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Until recently, most organizations were vertical and had many layers of managers and supervisors between top management and frontline workers (Pettinger, Nelson & Economy, 2010). The classic model of a vertical organization is, in principle, similar to that commonly used in traditional military organizations.
The traditional approach to organizational problems sought to discover or prescribe basic values which could universally apply to any organization. Although it is generally recognized today that there are few, if any, principles which can be applied equally to all organizations, those developed from the classical approach, for generations, had and still have strong and pervasive influences on understanding management thinking and consequently, on the structure of organizations.
Today, organizations exist and operate in a fast changing environment driven by advances in technology. While the concept of hierarchy made a lot of sense in the past, this may not be so in the present world. Guided by growth in technology and heightened competition, organizations are presented with numerous approaches to business operations.
The increased use of groups or teams, the growth of flexible employment, increasing use of sub-contracting, an emphasis on participation and empowerment, and the involvement of many workers in decision making have all led to changes in the traditional boss-subordinate relationship. In turn, this has led to a discussion on the role of hierarchy in modern organizations and the extent to which managers can rely solely on their perceived formal authority within the structure of the organization.
This paper seeks to establish the extent to which the the notion of hierarchy is relevant to our understanding of management in contemporary organizations. In spite of the radical transformation witnessed in the business environment, it is still believed that modern organizations can only be understood by first learning how they are affected by hierarchy.
To a large extent, most organizations have been influenced by how the military operates and by the desire to adopt modern styles of management based on science (Saxena, 2009). In general, bureaucracies and hierarchical structures are associated with most contemporary organizations as was the case with organizations in earlier generations.
According to Lucey (2004), hierarchy appears to be a natural order of doing things that applies to every single organization. In these organizations, the behavior of employees is often controlled through rules and regulations formulated by human resource professionals. Business operations are often organized in functional departments that are headed by managers or supervisors. Usually, employees carrying out similar operations are stationed in the same neighborhood.
In most cases, a hierarchical structure is considered applicable to varied organizations which include governments and even churches. In general, a hierarchical structure is familiar, predictable, and rational. However, despite being well known, the structure has inherent disadvantages that must be critically evaluated before adoption for any given situation. Simply stated, it is not a multi purpose organizational structure.
The Importance of Hierarchy
Besides embracing a variety of media, communication in organizations can take many different forms. The variety of media is usually presented in a format that shows the various alternatives available to the manager when choosing the mode of delivery. This helps managers to assess their personal qualities and consider what motivates and satisfies them at work.
It also gives them the opportunity to identify different career options and ways of developing their careers within an organization. In addition, it enables managers to begin the process of matching themselves to possible career options. Whether the environment is formal or informal, it is not possible to escape from a functional hierarchy. However, the more skilled the company’s workforce is the fewer the tiers of management and individual managers required.
Though it is often assumed that communication takes the form of telling someone to do something, it is a much more extended, complex and subtle process, embracing careful examination of what is to be transmitted and how it is transmitted, ensuring the existence of an environment conducive to full understanding of the message sent, ensuring that the message received is identical to that sent, and seeing to it that communication is accepted and acted upon by its recipient.
Traditionally, senior managers have been concerned with setting the strategic direction and objectives for the organization, and middle managers have been tasked with making things happen and managing changes. The corollary is that senior managers are concerned with results and middle managers with how the results are achieved. Ordinarily, managers are required to analyze every bit of information to support decision making and to achieve set objectives and goals.
There is a lot of muddled thinking about hierarchies and the whole issue of how equally people are treated within companies (Miller, 2007). Ideally, it is necessary to endeavor to reinforce the authority of individual decisions. Oftentimes, however, when a decision of significant importance has to be made, there is a tendency for individuals to be fearful of making such a decision or else they feel the need for collective ratification of the decision.
Under such circumstances, the formation of a committee helps the various members to afford each other mutual support. As noted earlier, it is practically impossible to escape from a functional hierarchy, despite the fact that a more skilled workforce requires fewer tiers of management and individual mangers.
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The precise nature of career management tends to vary for different people, depending upon their current work situation and the extent to which they want it to develop. Thus individuals will find different exercises relevant at different times in their working lives. It is important to bear in mind that there are many variables which influence the most appropriate organizational structure and system of management.
They include situational factors and the contingency approach. Changing patterns of work organization, the demand for greater flexibility, and the multi-skills challenge, as well as managerial processes such as delegation and empowerment, all have a major inter-relationship with structure and thus influence decisions on structural design.
It takes the organizational values and policies and the legal requirement which have a bearing on the collection of information and how the information is to be interpreted. One needs to check that the recipient understands the information and advice provided, and observe the rules and guidelines on confidentiality as well as laws on data protection.
As noted by Miller (2007), it has become clear that the concept of organization is not an absolute. It is a tool for making people productive in working together.
While recognizing that there is clearly no one right organization, there is nevertheless in the final analysis, an underlying need to establish a framework of order and system of command by which the work to be undertaken is accomplished successfully. This demands that attention be given to certain basic principles and considerations in the design of organizational structures, or in reviewing the effectiveness of existing structures.
According to Kuhn (2006), the flow of communication largely depends on the hierarchy of the modern day organization. The strict classical hierarchy, which can be found in the so called old economy, caused a top-down communication structure. With the evolution of modern business, however, the need to change the hierarchy in organizations to allow flexibility is very critical (Kuhn, 2006).
Due to the changing demands from customers and tasks which have to be satisfied, teamwork is one of the key words in modern businesses. By building teams of experts based on customer demands, the modern business is more process oriented than hierarchy oriented. The communication model can be better understood if the hierarchy is in the context of communication flows within an organization.
The communication flow in modern businesses can be visualized as a net. Everyone communicates with everyone. This influences the hierarchical structure to a very high degree. Although it may appear that no differences are noticeable, hierarchy still exists in modern organizations. However, through the possibility of network communication, organizations have become more flat unlike in the past.
Effect of a Deficient Organizational Structure
It is not easy to describe, in a positive manner, what makes up a good or effective organizational structure although attention should be given to critical design factors.
However, the negative effects of a poorly designed structure can be identified more easily. Generally, an organization is like an organism, having a moment of birth, growth through several distinct stages of development, maturation, and finally an end. As a matter of fact, there are numerous pathogens that can prove fatal to a company including seismic shifts in markets, myopic strategic vision, hostile takeovers, unforeseen competitive technologies, and the like.
If a company has the competencies that flow from self awareness and self regulation, motivation and empathy, leadership skills and open communication, it should prove to be more resilient regardless of what the future brings. Apparently, it has always been part of the role of a good manager, supervisor, or team leader to be able to respond constructively to the emotional and inter-personal difficulties of members of his or her team.
In the recent past, however, an increasing number of organizations have sought to augment the counseling skills of their managers by making professional counseling available to employees. Handling information is undertaken with consideration for the rights of people to know that information is stored and available and the importance of using appropriate communication methods.
A number of researchers have tended to lay emphasis on the technical planning of the organization and the importance of determining and laying out structures before giving any thought to the individual members of the organization. As part of the obvious duty of the manager, it is not a substitute for the need for definite planning of the structure.
In short, a very large proportion of the friction and confusion in current society, with its manifest consequences in human suffering, may be traced back directly to faulty organization in the structure sense. Emphasis on the logical design of organization structure rather than the development around the personalities of its members is typical of the classical approach to organization and management.
Recent attempts made to flatten the management hierarchy in organizations have sought, among other things, to reduce stratification caused by the organizational structure. The use of teams, for example, is meant to break down existing hierarchical structures in organizations and to create an environment where employees can freely discuss issues with one another and offer support when needed.
However, each of these teams works through an organizational hierarchy. According to Harris (2006), it is possible for teams to function productively in a hierarchical, socially stratified environment seen in most organizations. This is, however, a challenge for some organizations.
Despite the fact that the contemporary business world has largely been affected by changes in technology, hierarchy still exists in organizations and is relevant for understanding the structure of organizations today. Clearly, the new business environment encourages a flat rather than a hierarchical structure in organizations but does not completely kill the existences of a structure of authority within organizations.
In any modern business environment, many channels of communication exist and may be used by managers as they please to reach other employees. Similarly, employees can easily gain direct access to anyone in the organization when required without having to go through an intermediary.
Great organizations do not just happen by chance. Any positive organization must be based on sound, general principles of behavior to effectively guide operations. Considering that organizations exist and operate in circumstances that are generally unique, it is imperative for every single organization to come up with structures that are suitable to their own business operations.
Harris, M. G. (2006). Managing Health Services: Concepts and Practice. Marrickville, NSW: Elsevier Australia.
Kuhn, M. (2006). Communication Systems in Modern Business Management Structures – Needs, Requirements and Solutions. Munich, Germany: GRIN Verlag.
Lucey, T. (2004). Management Information Systems. Bedford Row, London: Cengage Learning EMEA.
Miller, A. (2007). How to Manage Human Resource in Organizations. Maitland, FL: Xulon Press.
Pettinger, R., Nelson, B. & Economy, P. (2010). Managing For Dummies. Hoboken, NJ: John Wiley and Sons.
Saxena, P. K. (2009). Principles of Management: A Modern Approach. Darya Ganj: Global India Publications.