Organizational structures

An organization structure is the basic framework within which the decision making behavior occurs it shows the different posts in organization and the responsibilities attached to these different posts

Various types of organizational structure

1. Line organization (military)

The authority move from top levels to lower levels. There is direct vertical relationship connecting the positions at each level with those above and below

Advantages

  • Simple and is readily understood but the staff
  • Responsibility for work at different levels in clear
  • Lines of communication both upward and downward are indicated
  • Chain of command are shown
  • Economic and effective
  • Discipline can easily be maintained

Disadvantages

  • Works on a dictatorial basis
  • The organization is rigid and in inflexible
  • Each department tends to become an empire of its own
  • Where there is no overall planning, there are possibilities of lack of coordination of work at different departments

2. Staff organization (functional organization)

Various departments are established and each department is required to perform some specific duties e.g. production ,marketing, finance etc.

Advantages

  • There is specialization by each department and responsibilities is also fixed
  • Coordination is a must as each department relies on each other and thus discipline can be maintained
  • Methods and operations can be standardized
  • Mass production is made by standardization and specialization

Disadvantages

  • In a large organization with several departments, there may be too many experts and many bosses
  • The workers become confused because of the many bosses
  • The system becomes very much detailed and thus uneconomical
  • There are too high overhead expenses
  • It’s difficult to fix responsibility on workers

3. Line and staff organization

Under this structure, a company is divided into departments each engaged in a particular undertaking.

Services are carried out in such a way that those very close or important are carried out independently by each unit e.g. purchasing of raw materials, production, planning and personnel.

Other service departments e.g. accounts, sales etc. provide service to all departments

The underlying idea of this method is that specialized work is to be left to experts who will give advice on specialized grounds e.g. investigation, research etc.

The staff officers have no executive positions in the concern and are thinkers while the officers are the doers

Advantages

  • The principle of specialization is retained and responsibility fixed
  • Coordination is possible yet discipline can be maintained at the same time
  • Increased efficiency of operations is possible
  • Mass production is possible

Disadvantages

  • Staff may be confused by those with higher power i.e. between the executives and staff officers
  • Conflicts between line and staff officers
  • There is a possibility of issuing contradicting orders



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