Organizational Structure

Organizational structures are in essence paradigms that divulge how companies are managed and how information is disseminated and flown between the different levels of hierarchy within the setting. It is a chart or layout that depicts the logistical organization of a company, how the roles, power, authority, and primary collective responsibilities are assigned and governed. This designed structure depends substantially on its objectives and the strategy it develops in executing those goals. What is more, an organizational chart-the visual delineation of this vertical structure- needs to be taken into account in advance of building up the infrastructure of an organization. Taking utmost care while creating the organizational structure, which determines the reporting relationships and the authority flow to support good communication resulting in an efficacious work process flow, is unquestionably crucial for any organization.

What are the two main organizational structures?

Organizational structures, on both theoretical and practical grounds have yet to be classified based on the size of the organization, nature of the business, the objectives and business strategy to achieve them, and the organization environment. Typically organizational structures are divided into two main classifications in the world of business grounded on the chain of command, a span of control, and centralization in terms of making decisions for the organization. These two are called mechanistic and organic structures.

Mechanistic Vs. Organic Organizational Structure

These structures span on a spectrum, with mechanistic which represents the conventional, top-down approach at one side and organic structure with a more collaborative flexible approach at the other.

Mechanistic Organizational Structures

Recognized for having narrow spans of control along with high centralization, specialization, and formalization, mechanistic structures also known as bureaucratic structures are quite obdurate in what specific departments are tailored and authorized to undertake for the company. Mitra Ferdows added that indeed this model is more formal in a way that holds staff accountable for their work while on the other hand, creativity, resourcefulness, and agility the organization needs to keep up with random changes in the market will be stifled. Despite this, there are distinct advantages to this model like the chain of commands, meaning that as a business grows, it needs to make sure every individual and team has been informed of what is expected of them. The hierarchy would then work to business advantage sustaining the growth with more people and projects to trace and eventually requiring instances of policymaking. In other words, mechanistic structures are better to remain at hand for the time of need.

Organic Organizational Structures

Mitra Ferdows in her article continues: Organic structures also known as flat structures, on the other side of the spectrum, are known for their wide spans of control, low specialization, decentralization, and loss departmentalization. This model bases on taking on projects based on their importance and what the team is capable of rather than what is expected of them or what they are designed to do. This considerably formal structure which takes a bit of an ad hoc approach to business needs can sometimes make the chain of commands whether long or short difficult to decipher. Organic structure, however, to a business that is navigating a fast-moving industry, empowering employees to try new things and develop as professionals, in the long run, will make the organization's workforce more powerful.

What is the best organizational structure?

According to Mitra Ferdows, arguing on the obvious advantages to any of the mentioned structures would be vain as finding the most appropriate model for a business depends on several factors like the industry that company fits into, the overall size of the company along with the company goals whether in terms of finances or services it would provide the customers with. She adds: "Broadly speaking, taking flexibility into consideration, start-ups would benefit more from organic structures and conventional organizations with their roots in the ground would still need more precisions to stick to one structure over the other."

More Specific types of Organizational Structure

Mitra Ferdows further points out that with most of the structures falling on the more traditional side of the spectrum (mechanistic), there are more specific types of these so-called models namely functional, product-based, market-based, geographical divisional, process-based, matrix, circular, flat, and network. These are simply archetypes as in practice hybrid structures are implemented by organizations to adopt elements from multiple structure types.

An organization that is well structured achieves effective coordination, as the structure delineates formal communication channels, and describes how separate actions of individuals are linked together. An organizational structure defines how the roles, power, authority, and responsibilities are assigned and governed, and depicts how information flows between the different levels of hierarchy in an organization."

The structure and organization designs depend greatly on its objectives and the strategy it adopts