TYPES OF ORGANIZATIONAL STRUCTURE

presented by

Joshna

Organizational structure

Definition The ways in which an organization

divides it tasks and then coordinates them.

TALL STRUCTURE As an organization grows, the number of

management levels increases and the structure grows taller.

Diagram: Tall Structure

Advantage of tall structure There is a narrow span of control ie

each manager has a small number of employees under their control.

There is a clear management structure.

There will be clear lines of responsibility and control.

Disadvantage

The freedom and responsibility of employees (subordinates) is restricted.

Decision making is slow Communication has to take place

through many layers of management.

High management cost.

FLAT STRUCTURE

A flat organization structure has few levels of management between the executive level and the front-line employees.

The premise behind a flat organization structure is to empower employees by making them a larger part of the decision-making process.

Disadvantage

•Workers may have more than one manager/boss.

•May limit the growth of the organisation.•Structure limited to small organisations

such as partnerships, co-operatives and some private limited companies.

More/Greater communication between management and workers.

Better team sprit. Easier decision making. Fewer levels of management which includes

benefits such as lower costs as managers are generally paid more than worker.

Advantage

Project structure

This type of organization is suitable when an organization undertakes specialized work for a particular period as one time operation.

the team members are reassigned.

Advantage

Clear Line of Command

Quick Decision MakingKnowledge SharingEasier Supervision

FUNCTIONAL STRUCTURE

This is where the work is divided into specific areas of specialization: jobs and activities are grouped together – also referred to as departmentation.

Departmentation can take place in different ways: based on a product or service, by types of customers, or by type of equipment used to produce the business products.

Advantage

saves us money because of the economies of scale.

it helps in privacy of information.

Disadvantage

The coordination between different department more difficult than other structures.

It also does not allow for flexibility because of the centralization.

DIVISIONAL STRUCTURE

Divisional Structures A division is a collection of functions working together to produce a product. Divisions create smaller, manageable parts of a firm. A division has marketing, finance, and other function.

Product structure: divisions created according to the type of product or service

. Geographic structure: divisions based on the area of a country or world served.

Market structure: divisions based on the types of customers served.

Advantage

Increases strategic and operational control.

Quick response to environmental changes

Increased focus on products and markets

MatrixSometimes an organization

needs to run according to what projects they have to do.

In these situations people usually work together in a team to achieve their projects goals.

Advantage

Decentralised decision-making Strong product coordination

Flexible use of human resources

DISADVANTAGE

High administrative costs Confusion over authority and

responsibility (potential) Excessive focus on internal

relations Overemphasis on group

decision-making Slow response to change

(possible)

Virtual OrganizationAn organization uses information and

communication technologies to Virtual organization can be thought of as a way in replace or augment some aspect of the organization.

People who are virtually organized primarily interact by electronic means.