Departmentalization (or simply departmentation) refers to the grouping of This helps the organisation to assign the work only to those who are best suited. Departmentation can provide a necessary degree of specialisation of executive activity for efficient performance. It can simplify the tasks of management within a . In the words of Allen, “Departmentation is a means of dividing a large and monolithic functional organisation into smaller, flexible, administrative units.”.

Author: Nirisar Zulujind
Country: Guinea-Bissau
Language: English (Spanish)
Genre: Video
Published (Last): 27 September 2004
Pages: 317
PDF File Size: 1.45 Mb
ePub File Size: 11.15 Mb
ISBN: 389-9-64575-619-7
Downloads: 57881
Price: Free* [*Free Regsitration Required]
Uploader: Kazrashakar

If necessary, a major function may be divided depxrtmentation sub-functions. In simple words, departmentation is the process of classifying and grouping all the activities of an enterprise into different units and sub-units. A big business enterprise will, usually, have more departments as compared to a small one. For example, a job requires three steps for its completion.

Types of Organisational Designs: While some of the functional activities are decentralised, others are centralised. The production function may be further subdivided on the basis of the process of production when the production process has distinct activity groups, they are taken as the basis of departmentation. There are problems of co-ordination and supervision of employees who work in shifts. Efficiency can be achieved if departments are created for each process as each one has its peculiarities.

What is Departmentalization? definition, objectives and methods – Business Jargons

Product departmentation is suitable for product diversification where marketing characteristics of each product are different from others.

In large organisations, one person cannot look after all the managerial functions planning, organising etc. It becomes necessary to differentiate clearly between the line authority and functional authority of managers.


Similarly, a printing press may have composing, proof reading, printing and binding departments.

This promotes product specialisation which helps in orhanisation growth. While marketing strategies for cosmetics need to be intensive, it is not so in case of stationery or pharmaceuticals. Similarly, funds required for each product line are different. It provides the advantages of specialisation required at each level of the total processes.

Departmentation: it’s Meaning and Definition – Explained!

Soldiers in army are grouped in numbers to form departments. Dividing the business house into various departments makes the co-ordination of various activities very difficult. First the organisation is divided on the basis of functions. He can co-ordinate the efforts of people working under him.

Departmentalisation : Meaning, Need and Types

People working in one department are closely knitted and work collectively towards achievement of departmental goals. Product managers are accountable for results of their product departments. So, in this way, the entire organization is divided into parts, i. Departmentation helps in sharing resources according to departmental needs. Grouping of activities and, consequently, of personnel, into departments makes it possible to expand an enterprise to any extent.

Personal skill and specialised knowledge of the production managers can be fully utilised. If firms establish their areas of operation near the sources of raw material, they will be able to produce at low cost and take depratmentation of economies of operation.

Accounting Banking Business Business Statistics. Large organisations, where each process requires different technology, operate most suitably under process departmentation. Flow of work from one level to another and for every department, i. In the absence of departmentation, managers can supervise a limited number of activities, depending upon their skills and abilities. Thus, customers of different regions with different tastes and preferences for departmentatio same product are looked after by ogranisation departments set up in their territories.


It is obviously not possible for one functional manager to manage efficiently such widely spread activities.

Here, the market is broken up into sales territories and a responsible executive is put in charge of each territory.

Rather than A a worker handling step 1, B handling step 2 and C handling step 3, A may carry out all the steps on product X, B carries out the same set of steps for product Y and C for product Z. Grouping of activities into departments is necessary part of the process deparrmentation setting up organisation, whenever enterprise expands beyond the size that cannot be effectively managed by one person.

If workers are not able to carry out the activities efficiently, managers can train them to do so. There should be some agency to co-ordinate the activities of various departments. The goals of the business are common and everybody should try to achieve them in their respective fields.

Product departmentation is grouping of jobs and resources around the products or product lines that a company sells. Sales people understand consumer behaviour and provide them the desired services. This departmmentation possible through shift duties.