An Effective Organizational Structure - Essay Example

College In today ever changing economy, it has been proven to be significant for each business enterprise or organization to possess an effective organizational structure or formation that utilizes the valuable resources of the employers. Companies engage in competition in the global economy to gain a successful economic advantage over one another thus the need for a well structured business strategy (Buhler, 2008). An efficient and effective business organizational structure enable a company to devise policies and come up with sane procedures and practices which helps in generating of high profits. Highly skilled personnel are the most important valuable of a business enterprise. Qualified workers enable the tasks and the objectives of the company to be achieved appropriately thus putting the organization to a benchmark of great level of success. These goals are ultimately achieved through effective coordination as spelled out in an organization structure that the company might prefer (Buhler, 2008). The type of structure and design a company might opt for, have explicit and implicit effect on how each employee relate with one another in terms of communication. A well designed business structure has significant effects to its members. These effects are portrayed based on how members react to changes within their work environment and their ultimate output. Organizational structures which are well planned are easy get accustomed to and enhance collaboration between employees for the best interest of the company (Buhler, 2008). Effective Communication is a crucial tool within an organization which enables it to thrive. Authorities are distributed among different level of ranks. For example, a new employee who has just been hired will know where to report and where to seek for help when confronted with a hard situation. Most companies prefer addressing issues affecting the organization through departmental official who is in turn forward the complain or a request to the executives of the companies for subsequent analysis and coming up with solutions. An organizational structure enables the employees to communicate with the authorities following the right channels which have been put in place (Buhler, 2008). A well-built organization design boosts the morale and confidence of its members. Respect is an important value which motivates workers at their work place. Employees need to feel valued by their employers in terms of their contribution in achieving the organizational main objectives. Giving Incentives to the members is an important motivational factor, whenever they are faced with challenges in the course of their practice. Incentives help them see more opportunities which might enable them to advance in their carrier. Conversely, organization structure might also have a negative impact on the employee spirit and morale (Walker, 2002). For instance, raising salaries for the heads of projects and giving them incentives e.g. bonus while delaying payments of team member salaries, can demoralize the minor employees involved in those projects. How a business is structured to operate plays a crucial role in relation to the level of motivation an individual might have (Klewes & Langen, 2008). Decision making is an important aspect of an organization structure. How fast or how slow an organization makes decisions depend on the efficiency of a company’s executive coordination. For a simple structure composed of the manager who is answerable to the director, the decision making process is faster hence the quick growth. Big companies have a stratum of management. Responsibilities are more elaborate thus it is important to identify the individuals that are the overseers of certain functions and practices of within the company (Puffers, 2004). Productivity of each employee is best evaluated and determined by a well organized organization structure. Supervisors are able to gauge the efforts that are put in by their subordinates according to the work assigned to them. Supervisors are able to determine everyone’s contribution in terms of skills, their relationship with one another and how cautious employees are in keeping deadline of their assignments. This assessment helps the company to prepare a performance appraisal that helps the organization to recognize and appreciate hard work and determination of certain employees (Puffers, 2004; Ilgen & Pulakos, 1999). One of the basics of an organization structure is producing results. Individuals at high ranks are responsible for giving direction to the subordinate staff members thus enhancing achievement of business goals. Teamwork is also promoted by the management of an organization through provision of team building strategies, working towards a common aspiration. Consumers in the market have become more sophisticated and knowledgeable thus demanding for more customized goods and services. Managers and business officials manages this dynamic problems domains through an effective structure that the company has in place. Technological change is an important aspect that the organization has to be well conversant with (Puffers, 2004).It helps companies keep in touch with their customers in accordance with the law. Types of organizational design There are two main categories of organizational design reflected in various organizations. 1. Traditional design-which includes geographical structure, simple structure and functional structure. 2. Contemporary design-includes team structure, matrix structure and project structure. Simple structure It is characterized by centralized authority and presence of little formal functions. This instance of design is evident in small businesses with are starting up or thriving. In a business with few employees, for example twelve employees, the owner might opt to be the manager since the business is not complex to be managed by many people. He coordinates all the important functions of the business. The employees on the other hand, work in various business areas e.g. an employee who handles accounts might also be in charge of advertising the company’s products and doing sales. This type of structure lacks business standards, but they begin to be reflected when the business starts to spread out (Huber & Glick, 1993). Functional structure This is where the company’s responsibilities are grouped and merged into respective departments. Employees are assigned into specific departments with specific responsibilities to handle to enable in achieving the company’s goals. There exists a monitoring department with communicates with other departments from outside to ensure that coordination is achieved among the departments present at workplace (Puffers, 2004). Matrix structure This is type of structure which fosters teamwork among its members. Individuals join hands and work together to accomplish tasks at hand. Through this type of setting, projects are well coordinated and work of high quality is produced since collective efforts and responsibilities are adhered to (Klinedinst & Kalmi, 2009). Workers are answerable to their team manager and their departmental manager to which they belong to. In case of a conflict between the two managers, it can result into strained external relationship (Rant & Rozman, 2008). Geographic structure It is realized when a business is of a complex structure and the business has many branches in different localities. Every branch has a separate environment that is distinct from one another. Each business has a branch manager who tackles the issues affecting his or her branch is they are answerable to the managing director of the company. The environments in which the business enterprises operate in are unique as a result manages deal with issues distinctly. This type of structure normally must have a superb and well coordinated overall management to effectively communicate with each business zone (Denison, 2001). The success of any business in the global market depends on how well prepared the business is in terms of motivating its employees who are the main assets of the organization. The organization should be tolerant to frustration (Puffers, 2004). Being tolerant avoids a conflict of interest that might arise due to a clash of organizational needs and the individuals’ needs. Rules have to be put in place to facilitate mediation between the conflicting parties. Whichever organizational design a company opt for, it has to evaluate its benefits and the ultimate impact to the company. A structure which encourage teamwork, faster decision making and a well coordinated ones s the best design since it opens the business to global opportunities in the market. Decisions are able to be made quickly without delay and collective efforts are made thus smooth operation of the entire business (Hovelja, 2008). Reference Buhler.P.M (2008). Сhanging organizational structure and their impact on managers 72(2), 24-26 Denison, D. R. (2001). Managing organizational change in transition economies. Mahwah, N.J: L. Erlbaum. Hovelja, T. (January 01, 2008). Organisational effects on information technology productivity in enterprises: The case of Slovenia. Economic and Business Review, 10, 3, 243-261. Huber, G. P., & Glick, W. H. (1993). Organizational change and redesign: Ideas and insights for improving performance. New York: Oxford University Press. Ilgen, D. R., & Pulakos, E. D. (1999). The changing nature of performance: Implications for staffing, motivation, and development. San Francisco: Jossey-Bass Publishers. Klewes, J., & Langen, R. (2008). Change 2.0: Beyond organisational transformation. Berlin: Springer. Klinedinst, M., & Kalmi, P. (2009). Participation in the age of globalization and information. Bingley: Emerald Group Publishing Limited. Puffers. (2004). Сhanging organizational structure. Academy of Management Executive, Vol. 18, No2. Rant, M., & Rozman, R. (January 01, 2008). Modelling the interplay of environment, organisational and network structure changes. Economic and Business Review, 10, 2, 89-116. Walker, W. E. (2002). Changing organizational culture: Strategy, structure, and professionalism in the U.S. General Accounting Office. Knoxville: University of Tennessee Press. Read More