Is there one best way to structure an organisation? Organisations are social entities that which are made up of a group of people that work together in achieving the same goal. Organisational structure is the framework that controls the hierarchy of the organisation and defines authorities and duties to its members. There is no one best way in which an organisation can be structured. Firstly, neither centralised or decentralised organisational structures were found to be better for organisations. Organisation structure is very complex and company specific where there are a number of different variables dictate what structure is to be used where even modelling has attempted to determine the best fit. Different organisational structures tend to benefit the strategies of different organisations .
Centralised or decentralised organisational structures are neither better nor worst than each other. Centralised management structure of an organisation is when decision making is kept at the top the hierarchical structure as oppose to centralised structure where responsibility is spread over a larger group. A Canadian law firm, Borden Ladner Gervais (BLG) found that when they altered their organisation structure to a more decentralised structure, that it proved beneficial for their business. It allowed for the regional offices to have their own control of their operations while still maintaining constant communication. The firm's national managing partner, Sean Weir, said "A top-down structure that might work for someone else was definitely not going to work for us" (Gray, J, 2003). This law firm demonstrated how a decentralised structure was able to be better for an organisation than a centralised structure. Leiponen and Helfat (2011) also found that decentralised organisational structures were best suited to research and development as it minimised coordination costs and that division managers were better rewarded for dealing with their won markets. However, the...
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