Forms of Organization Structure: Organizing | Principle of Management

Organizing

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Forms of Organization Structure: Organizing | Principle of Management

Forms of Organization Structure

Forms of Organization Structure:

Organizational structure refers to the hierarchical arrangement of various position in an organisation. It is a basic framework within which the decision making behavior of an executive takes place. Thus, a structure reflects each organization’s specific situation.

The forms of organization structure are as follows:

I. Line Structure: It is the oldest and simple form of organization structure. It is also known as scalar or military type of structure. In this structure authority is passed down from top management to middle managers in the process for discharging the given responsibility and from them it goes down to supervisors and then workers. In this structure each person has one superior to whom he/she reports and looks for instructions. Thus, a single specific chain of command exists.

Advantages:

  1. It is Simple and Clear structure.
  2. Quick decision making can be ascertained on this structure.
  3. Good coordination.(It has effective communication and feedback system)
  4. It ensures Unified control and discipline.
  5. This structure is less costly and thus helps in maintaining efficiency.
  6. It is flexible and can easily cope with changing environment.

Disadvantages:

  1. Lack of specialization.
  2. Only useful in small organization and big organization where strong discipline need to be maintained.
  3. Centralization of authority at the top level may lead to autocratic behavior.
  4. 4. Chances of nepotism and favoritism
  5. Key managers suffer from Work Load
  6. One way communication.
  7. Since line managers are busy on conducting operational activities which limits the scope of specialization.

II. Line and Staff Structure: Line and Staff structure comprises a combination of both line employees (actual managers who are directly responsible for the performance and people) and staff employees (who are functional experts and advises to line staff).In the line and staff structure, these experts help line managers by providing their functional expertise.

Advantages:

  1. Use of experts facilitates decision making and specilzation.
  2. Fewer burden to line managers.
  3. Improvement in operational efficiency.

Disadvantages:

  1. Chances of Conflict.
  2. Increases cost.
  3. Difficulty in adopting creative ideas.
  4. Heavy inclination on staff specialist may decreases the effectiveness of line managers.

III. Committee Structure: A committee organization refers to the structure where authority and responsibility are jointly held by a group of individual rather than by single managers.

  • Almost all big organization has committee structure.
  • Formed for better communication and coordination.

Advantages:

  1. People accept group decision.
  2. Motivation and commitment.
  3. Participatory in nature.(autonomy to participate)
  4. Dealing with complex problems.

Disadvantages:

  1. Slower in making decision.
  2. Expensive
  3. Difficult in maintaining secrecy.
  4. High risk of one man show.( domination of aggressive person)

IV. Functional Structure: FW Taylor originally developed the concept of functional structure. Under this structure, the entire work of the organization is divided into major functions. Every function is placed under the charge of a specialist and the subordinates are accountable to different functional specialist for the performance of different function.

Advantages:

  1. The Use of specialist Skill facilitates work specialization.
  2. Specialist managers increase efficiency by controlling wastage and uniform decisions.
  3. Work is divided on the basis of functional specialization, which reduces the overburden of work to managers.
  4. Training and development opportunities become available for the employees.
  5. Command authority can be ascertained by the specialist.

Disadvantages:

  1. Due to lack of clearly defined authority conflict may appear between foreman and superior.
  2. It lacks unity of command. One worker has to obey orders of several bosses sand has to be responsible to all.
  3. Delay in decision making.
  4. There is no provision of formal relationship among the functional specialist which may lack mutual coordination among them.

V. Matrix Structure: Matrix organization is also called project organization, gird organization or multiple command system. In this structure, functional and departmental forms overlap. Matrix design features a multiple command structure in which one individual may have any number of superior including one functional and one or more project managers.

  • essential for :- rapid change in environment, face uncertainties
  • high information-processing requirement.
  • financial and HR constraints.

Advantages:

  1. Efficient use of resources.
  2. Flexibility
  3. Improve in decision quality.
  4. Opportunities for personal development.

Disadvantages:

  1. Delay in decision making.
  2. Power struggle.
  3. Lack of accountability.
  4. Lack of commitment.

Emerging concept of Organizing:

1. Team Structure: Team is considered today as the most effective means to organize work activities. Team members are allowed to make decision on selection of inputs, scheduling and allocating tasks among members training and development, performance evaluation and controlling. The team based environment enhances performs reduces stress and promotes the climate of creativity and innovation in the organization.

2. Virtual Organization: this is also called network organization where organization creates a network of relationship that allows them to contract out almost all managerial function- distribution, marketing, account keeping, staff management and other function. If management feels that outside can undertake these function in a better and cheaper ways, such function are outsourced. Since, most of the functions are outsourced and very little function is performed, so it is called virtual organization.

3. Boundary less organization: Boundary less organization are composed of people who are linked by computers, faxes, computer aided design systems and video teleconferencing. They rarely see one another face-to-face. People are utilized when their services are needed, but they are not formal members of organization. They are functional experts who forms and alliance within an organization, to fulfill their contractual obligation.

4. Learning Organization: Learning Organization refers to those organizations which have developed the capacity to continuously learn, adapt and change. A learning organization accumulates knowledge from the past experience, learning across parts of the company and learning from other companies .It creates an environment to unlock the knowledge of people working in the organization. People are encouraged to share information and knowledge so that they can easily contribute to a changed goal in learning organization.

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