Fundamentals of Management, 8th ed

186

Part 3: Organizing

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will be grouped back together into logical departments,

and how authority and responsibility will be allocated

across positions.

Instructions: Assume that you have decided to open a

handmade chocolate business in your local community.

Your products will be traditional bars and novelty-shaped

chocolates, truffles, other chocolate products such as ice

cream, and gift baskets and boxes featuring chocolates.

You have hired a talented chef and believe that her exper-

tise, coupled with your unique designs and high-quality

ingredients, will make your products very popular. You

have also inherited enough money to get your business

up and running and to cover about one year of living

expenses (in other words, you do not need to pay yourself

a salary).

You intend to buy food items, including chocolate,

cocoa, white chocolate, nuts, and fruit, from suppliers

who deliver to your area. Your chef will then turn those

ingredients into luscious products that will then be

attractively packaged. Local grocery store owners and

restaurant chefs have seen samples of your products

and indicated a keen interest in selling them. You

know, however, that you will still need to service

accounts and keep your customers happy. At the pres-

ent time, you are trying to determine how many people

you need to get your business going and how to group

them most effectively into an organization. You realize

that you can start out quite small and then expand as

sales warrant. However, you also worry that if you are

continually adding people and rearranging your

organization, confusion and inefficiency may result.

Under each of the following scenarios, decide how

best to design your organization. Sketch a basic organi-

zation chart to show your thoughts.

• Scenario 1. You will design and sell the products

yourself, as well as oversee production. You will

start with a workforce of five people.

• Scenario 2. You intend to devote all of your time to

sales to increase revenues, leaving all other functions

to others. You will start with a workforce of nine

people.

• Scenario 3. You do not intend to handle any one

function yourself but will instead oversee the entire

operation and will start with a workforce of 15

people.

1.

After you have created your organization chart,

form small groups of four to five people each.

Compare your various organization charts, focus-

ing on similarities and differences.

2.

Working in the same group, assume that five years

have passed and that your business has been a

big success. You have a large factory for making

your chocolates and are shipping them to 15

states. You employ almost 500 people. Create an

organization design that you think fits this organi-

zation best.