Formal Organizational Structure

8 Key excerpts on "Formal Organizational Structure"

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  eBook - ePub

  System Engineering Management

  • Benjamin S. Blanchard, John E. Blyler(Authors)
  • 2016(Publication Date)
  • Wiley

    (Publisher)

  matrix, and so on. These organizational patterns are discussed in the sections to follow, as they relate to the objectives of system engineering.

  7.4.1 Functional Organization Structure

  The primary building block for most organizational patterns is the functional structure reflected in Figure 7.2 . This approach, sometimes referred to as the “classical” or “traditional” approach, involves the grouping of specialties or disciplines into separately identifiable entities. The intent is to perform similar activities within one organizational component. For example, all engineering work would be the responsibility of one executive, all production or manufacturing work would be the responsibility of another executive, and so on. Figure 7.3 shows a further breakout of engineering activities for illustrative purposes.

  Figure 7.2

  Producer organization (traditional functionally oriented structure).

  Figure 7.3

  Breakout of engineering organizational activities.

  As shown in the figures, the depth of the individual elements of the organization will vary with the type of project and level of emphasis required. For projects involving the conceptual and/or preliminary design of new systems, there will be a great deal of emphasis on marketing and engineering. Within engineering, the system engineering organization should be highly influential in the design decision-making process, as compared with some of the individual design disciplines. Later, as the development process phases into detail design, the individual design disciplines will assume a greater degree of importance, and the interest in production and manufacturing increases.

  As with any organizational structure, there are advantages and disadvantages. Table 7.1 identifies some of the pros and cons associated with the pure functional approach illustrated in Figure 7.2

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  The Psychology of Behaviour at Work

  The Individual in the Organization

  • Adrian Furnham(Author)
  • 2012(Publication Date)
  • Psychology Press

    (Publisher)

  Accountability is the subordinate’s acceptance of a given task to perform because he or she is a member of the organization. It requires that person to report on his or her discharge of responsibilities.

  Organizations are layered, and within the hierarchical structure there are usually three broad interrelated levels: technical, managerial and external. The dimensions of structure can be identified in various ways, but are usually taken to include the grouping of activities, the responsibilities of individuals, levels of hierarchical authority, span of control and formal organizational relationships (see Chapter 2 ). An additional important dimension of structure is the impact of information technology, which naturally affects the flow of information through the structure.

  The structure of an organization affects not only productivity and economic efficiency, but also the morale and job satisfaction of its members. The overall effectiveness of the organization will be influenced both by structural design and by the behaviour of the employees. The “sociotechnical system” maintains and integrates the structural and technological requirements of the organization, and the needs and demands of the human part of the organization. A badly designed structure is in part likely to lead to inefficiency, low motivation and morale, late and inappropriate decisions, conflict, rising costs and lack of development.

  There is always an underlying need to establish a framework of order and system of command through which the activities of the organization can be planned, organized, directed and controlled. This demands attention to certain basic considerations in the design of organization structure, such as the classic Weberian bureaucracy decisions: clarification of objectives, dimensions of structure, division of work and coordination of activities, centralization, task and element functions, principles of organization, span of control and scalar chain, and formal organizational relationships (see Chapter 2

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  Organizations

  Structures, Processes and Outcomes

  • Pamela S. Tolbert, Richard H. Hall(Authors)
  • 2015(Publication Date)
  • Routledge

    (Publisher)

  It is this kind of context in which matrix forms of organization are expected to be best suited, although the dual-authority structure can require extremely intensive interactions and demands, especially on those employees who have two bosses. Partly because of this, it has been suggested that it’s most suited to relatively smaller organizations with a limited number (three or four product lines) (Galbraith, 1971). Information Technology Before moving on to consider other forces that shape formal structure, there are a few additional points to note about studies of technology and organizations. Research on the effects of technology on organizations dropped off considerably after the 1970s—perhaps because of the shift in researchers’ interests from understanding internal influences on organizational operations to understanding more external, environmental influences. This shift seems particularly surprising, however, because it was after this time point that information technologies developed in ways that allowed significant transformations in the way people worked and, hence, in organizational routines and operations (Zammuto et al., 2007). These technologies allow information to be exchanged simultaneously among a large number of individuals working at geographically and temporally dispersed locations; they also provide decision-making tools (simulations, visualization of work processes, etc.) that were largely unknown thirty years ago (Kellogg, Orlikowski, and Yates, 2006 ; Polzer et al., 2006). Such technological change has potentially enormous implications for the way organizations are structured. Yet we have little systematic knowledge of whether or how this technology has significantly altered structural patterns or the conditions under which it does or does not lead to structural changes

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  The SAGE Encyclopedia of Industrial and Organizational Psychology

  • Steven G. Rogelberg(Author)
  • 2016(Publication Date)
  • SAGE Publications, Inc

    (Publisher)

  virtual organization (also called boundaryless, network, shadow, and barrier free) may have only a small number of core employees and, in its most extreme case, no physical location beyond that needed to house a small cadre of managers or information technicians. Production or services that constitute the core of the organization’s mission may be outsourced completely to sites around the globe, with information technologies serving as the primary communication links. In fact, the explosion of technologies that can be used to connect employees and managers has led to network sharing among rivals to provide a service or product. The development of virtual organizations has especially focused the attention of organizational researchers on the integration of work. Historically, when much work was done in one location by workers, integration was relatively straightforward. With the advent of newer technologies, and changes in lifestyle (e.g., more emphasis on work–family balance), systems integration has become a critical topic and one that relates ultimately to organizational structure and its impact on employees. Additional research has begun to focus, for example, on the development of trust among employees located in disparate geographical areas, who are working together to achieve a common end, but who have never met (or will never meet) one another. Despite the constant of change, there is little doubt that the ongoing evolution in the world of work will be depicted in adaptations of organizational structure.

  Summary

  Organizational structure is the way people and the work to be accomplished within organizations are configured and coordinated. The primary elements of structure are centralization, formalization, and complexity. These elements are affected by forces outside the organization as well as by organizational size. Information technology and globalization are especially potent factors of organizational structures. Meaningful relationships exist between organizational structure and organizational strategy, performance, and individual attitudes and behaviors.

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  Organizational Behaviour

  • Paul Smith, Marilyn Farmer, Wendy Yellowley(Authors)
  • 2013(Publication Date)
  • Routledge

    (Publisher)

  Of course, strategy and structure are inextricably intertwined. Chandler's point was that new challenges give rise to new structures. The challenges of size and complexity, coupled with advances in communications and techniques of management control, produced divisionalization and decentralization. These same forces, several generations on, are now driving us towards new structural solutions – the federated organization, the multi-company coalition, and the virtual company. Few historians are prescient. Chandler was.

  (Adapted from Crainer and Dearlove 2003; quotation from p. 32)

  Q  To what extent does structure follow strategy?

  Technology

  Technology can be defined as how the organization transfers its inputs into its outputs (Robbins, Judge and Campbell 2010: 443). A car manufacturer, such as Ford, uses production lines to manufacture its vehicles. On the other hand, a university may use a variety of teaching technologies – some traditional, such as the lecture or seminar, and others more modern, such as the case study and a virtual learning environment.

  It is suggested that the type of technology has an important influence on the organizational structure. Studies point to the degree of routineness as being a key aspect in this. Technologies lie on a continuum from the standardized, routine and automated through to the non-routine and customized. Much of large-scale production-line manufacturing would be an example of the former, while furniture restoring, custom shoemaking and medical research would be examples of the latter. Although the link between routines and structure is a complex one, studies have found a clear association between routineness and formalization: organizations with routine technologies tend to have greater formalization, in terms of rules, regulations, job descriptions and documentation. Routine technologies also tend to be associated with taller and more departmentalized structures.

  Environment

  Various studies have shown a link between the structure and management of an organization and the external environment within which the firm operates, specifically in relation to the degree of uncertainty and change in the environment.

  Burns and Stalker (1961) studied a number of UK firms in different industries and their settings. They characterized these settings or environments into five types, ranging from stable to unpredictable. Two main types of structure and management practice were also identified: the mechanistic and the organic. The mechanistic structure was one with a high degree of task specialization and formalization, tight specification of individual responsibility and authority, centralized decision-making and formal rules and procedures. It can be likened to Weber's bureaucratic structure. The organic structure possessed little task specialization, a low degree of formalization, delegated decision-making and a high degree of individual responsibility.

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  Project Management Leadership

  Building Creative Teams

  • Rory Burke, Steve Barron(Authors)
  • 2014(Publication Date)
  • Wiley

    (Publisher)

  1. What is a Project Organization Structure?

  An organization structure enables a company to group people in a controlled manner for the purpose of performing work. In the project context, a project organization structure includes all of the elements set out in Table 4.1 .

  Table 4.1 : Project Organization Structure

  Temporary Organization Structure	A temporary organization structure that can be set up to perform a project, as outlined in the business case and project charter, and then disbanded when the project is complete.
  Reporting Structure	Reporting structures that outline who reports to whom, identifying the relationship between the project participants, together with defining their duties, responsibilities, authority and lines of communication.
  Assigning Responsibility	A project organization structure that enables responsibilities to be assigned to project participants to perform the work. In the project context, the project manager is the single point of responsibility who will, in turn, issue instructions to the resource providers.

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  Project Management

  A Systems Approach to Planning, Scheduling, and Controlling

  • Harold Kerzner(Author)
  • 2013(Publication Date)
  • Wiley

    (Publisher)

  Behavioralists contend that there is no one best structure to meet the challenges of tomorrow’s organizations. The structure used, however, must be one that optimizes company performance by achieving a balance between the social and the technical requirements.

  Organizations can be defined as groups of people who must coordinate their activities in order to meet organizational objectives. The coordination function requires strong communications and a clear understanding of the relationships and interdependencies among people. Organizational structures are dictated by such factors as technology and its rate of change, complexity, resource availability, products and/or services, competition, and decision-making requirements. The reader must keep in mind that there is no such thing as a good or bad organizational structure; there are only appropriate or inappropriate ones.

  Even the simplest type of organizational change can induce major conflicts. The creation of a new position, the need for better planning, the lengthening or shortening of the span of control, the need for additional technology (knowledge), and centralization or decentralization can result in major changes in the sociotechnical subsystem.

  Organizational restructuring is a compromise between the traditional (classical) and the behavioral schools of thought; management must consider the needs of individuals as well as the needs of the company. Is the organization structured to manage people or to manage work?

  There is a wide variety of organizational forms for restructuring management. The exact method depends on the people in the organization, the company’s product lines, and management’s philosophy. A poorly restructured organization can sever communication channels that may have taken months or years to cultivate; cause a restructuring of the informal organization, thus creating new power, status, and political positions; and eliminate job satisfaction and motivational factors to such a degree that complete discontent results.

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  Project Management

  A Systems Approach to Planning, Scheduling, and Controlling

  • Harold Kerzner(Author)
  • 2009(Publication Date)
  • Wiley

    (Publisher)

  If we assume that an organizational system is composed of both human and nonhuman resources, then we must analyze the sociotechnical subsystem whenever organizational changes are being considered. The social system is represented by the organization’s personnel and their group behavior. The technical system includes the technology, materials, and machines necessary to perform the required tasks.

  Behavioralists contend that there is no one best structure to meet the challenges of tomorrow’s organizations. The structure used, however, must be one that optimizes company performance by achieving a balance between the social and the technical requirements. According to Sadler18 :

  Since the relative influence of these (sociotechnical) factors change from situation to situation, there can be no such thing as an ideal structure making for effectiveness in organizations of all kinds, or even appropriate to a single type of organization at different stages in its development.

  There are often real and important conflicts between the type of organizational structure called for if the tasks are to be achieved with minimum cost, and the structure that will be required if human beings are to have their needs satisfied. Considerable management judgment is called for when decisions are made as to the allocation of work activities to individuals and groups. High standardization of performance, high manpower utilization and other economic advantages associated with a high level of specialization and routinization of work have to be balanced against the possible effects of extreme specialization in lowering employee attitudes and motivation.

  Organizations can be defined as groups of people who must coordinate their activities in order to meet organizational objectives. The coordination function requires strong communications and a clear understanding of the relationships and interdependencies among people. Organizational structures are dictated by such factors as technology and its rate of change, complexity, resource availability, products and/or services, competition, and decision-making requirements. The reader must keep in mind that there is no such thing as a good or bad organizational structure; there are only appropriate or inappropriate ones

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