Departmentalisation: Meaning, Need and Types

Meaning of Departmentalisation

The act of dividing an organization’s activities into numerous units for the purpose of administration at all levels is known as “departmentation” or “departmentalisation.”

The units thus formed may be designated as departments, divisions, branches, sections, or any other form. Organizing is the process of dividing and classifying tasks in a business and assigning various responsibilities and obligations to different people.

Dividing the work naturally implies the recognition of separate activities that must be completed in order to attain corporate goals. After that, the numerous operations should be organized together on some logical basis so that a team can be formed. For effective performance, departmentation may be required to provide a specific level of expertise in executive function. It can make managing easier by reducing the amount of time it takes and by streamlining operations. It also provides a foundation on which senior executives may collaborate and control departmental units’ activities.

Need for and Importance of Departmentation

The fundamental function of departmentation is to make the size of each departmental unit manageable and secure the benefits of specialization. Grouping tasks and people together into departments allows an organization to grow at any rate.

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Departmentation is necessary on account of the following reasons:

Advantages of Specialisation

The advantages of specialisation can be obtained through departmentation. When each department is responsible for a single major activity, the company grows and efficiency of operations improves.

Feeling of Autonomy

Departments are generally founded in businesses with certain levels of autonomy and freedom. Within the overall plan of the business, a departmental supervisor has the authority to make autonomous decisions. The sense of independence engenders job contentment and motivation, which results in improved operational efficiency.

Expansion

A small number of workers might only be supervised and directed by one manager. The ability to expand and develop is made possible through departmentation.

Fixation of Responsibility

Each person in the organisation thus knows his personal function in the whole structure. The management of results may be more precisely defined, clearly and accurately, as well as responsibility for performance being assigned to specific individuals.

Upliftment of Managerial Skill

Supervision aids in the development of managerial skills. Two reasons explain why this occurs. First, managers direct their attention to some specific challenges that allow them to acquire on-the-job training. Secondly, since the managers’ tasks are defined, it is simple to determine whether they need more education.

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Facility in Appraisal

When specific responsibilities are entrusted to departmental workers, the appraisal of managerial performance becomes much easier. When the areas of activity are defined and the performance criteria are established, managerial excellence can be measured. In both cases, departmentation is available to assist you.

When a larger function is broken down into smaller parts and each manager has his or her own part, the area to be evaluated is easy to see; and factors that influence performance may be identified more readily. Similarly, because the elements affecting workplace performance can be recognized clearly, performance evaluation becomes more successful.

Administrative Control

Supervision is the practice of dividing a large and complex organization into small administrative units. Administrative control is facilitated by grouping activities and personnel into manageable units. Each department’s standards of performance can be precisely set.

Types of Departmentation

Departmentation has several foundations. The most frequent bases are function, product, territory, process, customer, and time.

Advantages

Functional departmentation has several advantages, including the following:

It is the most natural and reasonable form of departmentation.
It guarantees the successful completion of all activities required to meet the company’s goals.
It promotes job specialization, allowing for maximum use of human resources.
It is a useful tool for delegating power.
The point of a matrix structure is for the most powerful executives to have direct control over key activities, while still allowing others to manage other functions.
It eliminates the duplication of tasks.
The managers are limited to a specific set of abilities when compared to skilled professionals.
This makes it easier to teach since managers will only be experts in a limited field of knowledge.

Disadvantages

Functional departmentation has several drawbacks. The following are some of the drawbacks associated with functional departmentation:

There may be disputes between departments.
There is little opportunity for managerial development.
Top-level management trainers are nonexistent. The burden of success cannot be placed on the shoulders of any one functional head.
There is an overemphasis on specialization.
Coordinating the operations of several departments may be difficult.
There may be issues with slow response times and high overhead.

Departmentation by Products

Every major product is assigned to a distinct department in the product organization. One product is managed by each department, which oversees production, sales, and financing of one item. When the expansion, diversification, manufacturing and marketing features of each product are most important, using departmentation is beneficial.

It’s frequently employed in industries like automobile and electronics, where the manufacturing line is complicated and varied, necessitating specialized expertise and substantial investment in plant, equipment, and other facilities.