail,
computerized billing, software
Searching for lost or misplaced items
Scrap rates
Labor turnover, layoffs, new workers
Safety
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Methods
Design of the workspace
Incentive plans that reward productivity
Capacity utilization
Location
Layout
Inventory
Scheduling
Shortage of IT workers and other technical workers
Equipment breakdowns
Part and material shortages
Inadequate investment in training & education of the
employees
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 76
Design of the workspace
Incentive plans that reward productivity
Capacity utilization
Location
Layout
Inventory
Scheduling
Shortage of IT workers and other technical workers
Equipment breakdowns
Part and material shortages
Inadequate investment in training & education of the
employees
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 76
Types of productivity
Partial Productivity Measure
Partial Productivity is the ratio of output to one class of input.
Labour productivity = output / labour input
Total-factor Productivity Measure
+ Total-factor Productivity is the ratio of net output to sum of
associated labour and captial (factor) inputs.
total-factor productivity = net output / (labour and capital input)
Total Productivity Measure
+ Total Productivity is the ratio of total output to the sum of all input
factors.
Total productivity = total output / total input
Both the output and input(s) are expressed in real or physical
terms by being reduced to constant rupees of a reference period
(base period).
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Partial Productivity Measure
Partial Productivity is the ratio of output to one class of input.
Labour productivity = output / labour input
Total-factor Productivity Measure
+ Total-factor Productivity is the ratio of net output to sum of
associated labour and captial (factor) inputs.
total-factor productivity = net output / (labour and capital input)
Total Productivity Measure
+ Total Productivity is the ratio of total output to the sum of all input
factors.
Total productivity = total output / total input
Both the output and input(s) are expressed in real or physical
terms by being reduced to constant rupees of a reference period
(base period).
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Example
For a company XYZ, the total inputs and outputs have been
converted in to money value and are given below. calculate
total productivity and partial productivity for different
categories of inputs.
+ Material input= Rs 20,000
+ Human input= Rs 30,000
+ Energy input= Rs 10,000
+ Capital input= Rs 3,00,000
+ Miscellaneous input= Rs 50,000
¢ Total output = Rs 5,00,000
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
For a company XYZ, the total inputs and outputs have been
converted in to money value and are given below. calculate
total productivity and partial productivity for different
categories of inputs.
+ Material input= Rs 20,000
+ Human input= Rs 30,000
+ Energy input= Rs 10,000
+ Capital input= Rs 3,00,000
+ Miscellaneous input= Rs 50,000
¢ Total output = Rs 5,00,000
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Total productivity = total output/ total input
= 5,00,000/4,10,000 =1.219
Partial productivities
Material productivity = total output/ material input
= 5,00,000/20,000 =25
Human productivity= total output/human input
= 5,00,000/30,000=16.66
Energy productivity = total output/energy input
= 5,00,000/10,000=50
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
= 5,00,000/4,10,000 =1.219
Partial productivities
Material productivity = total output/ material input
= 5,00,000/20,000 =25
Human productivity= total output/human input
= 5,00,000/30,000=16.66
Energy productivity = total output/energy input
= 5,00,000/10,000=50
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Common misused of the term Productivity
+ XYZ electronic company produced 10000
calculators by employing 50 people at 8 hours/day
for 25 days.
¢ Production = 10000 calculators
Productivity (of labour) = output / labour input
10,000/ (50x8x25=10,000)
1 calculator per man-hours
This company increased its production to 12000 calculators by hiring 10
additional workers at 8 hours/day for 25 days.
Production = 12000 calculators
Productivity (of labour) = 1 calculator per man-hours
Production is concerned with the activity of producing goods and/or services.
An a! production does not necessarily mean increased pindncualy
UI/UI/ZUI7 PROFV.V.SHINDE NDMVP-S RETCOE NASHIK
+ XYZ electronic company produced 10000
calculators by employing 50 people at 8 hours/day
for 25 days.
¢ Production = 10000 calculators
Productivity (of labour) = output / labour input
10,000/ (50x8x25=10,000)
1 calculator per man-hours
This company increased its production to 12000 calculators by hiring 10
additional workers at 8 hours/day for 25 days.
Production = 12000 calculators
Productivity (of labour) = 1 calculator per man-hours
Production is concerned with the activity of producing goods and/or services.
An a! production does not necessarily mean increased pindncualy
UI/UI/ZUI7 PROFV.V.SHINDE NDMVP-S RETCOE NASHIK
Productivity Improvement Methods
Change | Change
Productivity Improvement Method Example
Increase output while input remains the same _ 4 Modifying or upgracing a plants control system to
improve heat rate
Decrease input while output remains the same + — | Automating the accounts payable process
Increase input resulting in a very large increase in Investing in regional transmission infrastructure to
output secure additional alternatives for off-system sales
Decrease input by a very large amount with a
resutant al recto in nit y
Restacking and consoldation of facilties/real estate
ya
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
Change | Change
Productivity Improvement Method Example
Increase output while input remains the same _ 4 Modifying or upgracing a plants control system to
improve heat rate
Decrease input while output remains the same + — | Automating the accounts payable process
Increase input resulting in a very large increase in Investing in regional transmission infrastructure to
output secure additional alternatives for off-system sales
Decrease input by a very large amount with a
resutant al recto in nit y
Restacking and consoldation of facilties/real estate
ya
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
“It’s Not Just About Cost Reduction”
Productivity improvements can be made to all resources available to an organization.
People and Labor Materials Plant and Equipment Other Capital Energy
1 Use appropriate andlor m Utilize less.expensive M Optimize and = Reduce working capital M implementánstall energy
better process and and/or alternative standardize maintenance efficiency programs and
‘communication tools, materials processes, procedures, ‘equipment
Da = Improve material en aes. = Reduce or minimize
applications utilization = Upgrademodify existing vaste
= Streamline and "Uli Racewpenene equipment
‘standardize work sources = Restack and consolidate
PA one em Match material names
and poli
PERS specifications to job = Reduce and/orimprove
= Improve working requirements oor or workspace
‘conditions, e.g., lighting,
ventilation, work
station/ofice layout, etc.
= Enhance and improve
‘compensation, revard,
and recognition
programs
= Enhance and improve
training and
development programs
= Optimize recruiting and
on-boarding processes
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 82
Productivity improvements can be made to all resources available to an organization.
People and Labor Materials Plant and Equipment Other Capital Energy
1 Use appropriate andlor m Utilize less.expensive M Optimize and = Reduce working capital M implementánstall energy
better process and and/or alternative standardize maintenance efficiency programs and
‘communication tools, materials processes, procedures, ‘equipment
Da = Improve material en aes. = Reduce or minimize
applications utilization = Upgrademodify existing vaste
= Streamline and "Uli Racewpenene equipment
‘standardize work sources = Restack and consolidate
PA one em Match material names
and poli
PERS specifications to job = Reduce and/orimprove
= Improve working requirements oor or workspace
‘conditions, e.g., lighting,
ventilation, work
station/ofice layout, etc.
= Enhance and improve
‘compensation, revard,
and recognition
programs
= Enhance and improve
training and
development programs
= Optimize recruiting and
on-boarding processes
01/01/2017 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK 82
Productivity Improvement Methods
» Productivity improvement techniques can be applied
effectively in enterprises of any size, from one person
companies to corporations with thousands of staff.
A) KAIZEN Techniques:
+ Kaizen (Continuous improvement) is a management
supported employee driven process where, employees
make a great number of continuous improvement
efforts.
01/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
» Productivity improvement techniques can be applied
effectively in enterprises of any size, from one person
companies to corporations with thousands of staff.
A) KAIZEN Techniques:
+ Kaizen (Continuous improvement) is a management
supported employee driven process where, employees
make a great number of continuous improvement
efforts.
01/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
B) Total Productive maintenance (TPM):
+ TPM is keeping machines in good working condition
through systematic maintenance of equipment so that they
fail less frequently and production process continues
without interruption.
C) Just In Time:-
+ JIT is a management philosophy aimed at eliminating
waste from every aspect.
» of manufacturing and its related activities. The term JIT
refers to producing only what is needed, when it is needed
and in needed quantity.
+ The aim of JIT in a factory is to reduce lead times
minimize inventory reduce the defect rate to zero and
accomplish all of the above at minimum cost
01/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
+ TPM is keeping machines in good working condition
through systematic maintenance of equipment so that they
fail less frequently and production process continues
without interruption.
C) Just In Time:-
+ JIT is a management philosophy aimed at eliminating
waste from every aspect.
» of manufacturing and its related activities. The term JIT
refers to producing only what is needed, when it is needed
and in needed quantity.
+ The aim of JIT in a factory is to reduce lead times
minimize inventory reduce the defect rate to zero and
accomplish all of the above at minimum cost
01/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
D)Kanban:-
+ Kanban is a manual production scheduling technique
controlled by a process or machine operator.
+ Kanban means card in Japanese, is attached to given
number of parts or products in the production line
instructing the delivery of given quantity.
» The kanban card after all parts/products have been
used up is returned by the operator to its origin.
Production is controlled through demand originating
from external customer
01/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
+ Kanban is a manual production scheduling technique
controlled by a process or machine operator.
+ Kanban means card in Japanese, is attached to given
number of parts or products in the production line
instructing the delivery of given quantity.
» The kanban card after all parts/products have been
used up is returned by the operator to its origin.
Production is controlled through demand originating
from external customer
01/01/201 PROF.V.V.SHINDE NDMVP'S KBTCOE NASHIK
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