What does departmentation involve?

Departmentation involves the grouping of resources into work units, which is essential for organizing a business effectively. This process allows organizations to align individuals and resources based on shared functions, goals, or geographies, facilitating collaboration and improving efficiency. When resources—such as personnel, equipment, and budgets—are organized into specific departments, it helps streamline operations and clarify roles and responsibilities, promoting better communication and coordination.

The other options relate to different organizational processes. For instance, breaking down company policies pertains to policy management rather than structuring the organization itself. Setting up new technological systems involves integrating technology into workflows but does not inherently address the organization of resources. Outsourcing functions implies shifting certain operations outside of the organization, which is a strategic choice but isn’t about internal resource structuring. Thus, the focus on grouping resources into work units distinctly captures the essence of departmentation.