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Organizational Information Flow


Information Flow

Information flow in an organization in two ways:

  1. Vertically -  Flow up and down among managers
    Example: Production supervisors constantly communicate with with production-line workers and their own managers.
  2. Horizontally -  Flow sideways among departments
    Example: Regional sales managers from the marketing department set their sales goals by coordinating with  production managers in the production department.


Organizational Functions

Most organizations have departments that perform five basic functions:

  1. Accounting - Keep track of all financial activities.
  2. Production - Makes company product.
  3. Marketing - Advertises, promotes, ands sells the product.
  4. Human Resources - Finds and hires people and handle personnel matters.
  5. Research - Does product research and relates new discoveries to the firm's current or new products.


Management Levels

There are three management levels in most organizations:

  1. Supervisors
    1. Manage and monitor the employees or workers.
    2. Responsible for operational matters (day-to-day operations).
    3. Example: production supervisor monitors materials needed to build a product.
  2. Middle Management
    1. Deal with control planning, tactical planning, and decision-making.
    2. Implement long-term goals of the organization.
    3. Example: regional sales manager sets sales goals for sales in several states.
  3. Top Management
    1. Concerned with long-range planning (strategic planning)
    2. Need information to help them plan future growth and direction of the organization.
    3. Example: vice president of marketing determines demand for current products and sales strategies for new products.




Information flow

  1. Information must flow in different directions to support the different information needs of management.

  2. Each level of management has different information needs.
    1. Strategic Needs of Top-level managers
      1. Information that reveals overall condition of the business in capsule form.
      2. Information from all departments below and from outside the organization.
      3. Information to plan for long-range events.
      4. Example: planning for new facilities
    2. Tactical Needs of Middle-level managers
      1. Summarized information (weekly or monthly reports).
      2. Information both horizontal and vertical across functional lines within the organization.
      3. Historical, internal information to develop budgets and evaluate performances.
      4. Example: developing production goals, concurring with top-level managers and supervisors
    3. Operational Needs of Supervisors
      1. Detailed current day-to-day information.
      2. Information flow is primarily vertical.
      3. Communicate mainly with middle managers and workers beneath them.
      4. Day-to-day internal information to keep operations running smoothly.
      5. Example: monitoring current supplies, current inventory, and production output.


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