Organizational Design

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Key Concepts of Organizational Design
University of Phoenix

Key Concepts of Organizational Design
This paper will provide key concepts of organization design. It will describe the five best design choices and also will provide information regarding some common organizational structures. An organization will have to continuously look at the design and structure it uses to ensure that it is going to establish its goals and vision. Importance of Organizational Design Choices

Organizational Design will allow an organization to improve itself. With organizational design, employee satisfaction is improved, customer satisfaction is improved, financial performance is improved and a competitive edge is gained. In order for an organization to have innovative success the best design choices are hierarchy, integration, control, formalization, and authority. Hierarchy

According to Jones (2004), “Hierarchy is the classification of people according to authority and rank” (p. 101). With a hierarchy, individuals at the top level have more authority and rank. Each level down form the highest rank is under the control of the higher rank. A hierarchy provides an organization with structure. An organization can structure itself by vertical differentiation or horizontal differentiation. According to Jones (2004), “ Vertical differentiation is the way an organization designs its hierarchy of authority and creates reporting relationships to link organizational roles and subunits, horizontal differentiation is the way an organization groups organizational task into roles and roles into subunits” (p. 102). Employees are able to become more specialized with horizontal differentiation. Vertical differentiation allows for chain of authority. It gives more control to the organization. Integration

According to Jones (2004), “Integration is the process of coordinating various task, functions, and divisions so that they work together and not at cross-purposes “(p. 104). Integration allows for departments to work together. This strengthens the organization and improves communications within the organization. There are seven integration mechanisms that can be used as differentiation increases; they are the hierarchy of authority, direct contact, liaison role, task force, team, integration role and integrating department. Hierarchy of Authority separates individuals by how much authority they have. Direct contact allows for managers and leaders to meet so that they may coordinate activities. When communications increases amongst different units, one or more managers must take on a liaison role. Task forces and teams are established to address issues and solve problems. Control

According to Jones (2004), “Control is the ability to coordinate and motivate people to work in the organization’s interest (p. 99). Control allows for employees to be motivated and allows for coordination within the organization. A great leader will have more ability to motivate and control his or her subordinates. Formalization

According to Jones (2004), “Formalization is the use of written rules and procedures to standardize operations” (p. 112). Part of my organizations responsibilities is to follow written rules and procedures. Without them we would not be certified by the FAA to perform maintenance and without them we would not be able to meet the safety requirements and standards set by the FAA. With these types of procedures, like the military, there is no slack to stray from the written rules and procedures. Authority

According to Jones (2004), “Authority is the power to hold people accountable for their actions and to make decisions concerning the use of organizational resources” (p. 99). Authority allows for each individual to clearly understand their roles and responsibilities, According to my classmate Kevin Bragg (2009), “where would the military be without authority” (discussion posting). Authority and control go hand and hand and when a...
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