simple structure advantages and disadvantages

It Is Cost Efficient As mentioned, in this organizational structure, there are fewer (or no) manager layers between the executive and the staff. Employees may lose sight of the organization as a whole. The organization culture brings all the employees on a common platform. In India, many companies have diversified into unrelated businesses and have found functional structure quite unsuitable for them. For example, for new product development, no functional department is created but a multidisciplinary team is created that works on a single process. An organisation structure shows the authority and responsibility relationships between the various positions in the organisation by showing who reports to whom. (n.d.). Fair Use Policy or become aware of any violations, please do not hesitate to contact us via support@edubirdie.com. The matrix structure, which is a combination of structures, has, therefore, become popular. C)wCYP.TwslMK?yir~?_9:yizMX#Vw}Y}v~e}!6?_=}h[+|q]*S5z~ix:?EVF ?$d The activities of the individuals and the groups will become more rational, stable and predictable. 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 What is Decentralization: Advantages & Disadvantages of Decentralisation. Get your paper done in as fast as 3 hours, 24/7. This is being applied to various fields of activities because of pressure for dual focus, pressure for high information processing, and pressure for shared resources. If there are too many divisions, coordination becomes complex and difficult. The project staff is separate from and independent of the functional departments. ii. A team-based organization is considered to be better than group-based organization as the former leads to enhanced performance, reduced costs, organizational enhancement, and better employee satisfaction. The specialisation increases operational efficiency, economic flexibility, and greater motivation to the people having attached with their area of speciality. i. Communication is one of the preeminent compelling gadgets an organization must work with, and communication with respect to the flow of information and the structure of the company can offer assistance to decrease confuse and streamline the method. Entrepreneurial Structure (Simple Structure): 4. Information about projects flows across business functions through cross-functional teams and is not locked in the hands of the project manager and his team. (2013, October 4). The important disadvantages of the matrix organisation are the following: i. Departmentation by customer may be followed in enterprises engaged in providing specialised services to different classes of customers. Under this, each major product or product line is organised as a separate division. The concept and practice of boundary less organizations is quite new. (b) Are temporary decisions. c. They set their own goals and inspect their own work. iii. There is no potential for future development. 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) Co-ordination between line and staff may become difficult. Organic structure represents low horizontal differentiation, low formalization, free communication, and participation by low-level members in decision-making. It increases problems of central management control. h. They may hire their own replacement or assume responsibility for disciplining their own members. 2022 Mar 17 [cited 2023 Jan 18]. You can order a unique, plagiarism-free paper written by a professional writer. But to coordinate their functioning, certain essential services such as Corporate Planning, Finance, Legal and Research & Development are organised at the headquarters. (iii) There may be lack of understanding between different departments. It enables the company to cater to the needs of the different regions more effectively. Market-oriented long-range growth-oriented strategies can be planned and implemented. It may sometimes cause fragmentation and duplication of functions. Activities related to a function are grouped in a single unit with a view to give a well-defined direction to the whole group. Content Guidelines 2. For example, one of the virtual organizations created by Intel, USA and a Japanese company could not work properly because the Japanese company was not able to complete its part of the project, leaving Intel with a major product delivery problem. We have already learned in previous chapter that data structure plays crucial role in design and maintenance of The Importance of a Good Organizational Structure. (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. (iii) It leads to specialisation of physical facilities on the basis of products which results in economy. i. d. They often create their own schedules and review their performance as a group. All the authority and decision-making is concentrated in the owner manager who often directly supervises all the activities. Like. Geographical structure is followed in case of service organisations which have offices in different regions or geographical areas. iii. 1. Divisional structure has some advantages: ii. Sharply focuses on accountability for performance. Coordination and control processes tend to be tightly structured. Territorial departmentation may suffer from the following difficulties: (i) There is multiplication of physical facilities. Before uploading and sharing your knowledge on this site, please read the following pages: 1. The operating divisions are relatively independent and consist of products and services that are different from those of the other divisions. When making beyond any doubt your organization is well organized, a couple of steps must be taken after: When it comes to advancing the structure of a company it is basic to communicate the proper stream of information to everyone inside the organization. 2. This essay is available online and was probably used by another student. It empowers suitable organization. Because overall objectives are set and defined by top management, the functional units must also be organized in that perspective. For example, Life Insurance Corporation of India runs its life insurance business on the basis of territorial divisionalisation in which the entire geographical area of the country has been divided into five zoneseastern, central, northern, southern, and western. It has some of the advantages of decentralisation. Type # 1. Divisional structure based on territories served. In India, several companies like DCM, Gwalior Rayons, Century Mills and Voltas follow divisional structure to organise their operations. The local managers are more conversant with their needs and those of their customers. Moreover, our purpose here is to highlight the mission of the organizational structure, show its importance, diversification and when each type can be used. WebAdvantages: Employees who work in such a structure are well organized and grouped according to tasks and functions Employees focus on specific work or mission Essay Service Examples Business Organizational Structure. As such, there is always a lack of proper coordination and control. Low-cost but efficient information technology has also facilitated this process. 7. Establishes relationship people, gatherings and divisions. It Is Cost Efficient As mentioned, in this organizational structure, there are fewer (or no) manager layers While growth through expansion of same line of business forces an organization to organize on functional basis, growth through geographic and product diversification necessitates the adoption of divisional structure. What is the disadvantage of simple organizational structure? (Ingram, 2019) A formal layout of a companys structure makes it simpler to add new positions within the company, as well, giving an adaptable and ready means for development. For instance, a financing employee may report to financial manager, but at the same time a project may arise studying a budget, then this employee should report to the project manager as well. Thus, each functional staff has two bosseshis administrative head and his project manager. It may take more time to take a decision. Through these networks, people of boundary less organizations communicate across intra-organizational and extra-organizational boundaries. i. SBU structure makes the task of planning and control by the corporate office more manageable. Types of Organisation Structure With Merits and Demerits. For instance, line organisation is a kind of mechanistic structure. For instance, if an undertaking is in production line, the dominant element in its organisation chart would be manufacturing and assembling. WebSee definition of simple on Dictionary.com adj. Management, Organisation, Organisation Structure, Types of Organisation Structure. A blockchain is a distributed network that is composed of records that are maintained on an immutable basis. It leads to uneconomical operations. Each division may have further organisation based on functional departmentation. For example a large company having business throughout India may departmentalise its business by the major geographical regions (Example Southern India, Northern India, Western India, Eastern India and Central India). iv. Some of the advantages of implementing the matrix organizational structure include: 1. 2023 EduBirdie.com. It provides for a clear definition of functions and responsibilities. x@B It may create and confusion conflict, due to improper understanding about employees responsibilities. Network structure is created around a central organisation that relies on other organisations to perform manufacturing, distribution, financing and other crucial business functions on a contract basis. Divisional structure is similar to dividing an organization into several smaller organizations but it is not quite the same, since each smaller organization is not completely independent. It is created to exploit fast changing opportunities and share skills and even facilitate access to global markets. 21 days ago. b. The products are often unrelated and require different emphasis on different functions. In the present era of globalisation, strategic alliances and organization-customer-supplier links have become significant sources for developing competitive advantage. i. Why Is Organizational Structure Important? Require an additional layer of management. In my paper I am writing about the Drug Enforcement Administration and the importance of this agency and the difference it has made within our nation.to know this agency is dedicated to putting an end to drugs in America. Committee Organisational Structure Features: (a) Formed for managing certain problems/situations. (ii) It may be difficult for an enterprise to adapt itself to changes in technology, demand, etc. The word simple has many other senses as An orderly hierarchy in which people are related in a meaningful sequence will result. 5. Separate strategic and operational control, iii. All rights reserved, The Relationship Between Organizational Structure And Job Performance, Organizational Structure And Behavior For Dunkin' Brands, Organizational Structure For Hardware Shack, Organizational Structure: Management, Marketing And Human Resource Management, AJS Organizational Administration In Justice And Security, The Organizational Structure Of Nazi Concentration Camp, Organizational And Management System Of Nike Company, Apple's Organizational Culture And Structure, Motivation And Leadership In Different Organizational Structures. N{6[(b+-lCe[n;V\7j0 vi. 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. }rGcJ1h%1Ipht]P/`[t"S%73z.0bDw[ee=i~{`h0[wG97\7am97lQss,[nWO It is found in almost every enterprise at some level in the organisation structure as it leads to better planning and control of the key functions on which the survival and growth of the enterprise depends. (v) The departments based on territories can function as autonomous units. viii. It also helps in reducing transportation and distribution costs. Companies need quick decisions when operating in a dynamic business environment. ADVERTISEMENTS: 2. (vi) It facilitates better coordination of activities within each department. Retrieved from Chron: https://smallbusiness.chron.com/organizational-structure-important-3793.html, Juneja, P. (2015). 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. Where there are conflicts of interests, the quality of decision-making is enhanced by matrix structure. Centralization is an organizational structure that gives the ability of decision-making responsibilities to higher management. Since these activities may be divided and assigned in different ways, there are many forms of organization structure. In this type, each department has a boss or supervisor, with top down management hierarchy who supervise lower levels. There is no accountability of each function for total results. Some companies can do something very well but struggle with most others. vii. This may lead to decrease in profits even, when there is increase in sales. Describe the three basic types of organizational structures and the Besides better coordination, it will also improve customer service. (v) Attempts to enforce uniform marketing and personnel policies in all the regional units may be contrary to the local needs of some units. This would include the project managers and the subject matter experts. A consistent framework of checks and input can offer help in ensuring that the corporate structure is working authentically which all data is being gotten. Each product line or product group gets concentrated attention. Center administration need to take on more of a support role to the choices made by the organization, rather than endeavoring to manage anything to workers. Similarly, a commercial organisation may be divided into wholesale, retail and export departments. Each unit is directly accountable to the organization. However, it is not free from shortcomings. Product structure can also help your business: Product organisational structure does have certain disadvantages, including being difficult to scale and (iii) There may be lack of talented personnel to take charge of regional departments. High cost of operations and large investment make it unsuitable for small firms. Leads to competitive spirit within the organisation. Under this structure, there could be confusion regarding job and task responsibilities. What are the advantages and disadvantages of Organisational structure? Divisional Structure 4. The activities of the individuals and the groups will become Vertical communication between superior and subordinate is the tendency in mechanistic structure. An owner might become swamped with work, if he has to approve every decision at a A common theme of functional design proponents is the desirability of standardizing repetitive tasks and making them routine wherever possible. iii. (vi) It facilitates the expansion of business in various regions. Therefore, there is direct interaction between those who manage and those who are managed. i. (v) Excessive specialisation may destroy teamwork in the organisation. iii. Allows new business and new products to be added easily. Intel was not happy about that venture and decided not to participate in any such venture. v. Career patterns and professional development in specialised area. The disadvantages of product based structure are as under: (i) It results in the duplication of personnel and physical facilities. However, top management will continue to control decisions that involve strategic and coordinative variables. It is the oldest and most common organisation structure. For example, GEC was earlier having nine product groups and forty-eight divisions which were reorganised into forty- three strategic business units, many of which crossed group, division, and profit centre lines. This is appropriate specially when each product is relatively complex and large amount of capital is required for each product. When the company creates a choice making handle make sure it is caught on by the entire organization, and hold preparing classes on workflow in case required. Many of these problems can be overcome through sharp focus on tasks and responsibilities of corporate and divisional management, measurement of performance of divisions, long-term policy for performance and incentives, creating more autonomy and decentralisation of authority, and finally the explicit strategies for both the firm as a whole and its various divisions. Simple structure is a basic organizational design structure with low departmentalization, little work specialization, wide spans of control, centralized authority (typically the owner has most of the power) and little formalization or rules that govern operation. Weba piece of cake a piece of old tackle a pushover as easy as ABC as easy as falling off a log as easy as pie a snack a snap a snip child's play duck soup easy-peasy kids' stuff money for jam money for old rope no sweat easy to do cream puff more For Sheldon Cooper, adhering to social constructs was not simple . Adjective Easy to understand iv. Each unit has its own functional structure for various activities necessary for the product. When it is used, the organization is departmentalized on the basis of functions. The divisional structure may be based on product or geographical territory. 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. The SBU structure groups similar products, markets and/or technologies into homogeneous groups in order to achieve synergies. (iii) The project manager has to face a very unusual decision pressure that results from the severe penalties to be imposed because of the delay in completion of the project. Boundary less organization has self-managing teams but it differs from a team-based organization. It promotes development of managers through increased involvement in decision-making. Thus, virtual organization is a temporary alliance between two or more organizations that band together to undertake a specified venture. Firstly, there may be lack of close control over manufacturing operations. 3. For this purpose, all the functions required for strategy implementation are classified into basic, secondary, and supporting functions according to their nature and importance. Start your journey 4.8 on AppStore All the tools you need 1. They provide organisations with both freedom and control, whilst still enabling transparency and progression for employees. 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