Organisational Management

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Table of Contents

Functional Organisational Structure
Management Theories
Reference List

Functional Organisational Structure

The structure is designed on hierarchies such that positions as well as functions of each individual within the company are clearly stated. The organisation is segmented into key functional departments where each department encompasses all the activities related to it and all the departments within the organisation work towards achieving the common goal of the organisation.

Organisations which mostly apply functional structure usually deal in one product or service just like Barclays Bank which offers financial services to customers. In Barclays Bank for example, there is the human resource, sales and marketing, accounts and finance, security, wealth management, mortgage, banking and insurance departments. Under these departments are other sub departments (Barclays 2011).

Functional structure offers Barclays various advantages in its management and business processes. Since the structure ensures that Barclays has a well structured hierarchy as well as functions for each department and individuals, executing projects and providing instructions to employees in particular departments is easier (Miles & Snow 1992, 11).

The linear structure in the organisation gives each employee an opportunity for pursuing a defined carrier path and as such employees are motivated to perform their best and commit themselves to the organisation as they are able to grow within their departments. Besides, departmentalisation groups employees with similar interests and skills together and this is likely to improve the performance of each department and the organisation as a whole (Miles & Snow 1992, 11).

Functional structure ensures that Barclays elicit only the best for each department as each employee is taken his or her area of specialisation. Functional structure also enables Barclays Bank avoid duplication of roles and to also reduce management risks.

Functional structure also has shortcomings which may limit Barclays’ business processes. The rigid hierarchy goes hand in hand with bureaucratic management which makes decisions to take long before they are made or before they materialize. Intra-departmental communication may take some time as each department is distinct.

Besides, each department’s viewpoint is limited to its operations making it difficult to see the bigger picture of the organisation. Ability to see the bigger picture of the organisation motivates individuals in the organization to adopt more efficient measures in achieving the common goal of the organization (Miles & Snow 1992, 13).

Management Theories

Scientific Management Theory

The theory was developed in 1880s and in the early 1890s by Fredrick Taylor to help improve economic efficiency and production in manufacturing industries. Taylor realized that the only way to improve productivity was to make the workers more efficient. It was very influential in management of companies in 1910s.

However, it evolved in 1930s as most management theorists, workers and unions felt that it did not take into account human relations in management. His theory only focused on achieving economic efficiency and this placed undue pressure on workers to work harder and faster.

The emphasis on achieving higher productivity made some managers to exploit customers as well as the workers and hence workers and unions opposed it (Beissinger 1988, 5).

It should be noted that an organization can apply several organizational structures in its operations. For example, Barclays applies functional structure, matrix structure as well as market structure.

Administrative Management Theory

The theory was developed by Henry Fayol in early 1900s with major focus on duties of management. It was meant to establish universal principles of management which could be easily applied in all organisations.

It was developed as an attempt to establish a flexible system of management that could be applied to any situation (George 146). Fayol’s theory of administrative management evolved in 1950s and 1960s as it was viewed by other management theorists to be rigid and also inflexible. It limited managerial duties to decision making, planning as well as controlling (Wren 1970, 146).

Human Relations Theory

Elton Mayo’s Human Relations Theory began in early 1930s when he attempted to determine the effects of groups within an organisation on the overall productivity of the organisation. His efforts were prompted by the need to develop a theory that would move away from Taylor’s scientific management theory which only focused on productivity while assuming the group dynamics and the social makeup that exist in organizations and their influence on overall production.

Evolutions of this theory began in late 1950s and extended to early 1960s as theorists attempted to expand the theory by giving it a more psychological direction. The theory had not addressed employee development and growth in the company as it only focused on human relations in an organization (Smith 2007, 47).

Charity Organisations

According to East Lothian Voluntary Organisations Network (n.d, 1), charity organizations may have organizational structures or may operate without having any formally organised structure especially if it operates on a small scale.

Charity organizations are not required by law to establish a legal structure and as such, charity organizations that are not ready to operate under rules and regulations which come with formal structures have the freedom to operate in their own way (Grobman 2008, 24).

However, most charity organisations find it important to adopt formal organisational structures to avoid management risks. The organisational structures enables them achieve credibility and continuity as well as a basis for setting common objectives.

The type of organisational structure adopted by charity organisations is determined by the organisation’s level of activities and size. A charity organizations may adopt incorporated, unincorporated or trusts structure (East Lothian Voluntary Organisations Network (n.d, 1).

Reference List

Barclays. (2011). Web.

Beissinger, M. R., 1988, Scientific management, socialist discipline, and Soviet Power. London: I.B. Tauris & Co Ltd.

East Lothian Voluntary Organisations Network, (n.d). Organisational structures of charities. Web.

Grobman, G. M., 2008, The nonprofit handbook: Everything you need to know to start and run your nonprofit organization. Harrisburg: White Hat Communications.

Miles, R. E, & Snow, C. C., 1992, Causes of failure in network organizations. California Management Review. California: University of California Press.

Smith, M., 2007, Fundamentals of management. Maidenhead: McGraw-Hill.

Wren, D., 1970, The evolution of management thought, Chichester. San Francisco: CA Josey-Bass Publishers.

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