(v) Excessive specialisation may destroy teamwork in the organisation. Thus, there is duplication or triplication of activities, personnel and equipment. In traditional organizations, functional departments create horizontal boundaries which stifle interaction between functions, product lines, and units. There is no accountability of each function for total results. And the territories served by the firm have their unique problems. It may be noted that generally project teams are created along with the existing functional organisation. Each individual has a job description that outlines obligations, and each job occupies its own position on the company organization chart. Each unit is directly accountable to the organization. The synergistic effect is generated in virtual organization because of the complementarity of competences of different partners. Many educational institutions usually follow this type of departmentation. iv. Divisional structure is formed by creating a set of autonomous units or divisions which are coordinated by the central headquarters. (iii) Co-ordination between line and staff may become difficult. Get your paper done in as fast as 3 hours, 24/7. What is Decentralization: Advantages & Disadvantages of Decentralisation. (iii) It introduces specialisation leading to higher productivity and economical operations. iii. (iii) There may be lack of talented personnel to take charge of regional departments. iii. Shell type structure construction was as old as 1920s. Special knowledge and experience contribute to the common goals of the concern. Small-business proprietors ought to start considering a formal structure early within the development stage of their business. (Root, 2017)An organization ought to continuously take a great structure since a well-structured organization is able to create way better choices and adjust way better to changes within the commerce world, whereas an ill-structured, or a basically confounded organization leads to bottlenecks within the decision-making handle and can have an greatly awful impact on generation and income. iii. (v) It helps in training of specialist managers rather than generalist managers. The concept of virtual organization/corporation, also known as networked organization or modular organization along with virtual team and office has entered management field very recently. Its a hybrid organizational, a blending of the functions and projects. Content Guidelines 2. Informal communication plays a bigger role. Start your journey 4.8 on AppStore All the tools you need 1. ii. In matrix structure, a project manager is appointed to coordinate the activities of the project. iii. Even the earliest adopter of this concept, GE, has not yet achieved this boundary less status. ii. The two traditional bases are product and territory. WebDiscuss its advantages and disadvantages. For example, in an insurance company, departmentation may be achieved on the basis of these functions, viz., underwriting agency, claims adjustment and administration. Each division may have further organisation based on functional departmentation. (ii) There may be problems of integration between various regional offices. Clear accountability, ii. feeble-minded; not intelligent synonyms for simple Compare Synonyms clean elementary plain quiet smooth straightforward transparent uncomplicated cinch light picnic snap walkover child's play easy as pie effortless The work culture gives an identity to the organization. Websimple definition: 1. easy to understand or do; not difficult: 2. used to describe the one important fact, truth. This essay wont pass a plagiarism check! The matrix structure has the following advantages: i. The core of the network structure is the central organisation which coordinates relationships and activities with the other organisations in the network. It has neither central office nor organization chart; it has no hierarchy, no vertical Integration.. The important people of the company were Jimmy Wales, the person in charge of Bomis, and Larry Sanger, the editor-in-chief of Nupedia. Apart from basic and secondary functions, departments are also created for supporting activities to take the advantages of specialisation and to support the basic and secondary activities. Separate strategic and operational control, iii. It helps to maintain the power and prestige of the major functions. The concept and practice of boundary less organizations is quite new. 0. The major characteristics of a boundary less organization are as follows: i. At the same time, divisionalisation involves certain negative points in the form of being expensive, presenting control and coordination problems, lack of suitable personnel for heading divisions, and lack of specialisation of activities. The merits of project structure are as under: (i) Project organisation concentrates on completion of a complex project or assignment. It facilitates specialised performance of various functions. (ii) It employs personnel with special abilities for meeting different customer requirements. Team-Based Organisation 7. The literal meaning of virtual is having the efficacy without the material part; unreal but capable of being considered as real for the purpose. Chance of differences in image and quality may occur across divisions. Our writers will provide you with an essay sample written from scratch: any topic, any deadline, any instructions. 2. (iii) Product departmentation may sometimes lead to difficulties in coordination of certain specialised activities like marketing, financing and accounting. Everything you need to know about the types and classification of organisation structure. Offer assistance on an issue can come from anyplace inside the company. 6. For instance, Life Insurance Corporation of India (LIC) has semi-autonomous divisions in different regions of the country. Functional design eliminates duplication. 7. You will got to consider contributing in a workflow program for superior record taking care of. Later, many organizations have moved from these bases to create divisions on the basis of strategic business units. Departments are replaced by self-managing teams. ii. The departmentation by product places all the responsibility and authority under one manager to get the product (or service) produced and marketed. When it is used, the organization is departmentalized on the basis of functions. The basic reason behind creating a virtual organization is to generate synergy through temporary alliances. It requires decision making through the levels of organization and flattens out the vertical appearance of a hierarchy. In this study we aimed to show that the number of organizational structures may vary from one perspective to another, the definition as well, but the mission and the function of these structures are the same. A good example of this strategy is Google and LinkedIn, who already have an internal incubator, thus their employees are peached to be creative and innovative to promote the growth of the company. iii. Virtual Organisation. It is suitable where environment is uncertain and generally dynamic or unstable. For instance, a big automobile servicing enterprise may organise its departments as follows heavy vehicle servicing division, car servicing division, and scooter servicing division. Customer Based Structure 12. Departmentation by customer may be followed in enterprises engaged in providing specialised services to different classes of customers. Matrix structure is the realisation of two-dimensional structure which emanates directly from two dimensions of authority. The products are often unrelated and require different emphasis on different functions. There is no single organisation structure or design that is suitable for a given strategy. Limit opportunities for upward mobility. It tends to overburden the senior managers with routine matters. Matrix structure is essentially a violation of unity of command and, therefore, whole classical concepts related to the principle of unity of command are violated. It is one thing to make a compelling stream of data, and it is another thing to ensure that the data is being fittingly gotten and informational are being carried out. It enables the company to cater to the needs of the different regions more effectively. WebDivisional structure has some advantages: i. Some of the disadvantages of functional organizational structures include: Hindered decision-making: F ormal organizational structures ]ypically require employees to seek approval from management and other authority figures before making decisions. It ensures quick delivery of products to customers in different areas, and intensive exploitation of local markets. Functional structure provides essentially slow decision making process because the problem requiring a decision has to pass to various departments as all of them have something to say on the matter. i. What is the disadvantage of simple organizational structure? Entrepreneurial structure is quite simple in nature (that is why it is also called as simple structure) and is suitable for small organizations in which the entrepreneurs also work as chief executives. Territorial departmentation has the following advantages: (i) It leads to the benefits of local operations. 3. The main advantages of the simple structure are the following: i. The owner manager gets invested with a complete knowledge of his organisation and its business. ii. Decision-making is very quick. Advantages There becomes reduced personal responsibility for any business debts incurred Legal liability also becomes reduced since a company is a separate legal entity from you as an individual Company tax rates are lower compared to higher marginal tax rates It can be much easier to raise finance and capital to grow and expand Other advantages of the matrix structure are: Effective flow of information. ii. However, this can be treated as an operational problem which can be overcome through experience over the period of time. If teams are not created properly, there may, Types of Organisation Structure In Relation to the Attainment of the Organisational Objectives, 4. Virtual or Network Organisation 14. However, with advances in information technology, the network structure is gaining popularity. Describe the three basic types of organizational structures and the WebAdvantages of Organisation Structure: Merits of having a well-designed organisation structure are as follows: 1. iv. It may create and confusion conflict, due to improper understanding about employees responsibilities. It may give rise to conflicts between divisions. (iv) There will also be problems in providing centralised services to various departments which are located in different regions. viii. (iv) It is easier to evaluate and compare the performance of various product divisions. Organization structure is the pattern in which various organizational activities are divided and assigned among positions, groups, departments, and divisions and the coordinating mechanism among these activities to achieve organizational objectives. (iii) There may be lack of understanding between different departments. Under this, customers are the guide for grouping the activities. As the emphasis under this structure is generally on the total volume of business in the regions, some business lines may not get the required attention. Divisional structure has some advantages: ii. The data structure is a good solution for storing data on framework. What is Decentralization: Advantages & Disadvantages of Decentralisation. Centralization is an organizational structure that gives the ability of decision-making responsibilities to higher management. Convenient (v) Attempts to enforce uniform marketing and personnel policies in all the regional units may be contrary to the local needs of some units. Functional Structure 3. The different organisational structures described above have their own advantages and disadvantages. A effective supervisor ought to be the go-between for specialists and officials, and a facilitator thats doled out an errand to total. If people are not sure whom they report to, they may discover they are given conflicting assignments by two or more supervisors above them. Departmentation refers to the formal structure of the organisation composed of various departments and managerial positions and their relationships to each other. v. Coordination of functional activities related to a product line is easy under this structure. Commitment to the organisational goals is more valued than loyalty and obedience. During his assignment to a project, he works under the coordinative command of the project manager and he may be called upon by his permanent superior to perform certain services needed in the project. Matrix Structure 6. There are different types of departmentation or organisational structure. An organisations growth makes structure complex. 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