Advantages Of Departmentalization

Departmentalization is the grouping of job positions into departments and the department into the entire organization. There are many ways this can occur in an organization. This will depend if the organization is big, small or a multinational corporation.

Network approach to departmentalization

This is the newest from of departmentalization. This involves subcontracting major functions of an organization to third party organizations. The sub contracted functions will be controlled and coordinated from a central hub. This will mean that organizations can focus on what they do best and they will be able to outsource the rest. Well known Call Center Solution is a very popular form of outsourcing business activities. Organizations should look for ones that build and give a very unique and very special customer experience because this will build your brand and increase customer loyalty for your products and services.

IVR services are used here and it allows the employees to free themselves for more lucrative activities. These services are able to handle a large volume of calls.

Small firms find that this type of approach to departmentalization is very useful because they are able to reach a large market for their products at a lower cost by using outside distributors and manufacturers. Organizations will gain global expertize and they will be able to reduce their administrative costs.

Vertical function approach

This is the most basic form of departmentalization and it is occurred based on similar skills, knowledge and resource use. This is also useful for small organizations and they will benefit from an efficient use of resources and from centralized authority. However there won’t be any coordination across functional departments and the organization won’t be able to respond to the changes in the external environment. View this page for further information regarding Telephone Recorder.

Divisional approach to departmentalization

This is the grouping of business positions into departments based on geography, product or service. This is sometimes called the programmed approach. Here the problems will be solved between departments and this will lead to decentralization in departments. This is a very useful structure for large companies. Decisions can be made faster because of the decentralized decision making the so organizations will be able to respond to problems faster.

Horizontal matrix approach

This is a combination of the vertical function approach and the divisional approach. Here one employee will have to report to two bosses. This is mainly used in multinational cooperation’s. There will be a problem for employees who have to report to two bosses, they will require human relations training to deal with it. Employees will be more motivated because of enlarged tasks.