What is Departmentalization?

Departmentalization, also referred to as departmentation, is the process of grouping teams or activities into departments or functions with specific objectives, goals, and outcomes to be achieved. It is a way of dividing an organization into separate parts (departments), each with its functions and responsibilities, but all geared towards achieving the organization’s overall goals. It’s a key part of the organizational design process.

Every employee in a department either performs similar tasks and shares a common goal or works within a multidisciplinary department with varied skills. Coordination among these employees is important, as is the ability to hold employees accountable for their actions.