Modern day business organizations are faced with myriad challenges ranging from being relevant to the current highly competitive business environment to globalization (Bateman & Snell, 2007). Indeed, organizations have to contend with management dynamism, ethical issues, financial upheavals, growth and sustainability. The most important is to be profitable to the stakeholders. Unless these organizations re-strategize they are unlikely to survive these challenges. In fact, organizations have to deviate from old philosophical schools of business management to modern day theoretical perspectives that have ensured their survival amid economic, social and political predicaments.
Organizational structure
Most organizations are a form of bureaucracy with a chain of command and decisions being top down. Nevertheless, many of these bureaucratic organizations have rarely succeeded in the modern day business environment. Bureaucracies are neither new in the organizational structural theory nor have they been scraped out totally. Basically, bureaucracy is still a typical modern day organizational structure though it has undergone structural readjustments that fit the new perspectives of modern organization (Beamish et al., 2003).
The old view of bureaucracies as rigid structures has totally changed. The modern view of boundaries created within various levels of bureaucracy are permeable structures and processes. Structural changes taking place actually focus on cutting down the functional precincts between various vertical levels and across departments. Essentially organizations are now encouraging sharing of business ideas and processes across these borders (Bateman & Snell, 2007). Instead of using these bureaucratic boundaries to create responsibilities, separate employees, practice and locations, many organizations are now centering their attention on how to make these boundaries permeable to information, ideas, endowment, innovations, decisions, rewards and actions.
Ashkenas et al. (2002) argue that boundaries will continue to exist. People are specialized differently thus perform different tasks. Levels of influence and authority exist differently among the organization employees while people within the production line perform different tasks. Furthermore, people are differentiated by geography and work conditions but in particular diverse culture and time zone. All these differences create bureaucratic limitations. The underlying purpose of these boundaries is to keep production focused and distinct (Jones, 2010). Definitely the modern concept of organization boundary-less is not intended to do away with these distinct functions but to make them more porous and flexible to the changes taking place in the modern day business environment. Boundary-less organization is tolerant to free flow of information and ideas whilst resources pass through its structures quickly and easily to enhance effective functioning.
Reasons for structural changes
The reason why many organizations are changing too fast to the new form of structure is because of the demise of large corporations which occurs despite the enormous investments in technology and other business processes. It is emerging that these organizations are embroiled in the traditionally rigid structures which could not allow flexibility even during turbulent times. According to Ashkenas et al. (2010), these companies fell from indomitable to evincible. They are encountered with structural changes that materialize to be beyond their ability to counter. When instability and turbulence came all these organizations were deficient of flexible structures that could quickly respond to these disasters. They had to grapple with rigid and calcified structures they created and failed to change over time.
Conclusion
The traditional notions of bureaucratic structures as fixed barriers or unyielding divisional levels are now being replaced by naturally permeable, flexible and movable modern day notion of organizational structures. Indeed the modern day structural boundary-less organizations are increasingly living up to the new challenges of business environment. The biggest challenge though is for the managers to uncover the right balance in determining the permeability of these boundaries and there places within the organization structure.
References
Ashkenas, R., Ulrich, D., Jick, T., & Kerr, S. (2002). The boundaryless organization: Breaking the chains of organizational structure. San Francisco, CA: Jossey-Bass.
Bateman, T. S., & Snell, S. A. (2007). Management: Leading and collaborating in a competitive world. Boston, MA: McGraw-Hill/Irwin.
Beamish, P., W., Morrison, A., Inkpen, A., & Rosenzweig, P. M. (2003). International management: Text and cases. Boston, MA: McGraw-Hill/Irwin.
Jones, G. R. (2010). Organizational theory, design, and change. Upper Saddle River, NJ: Pearson/Prentice Hall.
It is common for businesses to develop and grow differently, so there is a vast number of ways that companies may evolve. It usually depends on the management, industry, objectives, and specific leadership vision. These structural types have their own advantages, weaknesses, and challenges. For example, many firms face issues while allocating work and then coordinating diverse efforts after dividing responsibilities among groups of employees. The former process is called differentiation, and the latter is known as integration, and both play an essential role in organizational structure.
To begin with, differentiation is a process of separating a business into key components like units or departments. This division is especially common in major corporations because the larger a firm grows, the more challenging it becomes for a single leader to control all its operations. Thus, highly differentiated companies provide autonomy to their departments and units, making it easier to organize productive and effective work in all components. Noticeably, the corporate environment and culture may vary significantly in different units, which sometimes brings additional issues. Amazon and Apple are examples of companies that successfully differentiate their operations and have many different units.
Further, when firms apply differentiation, they still need to effectively perform their various tasks, which is why the process of integration is also significant. Overall, integration is the specific coordination of differentiated responsibilities and the work of all components. In other words, an organization that is highly integrated can have many various departments that are still closely connected and do not have much independence and autonomy. For instance, McDonald’s is a tightly controlled company, and most essential decisions are made by its small administrative group. Both integration and differentiation are extremely important and should be basic structures in organizations in order for them to operate effectively and be stronger than their competitors.
When it comes to integration, it is essential that firms choose carefully between the two available options. Overall, their choices should depend on the company’s industry, level of differentiation and its effectiveness, qualifications of managers, and other crucial factors. Organizations can coordinate group and individual efforts in two ways: vertically and laterally. The former is tighter, while the latter is more relaxed, informal, flexible, and simple.
Vertical integration refers to the system in which a firm’s higher levels use rules and policy, authority, and control and panning methods to coordinate the work of the staff. For example, authorized leaders have to make sure that action is aligned with the objectives and strategy of the firm. They make decisions, solve issues and conflicts, evaluate performance, and reward or punish employees. They also develop rules, policies, and planning and control systems so that the staff knows the work conditions and follows the standardized procedures. As mentioned above, all operations and decisions of McDonald’s are controlled by a small group of authorities, which is why it is possible to say that this company uses the vertical type of coordination.
Further, lateral integration uses task forces, meetings, gatherings, coordinating roles, matrix structures, and networks to control the efforts of the different units. Coordinating groups gather to negotiate and help dovetail the efforts and tasks of various departments. Spontaneous informal meetings make it possible for workers from different divisions to discuss some issues. Additionally, tasks forces allow the collaboration of diverse specialists when a rapid solution for a problem is required. The animation studio Pixar is an example of a company that integrates lateral coordination and does that extremely successfully: the informal connection between the workers and the three main groups allows them to develop more ideas and solve issues quickly.
Transitioning to a matrix-based institutional framework has several intended effects or advantages. A grid structure enables the company to become more adaptable and agile in response to marketplace shifts. In addition, a matrix layout increases the firm’s overall effectiveness and productivity. Finally, matrix architecture permits a corporation to shorten the time required to produce and commercialize new merchandise for the end user. This essay aims at communicating change to employees within an organization that intends to move from a functional institutional formation to a matrix configuration.
When transitioning from a functional to a corporate matrix structure, workers must work more effectively and be more fruitful. Therefore, this may make them feel compelled to work harder while anticipating the same benefits and wages. Employees may also experience job insecurity due to the changing organizational structure. Staff may also perceive that they are under duress and feel intimidated by the administration. When laborers perceive pressure, they will oppose the introduced structure modification. This will make it more challenging for the executive to ensure a seamless transition, as the collaboration and cooperation of personnel are essential for achieving the intended goals.
Even if the organization can execute its plan, its workers’ sentiments will demoralize them and cause them to underperform, resulting in decreased output and poor employee effectiveness. Therefore, transitioning from a modular to a corporate matrix structure will serve no purpose. The company can best handle these reactions by conveying the procedure and its plans to its people. Employees’ comments should be valued, and they should be persuaded that improvements are being made. Informing the workforce of the situation will reduce their fear and insecurity. The anticipated advantages of this shift should be presented to personnel from their standpoint, and staff should be consistently encouraged to be a component of this significant transition. It is essential to make employees aware of their value to the firm.
In conclusion, change within an organization is expected to impact employees in different ways. A grid structure helps the organization to be more adaptive and flexible in response to changing conditions. The change from a functional to a matrix organizational framework will necessitate that employees operate more efficiently and productively. Consequently, they may feel obliged to work harder while expecting the same perks and compensation. The best way for the organization to deal with these responses is by communicating the processes and their intentions to its employees.
The success of an organization is based on various factors, including organization structure. An effective structure is essential in managing and coordinating vital operations, making it easier to achieve the set goals. One of the vital organizational structures is specialization and division of labor. Specialization involves assigning the task to the employees who have the talent and skills to execute that duty efficiently. Specialization is vital in a workforce. It requires the management to identify each employee’s talent and group them according to their skills to be given their duties (Module 5 Organizational Structure and Processes). Specialization can also be viewed from a broader sense where an organization focuses on dealing with a particular service or product. This kind of specialization gives the organization identity and an image that customers identify with in the market.
On the other hand, division of labor involves breaking down the work process into several tasks that different people can perform. This concept complements specialization because workers are often assigned duties that they have the skills to perform best (Module 5 Organizational Structure and Processes). Organizations use division of labor to reduce the workload per employee and increase efficiency. Division of labor is also essential in reducing the time taken by an employee to attend to a specific duty. As a result, the production process is fastened, producing quality goods and services (Module 5 Organizational Structure and Processes). This structure is cheap and offers a better way for organizations to reduce operating costs and generate more income through a more affordable cost of production.
This organizational structure is ideal for Sun City because it can easily be applied in such a small entrepreneurial organization. A small organization that does not have enough resources to hire and train more workers can apply the division of labor and specialization structure to make its employees generalists who can perform multiple tasks effectively. Tom Wilson needs to distribute the available duties evenly to the other employees in the case of Sun City. When the workload per employee is reduced through the division of labor, it will reduce the time taken to complete vital operations, and the business will be productive. For instance, Sarah Balanced has more duties than Jack Ovalltrades. It would be recommendable for some of Sarah’s duties to be delegated to Jack.
The efficiency of the division of labor ad specialization can be traced to other renowned organizations that successfully employed this structure and achieved their objectives. For instance, Facebook’s success is based on having employees who have special skills to work efficiently in their given posts (Raveendran et al., 2021). This structure has improved the organization’s general performance because work is efficiently distributed among the workers. Facebook’s division of labor structure has been essential in increasing creativity and innovation among the employees because they work under low pressure and have ample time to understand the dynamics of their work.
From a personal experience, I worked at an organization that operated on the structure of the division of labor and specialization. The workforce was categorized into different segments where workers in each segment attended were assigned specific duties. Each worker was to stick in their respective post because operations were interdependent. Duties were interlinked such that the product had to pass through all the segments before it was complete. This created a sense of responsibility and accountability within the workforce and enhanced improved performance.
Conclusion
In conclusion, division of labor and specialization structure is essential in enhancing employee performance through the production of quality services. It also fastens the production process making the organization profitable. Sun City should distribute duties evenly to all its employees to reduce workload per worker and create room for innovation and creativity. This will reduce the organization’s operating costs and promote a cheaper production process.
References
Module 5 Organizational Structure and Processes. Lecture, Web.
Raveendran, M., Puranam, P., & Warglien, M. (2021). Division of labor through self-selection. Organization Science.
Organizational theory is a vital aspect that constitutes various patterns and structures applicable in solving problems, increasing efficiency, and maximizing productivity in corporations. In essence, it adopts these designs to formulate multiple approaches to help companies function best (Uzzi, 1996, p. 674). Therefore, some theories such as classical theory, human relations model, decision approach, and systems framework are imperative in explaining how different corporate structures contribute to operational efficiency and profitability.
Another significant aspect of management is corporate entrepreneurship which allows businesses to improve their innovation strategies. For example, the world’s renowned technology company, Apple, is recognized as a leader in novelty and ground-breaking ideas due to its adoption and use of corporate entrepreneurship (Danko et al., 2019, p. 1850). This paper discusses the relevant academic literature pertaining to organization structure theory and explains how Apple has established an entrepreneurial organization.
Academic Literature Pertaining to Organization Structure Theory
Organizational theory is a tool which allows managers to study the characteristics of different structures which constitute the functions of a company. In contrast, corporate structures are the configurations which give a firm its formal means of arranging other tasks and departments in an attempt to facilitate dissemination of information and minimize workload (Joseph and Gaba, 2020, p. 267). Therefore, different theories have been used to explain the concept of organizational structures, such as the classical management model, decision theory school, human relations principle, and open systems approach.
Classical Management Model
This approach provides a well-define description of how employees operate in a corporate structure. Therefore, classical management theorists are a group of individuals who view businesses as machines and human beings as components of the machinery (Glückler, 2005, p. 1727). Consequently, they hold the belief that the efficiency of a firm enhances the employees’ effectiveness. For example, two famous individuals who developed the concept above are Henri Fayol and Frederick Winslow Taylor (Grant, 1996, p. 61). While the latter focused on explaining how to increase the productivity of the shop by using time and motion, Fayol was interested in examining management as an entity (Granovetter, 1985, p. 481). He and his colleagues accentuated the need to set a well-defined corporate objective and make comprehensive specifications of the functions to be performed. Therefore, they expected performance to be at its peak by organizing activities into various departments, delegating control, and establishing formal relationships among the staff workers. Moreover, Fayol and his peers supported strict upper limits on the senior management’s span of control (Sigfusson and Chetty, 2013, p. 260). In essence, this theory primarily focused on explaining the relationship that exists between the workers and the organizational structure.
Human Relations School
The human relations theory is an approach which focuses on explaining the effectiveness of organizational structures based on worker satisfaction and factors that influence employee productivity. This model received its impetus from the performance-based experiments at the Hawthorne Plant of Western Electric in the 1920s (Stokvik, Adriaenssen and Johannessen, 2016, p. 341). According to the test results, increases in productivity are attributed to some group norms and individual incentives rather than the work conditions of an organizational structure (Blau, 1970, p. 201). These theorists have outlined the different subsets of the human relations model as group dynamics and informal organization (the configuration of unofficial activities, norms, relationships, and communication patterns) (Ali et al., 2018. p. 108). Therefore, work groups are considered as fulfilling essential individual requirements and hence become imperative components of the organizational design.
Decision Theory School
Decision theory is a model which explains the concept of organizational structures on the basis of decision-making. Herbert Simon and James G. March’s work is a prime example of the theory above, which uses individual viewpoints in reviewing the process of decision-making in organizations (Majidi, Mohammadi-Ivatloo and Soroudi, 2019, p. 157). They argue that people tend to be logical when choosing the best outcome based on the costs and benefits involved (Boschma, 2005, p. 61). In explaining corporate structures, decision theorists classify organizational goals by dividing them into departmental subgoals. The model is primarily segmented into two categories such as normative and optimal decision approaches. The former examines the outcome of choices, whereas the latter investigates and evaluates the reasons attributed to the decisions people make (Teece, 2018, p. 359). In essence, this approach gives managers an idea of how they can alter employee behavior by changing decision-making avenues.
Systems Theory
Systems theory explains the interrelationship that exists between an organization and its employees. Researchers in this school of thought view the company as a unit with a supply of resources (input), a conversion process, and the production of commodities (output) (Teece, 2018, p. 359). The open system theorists are differentiated from closed systems philosophers in that the former consider the introduction and transfer of energy as occurring with respect to the outside environment (Danko et al., 2019, p. 1850). They have disapproved the closed system theorists for not acknowledging the reliance of organizations on inputs from their surroundings and for overstressing determinants of internal functioning (Burgelman, 1984, p. 33). Therefore, this creates the need to explain the concept of open system theorists.
The open systems model considers the identification and mapping of recurrent cycles of input, transformation, output, and regenerated input which consists of the organizational pattern (Burt, Hogarth and Michaud, 2000, p. 123). Moreover, various generic system components of a company include the production, associated with throughput, structures facilitating manufacturing, supportive institutional functions to ensure favorable relations within the company (Ferreira, Mueller, & Papa, 2018, p. 121). In addition, maintenance structures are also included to indemnify the adequacy of human sources, whereas an adaptive framework is present to instigate appropriate responses to the dynamics in the environment (Leis, 2018). Lastly, managerial system components are considered vital because they coordinate and control different elements of the system (Burt and Merluzzi, 2014). In essence, these are the features of a system which are imperative for open system theorists in explaining the organizational structure and functioning (Benzer et al., 2017, p. 33). Generally, this approach is advantageous compared to other models because of its practical and consideration of the environment affecting a company and the workers.
How Apple Builds an Entrepreneurial Organization
An entrepreneurial organization is a company that practices entrepreneurship, the process by which the firm engages in developing new entrepreneurship products, processes, and services to create value and make profits through innovative thought and measures. In the contemporary world, various industries are influenced by some dynamics proving to be a challenge to modern-day firms (Dubini and Aldrich, 2002, p. 217). Therefore, leaders have incorporated different strategies to stay flexible and respond effectively to the changes in the business sector. Apple is an exceptional example of an establishment applying the concept of corporate entrepreneurship in several ways.
Leadership
Entrepreneurial firms prioritize leadership over management due to several reasons. In the case of Apple, the late Chief Executive Officer (CEO), Steve Jobs, inspired his team members by creating a philosophical booklet which highlighted a well-defined vision of the company (Kim, 2020, p. 17). The principles outlined in the pamphlet have been influential in today’s business as managers from various companies are using them to nurture employee engagement and impetus. Moreover, Jobs’ philosophies are imperative because they facilitate behavior to be reinforced through more empirical means than through compensation packages (Kim, 2020, p. 17). Therefore, the American technology giant continues to be resourceful and pioneering due to a psychologically invested and well-equipped workforce striving to achieve Apple’s large vision.
Employee Profile
Companies that follow corporate entrepreneurship do not employ individuals with capitalist characteristics. However, these firms create an organizational culture that promotes innovative practices. The four important qualities of an entrepreneurial personality are proactivity, vision, opportunism, and creativity (Inkpen, 1998, p. 69). Proactive behavior is the tendency to solve problems before they happen, whereas opportunism is the propensity to identify new business opportunities. Creativity is the ability to produce problem-solving ideas relating to originality and preference for novel strategies (Grant and Baden-Fuller, 2004, p. 61). In contrast, a visionary individual is a person who is able to anticipate, bring change, and create progress. Since a few people possess these qualities, leaders adopt psychometric practices to identify unique talent. Moreover, building teams with a balancing mix of proactive, visionary, innovative, and resourceful people can generate ground-breaking and practical ideas.
In the case of Apple’s co-founders, Steve Jobs and Steve Wozniak achieved the ideal equilibrium. Jobs mainly was a pioneering individual, whereas Wozniak was a professional in technology-related aspects (McCausland, 2021, p. 59). While Jobs could not program a computer, he had an idea of how he wanted it to operate. Conversely, Wozniak grasped Job’s concepts and understood how to make them a reality. From this case, managers learn the significance of developing a culture that promotes entrepreneurial practices rather than searching for individuals who possess such qualities (Jack, 2010, p. 120). Both Wozniak and Jobs made a stupendous duo, the kind that contemporary leaders should follow.
Organizational Structure
An organizational structure is imperative for corporate entrepreneurship because it defines how tasks are formally divided, categorized, and coordinated. Therefore, an entrepreneurial company requires a business configuration that maximizes the exploitation of market gaps (Kuratko, 2017, p. 441). Apple is famous for its functional organizational structure, which has driven its novelty over the years. Under Steve Jobs’ regime, the American giant had a conventional layout with business units (Kim, 2020, p. 17). However, when Jobs restructured it, he introduced a functional model that aligns expertise with decision rights.
Since Apple’s primary purpose is to manufacture products that enhance people’s lives. Therefore, Tim Cook, the incumbent CEO, has utilized Jobs’ principles to uphold the company’s vision (Kim, 2020, p. 17). For example, the company distinguishes itself from the competition by continuously improving its product features, as seen in the iPhone camera (Hsiao, 2017, p. 186). Apple leadership requires deep expertise, immersion in details, and collaborative discussion. Therefore, its functional structure enables it to create such innovations. Its central belief is that individuals with the most skills and experience in a sphere should have decision rights for that field (Yunis, Tarhini and Kassar, 2018, p. 334). This approach is based on the fact that Apple operates in markets with high rates of technological change and disruptions. Therefore, it must depend on the verdict and awareness of people with deep knowledge and skills of the technologies responsible for the obsolescence.
Apple’s functional structure also builds corporate entrepreneurship by focusing on leadership characteristics. Ever since Steve Jobs incorporated this formal arrangement, the company’s managers in every domain have been expected to have three significant leadership traits (Kim, 2020, p. 18). First, deep expertise enables individuals to perform their tasks and meet deadlines. In contrast to other organizations where general managers supervise their colleagues, at Apple, these experts lead their fellows (Nambisan et al., 2017). Second, an approach that permeates the American giant is “leaders should be aware of their business three levels down” because it is imperative for quick and effective cross-functional decision-making at the executive levels (Parkhe, 1993). Lastly, Apple expects its leadership to willingly and jointly have discussions. Collaborative debates are essential in this company, as seen in the development of the iPhone 7 plus dual-lens camera, which involved group effort of several teams such as camera software, motion sensor hardware, silicon design, and many more (Hsiao, 2017, p. 186). In essence, Apple practically builds an entrepreneurial organization based on its leadership approaches, corporate structure, and employee profile.
Conclusion
This paper has discussed the relevant academic literature explaining the concept of organization structure theories. In essence, the classical management model has highlighted some key attributes, such as giving clear goals and objectives of its assumption. The model is also vital because it provides an informative job description to the lowest level of various organizational structures. However, the researchers’ assumptions in this school of thought did not consider human needs and motivation. Moreover, classical theorists were overly rational and streamlined the function of management. While these theories give a broad view of the forces shaping an organization, managers should be able to apply them in different scenarios.
America’s most valuable brand, Apple, has successfully built an environment facilitating corporate entrepreneurship as explored above. The technology brand has achieved this by focusing on three significant aspects of management. First, the leadership principles and environment established by the late Steve Jobs have been influential in the firm’s success. Second, Jobs was able to incorporate an employee profile which promotes proactivity, creativity, vision, and opportunism. Third, Apple’s functional organizational structure, introduced by Jobs, has played a vital role in its path of building an entrepreneurial firm. In essence, Apple remains one of the most exceptional companies promoting corporate entrepreneurial environment.
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Danko, T. P. et al. (2019) ‘Impact of Intangible Assets on Competitive Positions of the Apple Company’, Journal of Advanced Research in Law & Economics, 10, p. 1850.
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McCausland, T. (2021) ‘Why innovation needs more diversity’, Research-Technology Management, 64(2), pp. 59–63.
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An essential position in the organizational system is that of Team Lead. They keep an eye on how the group is doing and offer direction to make sure advancement is being accomplished (Ahlstrom et al., 2020). Additionally, they make sure that everyone is held accountable for their particular tasks and that the team is working together successfully and efficiently. Team leads are also accountable for making sure that the team works as a cohesive one and act as a sounding board for team members to express their thoughts and concerns.
Team Members
Pool individual skills and knowledge.
Develop innovative solutions.
Work together to solve problems.
The foundation of the organizational system is the team. They are in charge of using their particular expertise and talents to create creative solutions and collaborate to resolve issues. Encourage team members to offer their thoughts and work toward the group’s objectives. Additionally, they should have the freedom to decide for themselves and be responsible for their work. They will be empowered to act independently and proactively, which will eventually provide better outcomes.
Collaborative Platform
Share and update information in real-time.
Connect with one another.
Enable natural conversations.
Promote collaboration.
Provide an easy way to access information.
Provide an easy way to communicate.
The effectiveness of the organizational structure depends on the utilization of a collaborative platform. It offers a simple way to access and share information in real-time, allowing for improved teamwork and communication. Additionally, it facilitates simpler communication and expedites problem solving. To guarantee that everyone is working from the same source of information, the platform should be available to all team members, with appropriate degrees of access for each team member.
Explanation of Changes
My suggested organizational structure adjustments put more of an emphasis on developing cross-functional teams that are structured around particular projects or objectives than on conventional departments. Employees will be able to collaborate more closely as a result, using their unique talents and expertise to solve issues and create fresh ideas. Every team needs a chosen leader to give direction, monitor development, and keep tabs on the group’s performance as a whole.
The primary distinction between the new structure and the old one is the shift in emphasis from discrete departments with a limited range of management authority to cross-functional teams with a designated leader. Due to the closer working relationships and increased freedom for each person to apply their unique talents and expertise, this will promote cooperation, communication, and autonomy. Additionally, it promotes more natural dialogues and improved teamwork, which makes it simpler to communicate and update information in real-time. Figure 1 below shows a revised organizational structure that I would propose for an organization, while figure 2 shows the functions associated with the various roles in the organizational structure.
Figure 1: A revised organizational structure.Figure 2: Various roles in the organizational structure.
Impact on Organizational Communication
The organization’s entire communication will be significantly impacted by the organizational structure modifications. Employees will be able to collaborate more closely thanks to the creation of cross-functional teams, combining their unique talents and experience to address issues and come up with fresh solutions. Team members will be able to engage more organically and share knowledge more easily as a result, creating a climate that is more favorable to good communication and cooperation. Collaboration and communication will be made easier by the implementation of a collaborative platform (Ahlstrom et al., 2020).
Team members will be able to communicate with one another easily via this platform, enabling real-time chats and updates. Additionally, it will make it easier for team leaders to keep an eye on things and make sure that work is getting done and that everyone is contributing effectively. As a consequence, there will be an improvement in organizational communication since team members will be able to decide more swiftly and accurately.
Impact on Overall Team Communication
Team communication and reporting structures will be significantly impacted by the changes to the organization’s structure. Communication between team members and with the leader will increase by forming cross-functional teams and designating a team leader (Ahlstrom et al., 2020). Better communication and more casual interactions ought to result from this. Team members will be able to collaborate more successfully if the team leader provides direction so that they can better comprehend the goals and direction of the project or effort.
Conclusion
The implementation of a collaborative platform will also have a significant effect on team reporting and communication. By reducing the reporting process, this platform should make it simpler to communicate and update information in real-time. Project updates, task lists, due dates, and any other pertinent information that team members need to be aware of can be included in this (Ahlstrom et al., 2020).
It will be simpler for team members to keep informed and on the same page if this data is easily available. It will be simpler to measure progress and make sure that the reporting process is effective and accurate with the team leader’s supervision and management of team performance. Team members will be more productive and efficient at work if the team leader is monitoring the progress and helping them to understand how their specific activities fit into the wider vision. The team leader may help the team members communicate more effectively by promoting open discussion and giving updates on their progress.
Reference
Ahlstrom, D., Arregle, J. L., Hitt, M. A., Qian, G., Ma, X., & Faems, D. (2020). Managing technological, sociopolitical, and institutional change in the new normal. Journal of Management Studies, 57(3), 411-437. Web.
The ultimate goal of an applied improvement project lies in achieving success — the meaningful change that results in enhanced organizational performance. However, the range of success criteria is quite broad since a project can succeed or fail in various dimensions. For instance, Frefer et al. (2018) accounted for approximately 80 success criteria and factors, ranging from cost and performance to time and stakeholder satisfaction. In this regard, the knowledge of organizational structure is immensely valuable since it allows us to understand which internal stakeholders can assist in the successful implementation of the project.
In particular, the information regarding the organizational structure is vital for revealing the key decision-makers. According to Derakhshan et al. (2019), decision-makers have a significant variety of responsibilities, including but not limited to project selection, allocation of resources, and contract management. Therefore, the knowledge of organizational structure makes it possible to quickly understand which decision-makers will have the strongest influence on the project implementation. Consequently, one will be able to save precious time by approaching the necessary stakeholders in advance. Having prompt access to a person who makes critical decisions is preferable to circumventing the obstacles.
In summary, the knowledge of organizational structure is highly important for project management success. The difference between project management success and ultimate project success lies in the timeframe. Whereas project management success manifests in reaching short-term objectives, eventual project success is a long-term category (Frefer et al., 2018). As such, knowing about the organizational structure before beginning to design an applied improvement project would enhance the project management aspect. Overall, the information on which internal stakeholders can provide a meaningful contribution to the project implementation will help with resource allocation and project prioritization.
References
Derakhshan, R., Turner, R., & Mancini, M. (2019). Project governance and stakeholders: A literature review. International journal of project management, 37(1), 98-116. Web.
Frefer, A. A., Mahmoud, M., Haleema, H., & Almamlook, R. (2018). Overview success criteria and critical success factors in project management. Industrial engineering & Management, 7(1), 1-6.
The divisional structure, also known as the decentralized one, improves the motivation of employees and control of operations in different locations. A major feature of a divisional structure is the clarity of accountability. Managers are responsible for their own departments. Top management clearly delegates powers and managers and employees immediately know how they perform, which is an advantage over the functional structure.
Researchers have found that the performance of teams and corporations are more enhanced in divisional than functional. This structure encourages employees to work harder, for the company and for their careers. Managers have firm control of their own divisions, which encourages a competitive internal environment and business development (David, 2011). When General Motors preferred divisional over centralized form in the 1920s, it surpassed Ford Motors, which had a heavily centralized structure (Bao & Wang, 2011).
The divisional structure also has disadvantages. Firms dislike it because it is costly. Each division needs employees who are especially knowledgeable on certain functions, and employees of this caliber are highly paid. Another reason is that duplication of employee functions is possible, in which functional specialists have to coordinate their efforts to their counterparts at headquarters. Additionally, managers have to be highly qualified, and this needs more funds from headquarters (David, 2011).
References
Bao, T. & Wang, Y. (2011). Incomplete contract, bargaining, and optimal divisional structure. Journal of Economics, 107(1), 81-96. Web.
David, F. (2011). Strategic management: Concepts and cases (13th ed.). Upper Saddle River, New Jersey: Prentice Hall.
Consulting business requires constant intellectual input with minimal barriers to decision-making. Teams are the most appropriate organizational structure for meeting the demands of such an enterprise. The reason for this choice is that consulting business does not produce physical products that require specialization and hierarchical division. Teams presuppose a bottom-up leadership approach, in which employees are directly involved in decision-making, which makes consulting services more effective.
The nature of consulting business does not demand a rigid structure. As there are no departments, all team members will have similar duties, which will complement each other (Burton & Obel, 2018). The manager is the only authoritative element representing a chain of command, while the overall management is decentralized. All communications between the manager and the employees should be informal to promote a sense of teamwork.
The most appropriate organizational theory is contingency/situational theory. It assumes that circumstances determine the most effective way of organizing the decision-making process. This theory supports the chosen organizational structure because it allows subordinates to make timely decisions without managerial participation, which is cost-effective (Burton & Obel, 2018). This flexibility is also crucial to understanding what makes teams effective at conducting consulting services – quick colleague feedback is as valuable as input from the manager.
Organizational structure can have a significant influence on the effectiveness of the consulting business. In fact, grouping employees into teams seem practical because it groups people with similar tasks and matching skills together, boosting work efficiency. Indeed, effective team communication and collaboration can produce faster and better solutions than an individual. In consulting business, a group of people working in concert on one specific question can develop a more appropriate answer because several professionals will view the problem from various angles. The goal-approach model of organizational effectiveness requires an evaluation of the firm’s performance based on the results it attained (Van Vulpen, 2020). The advantage of the selected structure is that the goal-approach model is easier to apply to a smaller group’s results. The drawback of this structure is that misunderstanding between team members may hinder projects. It means that if employees cannot quickly resolve an issue due to a lack of cooperation, the enterprise will suffer from administrative inefficiency.
Functional organizational structure is ideal for the company 1. Its structure should have two functional levels: managerial team at the top level hierarchy while programmers and supporting personnel – under it. Below, there is a chart to illustrate company 1 functional organizational structure:
Each employee in all the levels has a task to perform in relation to their specialization. The company 1 top level hierarchy is headed by managers who have the following roles: they are responsible for planning and making strategic decisions, passing decisions to employees and controlling implementation of these decisions. They also control tasks realization process. Managers’ offices should be located in the company’s main office Ar-Riyad. All the 25 programmers and the supporting personnel are answerable to the management.
Level two of the company’s hierarchy is the programmers and the supporting personnel. Each of this team has specialization in their functional roles. The programmers search for clients, provide technical support to their clients and do programming. The rationale for choosing this type of organizational structure for the company 1 is that each of the workers in this company has a specific task to perform depending on the specialization.
For instance, the programmers have specific tasks to accomplish in addition to searching for clients, providing technical support to company’s client and doing programming. Company managers have responsibility of staffing, controlling and coordinating the company activities. Supporting employees are supposed to facilitate company functions for it to achieve its goal. Also, they are a part of communication link between the management and the other company personnel.
Functional organization structure is suitable for this company because it has bigger software market. For instance, it has ten company clients from Ar-Riyad, two from Damman, one multinational company that specializes in business software and two other clients from Argentina.
In addition, its activity coordination and specialization are centralized. Its managers oversee the company task coordination and specialization. To achieve its goals this company has to divide its operation according to functional areas in addition to possessing various levels of authority.
Command flow is from the top (management) to those below (employees) in hierarchy. This structure will allow economies of scale within all company 1 functional departments. Additionally, it will enable depth knowledge and skill development and company’s accomplishment of its functional goals. It is also bested suited for company with one product like company 1.
Matrix organizational structure is suitable for the company 2 because it can allow this company to address multiple business dimensions using multiple command structure. Below, there is a chart to illustrate the company 2 matrix organizational structure.
In the company 2, management coordinates the activities of all other departments in the company. It is the highest level in the organization hierarchy. Command flows from the management to all other departments in the organization. Company’s managers occupy the highest post in the company’s central administration who are responsible for planning and making strategic decisions. They also pass decision to employees and control implementation of these decisions.
They also control tasks realization process. Managerial team decision is the implementation affect of all products of company which include fertilizer, gardening, and dealers in gardening tools. Employees are supposed to give feed back to management on matters concerning the company operations. The company 2 has many employees working in various departments of the company including production, marketing and sales. Out of the 250 employees, 100 are occupied in the production sector.
Its central offices are suited in Damman. Employees who have similar skills are put together for particular task. For instance, those employees working in production sector should report to a production manager, sales and marketing employee should report to sales and marketing managers respectively.
Rationale for using Matrix organizational structure, it is because Matrix organizational structure encourages innovation and fast action and speed information in the company. Additionally, Matrix organizational structure is suitable for a company which deals with more than one product.
The company 2 is involved in production of fertilizer, manufacturing of gardening tools and dealer in gardening tools for the famous U.S brand. Matrix organizational structure fits this company because its workers are selected according to the task needed. Departmental flexibility is of essential in running this company in various departments.
Matrix organizational structure is able to leverage functional economies of scale while remaining small task focused; it focuses employees on multiple business goals and facilitates innovation solution to complex and technical problems. It improves employees’ companywide focus through increased responsibility and decision making. It also allows a quick and easy transfer of resources and increases information flow through the creation of lateral communication channels and enhances personal communication skills.
In order for a company to attain its objectives, its organization’s structure should have tasks allocation, coordination and supervision. Organizational structure is a key determinant in any organization’s operations and performance. Companies have different organizational structure depending on their goals.
Organization structure enables an organization’s tasks, activities and processes allocation to its personnel, departments or branches. Basically, organizational structure serves two main purposes in an organization. They include forming a basis guide lines in any operations. It also defines company’s workers and departments duties to gear towards achieving it goal.
