Industrial Management and

Engineering Ethics
Organization and Management Roles
Department of Materials and Metallurgical Engineering

Conducted by
Prof. Dr. Md. Mamunur Roshid

Chittagong University of Engineering and Technology (CUET)

Chattogram-4349, Bangladesh.
 Definitions & Classification
➢ A consciously coordinated social unit, composed of two or more
people, that functions on a relatively continuous basis to achieve a
common goal or set of goals is known as Organization.
➢ An individual who achieves goals through other people is called
Manager.
Usually there are three types of Organization:
Line Organization

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 Line Organization

Merits: Demerits:
❑ Simplest ❑ Over-reliance
❑ Unity of Control ❑ Lack of Specialization
❑ Fixed Responsibility ❑ Inadequate Communication
❑ Flexibility ❑ Lack of Coordination
❑ Quick Decision ❑ Authority Leadership

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Line & Staff Organization

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 Line & Staff Organization

Figure: Structure of Line and Staff Organization

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 Line & Staff Organization

Merits:
❑ Relief to line of executives Demerits:
❑ Expert Advice ❑ Lack of Understanding
❑ Benefits of Specialization ❑ Lack of Sound Advice
❑ Better Coordination ❑ Line and Staff Conflicts
❑ Benefits of R&D ❑ Costly
❑ Training ❑ Assumption of Authority
❑ Balanced decisions
❑ Unity of Action

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 Functional Organization
Characteristics
1. The entire organizational activities are divided into specific functions
such as operations, finance, marketing and personal relations.
2. A complex form of administrative organization compared to the other
two.
3. Three authorities exist-Line, staff and function.
4. Each functional area is put under the charge of functional specialists,
and he has got the authority to give all decisions regarding the function
whenever the function is performed throughout the enterprise.
5. The principle of unity of command does not apply to such organization
as it is present in the line organization.

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 Functional Organization

Merits: Demerits:
❑ Specialization ❑ Poor Coordination
❑ Effective Control ❑ Lack of Command
❑ Efficiency ❑ Difficulty in fixing Responsibility
❑ Economy ❑ Conflicts
❑ Expansion ❑ Costly

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 Delegation of Authority
Delegation of authority means the division of authority and powers
downwards to the subordinate. It is about entrusting someone else to
do parts of your job.
Elements of Delegation
➢ Authority
➢ Responsibility
➢ Accountability

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 Skills of Manager
Technical Skills: It refer to the ability and knowledge of using the
equipment, technique and procedures involved in performing various
managerial tasks.

Human Skills: These are concerned with understanding the people.

Human skills imply the ability to work effectively with other people, both
as an individual and in a group. These are required to win the cooperation
of others and to build effective work teams.

Conceptual Skills: These skills refer to the ability to visualize the entire
picture or to consider a situation in its totality. Such skills help the
manager to conceptualize an environment, analyze the forces working in
a situation and take a broad and far-sighted view of the organization.
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Roles of Manager

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Minztberg’s
Managerial
Role
 Theory of Motivation
➢ Motivation is a psychological process that causes the arousal,
direction and persistence of voluntary actions that are goal
directed.

➢ It is the process by which a person’s efforts are energized,

directed and sustained towards attaining a goal.

➢ Motivation is the result of an interaction between the person

and a situation; it is not a personal trait.

➢ Motivation works best when individual needs are compatible

with organizational goals.
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Theory of Motivation
Maslow’s Hierarchy of Needs

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 Theory of Motivation
MacGregor’s Theories X and Y
➢ Theory X assumes that the workers have little ambition, dislike
work, and avoid responsibility. According to the Theory X, managers
believe the workers are irresponsible and resistant to change, dislike
work, lack ambition and prefer to be led. The main requirement is
close supervision.

➢ Theory Y assumes that workers can exercise self-direction, desire

responsibility and like to work. According to the Theory Y, managers
believe workers are willing to work, imaginative and creative, self-
directed, capable of self-control and accept responsibility. The main
requirement is appreciation and motivation.
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 Theory of Motivation
Herzberg’s Two Factory Theory
Job satisfaction and job dissatisfaction are created by two factors:
Hygiene and Motivators.

Hygiene or extrinsic (environmental) factors create job dissatisfaction.

Hygiene factors are supervision, company policy, relationship with
supervisor, working conditions, salary, relationship with peers,
personal life, relationship with subordinates, status, security, etc.

Motivators, or intrinsic (psychological) factors create job satisfaction.

Motivators are achievement, recognition, work itself, responsibility,
advancement, growth, etc.
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Distinction between Administration and
Management

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 Organizational Structure
➢ Organizational structure refers to how individual and team work
within an organization are coordinated. To achieve organizational
goals and objectives, individual work needs to be coordinated and
managed.
➢ Structure is a valuable tool in achieving coordination, as it specifies
reporting relationships (who reports to whom), delineates formal
communication channels, and describes how separate actions of
individuals are linked together.
➢ Organizations can function within a number of different structures,
each possessing distinct advantages and disadvantages.

***Although any structure that is not properly managed will be plagued with
issues, some organizational models are better equipped for particular
environments and tasks. 1
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 Building Blocks of Structure
1. Centralization is the degree to which decision-making authority is
concentrated at higher levels in an organization. In centralized companies,
many important decisions are made at higher levels of the hierarchy,
whereas in decentralized companies, decisions are made, and
problems are solved at lower levels by employees who are closer to the
problem in question.
where would you feel more comfortable and productive?
❑ Decentralized companies give more authority to lower-level employees,
resulting in a sense of empowerment.
❑ Decisions can be made more quickly, and employees often believe that
decentralized companies provide greater levels of procedural fairness to
employees.

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 Building Blocks of Structure
❑ Job candidates are more likely to be attracted to decentralized
organizations. Because centralized organizations assign decision-
making responsibility to higher level managers, they place greater
demands on the judgment capabilities of CEOs and other high-level
managers.
❑ However, centralization also has its advantages. Some employees are
more comfortable in an organization where their manager
confidently gives instructions and makes decisions. Centralization may
also lead to more efficient operations, particularly if the company is
operating in a stable environment.

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 Building Blocks of Structure
2. Formalization is the extent to which an organization’s policies,
procedures, job descriptions, and rules are written and explicitly
articulated.
Formalized structures are those in which there are many written rules
and regulations. These structures control employee behavior using
written rules, so that employees have little autonomy to decide on a
case-by-case basis.
An advantage of formalization is that it makes employee behavior
more predictable. Whenever a problem at work arises, employees know
to turn to a handbook or a procedure guideline.
Therefore, employees respond to problems in a similar way across the
organization; this leads to consistency of behavior.
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 Building Blocks of Structure
While formalization reduces ambiguity and provides direction to
employees, it is not without disadvantages.
A high degree of formalization may actually lead to reduced
innovativeness because employees are used to behaving in a certain
manner.
In fact, strategic decision making in such organizations often occurs
only when there is a crisis. A formalized structure is associated with
reduced motivation and job satisfaction as well as a slower pace of
decision making.
Example: The service industry is particularly susceptible to problems
associated with high levels of formalization. Sometimes employees who
are listening to a customer’s problems may need to take action, but the
answer may not be specified in any procedural guidelines or rulebook.
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 Building Blocks of Structure
3. Hierarchical Levels
❑ Keeping the size of the organization constant, tall structures have
several layers of management between frontline employees and the
top level, while flat structures consist of only a few layers.
❑ In tall structures, the number of employees reporting to each
manager tends to be smaller, resulting in greater opportunities for
managers to supervise and monitor employee activities.
❑ In contrast, flat structures involve a larger number of employees
reporting to each manager. In such a structure, managers will be
relatively unable to provide close supervision, leading to greater
levels of freedom of action for each employee.
***Research indicates that flat organizations provide greater need
satisfaction for employees and greater levels of self-actualization.
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 Building Blocks of Structure
At the same time, there may be some challenges associated with flat
structures. Research shows that when managers supervise a large number
of employees, which is more likely to happen in flat structures,
employees experience greater levels of role ambiguity—the confusion
that results from being unsure of what is expected of a worker on the job.
This is especially a disadvantage for employees who need closer
guidance from their managers.
Moreover, in a flat structure, advancement opportunities will be more
limited because there are fewer management layers.
Finally, while employees report that flat structures are better at satisfying
their higher-order needs such as selfactualization, they also report that
tall structures are better at satisfying security needs of employees. Because
tall structures are typical of large and well-established companies, it is possible
that when working in such organizations employees feel a greater sense of job 2
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 Building Blocks of Structure
4. Departmentalization: Organizational structures differ in terms of
departmentalization, which is broadly categorized as either functional or
divisional.
Organizations using functional structures group jobs based on
similarity in functions. Such structures may have departments such as
marketing, manufacturing, finance, accounting, human resources,
and information technology.
In these structures, each person serves a specialized role and handles
large volumes of transactions.
For example, in a functional structure, an employee in the marketing
department may serve as an event planner, planning promotional
events for all the products of the company.

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 Building Blocks of Structure

Example of a Pharmaceutical Company with a Functional Departmentalization

Structure

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 Building Blocks of Structure
In organizations using divisional structures, departments represent the
unique products, services, customers, or geographic locations the
company is serving.
Thus, each unique product or service the company is producing will
have its own department. Within each department, functions such as
marketing, manufacturing, and other roles are replicated.
In these structures, employees act like generalists as opposed to
specialists. Instead of performing specialized tasks, employees will be in
charge of performing many different tasks in the service of the product.
For example, a marketing employee in a company with a divisional
structure may be in charge of planning promotions, coordinating
relations with advertising agencies, and planning and conducting
marketing research, all for the particular product line handled by his or
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 Building Blocks of Structure

Example of a Pharmaceutical Company with a Divisional Departmentalization

Structure

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Matrix Structure of a Software Company

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 Organizational Change
Why Do Organization Change?

• Workplace Demographics
• Technology
• Globalization
• Changes in Market Conditions
• Growth
• Poor Performance

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 Resistance to Change

• Active resistance is the most negative reaction to a proposed change attempt.

• Passive resistance involves being disturbed by changes without necessarily voicing
these opinions.
• Compliance involves going along with proposed changes with little enthusiasm.
• Enthusiastic support are defenders of the new way and actually encourage others
around them to give support to the change effort as well.

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 Why Do People Resist Change?
➢ Disrupted habits
➢ Personality
➢ Feelings of Uncertainty
➢ Fear of Failure
➢ Personal Impact of Change
➢ Prevalence of Change
➢ Perceived Loss of Power

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Planning and Executing Change Effectively

Lewin’s Three-Stage Process of Change

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Planning and Executing Change Effectively
❖ Unfreezing Before Change:
✓ Communicating a Plan for Change
✓ Develop a sense of Urgency
✓ Building a Coalition
✓ Provide Support
✓ Allow Employees to Participate
❖ Executing the Change:
✓ Continue to Provide Support
✓ Create Small Wins
✓ Eliminate Obstacles
❖ Refreezing:
✓ Publicize Success
✓ Reward Change Adoption
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 Conflicts
Conflict is process that begins when one party perceives that another
party has negatively affected, or is about to negatively affect,
something that the first party cares about.

Functional vs Dysfunctional Conflict

➢ Not all conflict is bad. Some conflicts support the goals of the group and
improve its performance; these are functional, or constructive, forms
of conflict.
➢ But there are conflicts that hinder group performance; these are
dysfunctional, or destructive, forms of conflict. The criterion that
differentiates functional from dysfunctional conflict is group
performance. If a group is unable to achieve its goals because of
conflict, then the conflict is dysfunctional.
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 Conflicts

Conflict Intensity Continuum

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Strategy to Deal with Conflicts

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