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Wednesday, September 22, 2010

Explain characteristics of different types of organizational structures.

Explain characteristics of different types of organizational structures. Refer to your organization or any other organization you are familiar with and suggest the ways by which organizational structure can be improved for enhancing organizational effectiveness.

INTRODUCTION:-Every organization has a goal and the organization structure is one of the forces that affects the goal of the organization and is designed is such a manner as to serve as an instrument to accomplish the social goal. A structure is developed to give the shape to a tentative idea thought about at the initial stage. The structure in the beginning is very simple because the size of organization is small and it becomes complex and needs plannings and a systematic approach as the organization expends. At this stage, a well planned and designed structure emerges out.
The term structure is highly abstract and illusive. Its existence is real and affects everyone in the organization. In simple term structure is the patters in which various parts or components are interrelated or interconnected. Structure establishes relationships among various positions and activities in the organization and as because such positions are held by individuals, it prescribes relationships among people in the organization.


Line organization structure is perhaps the oldest and the

simplest form of organization and is also known as scalar military, vertical or departmental organizations. Under this organization the line of authority flows vertically from top to bottom. There is a single head of the organization who commands the whole affairs. The chief executive holds the authority and he delegates it to the subordinates and the subordinates further delegate the authority to their subordinates and it reaches to the bottom.

Chief Characteristics of Line Organization:-
(i) It implies vertical relationships. The authority and instructions flow from the to the top bottom.
(ii) The principal of unity of command is followed, i,e, each subordinate receives instructions only from his immediate superior and is responsible to him alone.
(iii) This structure specifies responsibility and authority for all the positions limiting the area of action by a particular position holder.
(iv) All persons at the same level are independent and are only responsible to the chief executive.

Under this form of organization, the entire activities of the organization are divided into various departments on the basis of some similarity headed by one departmental superintendent. Each department is self-contained unit in itself and is responsible only to the chief executive.

Chief Characteristics of Departmental Line Organization:-
(i) This form is very simple in both understanding and implementation.

It can easily be explained to workers. They have no confusion in their authority. responsibility and roles.
(ii) Shirking of responsibility is not possible under this form of organization because the responsibility is fixed at each level of hierachy. Everyone knows to whom he is responsible and who os responsible to him. In this way discipline is maintained in the organization.
(iii) Unification of authority, control and fixed responsibility ensure quick and prompt decision making possible.
(iv) This form has the advantage of flexibility The adjustment and changes can easily to made with the changing conditions due to unified control and fixed responsibility.
(v) It follows the principle of scalar chain. The executive head at the top of the line is responsible for the acts of line personnel the commands the whole line and greater control, discipline and better direction is possible.

As the nature suggests, Under functional authority relationships all activities of the organization are grouped together according to various basic functions such as production, marketing, finance and personnel etc. and each function is put under the charge of a specialist who is fully responsible for carrying out the function well throughout the organization.

Chief Characteristics of Functional Organization Structure:-
(i) It ensures division of labour and enables the concern to enjoy the advantages of specialization that is based on individual proficiency
and specialized knowledge.

(ii) It facilitates large scale production through specialization, standardization and availability of experts specialized and technical knowledge.
(iii) Due to specialized services made available to the individuals, the efficiency of workers improves at all levels of organization.
(iv) The system of flexible one. Any change in the organization can easily be incorporated without distributing the whole organization.

This type of organization has been evolved to achieve the advantages of the two forms of organization; line organization and functional organization, The first insists two much on the unity of command while the later insists too much on decentralization on control. In order to strike a happy balance between the two, the line and staff organization was evolved. In this organization, the structure is basically that of line organization but staff officers who are functional experts are provided to advice the line authorities in the performance of their duties.

Chief Characteristics of Line and Staff Organization Structure:-
(i) This system combines the advantages of the line and the functional organization. The line organization insists on unity of command and the functional organization insists on decentralized of control for specialization purposes.
(ii) As because staff people are consulted before taking and decision. The quality of decision is certainly high. Some methods adopted by IBM for effective organization.

A. Avoiding mistakes in organizing by Planning:
As with the other functions of managing establishment of objectives and orderly planning are necessary for good organization.
(i) Planning for the Ideal:-
The search for an ideal organization to reflect enterprise goals under given circumstances is the impetus to planning. The search entails charting the main lines of organization, considering the organizational philosophy of the enterprise managers and sketching out consequent authority relationships.
(ii) Modification for the Human Factor:-
If available personnel do not fit into the ideal structure and cannot or should not be pushed aside, the only choice is to modify the structure to fit individual capabilities, attitudes, or limitations
B. Avoiding Organizational Inflexibility:-
One basic advantage of organization planning is the avoidance of organizational inflexibility.
For example;- When performance was not as good as expected, chairman John Akers decided that it was time for restructuring. One problem was that decisions which should have been made by the marketing and main product groups were referred upward to the management committee. Another concern was the company’s ineffectiveness in identifying market riches and responding quickly with new product to fill the needs of customers. The old structure often resulted in conflicts among various groups, such as battles among marketing groups over rival products.

To overcome these problems IBM responded in several ways. For one major tasks were assigned and authority delegated to lower levels resulting in what might be considered mini IBM companies. Personal computers, for examples, were combined with the typewriter division. Similarly the midrange computer group was combined with the large main frame computer unit. Although the main frame computer instill the market leader, its market share has been ending, for some of its computing functions are now carried out by midsize computers.
C. Making Staff work Effective:-
(i) Understanding Authority Relationships:-
Managers must understand the nature of authority relationships if they
want to solve the problems of line and staff. As long as managers regard line and staff as groups of people or groupings of activities confusion will result, Line and staff are authority relationships and many jobs have elements of both.
(ii) Making Line Listen to staff:-
If staff counsel and advice are justifiable at all, it is because of the need for assistance either from experts or from those freed from more pressing duties to give such assistance.