Organizational structure
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Organizational structure is the way in which the interrelated groups of an organization are constructed. From a managerial point of view the main concerns are ensuring effective communication and coordination.
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[edit] Pre-bureaucratic
Pre-bureaucratic (entrepreneurial) structures lack standardization of tasks. This structure is most common in smaller organizations and is best used to solve simple tasks. The structure is totally centralized. The strategic leader makes all key decisions and most communication is done by one on one conversations.It is particularly useful for new (Entrepreneurial) business as it enables the founder to control growth and development.
They are usually based on traditional domination or charismatic domination in the sense of Max Weber's tripartite classification of authority.
[edit] Bureaucratic
Bureaucratic structures have a certain degree of standardization. They are better suited for more complex or larger scale organizations. Then tension between bureaucratic structures and non-bureaucratic is echoed in Burns and Stalker's (1961) distinction between mechanistic and organic structures.
[edit] Functional Structure
The organization is structured according to functional areas instead of product lines. The functional structure groups specialize in similar skills in separate units. This structure is best used when creating specific, uniform products. A functional structure is well suited to organizations which have a single or dominant core product because each subunit becomes extremely adept at performing its particular portion of the process. They are economically efficient, but lack flexibility. Communication between functional areas can be difficult.
[edit] Matrix structure
A matrix structure combines elements of functional and divisional structures. An employee will typically report to a general manager within his division, as well as to a functional manager at a central location who oversees that function across all divisions. A matrix structure can help to ensure better coordination of divisional and company-wide objectives, but it can also lead to inefficiency if the authority of the divisional managers and centralized functional managers are not well-clarified.
[edit] Divisional Structure
Divisional structure is formed when an organization is split up into a number of self-contained business units, each of which operates as a profit center. Such a division may occur on the basis of product or market or a combination of the two with each unit tending to operate along functional or product lines, but with certain key function (e.g., finance, personnel, corporate planning) provided centrally, usually at a company headquarters.
[edit] Post-Bureaucratic
The term post bureaucratic is used in two senses in the organizational literature, one generic and one much more specific (see Grey & Garsten, 2001). In the generic sense the term post bureaucratic is often used to describe a range of ideas developed since the 1980's that specifically contrast themselves with Weber's ideal type Bureaucracy. This may include Total Quality Management, Culture Management and the Matrix Organization amongst others. None of these however has left behind the core tenets of Bureaucracy. Hierarchies still exist, authority is still Weber's rational legal type and the organisation is still rule bound. Heckshcer, arguing along these lines, describes them as cleaned up bureaucracies (Hecksher & Donellson, 1994) rather than a fundamental shift away from bureaucracy. Gideon Kunda, in his classic study of culture management at 'Tech' argued that 'the essence of bureaucratic control - the formalisation, codification and enforcement of rules and regulations - does not change in principle.....it shifts focus from organizational structure to the organization's culture'.
Another smaller group of theorists have developed the theory of the Post-Bureaucratic Organization, (Heckscher and Donnellson, 1994 provide a detailed discussion) which attempts to describe an organization that is fundamentally not bureaucratic. Heckscher has developed an ideal type Post-Bureaucratic Organization in which decisions are based on dialogue and consensus rather than authority and command, the organisation is a network rather than a hierarchy, open at the boundaries (in direct contrast to culture management); there is an emphasis on meta-decision making rules rather than decision making rules. The problem with theories of this type is that it is very doubtful that such an organization exists. The exemplar case studies that show many of the required characteristics are all hi tech firms and very few in number. Furthermore, as is argued by Kunda (1992), the evidence points to new systems of managerial control building on what has gone before, rather than being a complete break with the past. Hence the move to the Post-Bureaucratic Organization may never take place.
Still other theorists are developing a resurgence of interest in Complexity Theory and Organizations, and have focused on how simple structures can be used to engender organizational adaptations. For instance, Miner and colleagues (2000) studied how simple structures could be used to generate improvisational outcomes in product development. Their study makes links to simple structures and improviseal learning. Other scholars such as Jan Rivkin, Kathleen Eisenhardt Nicolaj Sigglekow, and Nelson Repenning revive an older interest in how structure and strategy relate in dynamic environments.
[edit] See also
[edit] References
- Burns, S., & Stalker, G. M. 1961. The Management of Innovation. London: Tavistock Publications [1].
- Davis, J. P., Eisenhardt, K. M., & Bingham, C. B. 2006. Complexity Theory, Market Dynamism, and the Strategy of Simple Rules, Stanford Technology Ventures Program working paper [2].
- Grey, C & Garsten, C. 2001. Trust, control and post-bureaucracy. Organization Studies 22(2), PP 229-250 [3].
- Heckscher, C & Donnellson, A. (eds) 1994. The Post Bureaucratic Organization: new perspectives on organizational change [4].
- Kunda, G. 1992. Engineering Culture: control and commitment in a hi tech corporation. Philadelphia, Penn. Temple University Press [5].
- Rivkin, J., W. 2000. Imitation of Complex Strategies. Management Science, 46(6): 824-844 [6].
- Siggelkow, S. 2002. Evolution toward Fit. Administrative Science Quarterly, 47, pp. 125-159 [7].
