Even though the bureaucratic structure has received a lot of criticism, it has some advantages. The faster the enterprise can adapt its organizational structure to the new demands, the higher its capacity to survive is. Nature and Characteristics of Organisation Structure 3. Some of the advantages of a pure line organisation are: (i) A line structure tends to simplify and clarify responsibility, authority and accountability relationships. Structure of Organization; Advantages of Functional Organizational Structure. None of them is effective in certain situations. system in general and especially of their organizational structures. Meaning of Organisation Structure 2. Furthermore since each job is well described in terms of qualifications and duties, the promotional stages can be more clearly established. It Promotes Faster Decision Making Another advantage about a flat organiza… The organizational structure examples are usually a subject of study so that there can be a perfect structure for a particular company. Meaning of Organisation Structure: Organisation structure is the pattern of organisational hierarchy based on authority responsibility relationship. Since the lines of communication and flow of authority are clearly identified on the organizational chart, the intercommunication is both clearer and easier and it eliminates ambiguity. Nicky is a business writer with nearly two decades of hands-on and publishing experience. Because of a sense of belonging and high morale that a well-structured organization develops among employees and also because of clear-cut accountability, recognition of skill and appreciation for their contribution towards organizational growth, the employees develop their own initiative and a spirit of innovation and creativity. In a good organizational structure, the conflicts between individuals over jurisdiction are kept to a … Functional departmentalization is when jobs are grouped according to the functions they have within the organization. Report a Violation, 3 Steps that should be taken to Build the Structure of an Organization. However, there are three things that will help you in the organizational … An employee is given sufficient freedom within the domain of his responsibility and his authority. For example, under the sales department, we may have a sales director for each country where the company has a significant presence. Basically, it states that each person should report to only one manager directly above them. List of the Advantages of a Collaborative Structure 1. Advantages of Organization Well-conceived organizational structures provide security and transparency to employees. The concept of unity of command is another important concept that is part of this structure. Before publishing your articles on this site, please read the following pages: 1. This fosters trust and understanding in your staff. It helps an organization decide how the authority passes on, how message communication happens. Here are some of the key advantages and disadvantages to consider when looking at the addition of collaborative structures to the modern workplace. An ideal organizational structure based on clear-cut demarcation of authority, higher range of responsibility, discretionary freedom granted to personnel, incentives offered for specialized work etc., … The Advantages of Horizontal Organization. Understanding the interplay between these two concepts can help you to design the most effective performance management systems for your organizational structure. The concept of responsibility is a qualifier to the concept of authority. This means that there are less wages, fringe benefits, and so on, to pay for management. This type of organizational structure is a highly formal one where the jobs are well standardized and there are clear rules and protocols that guide employee behavior. The drawback is that it’s trying to encourage … According to Lounsbury Fish, “Organisation Structure … The right kind of organizational structure will make it possible for employees to communicate effectively with their managers and each other. Work specialization is all about how tasks and jobs are distributed within the organization. A disadvantage is that … HFMA: New Structures, New Roles for the Future of Health Care, LinkedIn: The Importance of a Good Organizational Structure to Growth and Profitability, MGMT: Six Key Elements in Organizational Design. It discusses the characteristics, advantages and disadvantages of different types of organizational structures, as well as when particular structures may be effective. The role of organizational structure in effectiveness and performance cannot be overstated. Business Models & Organizational Structure, How to Compare & Contrast Organizational Structure. 1. It involves lines of both authority and accountability as well as what kind of behavior is considered acceptable within the organization. There must be strategies in place to deal with the … Demerits. Product departmentalization occurs when jobs are grouped according to the product line. That way, the line of command does not branch out at any point in the hierarchy. Since a good organizational structure requires that the duties be clearly defined and assigned, such duplication of work is eliminated. 5. Accountability, predictability, structure and job security are just a few to mention. Information will flow easily in all directions and the employees will feel heard and like they have a say in how the organization is run. Process departmentalization is departmentalization based on customer or product flow. The advantages and disadvantages of a hierarchical organizational structure involve communication, innovation, and collaboration. In fact, to a certain degree, organizational structure is also about how the company relates to its external environment. Effective decision making requires an adequate amount of information and that information can only be obtained where there is good communication. Advantages of the hierarchical organizational structure are many, the most impelling of which is that your employees will have clearly defined roles and responsibilities, and a sense purpose … There are also some important concepts attached to this kind of organizational structure. Benefits of an Effective Operational Structure: A well-designed organization structure promotes success and facilitates company growth and profitability. For example, the person heading the … To know which one is best for you, you need to know about all of them. Since the goals are clearly established and resources clearly identified, both short term as well as strategic planning becomes more focused and realistic and such planning contains the provision to permit changes to be made in the right direction including expansion and contraction of facilities, operations and activities when it becomes necessary. Individual employees and departments, therefore, will specialize in doing certain parts of activities, rather than entire activities. A manufacturing firm, for example, may have a chemical mixing department, an assembling department, a packaging department, and so on. Duplication exists when work distribution is not clearly identified and the work is performed in a haphazard and disorganized way. The executive or the team leader has the knowledge and experience of that particular field. This makes it possible for them to effectively carry out those tasks. One advantage of the matrix organizational structure is that people across different functional areas have a better understanding of their coworkers in other areas. Training: A good organizational structure makes employee training easier to administer, and it also … 8 Quantitative Standards against which Performance can be measured in an Organization. Internal Communication Is Easier The right kind of organizational structure will make it possible for employees … Every manager has it within their power to tell certain people what to do and reasonably expect them to do it. Geographical departmentalization is where jobs are grouped based on geography or the territory of the unit. Is the organization run from a central place or is there more autonomy throughout the organization? Image Guidelines 5. Ultimately, there are a number of advantages of an organizational structure. Ultimately, the right kind of organizational structure will cause the company to run smoothly in every way. Organizational structure is … Customer departmentalization is based on the grouping of jobs according to the type of customer. In this 59 Designing centers: Principles for effective Organizational structure Call centers tend to have this kind of structure. Advantages of Functional Organizational Structure The employees are made into groups according to their skills, and thus the overall effectiveness and efficiency of the tasks increase.
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