After reading this article you will learn about:
1. Meaning of Organisation Structure
2. Elements of Organisation Structure
Meaning of Organisation Structure:
Organisation is “establishing effective behavioural relationships among persons so that they may work together efficiently and gain personal satisfaction in doing selected tasks under given environmental conditions for the purpose of achieving some goal or objective” — Terry and Franklin.
Organising refers to a whole divided into parts, each part assigned to organisational members, assigning authority and establishing relationships amongst them for collective contribution towards organisational goals. Division of work into smaller units, assigning people to those jobs and defining relationships creates the organisation structure. It defines the power that people enjoy by virtue of their official positions.
“An organisation’s structure specifies its division of work activities and shows how different functions or activities are linked; to some extent it also shows the level of specialisation of work activities. It also indicates the organisation’s hierarchy and authority structure, and shows its reporting relationships” — Robert H. Miles.
“Organisation structure is the formal pattern of interactions and coordination designed by management to link the tasks of individuals and groups in achieving organisational goals” — Kathryn M. Bartol and David C. Martin.
Elements of Organisation Structure:
Organisation structure has the following elements:
1. Objectives and plans:
Organisation structure is designed to meet plans and objectives of the organisation. It gives formal shape to organisational activities that help to achieve its objectives.
2. Specialisation of activities:
All organisational activities are divided into sub-units and grouped on the basis of similarity of characteristics. This forms departments which is the foundation of the organisation structure.
Standardisation means uniformity and consistency. To enable the members of different departments work in a co-ordinated manner, management lays down the policies, procedures and programmes which help in carrying out the decision-making processes. Standardisation provides stability to the organisation structure.
With specialisation of activities, workers may deviate from organisational goals and promote their individual goals. There is, thus, need to integrate the tasks of different units to make them contribute towards the common goal. Coordination ensures that organisation structure is respected by everyone and individual goals are also seen as contributors to organisational goals.
5. Centralisation and decentralisation:
Organisation structure where decision-making power vests with top managers is a centralised structure and a structure where decisions are made by middle and lower-level managers is a decentralised structure.
No organisation structure can be the best structure. It is subject to change depending upon changes in the environmental factors—economic, social, technological, political etc. Organisation structure is, thus, situational in nature.
Organisation structure is designed to achieve goals which are accomplished by human beings. The jobs and departments are, therefore, staffed with people and authority- responsibility relationships are established.
Forms of Organisation Structures:
There are various forms of organisation structures, designed on the basis of activities, performed in the organisation, their grouping into departments and relationship amongst people working in those departments.
Tom Burns and GM. Stalker describe two kinds of organisation structures:
1. Mechanistic or classical organisation structure:
This is a formal organisation structure with well-defined jobs, policies, schedules, chain of command, authority-responsibility relationships and vertical communication. The organisation and its members emphasise on organisational and individual goals with very little or no interaction with the environment.
2. Organic or behavioural organisation structure:
These structures are adaptive to environmental changes and prefer participative system of decision-making to vertical authority-responsibility relationships. Communication is both vertical and horizontal and control is self-imposed.