Organization structure

INTRODUCTION

It is the pattern of relationship. The structure of a system is the arrangement of its subsystems and components at a given moment of time. Organisation structure is the pattern of relationship among various components or parts of the organization. This prescribes the relationships among various activities & positions.

“A social system is a structuring of events or happenings rather than of physiological parts and it, therefore ,has no structure apart from its functioning.”

Design of basic structure involves such issues as how the work of the organisation will be divided and assigned among various positions, groups, divisions, departments etc. and how the coordination necessaty to accomplish total org. objectives will be achieved.

DEFINITION

Given by ‘Dalton et al’ :- “Organisation structure refers to the differentiation and integration of activities and authority, roles and relationships in the organization.”

NEED FOR ORGANISATION STRUCTURE

1)Facilating management action:- It must be plan for systematic completion of the work of each specialized job so that total activities accomplish common objectives. These activities should be completed in a co-ordinated way. Org. structure is the mechanism through which mgt. directs , coordinates and controls the org. activities.

2)Encouraging efficiency:- Org. structure is the frame work within which an org. functions. Org. members try to maximize the output of goods or services resulting from a given input of resources or atleast, make a respectable showing in that direction.

3)Communication:- Org. structure provides the pathways for communication among org. members as well as between the org. and its ent. When we establish the relationship in org. structure.

4)Optimum use of org. resources:- Org. structure gives higher place to activities which are more important to the achievement of org. objectives.

5)Job satisfaction:- Org. structure provides relatedness among tasks and responsibilities and people who work for an org. , sooner or later came to evaluate the nature of these relationships and of their own relationships to the org. and to their jobs.

FACTORS OF GOOD ORG. STRUCTURE

1)Simplicity:- Networking in the org. is essential but it should not lead to confusion and ambiguity. Every person in the org. should be clear about to whom he has to consult in a particular matter.

2)Flexibility:- Org. structure is based on circumstances and these are not fixed but changes over the period of time, there is a need for incorporating changes in org. structure.

3)Clear line of authority:- There should be clear line of authority running from top to bottom or in horizontal direction. The concept of clear line of authority implies that one should be very clear about what he is expected on achieve or contribute and what relationship should be maintained by him at his official level.

4)Proper delegation of authority:- Delegation of authority refers to authorization of a manager to make certain decisions. He can discharge his responsibility properly of he has commensurate authority.

5)Minimum possible managerial levels:- There should be minimum managerial level , longer is the line of communication . In the chain of command and the communication has to travel along the line creating problems of delay .

6)Principle of unity of direction and command:- Unity of direction refers to the concept of one plan one man. Every work in the org. having same objective must be assigned to a single person. Activities and functions of same type can be grouped together or geographical areas having same characteristics can be grouped together.

Unity of command again provides clarity in role while multiple commands provide opportunity to avoid responsibility.

FACTORS AFFECTING IN ORG. DESIGN

1)Environment :- Environment consist of all those factor that lie outside the org. but affect its working. Environment keep on changing however , the rate of change in various factors may not be uniform. Some may change at much faster rate , some at lower rate.

Taking environmental consideration, that org. structure is suitable which enables the org. to:-

(a)Monitor & process information about the environment.

(b)Increase org’s ability to pre-plan.

(c)Increase its flexibility to adapt.

(d)Decrease the level of performance for continued viability.

2)Strategy:- Strategy is the important course of action which are helpful to achieve the org. objectives. Choice of strategy by org. is largely depend determined by its environment. Other factors such as strength and weakness of org. are affected the choice of strategy.

The relationship between the strategy and structure can be thought in terms of utiliting structure for strategy implementation because structure is a means to an end and not an end its itself.

3)Technology:- Technology is components of the environment. When tech. changed , it will be directly affected the task structure. We use the 3 type of tech. in production:-

(a)Unit production

(b)Large batch and mass production

(c)process production

4)Size of org.:-It affects large functioning of system. The size of org. is measured on the basis of no. of employees, scale of operations and amount of investment. The size of an org. influence its co-ordination, direction ,control.

5)People:-The form of org. structure is a major source of satisfaction or dissatisfaction for people. Top mgt. philosophy about the degree of freedom and autonomy required for people in org. affects its structure.

MECHANISM FOR DESIGING STRUCTURE

1.What should be different units of the org.?

2.What components should join together and what components should be kept apart?

3.what is the opportunity , placement and relationship of different units?

Process approach:- Process approach to designing of an org. structure is related to identification of sequences of activities involved and then deciding the various units of org. combining various units and placing them at appropriate places. So that activities are performed properly.

Result approach:-

a)Defining the business on the basis of potential areas of market opportunities.

b)Establishing the obj. to be accomplished.

c)Determine the requirements for success and functional skills needed to meet them.

d)Determining the degree of authority keeping in mind the degree of centralization best suited to decision making

Decision approach:-

a)What decisions are needed to obtain result for achieving org. objectives?

b)What is the nature of such decisions?

c)At what level of the org. should such decision to be made?

d)What are the activities involved in org. affected by such decisions.

PROCESS IN DESIGNING STRUCTURE

1)Identification of activities:- In designing the structure managers must identify the necessary activities that must be performed in order to achieve the org. objective.

2)Grouping of activities:- Groping may be done on several bases, such as functions, geographical region, types of customers, types of equipments ,etc.

3)Delegation of authority:- Authority and responsibility are correlated and are taken to be constant companions because authority without responsibility is a dangerous thing and responsibility without authority is an empty vessel.

4)Centralisation:- Based on unity of command. It provides opportunity for personal leadership, quick decisions are made.

5)Decentralisation:-Dividing a large task into small segments and allot to different persons. Decentralisation means growth & diversification in org. It reduces the burden of top management and create compition among them.

7’s OF ORG. STRUCTURE

1. Staff

2. Skills

3. Subordinate goals

4. Supervision

5. Process

6. People

7. Physical evidence

FORMS /TYPES OF ORG.STRUCTURE

1)Line org. structure:- It is also known as scalar,military or vertical org. and perhaps the oldest form. All persons are at the same level in org. Each person is having assigned & self contained, without disturbance of other. Line org. can be designed in two ways:-

(a)Pure line org.:-Under this form , similar activities are performed at a particular level. Each group of activities is self-contained unit and is able to perform the assigned activities without the assistance of others.

(b)Departmental line org.:-Under this form, entire activities are divided into different departments on the basis of similarity of activities. Each department is placed under one departmental superintendent. All persons in the department are subject to control by the departmental head. The basic objective of this form is to have uniform control, authority and responsibility.

2)Line and staff org. structure:- Line and staff organisation refers to a pattern in which staff specialists advise managers to perform their duties.

3)Functional org. structure:- functional org. is ,perhaps , the most widely used one in medium and large organizations. This is a traditional concept of organising. For creating functional org., the basis of departmentation is the various functions to be performed by the org.

(a)Headquaters

-> Production

->Marketing

->Finance

->Personnel

4)Divisional org. structure:- In this form , the org. is divided into several fairly autonomous units. Each unit is relatively self-contained in that it has the resources to operate independently of other divisions.

5)Project org. structure:- In this form , project management, programme management, systems org., product management, brand management etc are closely related. The basic idea behind this structure is that since environmental changes very rapidly, the org. must be take up various activities on project basis, that is , adding the required ones and deleting the unnecessary ones.

6)Matrix org. structure:- matrix org. structure is essentially a violation of unity of command and therefore, whole classical concepts related to the principle of unity of command are violated. Matrix structure is the realisation of two –dimentional structure which emanates directly from two dimension of authority. Two complementary structures-:pure project structure and functional structure are merged together to create matrix structure.

7)Free-form org.:- It is closely related to project and matrix org. structure. It is based on the premise that the org. is an open system and the basic task of a manager tofacilitate changes in the org. . It reduces the emphasis on position, departments, and other formal units and on the organizational hierarchy.

CONCLUSION

Organisations are shifting from steep hierarchy of industrial era to network organizations based on dynamic teaming and virtual enterprising. So organisation structure is a pattern in which various parts or components are inter-related and it includes such as control procedures, information system, reward, punishment system, rules & procedure so on.