The Importance of Structure in Meeting the Goals of a Firm
The Importance of Structure in Meeting the Goals of a Firm
Organizational structure refers to the way that an organization arranges people and jobs so that its work can be performed and its goals can be met. When a work group is very small and face-to-face communication is frequent, formal structure may be unnecessary, but in a larger organization decisions have to be made about the delegation of various tasks. Thus, procedures are established that assign responsibilities for various functions. It is these decisions that determine the organizational structure.
Related Information can be found at http://www. referenceforbusiness. om/management. In essence, it refers to the formal or informal relationships between people in an organization. The business strategy selected by management determines the structure most appropriate to the organization. According to David B. Balkin, Robert L. Cardy and Luis R. Gomez-Mejia, 2012, An organization develops a business strategy by establishing a set of long-term goals based on the analysis of environmental opportunities and threats and the realistic appraisal of how the business can arrange its assets in order to compete most effectively.
It is very important for one such structure to be established in any firm as this may rely heavily on the survival of any business and ultimately the accomplishment of the organization’s goal. It is also important that these structures are monitored as influences such as rapid growth and the change in organizational culture may shift the dimension of the organizational structure so as important as it is to implement, it is equally important for it to be monitored as to be readily flexible to accommodate change if and when necessary.
Structures allow for the chain of command and specifies who report to whom and who does what. It depicts the skeletal body of the organization for clarity, uniformity, accountability and also responsibilities. Department leaders are in charge of delegating tasks and projects to subordinates so the department can meet project deadlines. It requires these leaders to carefully conduct job analysis in order to apply each employee’s job design, which involves the lay out of job responsibilities and duties and describe how they are to be performed in order to achieve an organization’s goals. Job design definition from Andrew J. DuBrin, 2003) Each position in an organization serves a specific purpose whether that at a supervisory or senior level or even that of the line staff personnel who are directly involved in the day-to-day production of the company’s products. Hence, work flow becomes very essential as this is the way work is organized to meet the organization’s product or service goals. (David B. Balkin, Robert L. Cardy, Luis R. Gomez-Mejia, 2012).
In essence, organizational structure fosters teamwork, where everyone in the department works toward a common goal. The best organizational structure for any organization depends on many factors including the work it does; its size in terms of employees, revenue, and the geographic dispersion of its facilities; and the range of its businesses (the degree to which it is diversified across markets). It is also dependent on the Human Resource Strategy that is most suitable or appropriate for that particular organization.
The best fit for the organization will ultimately yield maximum results – both with the organization’s overall goal or that of staff welfare. Best fit will lead to better performance, and lack of fit can create inconsistencies that will reduce performance. An organization’s design requires choosing a structure that will assist the firm to accomplish its goals most efficiently. There are three basic types of organizational structures they include; bureaucratic, flat, and boundaryless.
In a bureaucratic structure, a rational, systematic, and precise form of organization in which rules, regulations, and techniques of control are specifically defined. (Andrew J. DuBrin, 2003). Bureaucratic organizational structures are usually large, mature, formal and complex structures involving a set of highly routine activities tightly supervised under a centralized authority. It consist of hierarchies with many levels of management. It is based on functional division of labour, where employees are divided into divisions based on their function.
Sections of bureaucratic organizational structures are often categorized into departments or divisions, then further divided into sub-divisions. This structure Standardization and best-practices are often highlights in companies with tall organizational structures, ensuring that work is consistently completed efficiently and effectively. However, Flat Organization refers to an organizational structure with few or no levels of intervening management between staff and managers.
The idea is that well-trained workers will be more productive when they are more directly involved in the decision making process, rather than closely supervised by many layers of management. This structure is generally possible only in smaller organizations or individual units within larger organizations. When organizations develop into a critical size, organizations can retain a streamlined structure but cannot keep a completely flat manager-to-staff relationship without impacting productivity.
The flat organization model promotes employee involvement through a decentralized decision-making process. By elevating the level of responsibility of baseline employees and eliminating layers of middle management, comments and feedback reach all personnel involved in decisions more quickly. Boundaryless Organizational Structure is one that enables an organization to form relationships with customers, suppliers, and/or competitors, either to pool organizational resources for mutual benefit or to encourage competition in an organization. D. Balkin et al. ) This type of structure focuses on fluid and adaptive behavior, these organic structures welcome and thrive on change. The informal managerial style is well suited for intricate and “non-standard” work. Boundaryless organizations communicate mainly through email, phone and other virtual methods rather than more traditional face-to-face communication. The freedom to telecommute with international employees removes geographical barriers to productivity and allows for schedule flexibility.
By organizing expert employees in groups and giving them decision-making authority, these companies can change quickly to meet needs and function efficiently in an ill-defined hierarchy. (www. smallbusiness. chron. com/structure). Boundaryless organizational Structures share many characteristics of flat organizations. It is mainly used when collaborating with customers or suppliers to provide better quality products or services, when entering foreign markets that have entry barriers to foreign competitors and it reduces the financial risk to any one organization.
In concluding, it is important that all issues discussed are carefully considered in order to foster growth and to ensure the realization of the company’s goals whether long or short term. The discourse as to the best structure that will work for your organization is one that considers several attributes such as the type, size, strategy that is used in the organization and several other issues as explained but evidentially the structure should always be the one that fits best in alignment of the organization’s goal.
University/College: University of Arkansas System
Type of paper: Thesis/Dissertation Chapter
Date: 19 November 2016
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