In this essay I will discuss four different types of structures to manage their organizations also I will give examples to illustrate their advantages and disadvantages. Every large firm has an organization structure, it defines how tasks are grouped, divided, and coordinated. Every structure is setup by six key components (work organization, departmentalization, chain of command, span of control, centralization and decentralization, and formalization). Every aspect of these is vital for the efficiency of the company and we will se how the different types of organization structures affect them.
The work specialization is the degree to which activities are subdivided into single actions. In a few words, rather than an entire job being done by just one person, it is broken into number of simple actions, with each action being completed again and again by separate individual. The product is completed faster compared to being done by just one worker. It also helps the manager to make the best of his employees because some tasks need more complex skill rather to others and it could be done from untrained workers. This helps skilled workers not to work below their ability level, because they are paid more than non-skilled. Also helps the organization to spend its money more efficiently.
Departmentalization is further development of specialization. Once you have divided the work through specialization you need to group these jobs so that more complex task of exact type can be coordinated. The main benefit of grouping is putting all specialists together.
Chain of Command is the line through which the authority, process its decisions and defines who is superior to whom. We cannot define that definition without discussing two other concepts. Authority refers to the embodied power in a managerial position to give orders and expect them to be performed. The second concept is unity-of-control and it means that a person should be subortinated to just one superior.
Span of control refers to the number of subordinates that a manager has and how efficiently and effectively are they being direct. There are two types of span wide and tight. In recent year the trend is toward the wider span because they produce less bureaucracy and are cheaper.
The Matrix
The matrix structure is wide spread organization setup. It is used in advertising agencies, hospitals, universities, research laboratories, and entertainment companies. It mixes two forms of departmentalization functional and product so all specialists are grouped together. Another noticeable feature is the break of unity-of control concept and its replacement with two boss structure. For example, if you are a special effects supervisor in a movie company you are working on an exact movie project, but you are also working in the special effect department. So you report to both bosses (of the movie project and the department chief). The main power of this type of organization structure is putting all the specialists together so they can share information and resources. Therefore is a logical disadvantage of difficult coordination and completing the tasks on time and within the budget. The matrix structure is more expensive because there is a lot of duplication of work. Confusion is also created by the fact that an individual has to report to two bosses. Ambiguity is significantly increased and ambiguity often leads to conflict (Robbins p.463) An example of matrix structure is the Bulgarian company “Aroma” they are producing hygienic attributes so they are having projects on a new type on teeth brush, but the scientist also have to report to his own department.
The Simple Structure
The simple structure is commonly used in small business. The authority is centralized in one person who is the manager and the owner therefore the spans of control are widely spread. It has no departments and the structure is “flat”. The main strength of this structure is in its simplicity. It is flexible and cheap to maintain. The main disadvantage is that is usable only in small business. If the company grows there is risk to fail if not reconstructed because one person cannot make all the decisions in a company of 100 people. Another disadvantage is that the whole structure depends only on one person. A good example of simple structure is my uncle’s company Import Bulgaria. It is generally a small firm consisted of 4-5 which is importing chemicals for paints. He is the chairman and he decides what the strategy of the company is. Tilko that is his name, often mourn of the tons of bureaucracy he has to do when he is paying his taxes.
The Team Structure
Independent teams have become very popular in the new century. When a company uses team structure, they have a horizontal organization. A horizon structure means that the hierarchy is at minimum level, also the team structure breaks the departmental barrier and the decision making is decentralized. Another feature of this structure is that employees’ skills have to be balanced between specialization and generalization. A typical example of team structure is a Interne Games Desire organization. They have 3 different team responsible for different projects.
The Bureucracy
Bureaucracy is in the supermarket, where we buy food, in the universities, hospitals, public transport…But in order to be efficient it has standardized work process for coordination and control.
Bureaucracy means a system with very formalized rules, centralized authority, departments which have specific functions ,narrow spans of control and decision making that follows the chain of control. People are performing routine tasks, achieved by specialization. Bureaucracies do not require much talented managers because rules and regulations serve as managers. Rules have to be obeyed and innovative decision makers are rarely needed. Specialization restricts the area of action for example the production executive in a company is interested in production,the reseach and development manager is interested in the design ,the marketing executive is concerned for the sells and the accounting manager in the budget. And each one thinks that his department is the most important one this creates subunit conflicts.There are a lot of cases for which there is no rule and bureaucracy is helpless to perform the certain activity. This is one of its major weakness.
There has not been invented the perfect organization structure. Each of the presented has its disadvantages.
The choice of organization structure depends on the activity we want to perform and the contemporary conditions.
Bibliography
1. Robbins, Stephen (2009) , Organizational behaviour, Upper Saddle River, N.J. : Pearson Prentice Hall
2. Huczynski, Andrzej, (2007), Organizational behaviour : an introductory text, Harlow : Pearson Education
3. Boddy, David, (2008), Management : an introduction, Harlow : FT Prentice Hall
4. Thompson, Paul, (2009), Work organisations : a critical approach, Basingstoke : Palgrave Macmillan