Engineering Management.docx

Republic of the Philippines BATANGAS STATE UNIVERSITY Pablo Borbon Main II, Alangilan Batangas City College of Engineering, Architecture & Fine Arts www.batstate-u.edu.ph Tel. No. (043) 425-0139 loc. 118 Chemical and Food Engineering Department

IE 530 Engineering Management

Organizing and Effective Organizing and Organizational Culture

Guillano, Justin A.

ChE- 5201

Dr. Eufronia M. Magundayao Instructor

February 23, 2018

ORGANIZING Organizing is a management function which refers to the “the structuring of resources and activities to accomplish objectives in an efficient and effective manner.” It is undertaken to facilitate the implementation of plans. The arrangement or relationship of positions within an organization is called the structure. The result of the organizing process is the structure. FUNCTIONS OF ORGANIZATION 1. Organizing Workplace 2. Developing Structure 3. Delegating Work 4. Establishing Relationship When structuring an organization, the manager must be concerned with the following: 1. Division of labor – determining the scope of work and how it is combined in a job. 2. Delegation of authority – the process of assigning various degrees of decision making authority to subordinates. 3. Departmentation – the grouping of related jobs, activities, or processes into major organizational subunits. 4. Span of Control – the number of people who report directly to a given manager. 5. Coordination – the linking of activities in the organization that serves to achieve a common goal or objective. THE FORMAL AND INFORMAL ORGANIZATION The formal organization is “the structure that details lines of responsibilities, authority, and position.” What is depicted in the organization chart is the formal organization. It is “the planned structure” and it “represents the deliberate attempt to establish patterned relationships among the components that will meet the objectives effectively”. The formal structure is described by management through: 1. The organizational chart is a diagram of the organization’s official positions and formal lines of authority. 2. The organizational manual provides written descriptions of authority relationships, details the functions of major organizational units, and describes job procedures. 3. The policy manual describes personnel activities and company policies. Informal organizations are oftentimes very useful; in the accomplishment of major tasks, especially if these tasks conform to the expectations of the members of the informal group. The informal organization, useful as it is, is “vulnerable to expediency, manipulation, and opportunism,” according to Valentine. Its low visibility, Valentine added, makes it “difficult for management to detect these perversions and considerable harm can be done to the company.” STRUCTURING CHARACTERISTICS OF AN ORGANIZATION Organizational Structure - The formal system of work roles and authority relationships that govern how associates and managers interact with one another.

1. Centralization - The degree to which authority for meaningful decisions is retained at the top of an organization. 2. Standardization - The degree to which rules and standard operating procedures are followed. 3. Formalization - The degree to which rules and operating procedures are documented on paper or in company intranets. 4. Specialization - The degree to which associates and managers have jobs with narrow scopes and limited variety. FACTORS AFFECTING STRUCTURE 1. Corporate strategy – The overall approach an organization uses in interacting with its environment. The emphasis is placed on growth and diversification. 2. Growth – Related to increases in sales as well as increases in associates and managers. 3. Diversification – Related to the number of different product lines or service areas in the organization. TYPES OF ORGANIZATIONAL STRUCTURES 1. Functional Organization This is a form of departmentalization in which everyone engaged in one functional activity, such as engineering or marketing, is grouped into one unit. Functional organization structures are very effective in smaller firms, especially “single-business firms where key activities revolve around well-defined skills and areas of specialization.” Technical Director

Mechanical Design

Electrical Design

System Engineering

Quality Control

Production Engineering

2. Discipline Based Organization Favored by universities, governmental laboratories and other R&D organizations Promote innovative pursuits in individual disciplines, allowing employees to drill down to deeper knowledge levels without requiring much coordination with others. Engineering Dean

Mechanical Engineering

Electrical Engineering

Chemical Engineering

Industrial Engineering

Civil Engineering

3. Product or Market Organization This refers to the organization of a company by divisions that bring together all those involved with a certain type of product or customer.

The product or market organization, with its feature of operating by divisions, is “appropriate for a large corporation with many product lines in several related companies.” Technical Director

Government Products

University Products

Consumer Products

Custom Products

Industrial Products

4. Matrix Organization It is an organizational structure in which each employee reports both a functional or division manager and to a project or group A matrix, organization, according to Thompson and Strickland, “is a structure with two (or more) channels of command, two lines of budget authority, and two sources of performance and reward.” Higgins declared that “the matrix structure was designed to keep employees in a central pool and to allocate them to various projects in the firm according to length of time they were needed.”

CEO

Vice President, Engineering

Vice President, Production

Vice President, Finance

Vice President, Marketing

Employees Project Manager A

Project Manager B

Project Manager C

5. Team Organization Team members “on loan” from functional organizations to eliminate organizational conflicts; Team Leader in full control; Short term high-priority tasks/projects Examples: Product team, special task force Purposes: (1) create recommendation, (2) make or do things, and (3) run things TYPES OF AUTHORITY The delegation of authority is a requisite for effective organizing. It consists of three types. 1. Line authority – a manager’s right to tell subordinates what to do and then see they do it. 2. Staff authority – a staff specialist’s right to give advice to superior. 3. Functional authority – a specialist’s right to oversee lower level personnel involved in that specialty, regardless of where the personnel are in the organization.

Line departments perform tasks that reflect the organization’s primary goal and mission. In a construction firm, the department that negotiates and secures contracts for the firm is a line department. The construction division is also a line of function. Staff departments include all those that provided specialized skills in support of line departments. Examples of staff departments include those which perform strategic planning, labor relations, research, accounting, and personnel. Staff officers may be classified into the following: 1. Personal Staff – those individuals assigned to a specific manager to provide needed staff services. 2. Specialized staff – those individuals providing needed staff services for the whole organization.. A LINE AND STAFF ORGANIZATION President/Gener al Manager

Corporate Planning

Director of Research and

Legal Counsel

Director of Marketing

Director Manufacturing

Director of Finance

Industrial Engineering

Factory Manager

Quality Control Manager

First Shift Supervisor

Second Shift Supervisor

Third Shift Supervisor

Director of Personnel

THE PURPOSE OF COMMITTEES A committee is a formal group of persons formed for a specific purpose. For instance, the product planning committee, as described by Millevo, is ‘’often staffed by top executives from marketing, production, research, engineering, and finance, who work part-time to evaluate and approve product ideas.’’ Committees may be classified as follows: 1. Ad hoc committee – one created for a short-term purpose and have a limited life. An example is the committee created to manage the anniversary festivities of a certain firm. 2. Standing committee – it is a relatively permanent committee that deals with issues on an ongoing basis. An example is the grievance committee set up to handle initially complaints from employees of the organization. Committees may not work properly, however, if they are not correctly managed. Delaney suggests that ‘’it might be useful to set up some procedure to make the committee a more effective tool to accomplish our goals.’’

EFFECTIVE ORGANIZING AND ORGANIZATIONAL CULTURE Organizational Culture - Involves the values and norms shared by managers and associates that influence behavior. It is a powerful force in organizations. - shared set of beliefs, expectations, values, and norms that influence how members of an organization relate to one another and cooperate to achieve organizational goals TYPES OF CULTURES • Strong / Adaptive cultures – values and norms help an organization to build momentum and to grow and change as needed to achieve its goals and be effective • Weak / Inert cultures – Those that lead to values and norms that fail to motivate or inspire employees – Lead to stagnation and often failure over time SOURCES OF AN ORGANIZATION’S CULTURE 1. Characteristics of Organizational Members • Ultimate source of organizational culture is the people that make up the organization • Members become similar over time which may hinder their ability to adapt and respond to changes in the environment 2. Organizational Ethics – Moral values, beliefs, and rules that establish the appropriate way for an organization and its members to deal with each other and people outside the organization 3. Employment Relationship • Human resource policies: Can influence how hard employees will work to achieve the organization’s goals; How attached they will be to it; Whether or not they will buy into its values and norms 4. Organizational Structure • In a centralized organization: – people have little autonomy – norms that focus on being cautious, obeying authority, and respecting traditions emerge – predictability and stability are desired goals • In a flat, decentralized structure: – people have more freedom to choose and control their own activities – norms that focus on being creative and courageous and taking risks appear – gives rise to a culture in which innovation and flexibility are desired goals.

DEVELOPING ORGANIZATIONAL CULTURE

Shared Values

Reinforcing Outcomes

Organizational Culture

Norms

Individual and Group Behavior

Organizational cultures are based on shared values. Culture begins with shared values, which then produce norms that govern behavior. Behavior produces outcomes that are reinforced or punished, thereby bolstering the culture. Thus, any culture, positive or negative, becomes self-reinforcing and difficult to change. The strength of an organization’s culture is based to some degree on the homogeneity of associates and managers and the length and intensity of shared experiences in the organization.