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Deepika Yadav. Show More. No Downloads. Views Total views. Actions Shares. Embeds 0 No embeds. No notes for slide. Departmentation 1. Chhaya Patel Departmentation 2. Meaning of Departmentation Departmentation is the foundation of organisation structure. Departmentation means division of work into smaller units and their re-grouping into bigger units departments on the basis of similarity of features.
Each department is headed by a person known as departmental manager. Division of work into departments leads to specialisation as people of one department perform activities related to that department only. Basis of Departmentation There are two broad forms of organisation structure or departmentation: 1.
Functional departmentation 2. Divisional departmentation 4. Functional Departmentaion It is grouping of activities on the basis of similarities of functions. The nature of activities performed by different organisations is different.
Activities carried by a manufacturing concern are production, finance, personnel and sales. For a trader, the major activities are buying and selling. A bank performs the activities of borrowing and lending. The major functional departments further have derivative departments. Production department, for example, has departments to handle purchasing, production planning and control, manufacturing etc.
Merits of Functional Departmentation 1. Simple and logical basis of creating departments 2. Specialisaton 3. Co-ordination 4. Training and control 5. Supervision 6. Suitable for stable organisations 7. Suitable for small organisations 7. Limitations of Functional Departmentation 1. Overall organisational goals 2. Delayed decisions 3. Holding of accountablity 5. Unsuitable for dynamic organisations 6.
Complexity 8. Divisional Departmentation Divisional structures are created on the basis of smaller divisions where each division has its own functional activities production, finance, personnel and marketing. Major divisions that determine the organisaion structure are 1. Product departmentation 2.
Process or Equipment departmentation 3. Cutomer departmentation 4. Terriority or Geographic departmentation 5. Departmentation by Time 6. Departmentation by Size 7. Departmentation by Task Force 9. Product Departmentation This form of departmentation is suitable for companies that produce multiple products. Product departmentation is grouping of jobs and resources around the products or product lines that a company sells.
The focus is on the product line and all functional activities associated with the product line. Departments are created on the basis of products and product manager has the authority to carry out functional activities for his department. Process Departmentation In manufacturing organisations, where the product passes through different stages of production, each stage is designated as a process and departments created on the basis of processes is called process departmentation.
For each process, departments are created and headed by people who are skilled and competent to carry that process. Merits of Process Departmentation i Specialisation ii Economic considerations iii Technological consideration iv Facilitates training Limitations of Process Departmentation i Co-ordination ii Boredom Customer Departmentation When organisations sell goods to customers with different needs, departments on the basis of customers is the suitable form of departmentation.
Clear identification of customers and their needs is the basis of departmentalisation. Merits of Customer Departmentation i Competitive advantage ii Customer orientation iii Specialisation Limitations of Customer Departmentation i Co-ordination ii Identification of consumer groups iii Change in consumer behaviour iv Specialised staff Geographic Departmentation In territorial departmentation, organisation creates departments i close to its customers because they are geographically dispersed over different areas, or ii near the sources of deposits.
Each geographic unit has resources to cater to the needs of consumers of that area. General Manager of every department looks after functional activities of his geographical area while overall functional managers provide supporting services to the managers of different areas.
Merits of Geographic Departmentation i Training and development ii Customer orientation iii Low cost of production iv Communication Limitations of Geographic Departmentation i Co-ordination and control ii Expensive iii Managerial skills Departmentation By Time This method of departmentation is used in situations where work is done round the clock because — 1. Workers work in shifts; morning, afternoon and night, so that work can progress continuously.
Departmentation By Size This method is followed in army where number of workers in the unit is important. Departmentation By Task Force When organisation takes up different projects, it forms task forces, which consist of people from different units having different skills to carry out those projects. These groups are formed temporarily to work till completion of the project. They are similar to project organisations.
Departmentation by projects