Scribd Logo
Upload

Welcome to Scribd!

  • 19 views

    Good Governance 2

    Uploaded by

    Gino Lique
    The document discusses organizational structure and development. It defines organizational structure as the pattern of relationships and division of labor within an organization. The key types of organizational structures discussed are functional, product/service, geographical, divisional, and matrix. Centralization and decentralization are also covered, referring to whether decision-making power is concentrated at the top or distributed throughout an organization. Organizational structure aims to facilitate coordination, accountability, and performance while allowing flexibility.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd

    Good Governance 2

    Uploaded by

    Gino Lique
    19 views7 pages
    The document discusses organizational structure and development. It defines organizational structure as the pattern of relationships and division of labor within an organization. The key types of organizational structures discussed are functional, product/service, geographical, divisional, and matrix. Centralization and decentralization are also covered, referring to whether decision-making power is concentrated at the top or distributed throughout an organization. Organizational structure aims to facilitate coordination, accountability, and performance while allowing flexibility.

    Copyright

    © © All Rights Reserved

    Available Formats

    PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    The document discusses organizational structure and development. It defines organizational structure as the pattern of relationships and division of labor within an organization. The key types of organizational structures discussed are functional, product/service, geographical, divisional, and matrix. Centralization and decentralization are also covered, referring to whether decision-making power is concentrated at the top or distributed throughout an organization. Organizational structure aims to facilitate coordination, accountability, and performance while allowing flexibility.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    19 views7 pages

    Good Governance 2

    Uploaded by

    Gino Lique
    The document discusses organizational structure and development. It defines organizational structure as the pattern of relationships and division of labor within an organization. The key types of organizational structures discussed are functional, product/service, geographical, divisional, and matrix. Centralization and decentralization are also covered, referring to whether decision-making power is concentrated at the top or distributed throughout an organization. Organizational structure aims to facilitate coordination, accountability, and performance while allowing flexibility.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    You are on page 1of 7

    CHAPTER 2 ORGANIZATIONS: THEIR POLITICAL, STRUCTURAL AND

    ECONOMIC ENVIRONMENT

    Lesson Objectives
    At the end of this lesson, the students should be able to:
    1. Understanding the organizational development;
    2. Identify the types of organizational structure; and
    3. Explain centralization and decentralization.

    UNDERSTANDING THE ORGANIZATION AL ENVIRONMENT


     Organizations are complex adaptive systems that use people, tasks and
    technologies to achieve specified goals and objectives. Structuring the
    organization represent the division and distribution of work among members of
    organization, and the organization of their activities in such a way that they are
    directed towards achieving the declared goals and objectives of organization.
    Management is about low the organization and how it measures and monitors the
    resulting performance towards achieving the declared goals and objectives of the
    organization.

    ORGANIZATION THEORY
     Organization theory is especially useful for people who manage organizations, or
    who aspire to do so in the future. But whether or not you are manager, for
    examples, if you work in public health, you will be working with organizations (like
    hospitals, charities, local and national government etc.)
    Drucker suggest three criteria for effective organization:
    a. They must be organized for business organization
    b. Their structure should contain the least number of management levels.
    c. Organizational structure should facilitate training and testing of future organization
    leaders,
    ORGANIZATIONAL STRUCTURE
     Organization structure is the pattern of relationships among positions in the
    organization and among members of the
    organization. The purpose of structure is the
    division of work among members of the
    organization, and the coordination of their
    activities so that they are directed towards
    achieving the same goals and objective of the
    organization. Structure defines tasks and
    responsibilities, work roles and relationships
    and channels of communication.

    Objectives of an Organizational Structure


     Accountability for areas of work undertaken by groups and individual members of
    organization
     Coordination of different parts of the organization and different areas of work
     Effective and efficient organizational performance including resource utilization
     Monitoring the activities of the organization
     Flexibility in order to respond to changing environmental factors
     The social satisfaction of members of the organization

    Dimensions of Organizational Structure


    Child (1988) suggest six major dimensions as components of an organization structure:
     Allocation of individual tasks and responsibilities, job specialization and definition
     Formal reporting relationship, levels of authority and spans of control
     Grouping together of section, departments, divisions and larger units
     Systems for communication of information, integration of effort and participation
     Delegation of authority and procedures for monitoring and evaluating the action
     Motivation of employees through systems for performance appraisal
    Consequence of Structural Deficiencies (CHILD):
     Low motivation and morale
     Late and inappropriate decisions
     Conflict and lack of co-ordination
     Rising costs - e.g. diseconomies of scale
    Principles of Organizational Design
    and Diagnosis
     Simple structure: a centralized,
    perhaps autocratic arrangement
    typical of the entrepreneur-
    founded company.
     Machine bureaucracy: best at
    mass produced tasks and is
    characterized by many layers of
    management professional bodies.
     Professional bureaucracy
     Divisional zed form of bureaucracy: applies more to multinational or industrial
    corporation where a small central core controls key guidelines for a number of
    otherwise autonomous units
     Adhocracy: often found in new technology industries, which need constantly to
    innovate and respond to quickly changing markets.

    Types of organizational Structure


     This is essentially the process by which the organization’s mission is divided into
    discrete roles and tasks of individuals within the organization. There are different
    ways of doing this.
    These can fall into the following categories:
     Functional
     Product/service
     Geographical
     Divisional
     Matrix
    Functional
     Grouping of major functions e.g.
    contracting, information, finance,
    personnel and public health in health authorities.
    Advantages:
     Increases utilization and coordination of groups of people with
    technical/specialization expertise.
     Increases development and career opportunities for people in departments.
    Disadvantages:
     Encourage sectional interests and conflicts
     Difficult for organization to adapt to product/service diversification
    Product/Service
     Grouping by service/product. For example, in a hospital, into orthopedic, surgical,
    psychiatric rather than medical, nursing, paramedical, hotel services (functional).
    Advantages:

     Increases diversification
     Adaptability increased if service/product
    requires technical knowledge or large
    equipment
    Disadvantages:
     Encourages service conflicts
    Geographical
     A nationalized service develops regions, areas or district
    authorities.
    Advantages:
     More responsive to local/regional issues and different cultures, national/local laws.
    Disadvantages:
     Can lead to localities/regions conflicting with each other
    Divisional
     Grouping of services and/or geography and functionality (but with functions such
    as finance, personnel, planning retained at headquarters).
    Advantages:
     Suitable for international companies who are highly diversified, working in more
    than one country. For example, a pharmaceutical company with divisions in each
    country producing and marketing products developed by the parent company.
     Corporate strategic control with production and marketing independence at
    divisions.
    Matrix

     Grouping of projects and functions

    Advantages:

     Combines vertical and lateral lines of communication and authority


     Stability and efficiency (of mechanistic structure) with flexibility and informality (of
    inorganic structure)
     Emphasizes that project aims are all important
    Disadvantages:
     Potential conflict between project leader and functional leader regarding resources
     Project may be jeopardized if project members as well as leaders enter the conflict
    on opposite sides
     Does not tolerate diversification well

    CENTRALIZATION AND DECENTRALIZATION


     Centralization when all the power for decision making rests at a single point in the
    organization ultimately in the hands of one person or group, the structure is
    centralized. If the power is dispersed among many people/groups, it is known as
    decentralized or distributed. Note that some functions (research, planning, finance,
    personnel) are less amenable decentralization than others (e.g. contracting, client
    services). Centralization and decentralization should not be treated as absolutes,
    but rather as two ends of a continuum.

    Advantages:
     Frees top management of routine every day decisions to concentrate on strategic
    responsibilities
     Decisions are more local, quicker, more responsive to clients
     Increased awareness of cost effectiveness through the organization
     Increased motivation and satisfaction by junior management
    Disadvantages:
     Requires good communication and adequate control to and from the center
     Need for center to coordinate/integrate
     Can lead to inequity in treatment of clients
     Need individuals willing to take on additional responsibilities

    In general, large organizations lean towards:


     Less centralization
     More specialization
     More rules and procedures to be followed
    LEVELS OF THE ORGANIZATION
    According to ducker, organizations are layered into three main levels:
     The technical level of the organization is concerned with specific operations and
    defined tasks.
     The managerial level (or organizational level) is concerned with the coordination
    and integration of work, at the technical level e.g. resource allocation,
    administration and control of the operations of the technical function.
     The community level (or institutional level) is concerned with the broad objectives
    and the work of the organization as a whole. Decisions made at this level will
    include the selection the selection of operations, development of organizations in
    relation to external agencies and the wider social environment.

    For further discussion, please refer to the link provided: Organizational structure
    https://www.youtube.com/watch?v=wO_-MtWejRM
    For further discussion, please refer to the link provided: Types of organizational structure
    https://www.youtube.com/watch?v=Vbcpr1TS9NM
    For further discussion, please refer to the link provided: Centralization and decentralization
    https://www.youtube.com/watch?v=M1sV6YhxQD8

    Reference: Strategic Management Made Simple By: Felina C. Young

    You might also like