Departmentation in management. Departmentation: Management and Example 2022-12-17

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Departmentation is the process of grouping activities into departments. It is a fundamental aspect of management that helps to organize and coordinate the activities of a business or organization. There are several types of departmentation that can be used, each with its own set of benefits and limitations. In this essay, we will explore the different types of departmentation and the role that it plays in management.

The most common type of departmentation is functional departmentation. This involves grouping activities based on the function or specialization of the work being done. For example, in a manufacturing company, there may be a production department, a marketing department, and a finance department. Each department is responsible for a specific set of activities and functions within the organization.

Functional departmentation has several advantages. It allows for specialization of knowledge and skills, as employees within a department are typically experts in their field. This can lead to increased efficiency and productivity. It also allows for clear lines of authority and responsibility, as each department is headed by a manager who is responsible for the performance of the department.

However, functional departmentation can also have some limitations. It can lead to silos within the organization, as departments may become isolated and focused on their own goals and objectives. This can lead to a lack of coordination and communication between departments, which can hinder the overall performance of the organization.

Another type of departmentation is divisional departmentation. This involves grouping activities based on the product or service being offered. For example, a company that manufactures both automobiles and airplanes may have separate divisions for each product line. Each division is responsible for its own sales, production, and finance activities.

Divisional departmentation allows for greater autonomy and decision-making authority within each division. It also allows for customization of products and services to meet the needs of specific markets or customer groups. However, it can also lead to duplication of resources and increased costs, as each division may have its own support functions such as finance or HR.

A third type of departmentation is matrix departmentation. This involves combining functional and divisional departmentation, creating a matrix structure where employees report to both a functional manager and a divisional manager. This can allow for increased coordination and communication between departments, as well as flexibility in the allocation of resources. However, it can also lead to confusion and conflict as employees may have conflicting goals and priorities.

In conclusion, departmentation is a key aspect of management that helps to organize and coordinate the activities of an organization. Different types of departmentation have their own benefits and limitations, and the best approach will depend on the specific needs and goals of the organization. It is important for managers to carefully consider the pros and cons of each approach and to choose the one that best fits the needs of the organization.

Departmentalization in Management: Definition, Types & Advantages

departmentation in management

And no single individual can be make accountable for the performance of a given product line. Budgets which are one of the control mechanisms can be prepared to control the income and expenditure of different departments. Departmentation leads to grouping of both functions and personnel who are assigned to carry out allocated functions. The major advantages of the matrix organisation are the following: 1. Smaller businesses would use this type of structure only if they offer distinctly different products or services. When a company decides to expand geographically, it automatically incurs cost through duplication of personnel positions and additional building sites. Principle of organisational efficiency — The chosen basis of departmentation must promote managerial and operational efficiency in the organisation.

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Departmentation: Management and Example

departmentation in management

The narrow view-point and specialised training develop staff members who are experts in their own functional areas. Often, it is the underlying technology that determines the departmentation. Fixation of Responsibility — Every department is responsible for its performance. Secondly, because personnel are separated from one another, it is difficult to achieve their understanding and concern for the speciality areas outside their own. However, it presents problems at the top management level for coordination, multiplicity of efforts because of requirement of same functional facilities for different products, and problem in maintaining economical central staff services. Departmentation — Definitions Given by Eminent Authors In any organisation several activities are performed.

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Departmentation: Management and Example Essay Example

departmentation in management

An airline may outsource food, engineering services and airport handling. Introduction to Departmentation 2. But there is lack of understanding of the interrelationship and dependency of all functions. But generally they can be divided in number of jobs. Sometimes, products of the same company start competing which results in snatching one division profit from other division leaving behind net profit for the company zero. Departmentation by regions area or location or territory. ADVERTISEMENTS: In this context, one may cite the example of Oki Electric Industry Company of Japan which adopted a SBU structure.

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Departmentation: Meaning, Aims and Methods

departmentation in management

This helps in minimising the administration costs. Control: The department should be such that it facilitates the measurement of performance and the adoption of timely corrective action. The main merit behind this kind of structure is to achieve size advantage by putting people with common stills and organisations into similar units. Functional Departmentation: Probably the most common approach to organising is functional departmentation. Each department is responsible for manufacturing a product and selling it to customers. Therefore, that basis of departmentation should be chosen which puts closely related activities together.

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Departmentation

departmentation in management

It is the process of division of organisation into different parts known as departments. Elimination of departmentation — The management identifies its core competency and outsources the non-core functions to other organisations. The persons will be able to take up the work with efficiency and at a higher speed. It furnishes measurable training ground for general managers. They are asked to go in several directions. What would happen if we did it randomly, without regard for tasks? Bases for Departmentation : An organisation can be departmented on different bases depending upon its needs. The out of fashion products can be dispensed with through the departmentation by customers.

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Organisation and Departmentation

departmentation in management

The administrative units so created may be designated as departments, divisions, units, branches, sections, etc. Product departmentalization organizes employees based on which product line or set of services they work with. Departmentation and Departmentalization are two different terms with same meaning. It maintains power and prestige of major functions. Moreover, sending managers to work in each region provides excellent training for upper level management positions where a broad perspective is required for success.


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What do you mean by Departmentation in management?

departmentation in management

Functional Structure vs Divisional Structure Broadly, all other departments except the functional department can be headed under the divisional department. Employees tend to confuse and duplicate their job duties. With the growth of the organisation, however, the problem that functional departmentation can engender begin to offset the advantages it offers. All the departmental heads are specialists in their own area. Therefore, along with technical factors, departments should be created on the basis of availability of personnel, their aspirations and value systems, need for informal work groups, and attitudes of people towards various bases of departmentation.

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Departmentation: Meaning, Importance, Process, Need, Principles, Types, Merits

departmentation in management

It is difficult in the network organisation structure to maintain control over quality and performance. A department may be called a division, branch, regiment, section or some other organizational unit. Healthy working environment When duties and job roles of each department and each employee are clearly defined, the speed and accuracy of work increases, and workflow is smooth and hierarchical. At the lower level there may be sales assistants, sales representatives etc. Other merits of departmentation are discussed below: 1. Departmentation clarifies the job roles of every employee, ensures proper and smooth transfer of information from one department to another, and also strengthens the organizational structure. All activities of a particular territory are assigned to one department.


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Types of Departmentation

departmentation in management

Departmentation is an essential one in the modern business world. Depending on how many people there are in the organization, the coordinators themselves need to be organized into groups supervised by higher level managers, and so on. Cost The cost incurred in this departmentation is low because the activities like sales, budgeting, etc. The departmentation is the process of grouping the similar activities into one department. There is a danger of duplication of work.

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Departmentation in Management: Meaning, Importance, Principles, Types, Methods

departmentation in management

A distribution company, for example, that sells to consumers, government clients, large businesses and small businesses may decide to base its primary divisions on these different markets. Customer departmen­talisation allows the organisation to use skilled specialists to deal with unique customers or customer groups. Thus, an SBU is given its own mission and goals. Customer: An organisation may find it advantageous to organise its activities according to the different kinds of customers it serves. A new line of product can be introduced without any difficulty. Employees with similar jobs functions are grouped together.

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