Organizational construction provides the model of an organisation finding how functions and duties are delegated throughout the different degrees of the organisation. It has been defined by some as the looking glass through which coworkers see their organisation and its environing environment while others have described construction as the anchor of the organisation. In this memo. I will briefly discourse the importance of organisational construction. give illustrations of some major organisational constructions. and provide factors act uponing the pick of organisational construction.

Importance of Organizational Structure

Organizational construction is of import in the undermentioned facets of an organisation: scheme. public presentation. and member’s behaviour. Once an organisation has developed a scheme. it is highly of import to take some type of construction. Without construction. undertakings can non be assigned and carried out nor can authorization be decently exercised ensuing in an uneffective scheme. Performance can besides be affected by construction. While good organisation does non needfully bring forth good public presentation. hapless construction will do good public presentation about impossible ( Naoum. 2001 ) . Structure minimizes single influence. specify how determinations are made ( Dalton. et al. ) and enables or restricts communicating. All of which are likely to impact member’s behaviour.

Major Organizational Structures

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For the intents of this memo. four major organisational constructions will be discussed. The traditional construction is the simplest and is besides known as trade construction. Businesss in their early phases frequently use this type of construction. It is characterized by a director who assumes most or all of the duties of the organisation ( Naoum. 2001 ) . As an organisation grows or has multiple merchandise lines. a matrix construction is advantageous. This construction is characterized by a undertaking director with several functional directors ( Naoum. 2001 ) . If a company had two merchandise lines. each merchandise line would hold its ain gross revenues section. client service section. and accounting section ( “Organizational Structure” . 2013 ) . For organisations which produce standardized goods and services. a functional service is good. Within this construction. employees perform really specialised undertakings ( Naoum. 2001 ) . For illustration. an technology section would be staffed with merely package applied scientists. Divisional constructions. besides known as merchandise constructions. groups each map into a division. Automobile industries typically use this divisional construction. Within this industry. divisions may include: SUVs. subcompact autos. and saloons. Although non discussed in item in this memo. other organisational constructions include: organisational circle. squad. web. lattice. and practical ( “Organizational Structure” . 2013 ) .

Factors act uponing the pick of Organizational Structure

The undermentioned factors can impact the type of construction which an organisation may utilize: scheme. features. direction. operation. and environment. Strategy is the most of import factor act uponing type of construction. Harmonizing to Phillips and Gulley in their book Organizational Behavior: Tools for Success. higher public presentation will be achieved if construction and scheme are straight related ) . Organizational features include the age and size of the organisation. If the organisation is little. there is less demand for formal construction as communicating within a little group is simpler than that of a big organisation. Management besides affects that the type of construction which is used by an organisation. How a director develops an overall scheme. positions freedom and values the organisation will all impact the construction of the organisation. Operation’s undertaking and grade of engineering are besides of import factors. Finally. the environment plays a critical function in the organization’s construction. Environments that are complex require construction to be decentralized while hostile environments require the construction to be really centralised. An environment which is invariably altering requires a flexible construction ( Naoum. 2001 ) .

If an organisation programs to be successful. it must carefully measure all internal and external factors before finding what type of construction it chooses. It is of import to measure these factors from clip to clip to find if there is a demand for reorganisation. It is merely with the proper construction that an organisation will hold an effectual scheme and win. Each construction will hold its advantages and disadvantages to the organisation. Without some type of organisational construction. the workplace environment would be helter-skelter ( Marquis and Huston. 2009 ) . Finally. it is of import to observe that organisations may utilize more than one type of organisational construction. This is particularly true of big organisations. frequently with separate subordinates ( Taylor. 2006 ) .

IBM Recommendation

Some 80 old ages after International Business Machines Corporations ( IBM ) was founded. the company was still runing under a simple organisational construction. Decision devising was really centralized at the senior degree. While this construction is advantageous in a freshly developed organisation. it is non ever good to a company who has expanded operations. IBM was much excessively big to hold all determinations to be made at the corporate headquarter degree. It non merely resulted in delayed determination devising but reduced enthusiasm and creativeness from lower degree directors. It was clearly obvious that this simple construction was non leting IBM to transport out an effectual scheme but it was besides obvious that interrupting up the company into 13 divisions was non the manner to set this company back in the leader’s place either. The matrix construction could hold been proven to be the most effectual construction for this fighting company. Decision devising could hold been pushed down to functional directors which would hold led to higher employee morale and increased creativeness. Matrix designs are besides effectual in a quickly altering environment ( Gully and Phillips. 2012 ) and such was the environment for IBM. IBM’s clients should hold been their focal point. another ground the matrix construction was ideal ( Taylor. 2006 ) .

I have reviewed this memo relation to the Writing Guidelines and I believe it to the full conforms to them.

Electronic Signature: Jessica Rushing


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hypertext transfer protocol: //books. Google. com/books? id=_BjBzBw2IHMC & A ; printsec=frontcover & A ; source=gbs_ge_summary_r & A ; cad=0 # v=onepage & A ; q & A ; f=false Organizational Structure. ( n. d. ) . In Wikipedia. Retrieved January 16. 2013. from


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