Organizational structure, characteristics, elements, charts, and the factors that affect the choice of an organizational structure.

  A critical evaluation of the

organizational structure, characteristics, elements, charts, and the factors that affect the choice of an organizational structure.

 

 

 

 

 

 

 

Fabrice Tshiyoyi Banyingela

Your student ID number: R2308D16950940

Module Name: Theories of Management

Module code: UU-MBA-712-ZM

Date: 3 March 2024

Introduction

A structured organization is essential for every group of people with the same goal. Stephanie Dalfonzo a renowned expert in The Art of Organizing states that “Organizing is what you do before you do something, so that when you do it, it is not all mixed up.” Therefore, an organizational structure is crucial in assigning the responsibilities, relationships, and authority for each role in the organization. The first organizational structure was created in 1855 by railway superintendent Daniel McCallum and George Holt Henshaw. The term “organizational chart” (also referred to as org chart or organogram) which is based on people was coined by engineer Willard C. Brinton in 1914. Today, they represent government structures and companies. The emphasis of an organizational structure is on giving an organization a formal and prepared appearance so that it can govern itself and engage with the outside world. Through such methods, roles are clarified, communication is improved, accountability is assigned, and culture is respected.

 

Characteristics, elements, and importance

An organizational structure is a graphical representation that consists of a network of well-defined activities, arranged logically to facilitate other activities and create responsibility centers. It also has an authority-responsibility structure, where executives distribute authority, leading to superior-subordinate relationships. It also includes differentiation and integration, which involve division of work and departmentalization and coordination, dividing tasks into smaller tasks and assigning them to subordinates.

Henri Fayol's Division of Work is a widely used principle in organizations for creating charts. This is one of the top elements of an org chart that breaks down tasks into smaller jobs. Other elements such as (1) hierarchy displays the line of authority or chain of command, (2) Span of control grants clear control over a specific group of departments, and (3) centralization and decentralization which indicate the source and center of decision-making levels. The absence of certain elements in an organization chart can negatively impact the business, cause member miscommunication, and decrease efficiency. Setting an org chart provides several advantages such as (1) a clear reporting structure, (2) motivates employees in their ambitions to be promoted, (3) helps manage workload & planning by assigning the right workload to the right and available staff, (4) adequate delegation and (5) helps external stakeholders and investors to understand how the company is organized. A clear org chart enhances efficiency by preventing collisions and duplication of tasks. It removes ambiguity, fosters discipline, brings clarity to the members’ roles and flexibility to adapt to change, and elevates their morale.

 

Factors Affecting Choice of Org Structure

            Organizations must choose the appropriate structure based on various factors. An effective organizational chart involves identifying activities like production, technical, and financial, dividing them into tasks, assigning these tasks to specific jobs, assigning these jobs to departments, assigning rights and powers to their responsibilities, and establishing a coordination mechanism for departments. Managers must adapt to the business environment to create a structure that aligns with the organization's strategic objectives. Nations worldwide are organized as republics, monarchies, or kingdoms, with leaders like presidents, prime ministers, kings, or queens to reflect the needs of their territories. The size of an organization affects the choice of the org chart. For example, a large production company with hundreds of employees may face an overload when reporting to a single manager. The company should arrange to group them with a designated leader. Another factor can be the nature of business. For a church to expand internationally, the leader should establish a broader structure that decentralizes roles and responsibilities to local citizens. Furthermore, the market environment might also be a source of our decision-making according to our competitors’ and customers’ needs. With the rapid growth of technology, organizations need to adapt. Right after the COVID-19 pandemic, most companies realized the necessity to go online and have virtual businesses. The last factor is culture, which significantly influences an organization's ability to adapt and perform its functions effectively.

 

Types of charts

The most used types of org charts are hierarchical (or vertical) and flat (or Horizontal). Hierarchical structure is found in many organizations such as educational, governments, and military organizations as indicated in the below figure.

 

 

 


A hierarchy org chart is a vertically arranged structure with the most powerful role at the top, typically a CEO, MD, or President. Powers flow from top to bottom, with every role reporting to the top and grouped to form a unit or department like finances or sales. This structure offers benefits such as increasing efficiency and providing clear communication and a line of reporting. The main disadvantage is that most staff members are not held accountable for the organization's decisions.

The Flat or Horizontal organization chart, the second most used, promotes decentralization by placing members of the same departments on the same level of authority, indicating equal decision-making authority. The decision-making style aims to speed up the process, build trust, reduce micro-management, and encourage active participation, leading to innovation empowerment but also posing a risk of communication breakdown and power struggle. To prevent this, organizations should hire experienced and self-sufficient members to manage the show.

 

            Furthermore, the Matrix, Divisional, and Network organizational structures are the other three popular types of organizational structures used in many organizations. Matrix structure requires employees to report to multiple managers simultaneously such structure can be found in software development tasks where developers report to a project manager and a functional department manager as seen in the image below:  

 

This structure enhances employees’ capacity and skills in various fields but can lead to conflict between the managers.

Divisional structure (also called product-based or market-based structure) divides the company into several independent divisions within the company. Each division has its own independent functional managers. Coca-Cola for example is a global beverage manufacturer, that operates in various regions through a divisional structure, allowing it to customize marketing strategies and different product offerings.

 

The main benefit of this structure is the speed it provides in the decision-making process and promotes customized products based on the customers’ needs. The setback of this structure is the lack of coordination within the leadership.

The organization's network structure involves both internal and external stakeholders to gather expertise for a common goal, such as combating youth unemployment. It promotes decentralization and flexibility but can lead to a serious breach of confidentiality and unhealthy competition.

 

Organizations can adopt various structures, including functional, geographic, and project structures. Functional structures divide departments like technical and finance, with a manager as the leader. Geographic structures are used for multiple locations, while project structures are organized for specific projects with specific timing.

Conclusion

An org chart is a dynamic tool that reflects an organization's structure and should be able to adapt to the business environment's evolution. It outlines roles, responsibilities, and reporting lines and comes in various forms like vertical, horizontal, matrix, and divisional charts. A clear structure promotes communication and collaboration by defining roles and responsibilities, and enhances clarity and accountability, while inaccurate charts can cause confusion and conflict among members.


References

 

Chen J. “Organizational Chart Types, Meaning, and How It Works”.

Investopedia. Sept. 23. https://www.investopedia.com/terms/o/organizational-chart.asp . Accessed 1 Mar. 24

 

Taylor D. “Factors Influencing Organisational Structure”. Tutor Chase. (n.d.).

https://www.tutorchase.com/notes/ib/business-management/factors-influencing-organisational-structure . Accessed 2 Mar. 24

 

Miller D. “Types of Organizational Structures Explained.” EdrawMind. Feb. 24

https://edrawmind.wondershare.com/org-chart/types-of-organizational-structure.html?gad_source=1&gclid=CjwKCAiAivGuBhBEEiwAWiFmYcwEnBcLXNigQF6n3T1zShlrhLNsAAI94MMEhBLOH-3i7TrSvrj8SxoCPcYQAvD_BwE. Accessed: 3 Mar. 24

 

The Organizational Chart: Understanding Your Company’s Structure. (McNamara, C. (2021). Free Management Library. https://managementhelp.org/)

 

The Importance of Organizational Charts in Project Management. (Project Management Hacks. (2019). https://www.projectmanagementhacks.com/)

 

Burke, R. (2015). Project Plan. Project Plan (Flow Chart), P. 140-146.

sssss

 

 

 

 

Comments

Post a Comment

Popular posts from this blog

W12 Paper: Parenting

Family Relations: Parenting   Fabrice T. Banyingela Home and Family Department, BYU-Idaho FAML 160: Family Relations Ryanne Burnett March 27 th , 2022  ------------------- ------------ ------------------  Page 1 ------------------- ------------ ------------------ Abstract Throughout this week, I have learned that parenting is a skill that is mostly disregarded as a full-time job but in reality forms a core responsibility of parents. Parents need to trust their kids, lead with example, and create a very good & forgiving environment. As part of my study from Marriage and Family: The Quest for Intimacy and other readings, I have received knowledge about the four Parenting Styles: Authoritarian, Authoritative, Permissive, and Uninvolved. I will use two experiences I have had with parents in order to address some of the parenting styles.             Keywords: a utocratic parenting, active parenting, missed opport...
Read more

2b Design: A creative social business in Lebanon

2b Design: A creative social business in Lebanon Introduction After accumulating enough managerial experience as an entrepreneur, Raja Moubarak and his wife Benedicte de Blavous moved to Lebanon in 2003 and three years later decided to create a social business named 2b Design which specialized in transforming architectural salvage into works of art. 2b Design has a clear mission: “restoring the unseen beauty of the broken” which will focus on maintaining disappearing artwork, buildings, and tradition through artistic creations and employing marginalized individuals especially the unemployable along with the disabled. This mission is accomplished by gathering and utilizing wrought iron, decorative wood, and other elements found in scrapyards and old Lebanese homes thus preserving a heritage that was ever more in danger of disappearing while touching and improving the lives of the broken (people whose socio-economic status or disabilities hindered them from leading a decent life). ...
Read more

BUS 374 Social Innovation - Reflection: Final

Fabrice Tshiyoyi Banyingela Professor Brittany James BUS 374 Social Innovation 21 July 2021 Reflection: Final It was a beautiful decision to embark on this journey and learn some of the important concepts of Social Innovation. The coursework was a mix of watching video tutorials about successful entrepreneurs and reading articles, case studies, and more interestingly an inspired book “How to change the world.” I feel empowered as an aspiring entrepreneur to create real solutions for real people. The most interesting and exciting part of my course was the understanding of Hybrids and Social Businesses. This lesson gave me a deep understanding of how a non-profit can sustain itself by generating income for a good cause. I have learned the challenges that entrepreneurs faces when it comes to running either a for-profit or a nonprofit. By understanding the nature of a business and its ethics in order to solve a social issue, this course has awakened my entrepreneurship desire as a calling ...
Read more