BUS272 TB

458 Part 5 Reorganizing the Workplace
THE CANADIAN PRESS/Graham Hughes
The Carillon Generating Station on the Ottawa River (shown here) is one of Montreal-based Hydro-
Québec’s hydroelectric power stations. Hydro-Québec organizes its operations by functions so that the
company can be more responsive to growth outside Quebec. It has four divisions: Hydro-Québec Production,
Hydro-Québec TransÉnergie, Hydro-Québec Distribution, and Hydro-Québec Équipement et services
partagés/Société d’énergie de la Baie James.
and Pringles—under an executive who has complete global responsibility for it. The
major advantage to this type of grouping is increased accountability for product
performance, since all activities related to a specific product line are under the direction
of a single manager.
Geographical Departmentalization
Another way to departmentalize is on the basis of geography, or territory. The sales function,
for instance, may be divided regionally with departments for British Columbia,
the Prairies, Central Canada, and Atlantic Canada. Each of these regions is, in effect, a
department organized around geography. If an organization’s customers are scattered
over a large geographical area and have similar needs based on their location, then this
form of departmentalization can be valuable.
Process Departmentalization
Some companies organize departments by the processing that occurs. For example, an
aluminum tubing manufacturer might have the following departments: casting; press;
tubing; finishing; and inspecting, packing, and shipping. This is an example of process
departmentalization, because each department specializes in one specific phase in
the production of aluminum tubing. Since each process requires different skills, this
method offers a basis for the homogeneous categorizing of activities.
Process departmentalization can be used for processing customers, as well as products.
For example, in some provinces, you may go through a series of steps handled by
several departments before receiving your driver’s licence: (1) validation by a motor
vehicles division; (2) processing by the licensing department; and (3) payment collection
by the treasury department.
Customer Departmentalization
Yet another way to departmentalize is on the basis of the particular type of customer the
organization seeks to reach. Microsoft, for example, is organized around four customer