UNIVERSITI TUNKU ABDUL RAHMAN

FACULTY OF ENGINEERING AND SCIENCE

ACADEMIC YEAR: 2010/2011

JAN 2011 TRIMESTER

UBMM1013 MANAGEMENT PRINCIPLES

ASSIGNMENT COVER SHEET

Course details

Course : Quantity Surveying

Year and Semester of study : Year 1 Semester 3

Tutorial Group : Tutorial Group 14

Lecturer’s Name : Puan Junainah binti Mohd Som

Tutor’s Name : Puan Kasmah binti Tajuddin

Assignment Details

Topic : Organization Structure & Culture

Company : SYABAS SDN. BHD.

Due Date : Week 9, 14 March 2011 (Monday)

Students’ Detail

Name Student ID No.1. Lee Seng Keong 09044252. Mah Hoi Yuen 09037853. Ong Han Tsen 09030714. Tan Chow Yang 09081245 Tan Yeek Jean 0903174

Assignment Overall Marks : ____________ Marks.

UNIVERSITI TUNKU ABDUL RAHMAN

FACULTY OF ENGINEERING AND SCIENCE

ACADEMIC YEAR: 2010/2011

JAN 2011 TRIMESTER

UBMM1013 MANAGEMENT PRINCIPLES

MARKING SCHEME FOR GROUP ASSIGNMENT

Section Assessment Mark Allocation

Marks Awarded

1 Introduction 5 marks

2 Contents 15 marks

3 Findings 10 marks

4 Conclusion 10 marks

5 Recommendations 5 marks

6 Quality of the written assignment 5 marks

Total marks 50 marks

Comments:

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Name of marker: _______________________

Signature of marker: ___________________ Date: ______________________

TABLE OF CONTENT

NO. TOPIC PAGES1. INTRODUCTION

Introduction of SYABAS Sdn. Bhd. 2. CONTENT

Span of Control Functional Structure Geographical Departmentalization Mechanistic Structure Organizational Culture

3. FINDINGS 4. RECOMMENDATIONS5. CONCLUSION6. REFERENCES7. APPENDIX

Introduction

All talk about organizations relies on abstract conceptions, using words and their

meanings, to make sense systematically of our experience and observations of people doing

things together. A great deal of organizational life can be described and, more importantly,

sometimes even understood, predicted, and influenced, with abstract ideas about structure and

culture. To have a company working smoothly, all organizations and companies will have an

organizational structure so that individuals will have a clear view of what they are allocated to

do. Organizational Structure usually acts as a viewing glass through which workers see their

organization and also its environment. It can be structured in many different ways, depending on

the company’s objectives. The structure of an organization will determine the modes in which it

operates and performs. It also allows the expressed allocation of responsibilities for different

functions and processes to different entities of workers such as branch, departments and

individuals. Many organizational have hierarchical structure but not all. Organizational structure

can by further describe by the six key elements: work specialization, departmentalization,

authority responsibility and power, span of control, centralization and decentralization and the

last one formalization.

If organizational structure is not structured properly, it affects the organizational action in

two big ways. Firstly, it will affect the foundation on which the standard of the company’s

operation procedures and routines of the workers. And secondly, it determines which individuals

to participate in which decision making process, which will also affect on the output of the

company greatly, thus to what extant their views shape the organization’s actions. On the other

hand, as for organizational culture, it is an idea on the field of organizational studies and

management which describes the psychology, attitudes, experiences, values and beliefs of an

organization.

For better understanding on the organizational structure and cultures, a review on

SYABAS Company has been done. Syarikat Bekalan Air Selangor Sdn. Bhd. (SYABAS) was

incorporated on 8th July 1996 under the Malaysian Companies Act, 1965 to undertake the

privatization of water supply services in the State of Selangor and the Federal Territories of

Kuala Lumpur and Putrajaya ('the Privatization‘). The organizational structure of SYABAS

Company is under the mechanistic structure, which mean it is rigid hierarchical structure, fixed

duties, many rules begin fixed, formalized communication channels and centralized decision

authority.

Syarikat Bekalan Air Selangor Sdn Bhd (SYABAS) was incorporated on 8th July 1996

under the Malaysian Companies Act, 1965 to undertake the privatization of water supply

services in the State of Selangor and the Federal Territories of Kuala Lumpur and Putrajaya. The

Selangor water works is run by Syarikat Bekalan Air Selangor (SYABAS), the water supply

corporation for Selangor state and is a subsidiary of Puncak Niaga Sdn Bhd, the owner of

SYABAS.

Span of Control

Span of control is the term for the number of subordinate employees directly accountable

to a manager. The larger the number of employees a manager controls the wider is his span of

control. The manager controls six or fewer employees. There is close supervision of the

employees, tight control and fast communication, which is narrow span. There is also a wide

span, which the manager controls more than six employees. Managers are forced to delegate

work, and tasks may be less closely supervised. The Chief Executive Officer of this company

Dato Ruslan Hassan has nine spans of controls. This company generally has a wide

organizational structure, because the layers of management levels are only a few. Therefore, the

CEO has a very wide span of control in order to handle heavy load of tasks, being the monopoly

of water supplier in Selangor.

Functional Structure

Functional structures typically work well for smaller and less complex organizations

dealing with only one or a few products or services. This structure also works best in relatively

stable environments that allow organizations to pursue consistent strategies. Having said that,

this company runs with a functional structure in which nine departments are directly under the

supervision of the CEO. The region labeled ‘functional’ in the organization chart indicates how

the company works under functional departmentalization. People and tasks which required

similar skills and specialization are group together in one department, and are structured

according to functional areas. Since SYABAS is a company specializes in water supply,

functional structure can bring the best out of the company with its cost saving advantage.

Overall supervision will be high and coordination can be easily achieved. Since employees

performing similar tasks are grouped together therefore overall learning from each other’s skills

can be easily achieved. However, due to the segregation of departments, communication between

departments is very difficult. This lack of communication can contribute to the difficulty in

dealing with complexity.

Geographic Departmentalization

Besides functional structure, the company has also incorporated geographical structure to

complement its functional departmentalization. Geographical departmentalization is a process

grouping activities on the basis of territory. If an organization's customers are geographically

dispersed, it can group jobs based on geography. From the chart, the region labeled

‘geographical’ indicates the existence of this structure. The district department is divided into

three areas, namely the northern zone, central zone and southern zone. The reason why this

department is divided in different zones is that, the management can focus on the needs and

demand of the different zones. This segmentation helps management to manage their day-to-day

operations in a more orderly and efficient manner. The authority is retained in the Head

Department, which is the District Department. All activities in different territorial zones will be

reported to the head department.

Mechanistic Structure

Mechanistic structure is often appropriate in stable environments and for routine tasks

and technologies. In some ways similar to bureaucratic structures, mechanistic organizations

have clear, well-defined, centralized, vertical hierarchies of command, authority, and control.

Communication tends to follow formal channels and employees are given specific job

descriptions delineating their roles and responsibilities. Efficiency and predictability are

emphasized through specialization, standardization, and formalization. This results in rigidly

defined jobs, technologies, and processes. As the distance between the top and the bottom of the

organization expanded, top management would increasingly impose rules and regulations. The

term mechanistic suggests that organizational structures, processes, and roles are like a machine

in which each part of the organization does what it is designed to do.

According to SYABAS SDN. BHD. organization chart, the organization is using the mechanistic

structure. The organization chart shows the hierarchy of authority are well-defined is being used.

The organization is centralized, the decision-making kept as high as possible and most

communication is vertical. All the important decision and actions at the lower level are subject to

the approval of top management.

The implication of centralization can be:-

1. Reservation of decision making power at top level.

2. Reservation of operating authority with the middle level managers.

3. Reservation of operation at lower level at the directions of the top level.

Because of the organization are using functional structure, distance between the top and

the bottom are wide, Code of Business Ethic is being introduces as their rules & Standard.

Lastly, in this organization, employees work separately and specialize in one task, which is

individual specialization.

Organizational Culture

There are seven dimensions that can describe an organization’s culture, which are

attention to detail, outcome orientation, people orientation, team orientation, aggressiveness,

stability and the last one is innovation and risk taking. Function of Organizational Culture is to

conveys the sense of identity for organizations member and create distinction between one

organization and other.

From the code of business ethic of SYABAS, the aim of the company is to conduct the

business to the highest ethical standards possible, to enhance goods and services. Besides that,

this company wants to create organizational culture of honesty, fairness and concern for others

which focus on the outcome orientation dimension and stability dimension. SYABAS want the

employees to provide a better quality of life for the customers and ensure the preservation of our

environment.

Finally, it can be well said that organizational culture serves as a control mechanism that

control, guide, and shapes the attitude and behavior of the employees.

Recommendations

After discussion of our group on 32th 2020, we conclude that functional structure using

by SYABAS SDN. BHD had the only weakness, which is lack of communications.

Communications is one of the basic functions of an organization and is a very important thing in

a structure. Communications able us to send and receive information and helps in the process of

decision making. Lack of communications will influence the decision making, information,

relations of employee, output and income of company. In functional structure, people and tasks

which required similar skills and specialization are group together in one department and

employee work in individual specialization. Which mean that, employee only focus on their own

task and don’t know what others employee or department doing in the organization which is lack

of communications. In an organization, some task is had to done or process based on other

department information to complete the work. Lacking of communication will lead employee

receiving or sending wrong information and this will affect the flow of process and the goals of

company.

So the organization should create an intranet that able every employee to communicate,

send or receive information, having discussion and know more about information of company in

company work place. The intranet should have limited for use, like only can access for interact

with employee in company and information that related company. Besides that, company cans

also having meeting frequently for employees to communicate, discuss and share information.

Pursuit of functional goals can also cause managers to lose sight of what’s best for the overall

organization. Top manager should require a performance appraisal to manage and know more the

performance of employee.

Next is our group suggest that SYABAS SDN. BHD not only can adopt centralization

system, they also can adopt decentralization system to run certain task. Decentralization is the

degree to which lower-level managers provide input or actually make decisions. Example the

structured problem and programmed decisions can make by lower-level. This can save time of

top manager to make others more important decision like unstructured problem and

nonprogrammer decisions. Decision making for a company is usually reserved for the executives

of the company. Middle managers should take on more of a support role to the decisions made

by the company, rather than trying to dictate anything to employees. When managers are handed

a task, they should pool the resources necessary to assist their employees to get the job done. An

effective manager should be the go-between for employees and executives, and a facilitator that

is assigned a task to complete.

Conclusion

REFERENCE

1. About SYABAS

Retrieved 8 MARCH 2011

From SYABAS:

http://www.syabas.com.my/maincorp.php?pg_post=2&pg_id=1&menu_id=1

2. Code of Business Ethics

Retrieved 8 MARCH 2011

From SYABAS:

http://www.syabas.com.my/corporate/Inside.pdf

3. Corporate Philosophy

Retrieved 10 MARCH 2011

From SYABAS:

http://www.syabas.com.my/maincorp.php?pg_post=2&pg_id=1&menu_id=3

4. Organization Chart

Retrieved 10 MARCH 2011

From SYABAS:

http://www.syabas.com.my/mainpeople.php?pg_post=2&pg_id=2&menu_id=5

APPENDIX