MGT1-Principles of Management

Module 7
Organizing

Objectives: At the end of the lesson, the learners shall be able to:
a. discuss the nature of organization; and
b. distinguish the various types of organization structure

Introduction
After planning, organizing follows. The goals and objectives established during
planning will all go to waste if effective organizing, through the development of a design ed
structure of roles for effective performance does not follow. It requires an interlacing of
decision and communication work units to coordinate efforts toward the organizational goals
and objectives that were set earlier. To function well, organization structures and their specific
roles must be understood by all members of the organization. Rules and regulation principles
must also be put into practice. It must be remembered, however, that organizing depends on
the specific situation of the firm.

Activity 1: Word to remember

Direction. Identify what is being asked by the description given. On the space provided write
the letter before the letter.

Example:
P L A N N I N G
Q M B O O J O H

It provides direction to the organization.

1. A collection of people or groups of people working together to achieve a common goal.

O R G A N I Z A T I O N
P S H B O J A B U J P O

2. A management function which involves assigning task, allocating resources, and

coordinating work activities in order to achieve a common purpose
O R G A N I Z I N G
P S H B O J A J O H

3. A departmentalization structure of an organization into smaller work units

H O R I Z O N T A L
I P S J A P O U B M

4. A structure that clears out issues related to authority rights, responsibilities, and
reporting relationships
V E R T I C A L
W F S U J D B M
 5. A collection of independent, single function organizations that work together in order
to produce a product/service.
N E T W O R K
O F U X P S L

Lesson 1: Nature of Organization

The concept of organization has been evolved from the commencement of human
civilization when they started to live in groups. It means that the family is the beginning form
of organization. But nowadays, people must form different types of an organization based on
their goals consisting of business, social, religious, clubs and so on.
Groups of people are associated and coordinated for achieving common goals.
Member having similar interests and goals becomes ready to form a group for a joint effort
with different tasks and responsibilities. The division of works is carried out based on the
efficiency and specialization of the group members. Activities of each member get coordinated
with the help of an effective communication network. Responsibility and authority are
delegated based on the structure of the organization. https://baseread.com/what-is-
organization-nature-of-organization
Differentiation in organizations involves division of labor and specialization. These
necessarily result from the organization’s composition-many different work units with different
kinds of tasks, using different skills and work activities coordinating with one another for a
common end.
Division of labor involves assigning different tasks to different people in the
organization’s different work units. Related to it is specialization, the process in which
different individuals and units perform different tasks. An organization’s overall work is
complex and would be too much for any individual, therefore, the bigger the organization, the
more work units or work divisions and specialization are to be expected.
Integration is another process in the organization’s internal environment which
involves the collaboration and coordination of its different work units or work division.
Coordination refers to the procedures that connect work activities of the different work
divisions/units of the firm in order to achieve its overall goal. Structural mechanisms may be
devised in order to increase collaboration and coordination. The more highly differentiated
one’s organization is, the greater the need for integration among the different units.
Activity1: Organization Chart
Organization Chart is a visual representation of the organization’s structure showing
the different job position in the firm and their hierarchical arrangement for the purpose of
dividing labor and providing a picture of the reporting structure.
Direction: Construct an organization chart of your community or purok where you belong.
Indicate the names and positions of each purok officers.

Start here!
Lesson 2: Types of Organization Structure
An organization structure is a system made up of takes to be accomplished, work
movements from one work level to other work levels in the system, reporting relationships and
communications passageways that unite the work of different individual Epson and groups.
The types of organizational structure include:
a. Vertical structure
b. Horizontal structure
c. Network structure

Vertical Structure clears out issues related to authority rights, responsibilities and
reporting relationships. Authority rights refer to the legitimate rights of individuals, appointed
in positions like president, vice presidents, manager and the like, to give orders to their
subordinates, who in turn, report to them what they have done.

Horizontal Structure refers to the departmentalization of an organization into smaller

work units as tasks become increasingly varied and numerous. Departments formed are two
types:
1. Line Departments- deal
directly with the firm’s
primary goods and
services responsible for
manufacturing, selling and
providing services to
clients.

2. Staff Department- support

the activities of the line
department by doing
research, attending to legal
matters, performing public
relations duties.
 Meanwhile, departmentalization may be done using three approaches:

1. Functional approach-where the subdivisions are formed based on specialized activities

such as marketing, production, financial management and human resources
management

2. Divisional approach- where departments are formed based on management of their

products, customers or geographic areas covered.

3. Matrix Approach- is a hybrid form of departmentalization where managers and staff

personnel report to the superiors, the functional manager and the divisional manager.
 Network structure is a collection of independent, usually single function
organization/companies that work together in order to produce a product or service. Such
network organizations are each capable of doing their own specialized work activities
independently, like producing, distributing, designing, etc. but can work effectively at the same
time with other network members. Often their communication is by electronic means where
sharing of information is speedy. This results in their ability to respond at once to their
customers’ demands.

Activity 2. Organization Chart

a. After reading the short discussion on the types of organization structure, what type of
structure did you illustrate on Activity 1?
___________________________________________________________________
b. Based on your experience, how do you make decision in your organization?
___________________________________________________________________
___________________________________________________________________
___________________________________________________________________
Activity 3: Multiple Choice.
Direction: Choose the best answer.

1. The process of structuring both human and physical resources to accomplish

organizational objectives is called:
a. organizing.
b. formalization.
c. centralization.
d. departmentalization.

2. The framework of interrelationships among individuals and departments that describe

relationships of reporting and accountability is called:
a. chain of command.
b. functional arrangement.
c. specialization.
d. organizational structure.

3. A cross functional organizational structure in which individuals performing one function,

such as accounting, are to the senior executive in finance and to another senior
executive in a geographical, product, or customer department is called:
a. line organization.
b. matrix form.
c. informal organization.
d. bureaucratic organization.

4. Dividing Butuan City into the Sumilihon, Los Angeles, Ampayon would be
departmentalization by:
a. customer.
b. location.
c. function.
d. product.

5. Design engineers at Ford advise production personnel about what products to use in
making a product. This is an example of ____________ authority.
a. staff.
b. group.
c. line.
d. line & staff.

Reflection: I have learned that

_________________________________________________________________________
_________________________________________________________________________
_________________________________________________________________________

Reference:
• Cabrera, H.M.F, Altajeros, A.DC., Benjamin, R. (2016). Organization and
Management. Vibal Group. Quezon City
• DepEd Teachers Manual Organization and Management
• https://businessjargons.com/organization.html
• https://creately.com/blog/diagrams/types-of-organizational-charts/