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Organization Structure

This document discusses different types of organizational structures: [1] Line/hierarchical structure organizes employees in direct vertical relationships with authority flowing from top to bottom. It promotes unity of command but can overburden some levels. [2] Functional structure groups employees by specialized roles and allows expertise sharing but may lack flexibility. [3] Divisional structure divides the organization into self-sufficient units based on products, markets or geography, allowing specialization but also autonomy that can reduce coordination. [4] Matrix structure uses project teams drawing from different functions, strengthening coordination but potentially causing confusion over roles. Each structure has advantages like control or expertise and disadvantages like costs or flexibility that determine appropriate

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Jobin Jacob
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169 views15 pages

Organization Structure

This document discusses different types of organizational structures: [1] Line/hierarchical structure organizes employees in direct vertical relationships with authority flowing from top to bottom. It promotes unity of command but can overburden some levels. [2] Functional structure groups employees by specialized roles and allows expertise sharing but may lack flexibility. [3] Divisional structure divides the organization into self-sufficient units based on products, markets or geography, allowing specialization but also autonomy that can reduce coordination. [4] Matrix structure uses project teams drawing from different functions, strengthening coordination but potentially causing confusion over roles. Each structure has advantages like control or expertise and disadvantages like costs or flexibility that determine appropriate

Uploaded by

Jobin Jacob
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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ORGANIZATION STRUCTURE

By J.J
Objectives
• Understand about the concept of organization and organization
structure
• Understand types of organizational structures, their advantages and
disadvantages
• Understand the evaluation pattern and major points to be covered in
OST
Organization and Organization structure
Group of individuals(large or small) working together in order to
achieve a common goal

Systematic arrangement of people working with an organization


Formal organization structure catagories
1. Line Structure(also known as simple, vertical or hierarchical
organization)
2. Functional structure
3. Divisional Structure
4. Matrix structure
5. Project structure
1. Simple organization structure( Line/hierarchical)

• Organizations have only direct, vertical relationships


• Departments directly involved in accomplishing primary goals
• Authority flows from top to bottom
Simple/Line structure can be further divided into two

Pure line organization  Departmental line


organization
Advantage and disadvantages of line structure

• Simple to work • Can suffer from a lack of


• Promotes the unity of command. specialization at levels and
• Fixed responsibility and tasks at • Can overburden few levels to
each level their breaking points
• Stable form of organization • Division of work is not based on
any scientific plan but on the
whims of the manager

Useful in small scale business, continuous process industries


2. Functional organization structure

• Organizations groups employees according to a specialized or similar set of roles


• One of the most commonly used structure
• Operates well in stable environment
Advantage and disadvantages of Functional structure

• The team is managed by an • The functional organization may


experienced person with a have unhealthy competition
high ability and skills working with the other areas
• The team members work with • Another disadvantage of
other people in the field and it functional organization structure
allows sharing of thoughts and is that these functional groups
knowledge may not be able to communicate
more often which decreases
flexibility and innovation.
3. Divisional organization structure

• Grouping of
activities or
departmentation
on the basis of
product, market
or geography
Advantage and disadvantages of Divisional structure

• An advantage of a divisional • On the other hand, a divisional


structure is that each division can structure may result in too great of
operate as a separate, self- a sense of autonomy among each
sufficient unit division.
• Another advantage of a divisional • Another potential disadvantage of
structure is that it allows for a high a divisional organizational structure
degree of specialization. is that it may be more expensive to
operate. Because each division
operates as a separate entity
4. Matrix organization structure

• Organization designed to achieve specific results by using team of


specialists from different functional areas in the organization

C
Advantage and disadvantages of Matrix structure

• Allows team members to share • Confusion over authority and


information more readily across responsibility
task boundaries • High prospect of conflict
• Strong coordination between • Administration cost
product/project
• Fast response to change
4. Virtual organization structure

• Organization designed to achieve specific results by using team of


specialists from different functional areas in the organization
Advantage and disadvantages of Virtual structure

• Lower Overhead Costs • Reputational Risks


• Improved Employee Satisfaction. • Security and Compliance Issues.
• Larger Talent Pool • Lack of sociability
• Improved Employee Retention

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