Types of Organizational Structures
Functional Structure:
Definition: Organizes the organization into departments based on functions (e.g., marketing, finance, production).
Advantages:
Encourages specialization and expertise within each department.
Clear lines of authority and responsibility.
Disadvantages:
Can lead to silos, reducing interdepartmental communication and collaboration.
Divisional Structure:
Definition: Divides the organization into semi-autonomous units based on products, regions, or customers.
Advantages:
Focuses on specific markets or product lines, enhancing responsiveness.
Easier performance tracking for individual divisions.
Disadvantages:
May result in resource duplication across divisions, increasing costs.
Matrix Structure:
Definition: Combines functional and divisional structures, where employees report to both functional and project managers.
Advantages:
Promotes collaboration across departments and resource sharing.
Flexible and adapts to complex projects.
Disadvantages:
Dual reporting may cause confusion and conflict.
Requires strong communication and coordination.
Authority, Responsibility, and Delegation
Authority:
Definition: The power to make decisions, give orders, and allocate resources.
Characteristics:
Flows from top to bottom in the organizational hierarchy.
Must be accompanied by accountability.
Types:
Line Authority: Direct control over subordinates.
Staff Authority: Advisory power, supporting line authority.
Functional Authority: Control over specific activities or functions.
Responsibility:
Definition: The obligation of an individual to perform tasks assigned to them.
Key Points:
Flows upward, with subordinates accountable to their supervisors.
Responsibility cannot be delegated.
Delegation:
Definition: The process of assigning tasks and authority to subordinates.
Steps in Delegation:
Assignment of Tasks: Clearly define the duties to be performed.
Granting Authority: Provide the subordinate with the power to act.
Accountability: Ensure the subordinate is answerable for their actions.
Importance:
Empowers employees and builds trust.
Allows managers to focus on higher-level functions.
Challenges:
Reluctance to delegate due to mistrust or fear of losing control.
Lack of clarity in assigning tasks.
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