MAJOR TYPES OF ORGANIZATIONAL STRUCTURE
Date: 2015-10-07; view: 518.
ORGANIZATIONAL STRUCTURES
YOU SHOULD REMEMBER
The issues of centralization and decentralization involve the principle of delegation of authority. In centralization,a limited amount of authority is delegated; in decentralization,a significant amount of authority is delegated to lower levels. Each
form has its advantages and disadvantages and is affected by a number of factors, such as size of organization and the amount of geographic dispersion.
The primary formal relationships for organizing, as discussed earlier, are responsibility, authority, and accountability. They enable us to bring together functions, people, and other resources for the purpose of achieving objectives. The framework for organizing these formal relationships is known as the organizational structure.It provides the means for clarifying and communicating the lines of responsibility, authority, and accountability.
Although there are a number of variations of organizational structure, we shall discuss line and staff organizations and committee organization here.
• LINE ORGANIZATION
The line organizationis the simplest organizational structure. It is the “doing” organization, in that the work of all organizational units is directly involved in producing and marketing the organization's goods and services. There are direct vertical links between the different levels of the scalar chain. Since there is a clear authority structure, this form of organization promotes greater decision-making and is simple in form to understand.
On the other hand, managers may be overburdened when they have too many duties. Figure 11-12 illustrates a simple line organization.
• LINE AND STAFF ORGANIZATION
When staff specialists are added to a line organization to “advise,” “serve,” or “support” the line in some manner, we have a line and staff organization.These specialists contribute to the effectiveness and efficiency of the organization. Their authority is generally limited to making recommendations to the line organization. Sometimes this creates conflict. However, such conflict can be reduced by having staff specialists obtain some line experience, which will tend to make them better understand the problems facing the line managers they support. Such functions as human resources management and research and development are typical staff functions. Figure 11-13 provides an example of such a structure.
• COMMITTEE ORGANIZATION
When a group of people is formally appointed to consider or decide certain matters, this type of structure is a committee.Committees can be permanent (standing) or temporary and usually supplement line and staff functions. Sometimes ad hoc or temporary committees are set up to deal with a specific problem. Once this committee makes its recommendations, it is dissolved. On the other hand, permanent committees usually act in an advisory capacity to certain organizational units or managers. For example, committees are used to a large extent in universities. They may report to a dean or department chair. Certain committees, called plural committees, have the authority to order, not just to recommend. These committees are usually reserved for a very high level, such as the board of directors. An example is an executive committee of the board for compensation or for succession planning.
Although committees have a number of advantages, they also have a number of disadvantages, particularly being excessively time consuming. Hence they should be managed effectively.
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