Organization structure is the formal pattern of interactions and co-ordination designed by management to link the tasks of individuals and groups in achieving organizational goals Organization structure consists of four elements:
❖ The assignment of task and responsibilities that define the jobs of individuals and units. ❖ The clustering of individual positions into units and of units into departments and larger units to form an organizations hierarchy. ❖ The various mechanisms required to facilitate vertical (top-to-bottom) co-ordination, such as the number of individuals reporting to any given managerial position and degree of delegation of authority. ❖ The various mechanisms needed to foster horizontal (across departments) co-ordination such as task forces and interdepartmental teams. Organizations are a variant of clustered entities. An organization can be structured in many different ways and styles, depending on their objectives and ambiance. The structure of an organization will determine the modes in which it operates and performs. Organizational structure allows the expressed allocation of responsibilities for different functions and processes to different entities such as the branch, department, workgroup and individual. Individuals in an organizational structure are normally hired under time-limited work contracts or work orders, or under permanent employment contracts or program orders. The set organizational structure may not coincide with facts, evolving in operational action. Such divergence decreases performance, when growing. E.g. a wrong organizational structure may hamper cooperation and thus hinder the completion of orders in due time and within limits of resources and budgets. Organizational structures shall be adaptive to process requirements, aiming to optimize the ratio of effort and input to output.
An effective organizational structure shall facilitate working relationships between various entities in the organization and may improve the working efficiency within the organizational units. Organization shall retain a set order and control to enable monitoring the processes. Organization shall support command for coping with a mix of orders and a change of conditions while performing work. Organization shall allow for application of individual skills to enable high flexibility and apply creativity. When a business expands, the chain of command will lengthen and the spans of control will widen. When an organization comes to age, the flexibility will decrease and the creativity will fatigue. Therefore organizational structures shall be altered from time to time to enable recovery. If such alteration is prevented internally, the final escape is to turn down the organization to prepare for a re-launch in an entirely new set up. 1) The Functional Organizational Structure
This is grouping people together on the basis of their technical and specialist expertise; the organization can facilitate both their utilization and their coordination services of the whole enterprise. Functional grouping provides better opportunity for promotion and career development. The disadvantage is primarily the growth of sectional interest which may conflict with the needs of the organization as a whole, and the difficulties of adopting this form of organization to meet issues such as product, diversification or geographical dispersement. Each part has a functional purpose with regard to helping its internal or external customers. This structure is easy to manage but can be difficult to find something quickly. Employees within the functional divisions of an organization tend to perform a specialized set of tasks, for instance the engineering department would be staffed only with engineers. This leads to operational efficiencies within that group. However it could also lead to a lack of communication between the functional groups within an organization, making the organization...
References: Management Theory and Practice, “2nd Edition”.
Barlow $ Martin, Management (1191), 3rd Edition.
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