GENERAL HISTORY OF INDUSTRAL PSYCHOLOGY Industrial psychology is a relatively recent subfield of psychology. In fact it did not become fully productive until about the late 1920’s. The industrial side of industrial psychology has its historical origins in research on individual differences, assessment, and the prediction of performance. This branch of the field crystallized during World War I, in response to the need to rapidly assign new troops to duty stations. After the War the growing industrial base in the U.
S. added impetus to industrial psychology. Walter Dill Scott, who was elected President of the American Psychological Association (APA) in 1919, was arguably the most prominent I-O psychologist of his time, although James McKeen Cattell (elected APA President in 1895) and Hugo Munsterberg (1898) were influential in the early development of the field. Organizational psychology gained prominence after World War II, influenced by the Hawthorne studies and the work of researchers such as Kurt Lewin and Muzafer Sherif.
Before the late 1920’s many people had started to improve the workplace. Differential psychology, which became popular during World War I, was the start of improving the workplace. It focused in on how people are different but was not very successful in helping with ones job. The second idea was experimental psychology. This branch attempted to treat everyone as the same and tried to define laws in how people are similar. It too failed. The third idea was scientific management. This was the idea that there is only “one best way” to perform a job.
It was based on the fact that money is a motivator and left out the idea of job satisfaction. The last factor that helped industrial psychology become prominent was the human relations movement. This particular movement wanted to keep people happy through motivation along with job satisfaction. It also led to the Hawthorne Studies, which was the true start of industrial psychology. The Hawthorne Studies were conducted from about 1927-1932 by Elton Mayo at the Western Electric Company.
Some results that came out of this study were that a workplace must be seen as a social system not just a productive system, that including workers in decision making process can reduce resistance to change, and that individual work behaviour is determined by a complex set of factors. In the USA, initial activity in industry by psychologists was in advertising; however, employee selection then became the major focus. As a result of the training in experimental psychology, early industrial psychologists used a quantitative, scientific approach for selection that emphasized empirical verification of the effectiveness of their interventions.
In January 2010, the Society for Industrial and Organizational Psychology (SIOP) announced that, as a result of membership vote, it would retain its name and not change it to the Society for Organizational Psychology (TSOP) to eliminate the word “Industrial” THE IMPORTANT PEOPLE IN THE HISTORY OF INDUSTRIAL PSYCHOLOGY Hugo Munsterberg – Hugo Munsterberg (June 1, 1863 – December 19, 1916) was a German-American psychologist. He was a pioneer of applied psychology, extending his research and theories to legal, medical, clinical, educational, and business settings.
He is considered by many “the father of industrial psychology,” whose work in this area paved the way for the modern industrial-organizational psychology. His research on eyewitness testimony set up some fundamental insights in forensic psychology. There, he brought attention to the role of experience and memory on the perception and recall of events, showing that different people will describe the same event quite differently. Munsterberg created a series of mental tests and job questionnaires to test the applicants’ knowledge, skills, and abilities.
He also conducted research on several different occupations, seeking evidence for a correlation between mental tests and job performance. One of the results of his research was that there was a negative correlation between job efficiency and worker’s talking on a job. Munsterberg suggested a re-arrangement of the workplace to increase difficulty for workers to talk to each other, which in turn increased job productivity Munsterberg called for the creation of an independent science—industrial psychology—which would use insights from psychology to create a better atmosphere in the workplace, higher job efficiency, and greater job satisfaction.
Frederick Winslow Taylor: (March 20, 1856 – March 21, 1915), widely known as F. W. Taylor, was an American mechanical engineer who sought to improve industrial efficiency. A management consultant in his later years, he is sometimes called “the father of scientific management. Robert Yerkes – (May 26, 1876 – February 3, 1956) was a psychologist, ethnologist, and primatologist, best known for his work in intelligence testing and in the field of comparative psychology. Yerkes was a pioneer in the study of both human and primate intelligence, and of the social behaviour of gorillas and chimpanzees.
Yerkes worked with John D. Dodson to develop the Yerkes-Dodson Law relating arousal to task performance. The Yerkes National Primate Research Centre, which he established, is named in his honour James McKean Catelli: (May 25, 1860 – January 20, 1944), was an American psychologist, the first professor of psychology at the University of Pennsylvania. His work on mental testing helped establish psychology as a legitimate scientific discipline. Catelli not only developed the experimental aspects, through establishing a laboratory, he also began several scholarly journals for the publication of quality research.
After being dismissed from his academic position at Columbia University due to his opposition to American involvement in World War I, Catelli pursued his writing and development of applied psychology. Catelli’s work is significant in that he helped lay the foundation for the development of advances in understanding human nature. George Elton Mayo (December 26, 1880 – September 7, 1949) was an Australian-born American psychologist and sociologist. He is famous for the Hawthorne studies, which examined the effects of social relations, motivation, and employee satisfaction on factory productivity.
This work was a landmark in industrial psychology. Despite later criticisms of the validity of his results, Mayo’s work introduced the idea that the external factors (lighting, temperature, and so forth) were of lesser significance in determining productivity levels of workers than the social factors (such as work group relationships and feelings of belonging). Mayo and others extended this idea into larger social organizations, greatly enriching theories of management. Kurt Zadek Lewin (September 9, 1890 – February 12, 1947), was a German-born psychologist, one of the pioneers of contemporary social psychology.
He advocated Gestalt psychology and is well known for his development of the concept of the psychological “field,” or “life space,” within which each person lives and acts. Lewin believed that in order to understand or predict human behaviour, it was necessary to consider the totality of their life space. In this way, Lewin proposed that people develop understanding of their world, physical, mental, and social, through continuous interaction between their existing memories, desires, and goals and their environment.
Lewis also initiated the notion of “action research,” which involves a cycle of reflection on the results of planned action leading to improved planning and more effective behaviour. His work on group dynamics led to greater understanding of the relationship between attitudes (and prejudice) and behaviour, bringing hope that through a dynamic process of modifying the environment and the behaviour of individuals, that humanity can break down the barriers that divide different groups of people and learn to live in harmony.
HISTORY OF INDUSTRIAL PSYCHOLOGY IN AMERICA A significant era in what we might call personnel or industrial psychology started with major research efforts funded by the Army in World War I. Then-APA president Robert Yerkes, working with an Army grant, developed the Army Alpha test for screening and assigning literate army recruits, then later the Army Beta test to serve the same need for illiterate candidates. During the same period, Walter Scott focused on methods for classifying and assigning recruits into job categories.
He conducted performance ratings of officers and developed job qualifications standards for more than 500 jobs. These efforts gave credibility to industrial psychology that not only captured the attention of the military but also the business community. During World War II, many psychologists were brought into the Army to help with the war effort. The results of their research were eventually published in a series of 19 Army Air Force Aviation Psychology Program Research Reports.
Most of these were published from 1946 to 1948 and dealt with the core issues of industrial psychology, including classification tests, pilot, navigator, and bombardier selection and training, and equipment design. Many of these psychologists were already, or later became, leaders in the field, such as John C. Flanagan, Robert L. Thorndike, Paul M. Fitts, Arthur W. Melton, and Edwin E. Ghiselli. These volumes are an exciting contribution to the fields of industrial and human factors psychology.
In particular, report number three, Research Problems and Techniques by Robert Thorndike (1947), has served as a reference for much of the research in job analysis and test construction, because it explores problems associated with reliability, validity, and criteria. The US Air Force became a separate service in 1947 and has since been actively involved in all areas of psychological research. During the 1960s and 1970s, the Air Force had an active partnership with Purdue University, where I received my PhD.
This relationship involved sending Air Force officers for master’s and doctoral education in human factors engineering and industrial psychology. Graduates of the human factors engineering program have assisted the Air Force in design of aircraft, missile, and electronic systems, and have served as USAF Academy instructors. A large percentage of those receiving degrees in industrial psychology ended up at the Air Force Human Resources Laboratory. AFHRL was headquartered at Brooks Air Force Base and consisted of six research divisions.
The computational sciences division provided computer support for all of the other divisions. The personnel research division was involved in attitudinal, selection and classification, and development and evaluation research. The third division focused on occupational and manpower research. The remaining three divisions were the flying training division, the technical training division, and the advanced systems division, which researched personnel requirements and simulation techniques. Unfortunately, AFHRL was abolished as a laboratory during the 1990s.
Some of its functions were transferred to other bases. One of its major functions was job analysis research. Today that capability is very active at the Air Force Occupational Measurement Squadron, which employs the majority of individuals considered industrial psychologists in the Air Force. The remaining behavioural scientists – industrial psychologists included – are employed by either the USAF Academy or the Air Force Research Laboratory. These impressive organizations have made significant contributions, not only to industrial psychology but to behavioural and social science in general.
HISTORY OF INDUSTRIAL PSYCHOLOGY IN EUROPE It is a little known fact that industrial psychology was well established in the early years of the Soviet Union and that by the late 1930s, as a result of a political campaign, it was almost completely destroyed. This article outlines the development and the decline of Soviet industrial psychology and attempts to put these events in their political, economic, and cultural context. The Russian Civil War that followed the Bolshevik revolution of 1917 lasted until 1921.
During this period, an economic policy of War Communism was implemented, heavy industry was nationalized, and all private enterprise abolished. After the war was over, Soviet Russia struggled to rebuild its ruined economy. Vladimir Lenin, Leon Trotsky, and other Bolshevik leaders believed that rapid industrialization and modernization was a matter of life and death for the vulnerable new regime. As the New Economic Policy was implemented in 1921, ideological restrictions were relaxed and many Western ideas were adopted to facilitate economic development.
Inspired by Ford and Taylor’s ideas of efficiency and scientific management, Russian workers were encouraged to develop better work habits. Western ideas of “scientific organization of labour” or NOT, according to its Russian acronym, were widely popularized among the new members of the proletariat, many of whom until recently were semi-literate peasants. In 1921, with support of Lenin and Trotsky, Aleksei Gastev (1882–1938), an enthusiastic devotee of “Taylorization,” established the Central Institute of Labour or CIT.
One of the utopian goals of Gastev’s institute was the creation of the new “Mechanized Man”—the perfect industrial worker. This was to be accomplished through increasing labour efficiency, developing new training methods, and improving industrial design. Several scientific laboratories were established to investigate psychophysical process involved in industrial production jobs. Among the scientists conducting experimental research at CIT was Isaac Shpilrein (1891–1937). Shpilrein was a Russian-born, German-educated psychologist, who studied with both Wilhelm Wundt and William Stern.
Shpilrein was well familiar with Stern’s concept of psycho technique, which, similarly to Munsterberg, he defined as application of psychological methods to solving real-life problems. Shpilrein believed that work practices grounded in psychological research (rather than Taylorism) were the way to achieving Russia’s economic objectives. Following Stern, Shpilrein was an advocate of individual difference assessment as a selection and placement method. After leaving the Central Institute of Labour in 1922, Shpilrein became the undisputed leader of Soviet industrial psychologists.
He conducted original research, kept in contact with American and European colleagues, and mentored the new generation of industrial psychologists. By late 1920s, hundreds of specialists-psychotechnics employed in a variety of laboratory and industrial settings were conducting field and lab research in selection, placement, training, accident prevention, industrial design, and fatigue reduction. In 1927, the All-Russian Society of Psychotechnics and Applied Psychophysiology was formed. By 1931, the society had 1,020 active members.
Morris Viteles, the noted American psychologist, visited Russia in 1934 and observed the striking resemblance between the scope and methods of Soviet industrial psychologists and their Western colleagues. He also felt that “this progress was a tribute to the sincerity and integrity of Russian scientists who must struggle…against the intolerance of a political creed and system which denies to them the freedom of thought and opinion that is basic to real accomplishment in every field of science” (Viteles, 1935, p. 103).
This statement proves that Viteles was an astute observer. As Soviet industrial psychology was gathering momentum, the country was undergoing a political sea change. Soon after it began, however, the period of relative intellectual and scientific freedom was coming to an end. From 1928 on, following the defeat of Trotsky’s opposition, Stalin began seizing absolute power and building an isolated totalitarian society that had no more patience for dissent. The implementation of Five-Year Plans called for centralized command and control economic methods.
This trend was also manifested in the increasingly vigilant ideological oversight of science and education. In the early 1930s, Soviet industrial psychologists began to feel a growing pressure to distinguish themselves from the “bourgeois” psychologists in the West. This led to some awkward moments during the 7th International Psychotechnic conference in September of 1931 in Moscow as Shpilrein criticized William Stern, who was in the audience. Industrial psychologists’ attempts to adapt to the Marxist model of science did not save them from being repeatedly criticized in the Soviet press.
Their many accomplishments forgotten, psychologists were being accused of conducting counterrevolutionary research, especially where individual differences were concerned. In 1935 Shpilrein was arrested as a “Trotskist,” sent to GULAG, and later executed. Alexi Gastev shared his fate. The final blow was delivered in the fall of 1936 in the form of the decree of the Central Committee of the Communist party that accused psychotechnics of such “perversions” as misusing psychological testing in industry and education and reliance on non-Marxist research methods.
Virtually any kind of psychological assessment and individual differences research became taboo. Soon after, the Psychotechnic Society was dissolved, most research laboratories closed, and educational efforts seized. Many industrial psychologists lost their jobs in education and industry and had to find employment in other areas. Industrial psychology was not completely cleared of its counterrevolutionary label until the 1960s. HISTORY OF INDUSTRAIL PSYCHOLOGY IN AFRICA Industrial psychology has a long and dynamic history in South Africa. The contribution of South African psychologists to the world of work can be traced back to World War II.
During this time, R. W. Wilcock’s development of intelligence and special aptitude tests, P. R. Shawran’s early work on the selection of pilots for the armed forces, and I. D. MacCrone’s study of racial attitudes in South Africa were significant contributions (Raubenheimer, as cited in Muchinsky et al. , 1998). Subsequent work conducted by the Human Sciences Research Council (HSRC) in the late 1940s further advanced I-O psychology in South Africa. This work focused primarily on the development of psychometric instruments used in many different fields.
Additional contributions were made in J. G. Taylor’s work on the behavioural basis of perception; H. F. E. Renning’s studies of the abilities, temperament, interests, and creativity of the Kalahari Bushmen; W. Hudson’s studies of the perceptual abilities of Blacks; J. Wolpe’s and A. Lazarus’s work in the field of behaviour therapy; F. W. Blignaut’s study of alcohol addiction in white mice; and S. Biesheuvel’s research on the intelligence and abilities of different population groups in South Africa (Raubenheimer, as cited in Muchinsky et al. , 1998).
Over the last 3 decades, industrial psychology in South Africa has grown at a remarkable rate. Almost all universities have industrial psychology departments in addition to their psychology departments. These departments were established in the 1960s and 1970s. The popularity of industrial psychology as a field of study has increased enormously over time. In 1972, only 3,147 students studied industrial psychology at South African universities, but by 1997 about 12,000 undergraduate students in I-O psychology were enrolled at the University of South Africa (Unisa) alone.
Management Skills Knowledge And Attibutes
The rapid pace of change in the world of management necessitates that managers adapt to meet emerging challenges. Effective leadership of a Learning Focused Organisation in the 21st Century requires specific skills, knowledge, and attributes (SKAs). This text will explore ten SKAs and provide evidence of their importance for managers in a fast-paced world.
Communication skills are vital for managers in today’s organizations. These skills include listening, speaking, and sharing knowledge at all levels. Infante et al (1995, pp 307) emphasize the importance of tools that promote openness, dialogue, and honesty in a multicultural and evolving organization. Additionally, relationship building is crucial for managers to establish and maintain quality contacts that provide access to resources for developing a Learning Focused Organization.
According to Jacowski (2008), it is crucial to develop long-term relationships with individuals in similar industries as they can offer valuable services to an organization in the future. Additionally, Brooks & Schofields (1995, p4) emphasize the importance of time management skills by stating that “time equals money,” and without effective management, both time and money can quickly be consumed and appear to vanish. Measuring the time spent on specific tasks through estimation, questioning, and interviewing can result in saving money and reducing the overall time required for market readiness (Brooks & Schofields, 1995).
In order to develop a Learning Focused Organisation in the 21st Century, it is essential to allocate time, money, and resources. According to Carlopio et al (1997), managers in this era need problem-solving skills to handle constant change. Problem solving skills can be developed through four steps: defining the problem, generating alternative solutions, evaluating and selecting an alternative, and implementing and following up on the chosen solution (Carlopio et al, 1997, p169). Additionally, conflict resolution skills are crucial for managers in the 21st century due to a multicultural workforce that impacts outcomes (Liu & Chen, 2002,p170). Culture plays a role in determining values, interests, perceptions, and the selection of alternatives (Liu & Chen, 2002,p170). Maintaining team spirit requires promptly and effectively dealing with minor conflicts (Knutson, 2001). Overall, managers must be prepared to anticipate and adapt to change.
Managers must be prepared to adapt to constant change in order to meet the needs of customers, stakeholders, and the global landscape (Hermens, 2009, p16). In today’s rapidly changing world, an organization’s survival depends on its ability to quickly respond to these changes. This requires managers to possess flexibility, adaptability, and readiness for change (Hermens, 2009, p16).
In addition, managers play a role in promoting innovation within their organizations in order to stand out in fast-changing markets with rapidly evolving technology. According to Johne (1999), businesses that aim to compete in such markets must take a proactive approach and drive innovation (Johne, 1999, p7). Innovation can contribute significantly towards an organization’s competitive advantage (Sexton, 2003).
In the context of the 21st century
, self-development and continuous learning are crucial for managers as they strive to keep up with the rapid pace of change and ensure their organizations do not lag behind.
According to Jacowski (2008), a successful manager must be able to adapt to industry changes and guide their company in making seamless changes to stay ahead. Jacowski emphasizes the importance of continuing education and learning from the mistakes of other businesses.
In the 21st century, rapid technological advancements have significantly changed the way managers operate within organizations. This has resulted in increased interconnectedness among markets and organizations. Hunt (2001) highlights the impact of the internet and intranet in facilitating communication and knowledge sharing, as well as enabling more home-based work opportunities.
The installation of satellite technology in corporate meeting rooms for videoconferencing has decreased the need for in-person communication and the expenses associated with travel (Hunt J, 2001 p8). Additionally, forward-thinking managers who embrace creativity and innovation play a crucial role in redefining organizational practices. Toffler revolutionized the understanding of societal transformation by introducing the concept of three waves of change and highlighting the significance of information and knowledge as primary drivers for organizations in the 21st Century.
According to Peters (1996), the 4th Wave, Creation Intensification, involved organizations creating imaging to associate with a specific brand. For example, Coca Cola created the imagery of ‘Coke is Life’ to appeal to customers (Hernens, 2009, p18-19). The ambition to be a leader is described as “the inner fuel that helps drive people toward their vision” (Davis, 2008). While managers need to possess a variety of skills, knowledge, and attributes (SKAs) to perform their job effectively, it is impossible to be proficient in all of them. In this text, the writer will discuss three managerial qualities that can be improved within her organization.
Creating a team-focused work culture, self-development, and education to improve leadership skills and verbal communication are emphasized in the Hospitality Industry. According to Worral and Cooper (2000), interpersonal skills, teamwork, coaching, and counseling have been given lower priority by managers. In today’s world, a successful manager must be able to collaborate with peers to achieve customer satisfaction, enhance reputation, and retain employees (Smikie, 2009). The hospitality industry is a demanding customer service-oriented industry. At L’Aqua, the manager aims to foster teamwork among staff to provide exceptional and memorable customer service. The Toyota theory, still relevant in the 21st century, highlights the benefits of creating a culture that values teamwork and encourages interaction within the organization.
Within L’Aqua, the use of this concept and interpersonal “soft” skills aims to foster personal growth, create a team culture, and work together for the customer’s benefit, ultimately promoting organizational prosperity. According to Liker (2006, p.35), it involves people actively working, communicating, resolving issues, and growing together. Mintzberg (2006 p5) further suggests that effective leaders are those who engage with others.
The theory will be put into action by conducting group training sessions, which aim to enhance group communication and feedback while also offering service guidelines. This approach is intended to establish a common understanding of the organizational culture and service expectations amongst all staff members. The objective is to enhance the quality of service provided to patrons, with constant monitoring and management involvement at all levels to ensure consistency. As Shark (1998) asserts, ongoing education and training for all employees are vital in achieving high-quality standards.
Shark (1998) emphasizes the significance of monitoring and evaluating a team’s success in attaining organizational objectives. L’Aqua will assess this by utilizing surveys, conducting staff briefings, and implementing Total Quality Management. Doige and Whitchurch (1993) apply TQM principles to the public sector, emphasizing the need for continuous improvements toward aspirational goals, a customer-centric approach, and commitment at all levels of management. This feedback can contribute to enhancing managerial practices.
L’Aqua utilizes customer surveys to assess performance and quality, with the information gathered being communicated to the manager and subsequently relayed to the team. Positive feedback is provided for effective teamwork, while improvements are implemented as needed. By collecting and utilizing this feedback, the organization is able to make necessary adjustments and changes, thereby embodying the principles of a double loop learning organization (Hermens, 2009, p50-51). Self-development and education are essential for individuals aiming to enhance their leadership skills. The methods of management instruction have evolved over time in response to changing industries.
Today, in the 21st century, with the increasing desire for self-improvement, it is crucial for an organization to have a skilled and well-established management team leading the way (Heames & Harvey, 2006, p. 29). A study conducted in 1995 revealed that managers lacked formal training, with few receiving any additional managerial development. Among major trading nations, Australia had the lowest percentage of managers holding tertiary qualifications. Failing to promote qualifications and education among managers is a significant disadvantage (The Karpin report, 1995).
On-the-job training and university education are two types of training that the writer has undergone. There is a lot to learn in order to become a successful executive in today’s diverse global market, and there are various approaches to acquiring knowledge. Gaining first-hand experience in a leadership role is a beneficial way to develop executive skills, as it allows individuals to learn by doing (Heames & Harvey, 2006, p. 39). The venue manager of L’Aqua did not receive formal management training, but instead acquired the necessary skills, knowledge, and attributes (SKAs) on the job through guidance from senior management, everyday interactions with people, and trial and error.
Lawson (1997, p55) argues that on the job training offers the advantage of enabling workers to promptly showcase their newly acquired or improved skills. The Karpin report revealed a disparity between the functional expertise of Australian managers and that of the workers they supervise. However, if managers commence training alongside their subordinates, a better comprehension of task functionality can be achieved. To remain competitive in the marketplace and maintain professional currency, it is essential to consider training and professional development opportunities for both staff members and managers.
The writer hopes to acquire knowledge during their time at University which they can then use to fill any gaps in the organization they join. L’Aqua plans to encourage more interaction among peers, recognize and embrace multiculturalism, lead by example, utilize measurement techniques like Total quality management, and build a team based on Toyota’s theory to help facilitate the process of change. According to Smikie (2009, p.29), the philosophy is to “develop yourself, then be yourself” as staff will eventually catch on.
Acquiring knowledge can result in changes in managerial practices. This knowledge can be obtained through various means such as reading, discussing with colleagues, and maintaining journals. It is crucial to evaluate and analyze this knowledge in order to make enhancements. By engaging in self-reflection and analysis, managers can cultivate the capacity to listen, learn, reflect, and acknowledge errors (Smikie, J. 2009). Effective verbal communication is a vital skill for managers at all levels of an organization in the 21st century – whether it involves customers, employees, or top management.
According to Clegg (1998, pp 429), in Australia, where multiculturalism is thriving, it is essential to demonstrate respect for cultural values and beliefs when conversing with others. Communication should be frequent and encompass both informal and formal tones. In the hospitality industry, personal differences and multiculturalism are highly valued, with oral interactions being predominant. It is crucial to establish a shared language that is acceptable and respectful to everyone. Knutson (2001 pp44) found that effective verbal communication strengthens team building by facilitating the exchange of experiences and knowledge.
Team briefing can be used by L’Auqa as a way to communicate information to employees and promote a team culture (Infante et al, 1993, pp 309). According to Kitchen & Daly (2002, pp50), communication is considered vital for successfully implementing change. Effective communication can impact employee performances. Infante et al (1993, pp 710) argued that managers who communicate in a friendly manner, are less argumentative and aggressive, and provide valid reasons for implementing changes have a positive influence on employee performance.
To promote employee performance and encourage teamwork at L’Aqua, it is crucial to utilize effective communication techniques. These include maintaining a calm and supportive approach, being friendly and attentive, and demonstrating enthusiasm. In modern organizations that prioritize continuous learning, managers must possess a diverse set of skills, knowledge, and qualities in order to thrive. Regular training is vital for managers to enhance their skills, knowledge, and attitudes (SKAs), enabling them to effectively communicate changes to employees and cultivate a united team for the organization’s future.
Departmentation: Management And Example
Departmentation (Grouping) -One reason organizations exist is to do things that would be hard for one person to do by themselves. For example, it’s hard to conceive of one person building an office building. Instead, we have organizations of thousands of people with diverse skills that work together to build buildings. However, coordinating, controlling and just keeping track of a lot of individuals introduces its own problems. One way to solve these problems is to create a hierarchical system of supervision, so that small groups of workers (up to say, 50 people) are supervised by coordinators (managers).
Depending on how many people there are in the organization, the coordinators themselves need to be organized into groups supervised by higher level managers, and so on. Part and parcel of this hierarchical supervisory system is the cutting up of the organization into groups (departments). The question arises: On what basis should we carve up the members of the organization into subunits? What would happen if we did it randomly, without regard for tasks? One problem would be that each manager would have to be aware of what needed to be done in every area of the organization, in order to direct his/her workers.
This would be impossible in most cases. Common Bases for Departmentation What organizations actually do is group people in a way that relates to the task they perform. This still leaves a lot of possibilities. Here are six common bases for departmentation: 1. Knowledge and Skill. People are grouped by what they know. For example, hospitals have departments like Neurology, Allergy, Cardiology, Internal Medicine, Gastro-Enterology, etc. 2. Work Process. Workers are grouped based on the process or activity used by the worker.
For example, a manufacturing company may create separate casting, welding and machining groups. Often, it is the underlying technology that determines the departmentation. For example, a print shop may have separate letterpress and offset departments — two different processes for getting the same outputs. 3. Business Function. Grouping by the basic function in the organization: purchase supplies, raise capital, generate research, etc. This leads to the familiar departments of manufacturing, marketing, engineering, finance, and so on. 4. Time.
When work is done. For example, shifts in a factory or hospital or hotel. 5. Output. Grouping based on the products or services that the employee works on. For example, a manufacturer may have different divisions for each of its product lines. 6. Client. Grouping based on the type of clients their work is ultimately sold to. For example, computer companies often have different sales departments for home, small business, educational, government and large business customers. 7. Place. Groups are based on the geographical areas that they serve.
For example, during WW2, the US War Dept. was organized into 7 “theatres” corresponding to regions of the world where the US was fighting. Similarly, Post Offices are often divided by regions and zip codes. By function: A collection of collections and a specialization of organization type. Each instance of type of department by function is a collection of Departments (q. v. ) whose instances are distinguished by the fact that they perform a certain function for an organization (e. g. budget department and shipping and receiving department).
Employees with similar jobs (functions) are grouped together. e. g. production, financing, marketing and human resources. Advantages: • Employees can specialise and become experts in certain areas. • Simplifies tasks – each employee works with only one task or skill so it is easier to hire people. • Can be very cost efficient. By product: The purpose of product departmentation is that every product is handled by separate management team and the problems faced in the development of a product are carried out by single group of employees working in that unit.
The disadvantage is that the product managers need to coordinate with each other for the resource sharing which becomes a difficult process because of lesser communication between the product divisions. Sometimes, products of the same company start competing which results in snatching one division profit from other division leaving behind net profit for the company zero. However this kind of structure works best in the big organizations which have lots of products in their product portfolio.