Module Ed 103 (Reporting)

Republic of the Philippines
BATANGAS STATE UNIVERSITY

Pablo Borbon Main I, Batangas City, Philippines 4200
COLLEGE OF TEACHER EDUCATION
Tel. No (043) 980-0385 local 1128
ED 103
Organizational Theories
Learning Objectives
The learners should be able to:
1. Explain Organizational Theories.
2. Differentiate the Sub-parts of Organizational Theories.
ORGANIZATIONAL THEORIES AND APPLICATION

Organizational theory studies organizations to determine the frameworks and
structures that the organization uses to do the organizational functions and
routines. On many accessions organizational theories can also be used for
solving organizational problems. Its main purpose is to maximize efficiency
and productivity, and meet the expectations of stakeholders. Theories about
organizational structure can help in planning for organizational success
considering that these theories may influence how an organization deals with
issues and allocates resources.
1. Classical Organization Theory
Classical organization theory was developed in the first half of the 20th
century as a way of bringing together scientific management, bureaucratic
theory and administrative theory. Scientific management focused on getting the
best people and equipment, and studying each production task. Bureaucratic
theory involved establishing a hierarchy to describe the division of labor in a
company and recognizing the importance of specialization. Administrative
theory worked to establish a set of management principles that applied to all
organizations. One of the criticism of classical organization theory is that
motivation is only a function of economic rewards, like working so good and
so hard for salaries and benefits only.
2. Neoclassical Organization
Theory Improvements in organization theory led to consideration of the
work environment. Productivity improves in an environment with consistency
of values and purpose. Organizations can succeed with a cohesive environment
where subordinates are accepting of managerial authority, like employees are
empowered and given authority to decide on certain things; this system is
useful in the building up of employees' career.
3. Contingency Theory
Contingency theory deals mainly with conflict, which previous theories
considered something to be avoided at all costs. Conflict is unavoidable, but
according to contingency theory it is manageable. Organizations evolve to meet
their own strategic needs in rational, sequential and linear ways. Adapting to
changes in the environment is important to managerial and organizational
success. Managers must be able to make decisions contingent on current
circumstances.
4. Systems Theory
Systems theory describes the interconnection of all parts of an
organization and how one change in one area can affect multiple other
parts.Systems may not always interact in a lineal manner. Small changes in one
part may cause big changes in another part, while large changes in one area
may only result in small changes in another. Organizations act as systems
interacting with their environment. For example, a problem in purchasing
inferior quality of materials can result to a bigger problem in production which
finally affects the ultimate aim of the business-sales. Another. example would
be in marketing research, the right approach in the change of preference in
hand gadgets (Apple). iPhone 6 and 6 Plus made huge sales but it resulted to a
drop in sales of iPad Mini simply because some are already satisfied with the
bigger 6 and 6 Plus screen.
DELEGATION
Delegation of Authority
Delegation of Authority means division of authority and powers downwards
to the subordinates. Delegation is about entrusting someone else to do parts of
manager's job. By description, delegation of authority is the subdivision and sub
allocation of powers to the subordinates in order to achieve effective results.
Elements of Delegation
1. Authority - In context of a business organization, authority can be
defined as the power and right of a person to use and allocate the resources
efficiently. Making decisions and giving orders to achieve the organizational
objectives is part of the definition of authority. Authority should be
accompanied with an equal amount of responsibility. Delegating the authority
to someone else does not imply escaping from accountability. Accountability
still rests with the person having the utmost authority.
2. Responsibility - refers to the duty of the person to complete the task
assigned to him. Responsibility without adequate authority leads to discontent
and dissatisfaction among the person. The middle level and lower level
management hold more responsibility. The person held responsible for a job is
answerable for it. If he performs the tasks assigned as expected, he is bound for
praises. While if he does not accomplish tasks assigned as expected, then also
he is answerable for it.
3. Accountability - Being accountable means being innovative as the
person will think beyond his scope of job. It may include asking the question,
"What is at stake?" Accountability, in short, means being answerable for the
end result, it is something that cannot be escaped and it is arising from
responsibility.
FORMAL AND INFORMAL ORGANIZATION
Formal Organization refers to a structure of well-defined jobs each bearing a
degree of authority and responsibility. It is a conscious determination by which
people accomplish goals by adhering to the standards set by the structure. This
kind of organization is an arbitrary set-up in which each person responsible for
his performance. This type of structure is normally appropriate for matured
organization with considerable number of employees assigned to different
specific jobs.
Examples of Formal Organization:
1. Hospital
2. School
3. Church
Informal Organization refers to a network of personal and social relationships
which spontaneously originates within the formal set-up. Informal
organizations develop relationships which are built on likes, dislikes, feelings
and emotions. Therefore, the network of social groups based on friendships can
be called as informal organizations. Normally, there is no conscious effort
made to have informal organization. It emerges from the formal organization
and it is not based on any rules and regulations as in the case of formal
organization.
Examples of Informal Organizations:

1. Social Networks
2. Clubs
Assessment:
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Republic of the Philippines

BATANGAS STATE UNIVERSITY

ORGANIZATIONAL THEORIES AND APPLICATION

Examples of Informal Organizations:

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