Power and Authority



Organizational structure is a means of facilitating the achievement of organizational objectives. Such structures are not static, but dynamic. They reorganize in response to changing conditions that occur in the environment, new technology, or organizational growth. Organization structures are dependent upon the employees whose activities they guide. Supervisors rely upon power and authority to ensure that employees get things done.



The organizational structure provides the framework for the formal distribution of authority. Formalization is the degree to which tasks are standardized and rules and regulations govern employee behavior. It influences the amount of discretion an employee has over his or her job. In an organization with high degrees of formalization, job descriptions and policies provide clear direction. Where formalization is low, employees have a great deal of freedom in deciding how thy conduct their work. Within the same organization, different departments may have different degrees of formalization. For example, in a hospital, doctors have freedom in selecting treatments, drugs, and methods for treating patients. However, the hospital physical plant staff has a strict schedule for cleaning buildings, mowing lawns, and maintaining the facilities.

Authority is the legitimate power of a supervisor to direct subordinates to take action within the scope of the supervisor's position. Formal authority in the organization can be traced all the way back to the U.S. constitutional right to own property. The owner of the organization has the authority to make decisions. For example, entrepreneurial firms have an informal arrangement of employees and centralization of decision-making authority, the owner.


Forms of Authority

Three forms of authority are line authority, staff authority, and team authority.

Line authority is direct supervisory authority from superior to subordinate. Authority flows in a direct chain of command from the top of the company to the bottom. Chain of command is an unbroken line of reporting relationships that extends through the entire organization that defines the formal decision-making structure. It helps employees know to whom they are accountable, and whom to go to with a problem. Line departments are directly linked to the production and sales of specific products. Supervisors -- in line departments, such as marketing and production -- give direct orders, evaluate performance, and reward or punish those employees who work for them. Unity of command within the chain states that each person in an organization should take orders from and reports to only one person. This helps prevent conflicting demands being placed on employees by more than one boss. However, the trend toward employee empowerment, fueled by advances in technology and changes in design from downsizing and reengineering have tempered the importance of being accountable to only one superior. Span of control refers to the number of employees that should be placed under the direction of one manager. Spans within effective organizations vary greatly. The actual number depends on the amount of complexity and the level of specialization. In general, a wide span of control is possible with better-trained, more experienced, and committed employees.

Staff authority is more limited authority to advise. It is authority that is based on expertise and which usually involves advising line managers. Staff members are advisers and counselors who aid line departments in making decisions but do not have the authority to make final decisions. Staff supervisors help line departments decide what to do and how to do it. They coordinate and provide technical assistance or advice to all advisors, such as accounting, human resources, information technology, research, advertising, public relations, and legal services.

Team authority is granted to committees or work teams involved in an organization's daily operations. Work teams are groups of operating employees empowered to plan and organize their own work and to perform that work with a minimum of supervision. Team-Based structures organize separate functions into a group based on one overall objective. Empowered employees create their own schedules, design their own processes, and are held responsible for outcomes. This facilitates efficiencies in work process, and the ability to detect and react to changes in the environment. Employees with the skills and knowledge to manage more than one specialized task are able to promptly provide customers with quality products and services. Cross-functionally training team members allows any member to perform a variety of problem-solving tasks.

Teamwork is an imperative in a flat, boundaryless organizational structure. A team is a small number of people with complementary skills who work toward common goals for which they hold themselves mutually accountable. Self-managed teams are responsible for producing an entire product, a component, or an ongoing service. In most cases, members are cross-trained on the different tasks assigned to the team. Often, these teams are trained in technical, administrative, and interpersonal skills. Problem-solving teams do not affect an organization's structure because they exist for only a limited period. They are often used when organizations decide to make improvements in the quality of a product or service. Special-purpose teams consist of members who span functional or organizational boundaries and whose purpose is to examine complex issues such as introducing new technology, improving the quality of work process, or encouraging cooperation between labor and management in a unionized setting.



In addition to authority, supervisors have more personal sources of power to draw upon for getting things done. Everyone has power in one form or another and it is by exercising this power that organizations get things accomplished. Supervisors who are capable of achieving their objectives independently of others are said to possess strength. When these "strong" supervisors involve and incorporate others into their plans and activities they are making use of power, and in fact increasing the total amount of power available to incorporate into a particular situation or problem. Involving employees in setting objectives and making decisions as it relates to their jobs empowers everyone, and results in greater job satisfaction and commitment, as well as increased productivity. Empowering employees provides them with greater autonomy.

Power is the ability to exert influence in the organization beyond authority, which is derived from position. The supervisor's personal power could include job knowledge, personal influence, interpersonal skills, and ability to get results, empathetic ability, persuasive ability, and physical strength. J.P. French and B. Raven ("The Bases of Social Power" in Studies in Social Power, edited by D. Cartwright, Institute for Social Research, 1959, pp. 150-167) identify six sources of power: legitimate, coercive, reward, expert, referent, and information. Legitimate power is a result of the position a person holds in the organization hierarchy. This position power is broader than the ability to reward and punish, as members need to accept the authority of the position. Coercive power is the threat of sanctions. It is dependent on fear and includes, but is not limited to the ability to dismiss, assign undesirable work, or restriction of movement. Reward power results in people doing what is asked because they desire positive benefits or rewards. Rewards can be anything a person values (praise, raises, and promotions). Expert power comes from expertise, skill, or knowledge. Referent power refers to a person who has desirable resources or personal traits. It results in admiration and the desire to emulate. Information power is based upon the persuasiveness or content of a communication and is independent of the influencing individual.

In most instances, supervisors do not need to offer incentives or threaten retribution to get employees to do what they request. They influence employees because the employees want to follow. This power to influence comes from the employee granting authority to the supervisor.


Centralization versus Decentralization

Centralization is the degree to which decision-making is concentrated in top management's hands. Decentralization is the extent to which decision-making authority is pushed down the organization structure and shared with many lower-level employees. Centralized organizations have more levels of management with narrow spans of control. Employees are not free to make decisions. Decentralized organizations have fewer levels of management with wide spans of control giving employees more freedom of action. All other things being equal, a wide span of control is more efficient because it requires fewer managers. However, it is important to recognize that, at some point, effectiveness will decline.

The current trend is toward broadening decentralization. As competition intensifies, the need for organizations to be responsive increases. This has made employees, usually those at the lower levels, who are closest to customers extremely important. They are an excellent source of knowledge and implement changes that directly impact performance. Giving this group more input into certain decision-making activities can result in increased firm performance.

 It is impractical for the supervisor to handle all of the work of the department directly. In order to meet the organization's goals, focus on objectives, and ensure that all work is accomplished, supervisors must delegate authority. Authority is the legitimate power of a supervisor to direct subordinates to take action within the scope of the supervisor's position. By extension, this power, or a part thereof, is delegated and used in the name of a supervisor. Delegation is the downward transfer of formal authority from superior to subordinate. The employee is empowered to act for the supervisor, while the supervisor remains accountable for the outcome. Delegation of authority is a person-to-person relationship requiring trust, commitment, and contracting between the supervisor and the employee.

The supervisor assists in developing employees in order to strengthen the organization. He or she gives up the authority to make decisions that are best made by subordinates. This means that the supervisor allows subordinates the freedom to make mistakes and learn from them. He or she does not supervise subordinates' decision-making, but allows them the opportunity to develop their own skills. The supervisor lets subordinates know that he or she is willing to help, but not willing to do their jobs for them. The supervisor is not convinced that the best way for employees to learn is by telling them how to solve a problem. This results in those subordinates becoming dependent on the supervisor. The supervisor allows employees the opportunity to achieve and be credited for it.

An organization's most valuable resource is its people. By empowering employees who perform delegated jobs with the authority to manage those jobs, supervisors free themselves to manage more effectively. Successfully training future supervisors means delegating authority. This gives employees the concrete skills, experience, and the resulting confidence to develop themselves for higher positions. Delegation provides better managers and a higher degree of efficiency. Thus, collective effort, resulting in the organization's growth, is dependent on delegation of authority.


Responsibility and Accountability

Equally important to authority is the idea that when an employee is given responsibility for a job, he or she must also be given the degree of authority necessary to carry it out. Thus, for effective delegation, the authority granted to an employee must equal the assigned responsibility. Upon accepting the delegated task, the employee has incurred an obligation to perform the assigned work and to properly utilize the granted authority. Responsibility is the obligation to do assigned tasks. The individual employee is responsible for being proficient at his or her job. The supervisor is responsible for what employees do or fail to do, as well as for the resources under their control. Thus, responsibility is an integral part of a supervisor's authority.

Responsibilities fall into two categories: individual and organizational. Employees have individual responsibilities to be proficient in their job. They are responsible for their actions. Nobody gives or delegates individual responsibilities. Employees assume them when they accept a position in the organization. Organizational responsibilities refer to collective organizational accountability and include how well departments perform their work. For example, the supervisor is responsible for all the tasks assigned to his or her department, as directed by the manager.

When someone is responsible for something, he or she is liable, or accountable to a superior, for the outcome. Thus, accountability flows upward in the organization. All are held accountable for their personal, individual conduct. Accountability is answering for the result of one's actions or omissions. It is the reckoning, wherein one answers for his or her actions and accepts the consequences, good or bad. Accountability establishes reasons, motives and importance for actions in the eyes of managers and employees alike. Accountability is the final act in the establishment of one's credibility. It is important to remember that accountability results in rewards for good performance, as well as discipline for poor performance.


The Delegation Process

The delegation process has five phases: (1) preparing, (2) planning, (3) discussing, (4) auditing, and (5) appreciating. The first step in delegating is to identify what should and should not be delegated. The supervisor should delegate any task that a subordinate performs better. Tasks least critical to the performance of the supervisor's job can be delegated. Any task that provides valuable experience for subordinates should be delegated. Also, the supervisor can delegate the tasks that he or she dislikes the most. But, the supervisor should not delegate any task that would violate a confidence.

Preparing includes establishing the objectives of the delegation, specifying the task that needs to be accomplished, and deciding who should accomplish it.

Planning is meeting with the chosen subordinate to describe the task and to ask the subordinate to devise a plan of action. As Andrew Carnegie once said, "The secret of success is not in doing your own work but in recognizing the right man to do it." Trust between the supervisor and employee - that both will fulfill the commitment - is most important.

Discussing includes reviewing the objectives of the task as well as the subordinate's plan of action, any potential obstacles, and ways to avoid or deal with these obstacles. The supervisor should clarify and solicit feedback as to the employee's understanding. Clarifications needed for delegation include the desired results (what not how), guidelines, resources available, and consequences (good and bad). Delegation is similar to contracting between the supervisor and employee regarding how and when the work will be completed. The standards and time frames are discussed and agreed upon. The employee should know exactly what is expected and how the task will be evaluated.

Auditing is monitoring the progress of the delegation and making adjustments in response to unforeseen problems.

Appreciating is accepting the completed task and acknowledging the subordinate's efforts.

Since motivation influences productivity, supervisors need to understand what motivates employees to reach peak performance. It is not an easy task to increase employee motivation because employees respond in different ways to their jobs and their organization's practices. Motivation is the set of processes that moves a person toward a goal. Thus, motivated behaviors are voluntary choices controlled by the individual employee. The supervisor (motivator) wants to influence the factors that motivate employees to higher levels of productivity.

Factors that affect work motivation include individual differences, job characteristics, and organizational practices. Individual differences are the personal needs, values, and attitudes, interests and abilities that people bring to their jobs. Job characteristics are the aspects of the position that determine its limitations and challenges. Organizational practices are the rules, human resources policies, managerial practices, and rewards systems of an organization. Supervisors must consider how these factors interact to affect employee job performance.


Simple Model of Motivation

The purpose of behavior is to satisfy needs. A need is anything that is required, desired, or useful. A want is a conscious recognition of a need. A need arises when there is a difference in self-concept (the way I see myself) and perception (the way I see the world around me). The presence of an active need is expressed as an inner state of tension from which the individual seeks relief.


Theories of Motivation

Many methods of employee motivation have been developed. The study of work motivation has focused on the motivator (supervisor) as well as the motivatee (employee). Motivation theories are important to supervisors attempting to be effective leaders. Two primary approaches to motivation are content and process.

The content approach to motivation focuses on the assumption that individuals are motivated by the desire to fulfill inner needs. Content theories focus on the needs that motivate people.

Maslow's Hierarchy of Needs identifies five levels of needs, which are best seen as a hierarchy with the most basic need emerging first and the most sophisticated need last. People move up the hierarchy one level at a time. Gratified needs lose their strength and the next level of needs is activated. As basic or lower-level needs are satisfied, higher-level needs become operative. A satisfied need is not a motivator. The most powerful employee need is the one that has not been satisfied. Abraham Maslow first presented the five-tier hierarchy in 1942 to a psychoanalytic society and published it in 1954 in Motivation and Personality (New York: Harper and Row).

Level I - Physiological needs are the most basic human needs. They include food, water, and comfort. The organization helps to satisfy employees' physiological needs by a paycheck.
Level II - Safety needs are the desires for security and stability, to feel safe from harm. The organization helps to satisfy employees' safety needs by benefits.
Level III - Social needs are the desires for affiliation. They include friendship and belonging. The organization helps to satisfy employees' social needs through sports teams, parties, and celebrations. The supervisor can help fulfill social needs by showing direct care and concern for employees.
Level IV - Esteem needs are the desires for self-respect and respect or recognition from others. The organization helps to satisfy employees' esteem needs by matching the skills and abilities of the employee to the job. The supervisor can help fulfill esteem needs by showing workers that their work is appreciated.
Level V - Self-actualization needs are the desires for self-fulfillment and the realization of the individual's full potential. The supervisor can help fulfill self-actualization needs by assigning tasks that challenge employees' minds while drawing on their aptitude and training.

Alderfer's ERG identified three categories of needs. The most important contribution of the ERG model is the addition of the frustration-regression hypothesis, which holds that when individuals are frustrated in meeting higher level needs, the next lower level needs reemerge.
Existence needs are the desires for material and physical well being. These needs are satisfied with food, water, air, shelter, working conditions, pay, and fringe benefits.
Relatedness needs are the desires to establish and maintain interpersonal relationships. These needs are satisfied with relationships with family, friends, supervisors, subordinates, and co-workers.
Growth needs are the desires to be creative, to make useful and productive contributions and to have opportunities for personal development.

McClelland's Learned Needs divides motivation into needs for power, affiliation, and achievement.
Achievement motivated people thrive on pursuing and attaining goals. They like to be able to control the situations in which they are involved. They take moderate risks. They like to get immediate feedback on how they have done. They tend to be preoccupied with a task-orientation towards the job to be done.
Power motivated individuals see almost every situation as an opportunity to seize control or dominate others. They love to influence others. They like to change situations whether or not it is needed. They are willing to assert themselves when a decision needs to be made.
Affiliation motivated people are usually friendly and like to socialize with others. This may distract them from their performance requirements. They will usually respond to an appeal for cooperation.

Herzberg's Two-Factor Theory describes needs in terms of satisfaction and dissatisfaction. Frederick Herzberg examined motivation in the light of job content and contest. (See Work an the Nature of Man, Crowell Publications, 1966.) Motivating employees is a two-step process. First provide hygienes and then motivators. One continuum ranges from no satisfaction to satisfaction. The other continuum ranges from dissatisfaction to no dissatisfaction.

Satisfaction comes from motivators that are intrinsic or job content, such as achievement, recognition, advancement, responsibility, the work itself, and growth possibilities. Herzberg uses the term motivators for job satisfiers since they involve job content and the satisfaction that results from them. Motivators are considered job turn-ons. They are necessary for substantial improvements in work performance and move the employee beyond satisfaction to superior performance. Motivators correspond to Maslow's higher-level needs of esteem and self-actualization.

Dissatisfaction occurs when the following hygiene factors, extrinsic or job context, are not present on the job: pay, status, job security, working conditions, company policy, peer relations, and supervision. Herzberg uses the term hygiene for these factors because they are preventive in nature. They will not produce motivation, but they can prevent motivation from occurring. Hygiene factors can be considered job stay-ons because they encourage an employee to stay on a job. Once these factors are provided, they do not necessarily promote motivation; but their absence can create employee dissatisfaction. Hygiene factors correspond to Maslow's physiological, safety, and social needs in that they are extrinsic, or peripheral, to the job. They are present in the work environment of job context.

Motivation comes from the employee's feelings of accomplishment or job content rather than from the environmental factors or job context. Motivators encourage an employee to strive to do his or her best. Job enrichment can be used to meet higher-level needs. To enrich a job, a supervisor can introduce new or more difficult tasks, assign individuals specialized tasks that enable them to become experts, or grant additional authority to employees.

A key issue in accomplishing the goals identified in the planning process is structuring the work of the organization. Organizations are groups of people, with ideas and resources, working toward common goals. The purpose of the organizing function is to make the best use of the organization's resources to achieve organizational goals. Organizational structure is the formal decision-making framework by which job tasks are divided, grouped, and coordinated. Formalization is an important aspect of structure. It is the extent to which the units of the organization are explicitly defined and its policies, procedures, and goals are clearly stated. It is the official organizational structure conceived and built by top management. The formal organization can be seen and represented in chart form. An organization chart displays the organizational structure and shows job titles, lines of authority, and relationships between departments.

The informal organization is the network, unrelated to the firm's formal authority structure, of social interactions among its employees. It is the personal and social relationships that arise spontaneously as people associate with one another in the work environment. The supervisor must realize that the informal organization affects the formal organization. The informal organization can pressure group members to conform to the expectations of the informal group that conflict with those of the formal organization. This can result in the generation of false information or rumors and resistance to change desired by management. The supervisor should recognize the existence of information groups, identify the roles member play within these groups, and use knowledge of the groups to work effectively with them. The informal organization can make the formal organization more effective by providing support to management, stability to the environment, and useful communication channels.


Organizational Structure

Even though the differences among organizations are enormous, there are many similarities that enable them to be classified. One widely used classification is the twofold system (mechanistic versus organic forms of organizational structure) developed by Tom Burns and G. M. Stalker in their study of electronics firms in the United Kingdom. (See Burns, Tom and G. M. Stalker, Management of Innovation, London: Tavistock Publications, 1961, p. 19.)

The mechanistic structure is the traditional or classical design, common in many medium- and large-size organizations. Mechanistic organizations are somewhat rigid in that they consist of very clearly delineated jobs, have a well-defined hierarchical structure, and rely heavily on the formal chain of command for control. Bureaucratic organizations, with their emphasis on formalization, are the primary form of mechanistic structures. According to Max Weber, bureaucracy is a form of organization characterized by a rational, goal-directed hierarchy, impersonal decision making, formal controls, and subdivision into managerial positions and specialization of labor. Bureaucratic organizations are tall consisting of hierarchies with many levels of management. In a tall structure, people become relatively confined to their own area of specialization. Bureaucracies are driven by a top-down or command and control approach in which managers provide considerable direction and have considerable control over others. Other features of the bureaucratic organization include functional division of labor and work specialization.

On the other hand, the organic structure is more flexible, more adaptable to a participative form of management, and less concerned with a clearly defined structure. The organic organization is open to the environment in order to capitalize upon new opportunities.

Organic organizations have a flat structure with only one or two levels of management. Flat organizations emphasize a decentralized approach to management that encourage high employee involvement in decisions. The purpose of this structure is to create independent small businesses or enterprises that can rapidly respond to customers' needs or changes in the business environment. The supervisor tends to have a more personal relationship with his or her employees.

Rensis Likert has conducted extensive research on a non-bureaucratic organization design referred to as System 4 (participative-democratic). Management and employees interact in a friendly environment characterized by mutual confidence and trust. (See Likert, Rensis, , New York: McGraw-Hill, 1967, pp. 4-10).

Contingency organization means that the most appropriate organization structure for each situation depends upon technology, organizational size, goals and strategy, environmental stability, and characteristics of the employees. Mechanistic organizations are best suited to repetitive operations and stable environments, while organic organizations are best suited to an uncertain task and a changing environment.


Organization Design

Designing an organization involves choosing an organizational structure that will enable the company to most effectively achieve its goals. Organization design is the creation of an organization's structure, traditionally functional, divisional, and/or matrix.

Functions or divisions arrange traditional organizations. In a functional organization, authority is determined by the relationships between group functions and activities. Functional structures group similar or related occupational specialties or processes together under the familiar headings of finance, manufacturing, marketing, accounts receivable, research, surgery, and photo finishing. Economy is achieved through specialization. However, the organization risks losing sight of its overall interests as different departments pursue their own goals.

In a divisional organization, corporate divisions operate as relatively autonomous businesses under the larger corporate umbrella. In a conglomerate organization, divisions may be unrelated. Divisional structures are made up of self-contained strategic business units that each produces a single product. For example, General Motors' divisions include Chevrolet, Oldsmobile, Pontiac, and Cadillac. A central headquarters, focusing or results, coordinates and controls the activities, and provides support services between divisions. Functional departments accomplish division goals. A weakness however, is the tendency to duplicate activities among divisions.

In a matrix organization, teams are formed and team members report to two or more managers. Matrix structures utilize functional and divisional chains of command simultaneously in the same part of the organization, commonly for one-of-a-kind projects. It is used to develop a new product, to ensure the continuing success of a product to which several departments directly contribute, and to solve a difficult problem. By superimposing a project structure upon the functional structure, a matrix organization is formed that allows the organization to take advantage of new opportunities. This structure assigns specialists from different functional departments to work on one or more projects being led by project managers. The matrix concept facilitates working on concurrent projects by creating a dual chain of command, the project (program, systems, or product) manager and the functional manager. Project managers have authority over activities geared toward achieving organizational goals while functional managers have authority over promotion decisions and performance reviews. An example is an aerospace firm with a contract from NASA.

Matrix organizations are particularly appealing to firms that want to speed up the decision-making process. However, the matrix organization may not allow long-term working relationships to develop. Furthermore, using multiple managers for one employee may result in confusion as to manager evaluation and accountability. Thus, the matrix system may elevate the conflict between product and functional interests.

Boundaryless organizations are not defined or limited by horizontal, vertical, or external boundaries imposed by a predetermined structure. They share many of the characteristics of flat organizations, with a strong emphasis on teams. Cross-functional teams dissolve horizontal barriers and enable the organization to respond quickly to environmental changes and to spearhead innovation. Boundaryless organizations can form relationships (joint ventures, intellectual property, distribution channels, or financial resources) with customers, suppliers, and/or competitors. Telecommuting, strategic alliances and customer-organization linkages break down external barriers, streamlining work activities. Jack Welch, former CEO of General Electric, to facilitate interactions with customers and suppliers, first used this un-structure.

A boundaryless environment is required by learning organizations to facilitate team collaboration and the sharing of information. When an organization develops the continuous capacity to adapt and survive in an increasingly competitive environment because all members take an active role in identifying and resolving work-related issues, it has developed a learning culture. A learning organization is one that is able to adapt and respond to change. This design empowers employees because they acquire and share knowledge and apply this learning to decision-making. They are pooling collective intelligence and stimulating creative thought to improve performance. Supervisors facilitate learning by sharing and aligning the organization's vision for the future and sustaining a sense of community and strong culture.


Organizing Function

The organizing function deals with all those activities that result in the formal assignment of tasks and authority and a coordination of effort. The supervisor staffs the work unit, trains employees, secures resources, and empowers the work group into a productive team. The steps in the organizing process include (1) review plans, (2) list all tasks to be accomplished, (3) divide tasks into groups one person can accomplish - a job, (4) group related jobs together in a logical and efficient manner, (5) assign work to individuals, (6) delegate authority to establish relationships between jobs and groups of jobs.

The nature and scope of the work needed to accomplish the organization's objectives is needed to determine work classification and work unit design. Division of labor, or work specialization, is the degree to which tasks in an organization are divided into separate jobs. Work process requirements and employee skill level determine the degree of specialization. Placing capable people in each job ties directly with productivity improvement. In order to maximize productivity, supervisors match employee skill level with task requirements.

Supervisors should perform workflow analysis to examine how work creates or adds value to the ongoing processes in an organization. Workflow analysis looks at how work moves from the customer or the demand source through the organization to the point at which the work leaves the organization as a product or service to meet customer demand. Thus, workflow analysis can be used to tighten the connection between employees' work and customers' needs. Also, it can help to make major performance breakthroughs throughout business process reengineering (BPR), a fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in costs, quality, service, and speed.  BPR uses workflow analysis to identify jobs that can be eliminated or recombined to improve company performance.



After reviewing the plans, usually the first step in the organizing process is departmentalization. Once jobs have been classified through work specialization, they are grouped so those common tasks can be coordinated. Departmentalization is the basis on which work or individuals are grouped into manageable units. There are five traditional methods for grouping work activities.

Departmentalization by function organizes by the functions to be performed. The functions reflect the nature of the business. The advantage of this type of grouping is obtaining efficiencies from consolidating similar specialties and people with common skills, knowledge and orientations together in common units.

Departmentalization by product assembles all functions needed to make and market a particular product are placed under one executive. For instance, major department stores are structured around product groups such as home accessories, appliances, women's clothing, men's clothing, and children's clothing.

Departmentalization by geographical regions groups jobs on the basis of territory or geography. For example, Merck, a major pharmaceutical company, has its domestic sales departmentalized by regions such as Northeast, Southeast, Midwest, Southwest, and Northwest.

Departmentalization by process groups jobs on the basis of product or customer flow. Each process requires particular skills and offers a basis for homogeneous categorizing of work activities. A patient preparing for an operation would first engage in preliminary diagnostic tests, then go through the admitting process, undergo a procedure in surgery, receive post operative care, be discharged and perhaps receive out-patient attention. These services are each administered by different departments.

Departmentalization by customer groups jobs on the basis of a common set of needs or problems of specific customers. For instance, a plumbing firm may group its work according to whether it is serving private sector, public sector, government, or not-for-profit organizations. A current departmentalization trend is to structure work according to customer, using cross-functional teams. This group is chosen from different functions to work together across various departments to interdependently create new products or services. For example, a cross-functional team consisting of managers from accounting, finance, and marketing is created to prepare a technology plan.

To meet the many demands of performing their functions, managers assume multiple roles. A role is an organized set of behaviors. Henry Mintzberg has identified ten roles common to the work of all managers. The ten roles are divided into three groups: interpersonal, informational, and decisional*. The informational roles link all managerial work together. The interpersonal roles ensure that information is provided. The decisional roles make significant use of the information. The performance of managerial roles and the requirements of these roles can be played at different times by the same manager and to different degrees depending on the level and function of management. The ten roles are described individually, but they form an integrated whole.

The three interpersonal roles are primarily concerned with interpersonal relationships. In the figurehead role, the manager represents the organization in all matters of formality. The top level manager represents the company legally and socially to those outside of the organization. The supervisor represents the work group to higher management and higher management to the work group. In the liaison role, the manger interacts with peers and people outside the organization. The top level manager uses the liaison role to gain favors and information, while the supervisor uses it to maintain the routine flow of work. The leader role defines the relationships between the manger and employees.

The direct relationships with people in the interpersonal roles place the manager in a unique position to get information. Thus, the three informational roles are primarily concerned with the information aspects of managerial work. In the monitor role, the manager receives and collects information. In the role of disseminator, the manager transmits special information into the organization. The top level manager receives and transmits more information from people outside the organization than the supervisor. In the role of spokesperson, the manager disseminates the organization's information into its environment. Thus, the top level manager is seen as an industry expert, while the supervisor is seen as a unit or departmental expert.

The unique access to information places the manager at the center of organizational decision making. There are four decisional roles. In the entrepreneur role, the manager initiates change. In the disturbance handler role, the manger deals with threats to the organization. In the resource allocator role, the manager chooses where the organization will expend its efforts. In the negotiator role, the manager negotiates on behalf of the organization. The top level manager makes the decisions about the organization as a whole, while the supervisor makes decisions about his or her particular work unit.

The supervisor performs these managerial roles but with different emphasis than higher managers. Supervisory management is more focused and short-term in outlook. Thus, the figurehead role becomes less significant and the disturbance handler and negotiator roles increase in importance for the supervisor. Since leadership permeates all activities, the leader role is among the most important of all roles at all levels of management

In order to perform the functions of management and to assume multiple roles, managers must be skilled. Robert Katz identified three managerial skills that are essential to successful management: technical, human, and conceptual*. Technical skill involves process or technique knowledge and proficiency. Managers use the processes, techniques and tools of a specific area. Human skill involves the ability to interact effectively with people. Managers interact and cooperate with employees. Conceptual skill involves the formulation of ideas. Managers understand abstract relationships, develop ideas, and solve problems creatively. Thus, technical skill deals with things, human skill concerns people, and conceptual skill has to do with ideas.

A manager's level in the organization determines the relative importance of possessing technical, human, and conceptual skills. Top level managers need conceptual skills in order to view the organization as a whole. Conceptual skills are used in planning and dealing with ideas and abstractions. Supervisors need technical skills to manage their area of specialty. All levels of management need human skills in order to interact and communicate with other people successfully.

As the pace of change accelerates and diverse technologies converge, new global industries are being created (for example, telecommunications). Technological change alters the fundamental structure of firms and calls for new organizational approaches and management skills.

Successful organizations continually innovate and change based upon customer needs and feedback. Values, mission, and vision form the foundation for the execution of the functions of management. They are an organization's guidelines that affect how it will operate. They work only if visible and used in everyday activities and decisions. An organization's values are its beliefs or those qualities that have intrinsic worth and will not be compromised. Its mission is its purpose for existing. The vision is the image of itself in the future.



Each supervisor's approach to management will reflect his or her values, as well as those of the organization. Building trust starts with creating culture based on shared values. Values are traits or qualities having intrinsic worth, such as courage, respect, responsibility, caring, truthfulness, self-discipline, and fairness. Values serve as a baseline for actions and decision-making and guide employees in the organization's intentions and interests. The values driving behavior define the organizational culture. A strong value system or clearly defined culture turns beliefs into standards such as best quality, best performance, most reliable, most durable, safest, fastest, best value for the money, least expensive, most prestigious, best designed or styled, easiest to use. If asked, "What do we believe in?" or "List our organization's values" all employees in the organization should write down the same values. For example, McDonald's values were captured in its motto of "Q.S.C. & V." which stands for quality, service, cleanliness, and value.

Supervisors need to appreciate the significance of values and value systems. Values affect how a supervisor views other people and groups, thus influencing interpersonal relationships. Values affect how a supervisor perceives situations and solves problems. Values affect how a supervisor determines what is and is not ethical behavior. Values affect how a supervisor leads and controls employees. Since employees often base behavior on perceived values it is critical to ensure their perceptions reflect organizational values. Supervisors must communicate, encourage and reinforce the desired values and related behaviors to integrate them into the organizational culture.

Geert Hofstede identified a work-related value framework that has four dimensions: power distance, uncertainty avoidance, individualism, and polarization. Power distance is the attitude to human inequality and relationships to superiors and inferiors in any hierarchy. Uncertainty avoidance is the tolerance for uncertainty that determines choices and rituals to cope with it in social structures and belief systems. Individualism is the relationship between the individual and the collectivity, especially in the way individuals choose to live and work together. Polarization is the extent to which differences such as masculinity or femininity have implications for social organization and the organizations of beliefs. Every person has a different mental program, based on patterns of thinking, feeling, and acting, which are learned throughout a lifetime. The effects of these differences have many practical implications for those who work or are managers in multinational business and for those involved in international negotiations.



A mission is a broad definition of a business that differentiates it from all other organizations. It is the justification for the organization's existence. The mission statement is the "touchstone" by which all offerings are judged. In addition to the organization's purpose other key elements of the mission statement should include whom it serves, how, and why. The most effective mission statements are easily recalled and provide direction and motivation for the organization.

Since an organization exists to accomplish something in the larger environment, its specific mission or purpose provides employees with a shared sense of opportunity, direction, significance, and achievement. An explicit mission guides employees to work independently and yet collectively toward the realization of the organization's potential. Thus, a good mission statement gets the emotional bonding and commitment needed. It allows the individual employee to say; "I know how I should do my job differently."

For example, many people might think that The Walt Disney Company's mission is to run theme parks. But, Disney's mission is always moving toward an expanded view. Disney provides entertainment. "Disney's overriding objective is to create shareholder value by continuing to be the world's premier entertainment company from a creative, strategic, and financial standpoint."

Also, many people might think that Revlon's mission is to make cosmetics. Yet, Revlon provides glamour, excitement and innovation. Charles Revson, Revlon's founder understood the importance of mission. He said "In the factory, we make cosmetics; in the store, we sell hope."



Erich Fromm pointed out; "The best way to predict your future is to create it." A vision might be a picture, image, or description of the preferred future. A visionary has the ability to foresee something and sees the need for change first. He or she challenges the status quo and forces honest assessments of where the industry is headed and how the company can best get there. A visionary is ready with solutions before the problems arise.

A study over the period from 1926 to 1990 found visionary companies that set a purpose beyond making money outperformed other companies in the stock market by more than six to one. (See Gilbert Fuchsberg, "Visioning' Mission Becomes Its Own Mission," The Wall Street Journal, January 7, 1994, B1, 3.) Managers require more vision than ever because change is coming faster than ever. Leaders have the ability to make their vision real by engaging the minds, as well as the hearts of others.

Microsoft's early vision statement was "A Computer on Every Desk and In Every Home." (At approximately the same time, President John Akers said IBM's goal was to become a $100 billion company by then end of the century. At that time IBM sales were $50 billion.) Microsoft's vision has evolved [1998 the "Connected PC and the Connected TV"- the idea of integrating the intelligence and interactivity of PCs with the video and sound of TV] to 2002 "to enable people and businesses throughout the world to realize their full potential."

Life consists in what a man is thinking of all day.-- Ralph Waldo Emerson

A goal is an end that the organization strives to attain. However, the supervisor cannot "do" a goal. Supervisors break down processes, analyze them, set objectives and then drive hard to achieve them. Doing the same thing and expecting different results doesn't work. The supervisor must write an objective for what he or she is trying to accomplish. Thus, an objective is the object or aim of an action. It implies an explicit direction for the action to take and a specific quality of work to be accomplished within a given period of time. Objectives reflect the desired outcomes for individuals, groups and organizations. They provide direction for decision-making and a criterion against which outcomes are measured. Thus, objectives are the foundation of planning.



An effective planning tool to help the supervisor set objectives is Management by Objectives (MBO). MBO gained recognition in 1954 with the publication of Peter Drucker's book The Practice of Management. MBO is a collaborative process whereby the manager and each subordinate jointly determine objectives for that subordinate. To be successful MBO programs should include commitment and participation in the MBO process at all levels, from top management to the lowest position in the organization.

MBO begins when the supervisor explains the goals for the department in a meeting. The subordinate takes the goals and proposes objectives for his or her particular job. The supervisor meets with the subordinate to approve and, if necessary, modify the individual objectives. Modification of the individual's objectives is accomplished through negotiation since the supervisor has resources to help the subordinate commit to the achievement of the objective. Thus, a set of verifiable objectives for each individual are jointly determined, prioritized, and formalized.

The supervisor and the subordinate meet periodically to review the latter's progress. Communication is the key factor in determining MBO's success or failure. The supervisor gives feedback and may authorize modifications to the objectives or their timetables as circumstances dictate. Finally, the employee's performance is measured against his or her objectives, and he or she is rewarded accordingly.

Research has demonstrated that when top management is committed and personally involved in implementing MBO programs, they significantly improve performance. This finding is not surprising when one considers that during the MBO process employees determine what they will accomplish. After all, who knows what a person is capable of doing better than the person does him or herself?

Objectives are the driver of planning processes. It is imperative that top managers safeguard the intention of their goals to facilitate middle and lower management's effective translation and implementation of them. Objectives guide managerial activities such as budgeting, the development of action plans, staffing, and the purchasing of equipment. The organization's success ultimately depends on the combined outcomes of its objectives.



Most supervisors set objectives, but not with equal skill. Few, who do not correctly write objectives, will reap MBO's full benefits. An objective is simply a statement of what is to done and should be stated in terms of results. A mnemonic aid to write objectives is SMART (Specific, Measurable, Attainable, Result-oriented, Time-limited).



An objective must be specific with a single key result. If more than one result is to be accomplished, more than one objective should be written. Just knowing what is to be accomplished is a big step toward achieving it.

What is important to you? Once you clarify what you want to achieve, your attention will be focused on the objective that you deliberately set. You will be doing something important to you.



An objective must be measurable. Only an objective that affects behavior in a measurable way can be optimally effective. If possible, state the objective as a quantity. Some objectives are more difficult to measure than others are. However, difficulty does not mean that they cannot be measured. Treatment of salespeople might be measured by looking at the absenteeism and turnover rates among the sales force. Also, salespeople could be asked to fill out a behavioral questionnaire anonymously giving their observations of the supervision they receive. Customer service could be measured by such indices as the number of complaints received, by the number of customers lost, and by customer interviews or responses to questionnaires. Development of subordinates could be measured by determining the number of tasks the subordinate has mastered. Cooperation with other functions could be measured by length of delay in providing requested information, or by peer ratings of degree of cooperation.

Avoid statements of objectives in generalities. Infinitives to avoid include to know, to understand, to enjoy, and to believe. Action verbs are observable and better communicate the intent of what is to be attempted. They include to write, to apply, to recite, to revise, to contrast, to install, to select, to assemble, to compare, to investigate, and to develop.

How will you know you've progressed?



An objective must be attainable with the resources that are available. It must be realistic. Many objectives are realistic. Yet, the time it takes to achieve them may be unrealistic. For example, it is realistic to want to lose ten pounds. However, it is unrealistic to want to lose ten pounds in one week.

What barriers stand between you and your objective? How will each barrier be overcome and within what time frame?



The objective should be central to the goals of the organization. The successful completion of the objective should make a difference.

How will this objective help the organization move ahead? Is the objective aligned with the mission of the organization?



The objective should be traceable. Specific objectives enable time priorities to be set and time to be used on objectives that really matter.

Are the time lines you have established realistic? Will other competing demands cause delay? Will you be able to overcome those demands to accomplish the objective you've set in the time frame you've established?


Write Meaningful Objectives

Although the rules are difficult to establish, the following may be useful when writing an objective.

1. Start with an action or accomplishment verb. (Use the infinitive form of the verb. This means to start the with "to.")

2. Identify a single key result for each objective.

3. Give the date of the estimated completion.

4. Be sure the objective is one you can control.

5. To test for validity of SMART objectives, ask yourself the following questions.

S = Exactly what is my objective?

M = What would a good job look like?

A = Is my objective feasible?

R = Is my objective meaningful?

T = Is my objective traceable?

The following fill-in-the-blank equation may be useful when writing an objective.

OBJECTIVE: To (+ action verb + single key result + target date)