3. Prescribing Authority Relationships Since organizing process creates various departments and
positions therein, authority relationships have to be prescribed for
orderly functioning of various departments. These relationships have to
be prescribed for various positions in a department. Such relationships
may be in the form of line, staff or functional authority relationships.
Departmentation
The first task in designing an organization structure is
the identification of activities and grouping them on the basis of
some similarity. The process of grouping the activities is known as
departmentation. The need for departmentation arises because of
specialization of work and the limitations on the number of subordinates
that can be directly controlled by a supervisor. Different bases for
