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Traditional organisation theorists developed certain principles of organization structure. Communication generally occurs within each functional department and is communicated across departments through t… To subject the person to the authority of more than one immediate superior tends to divide his loyalty and confuse his action. These principles are intended for universal application to all enterprises. However, in reality, there is often a divergence between individual needs and organizational goals. Staff functions are auxiliary to the line functions and are advisory in nature. This principle in brief states: “it is desirable to consider simplicity of structure in developing and organisation, aiming for as clear-cut structure as will permit doing the necessary work efficiently”. Staff functional structures seldom exeunt apart from a combination with line structure. Structure is a valuable First, the corporate structure must provide a solid and stable working environment for everyone. Find suitable people to fill the positions and make optimum effects. At higher levels, however, grouping jobs into manageable units and their co-ordination can pose serious problems. Since objective have a direct bearing upon the organisation structure, one should take due cognizance of time, and develop and design the structures so as to facilitate accomplishment of objectives. There is said to exits decentralization in an organisation if decision making authority is pushed down to its lower levels and near the source of information and action as possible. To cope with these changes and get reach its objectives and organisation must be designed with sufficient amount of flexibility. Line structure is part of every organisation. Departmentalization requires analyzing everything that has to be done and determining the grouping in which it can be placed without violating the principle of homogeneity. The next very useful fundamental of organisation structure is the exception principle. Exception principle is also the principle underlying delegation of authority. Another advantage is that is focuses executive skills on logical and interrelated problems and provides a basis for top management to coordinate and control the efforts of the departments. The scalar principle holds that organisation consists of two or more levels of authority. We saw the value of this approach recently with an industrial goods manufacturer. Basic Principles of Organizational Structure. It should make the supervisors assess their subordinates’ performance easily, so as to conduct adequate guide and control. This principle implies that each area and function of an enterprise should operate with equal effectiveness in making its allotted contribution to the total purpose. Otherwise, the change won’t sustain itself. a) Line and Staff Relationships : Line authority refers to the scalar chain, or to the superior-subordinate linkages, that extend throughout the hierarchy (Koontz, O'Donnell and Weihrich). It is to be admitted that there is a limit to the number of subordinates a manager can effectively supervise, but what should be that limit is yet an open question. Objectives are helpful in determining the activities and the structure itself. The idea of span of control is related to the horizontal dimension of an organisation structure. Therefore, the design should aim at serving to reach the goals. A good organizational structure should be developed based on the following principles: The ultimate goal of organization design is to achieve the strategic objectives. To achieve organizational goals and objectives, individual work needs to … Consider the members of a group formed spontaneously to help push a car out of mud. By forcing a distinction between programmed decisions and the non-programmed decisions, the exception principle helps the manager to concentrate on un-programmed decisions involving new and unstructured elements. It is also frequently used to indicate either geographical dispersal or delegation. This site uses Akismet to reduce spam. The idea of simplicity in organizational structure may at first appear facetious in view of the large size and complex nature of many of our business organisations. Your email address will not be published. Often executives come to regard these domains as their own empires which receive their attention to the neglect of the organizational interest. Nevertheless, simplicity is an objective of organizational planning. Span of control (also referred to as the span of supervisions or span of management) refers to the number of subordinates reporting directly to the executive the principle holds that larger the number of subordinates reporting directly to the executive, the more difficult it tends to be for him to supervise and coordinate them effectively. Organizational structure refers to how individual and team work within an organization are coordinated. Once objectives are clearly defined, the organizer can conveniently proceed to group activities, delegate authority to individuals to whom activities have been assigned and coordinate their efforts for better results. These positions are basic units of the organizational structure. Make sure the hierarchy is reasonable and smooth, and the information flows rapidly and clearly from the executive committee to business units, functions, and departments. Organizations with such a structure are divided into smaller groups based on specialized functional areas, such as operations, finance, marketing, Human Resources, IT, etc. It implies devising a method of control so that only exceptional results are flagged for management attention. Organizational structure refers to how individual and team work within an organization are coordinated. The staff and functional types are modifications of the line structure. He terms geographical dispersal or delegation as mere “administrative reforms” intended to relieve pressure on top management. Thus, the notion of simplicity is identifiable with the convenience with which people- perhaps many having face-to-face personal contracts are able to combine into performing groups. The organizational structure is composed of functional positions that contribute to the business aims. On the basis of distinction like this, it is argued that line and staff functions should not be combined in one individual or department where separation of the functions is possible. Clearly a leader has emerged producing a two-level group consisting of the leader at the top and the pushers as follows. A flexible organisation is able to withstand pressures, but gives way to the demand for genuine change without fundamentally altering the basic functions of the various segments of the structure. Moreover, functional interdependency among work activities causes strains and tensions. Easy Org Chart Creator – Powerful & Economic Choice for Your Business, Org Chart Template: Essential Ones for Your Work, Org Chart Software: The Ultimate Guide for You, Dropbox Business Org Chart: Check the Magic Figures. Departmentalization breaks the work into manageable units. These principles should be used as mere fundamentals or guides to actions while designing the organisation structure. taylor applied by breaking down jobs into single repetitive tasks performed on specialized tools. Gluck viewed four possible bases of Departmentalization-purpose, process, product and place. 4. It implies devising a method of control so that only exceptional results are flagged for management attention. He calls this as the principle of federal decentralization’ which is based on organisation of activities into separate product business with separate markets and production and profits goals for each. It's your ultimate org chart tool which is advanced, easy and affordable. The reason is that these are basic authority relations, combination of which will result in confusion. Organisation structures are usually of line, staff and functional types. A good organizational structure should be developed based on the following principles: Strategy-oriented The ultimate goal of organization design is to achieve the strategic objectives. Simplicity is an appealing objective because it implies economy of efforts. While specializations cause great function interdependency among operatives, it also depersonalizes their activities so that individuals find little meaning in the work. However, for Ducker’s views on decentralization are quite penetrating and interesting. The first is the capacity of the higher executive to do his work efficiently, and second is the capacity of the executives to supervise. Org Chart Creator provides the best org charting service. Modern organizational structures have evolved from several organizational theories, which have identified certain principles as basic to any organization structure. F.W. Choice of basis is a recurring question and changes as the organisation grows, develops or employs a new technology.

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