Organizational structures have existed for a long time and it is not a new phenomenon in management. An organizational structure is the hierarchical organization of authority and duties of organizations and it comprises of activities like allocation of duties, supervision and coordination that is intended to make an organization realize its goals.
The structure of organizations can be in many forms considering the different goals and objectives to be achieved. It is through organizational structure that power, roles and organization’s way of operations and performance are determined.
Organizational structures offer the platform on which the basic operating processes and events rest. It also decides on the specific personnel who may take part in the processes of decision-making and to the limit their ideas decides the actions of the organization.
In an organization where there exists centralization, decision making capabilities are bestowed on the top managers and the departments are under strict control. Organizations should develop structures because they provide the specific guidelines for operation and brings members together. When an organization adopts the required organizational structure, the management process becomes more effective.
The way an organization’s structure develops will depend on which organizational structure category it will fall. When referring to tall structures, we see the top most managers being the CEO and different management levels.
As growth in the organization sets in, the management levels increase too but the slim span of control enables strict employee supervision. On the other hand, flat organizational structures are characterized by fewer management levels, quick decision making processes, faster communication and a wide span of control (Ellis, 2003).
Southwest Gas Corporation is an American company that provides energy supplies. It buys transports and distributes natural gas. Southwest Gas Corporation has transformed a great deal, from the usage of traditional structures to contemporary designs and this has seen it adopt a flat organizational structure. This organization focuses mainly on customer satisfaction considering the fact that its employees work with freedom.
The department in this company comprises of accounting and finance, human resource, marketing and distribution departmrnts.The departmental heads are the team leaders who are responsible for coordinating and supervising their departments. A trick to business growth in today’s ever changing global economy is controlled by innovation and creativity (Southwest Gas, 2007).
An organization like Southwest Gas that has constant contact with its customer base gets to know better their market and respond to its needs. Innovativeness results to potential re entry into the market with better products and services hence making organizations with flat structures remain relevant in the market. A flat structure offers employees with the opportunity to grow and succeed (Southwest Gas, 2007).
Organizational design may refer to a formal way of binding together technology, human resource and information in an organization. The design process starts with strategy creation. Matrix involves the process of allocating duties to professionals from different departments to develop or oversee a single or more projects. Personnel from marketing and finance departments may be required to design marketing strategies and determine budgets when introducing a new product or service in the market (Ellis, 2003).
A functional structure is based on the basic organizational functions like accounting, human resource, marketing and finance. An executive in a small company may hire managers for these areas, managers may employ coordinators. When the organization expands in the future, managers may assume the roles of directors.
Customer design ensures that the organization positions its employees in a manner that they are able to understand its customers. Offering products and services to different customers may require that departments come up with structures and design that meet the diverse needs of different customers. There are many managerial levels in tall organizational structures.
In a bureaucratic structure, there exist specific extents of standardization that is good for larger and complex organizations to adopt a tall structure. Max Webber characterized bureaucratic structures as being hierarchical, having well defined organizational roles and responsibilities, and recognition of performance (Ellis, 2003).
Large organizations are mostly characterized by tall organizational structures. British Gas Company a good example of a tall organizational structure. British Gas is a British-owned organization that deals with energy supplies and its deals stretch from the United Kingdom to North America. Activities at the British Gas are divided into business units by products, services, and functions focusing on customer needs.
The active departments in the British Gas company are the finance and marketing departments, headed by departmental heads who assume the roles of team players. Team structure is applied in the British Gas company as every member of this organization works as a team member.
The team leaders are also known as service managers. There is span of control at British Gas as each team has a manager or a leader. Employees who start their career as apprentice may later be service managers and/or operational managers as they progress in their careers (British Gas, 2012).
Qualcomm Incorporated is an American organization that deals with next-generation technologies and 3G networks. Qualcomm Incorporated is another tall structured organization that applies traditional organizational designs namely divisional and functional structures.
However, contemporary design is evident when team structure is employed. This organization is divided into two units based on functional and product departmentalization. The administrative or the functional units comprises of Human resource, marketing, financial and global development departments. These departments are responsible for worldwide coordination of the organizations operations (May, 2005).
At Qualcomm, there is work specialization where various tasks are given to different individuals depending on their specialization. Qualcomm’s departmentalization consists of functional and product departmentalization that includes the business and administrative units. The business Unit is further divided into subunits considering product departmentalization. The finance department is headed by a manager who oversees budget allocation.
Product marketing is done by the marketing department headed by a sales manager. The head of the Human resource department is responsible for employees’ welfare and well being. Many employees have teamed up hence the unity of command is minimal. Qualcomm is quite decentralized because teams are their own decision makers (May, 2005).
Organizational structure highlights hierarchical authority and the roles of different individuals in the organization. Organizational structures offer the platform on which the basic operating processes and events rest. The way an organization’s structure develops will depend on which organizational structure category it will fall.
Organizational design process starts with strategy creation. Offering products and services to different customers may require that departments come up with structures and design that meet the diverse needs of different customers. Large organizations are mostly characterized by tall organizational structures. A trick to business growth in today’s ever changing global economy that is controlled by innovation and creativity requires that centralization be discarded.
British Gas. (2012).British Gas. Retrieved from www.britishgas.co.uk
Ellis, C. (2003). The flattening Corporation. MIT Sloan management Review, 4(4), 5.
May, L. (2005). Organizational structure and designs. Retrieved from www.emaytrix.com/mgmt307/section 7.php
Southwest Gas Corporation. (2007). Pro of the Southwest gas Retrieved from http/www.swgas.com/about/aboutus/index.php?val N…