Elements of organizational structure give companies effective and efficient ways to run their businesses, manage their employees and ensure that tasks are completed. Elements such as work specialisation, departmentalisation, chain of command, span of control, centralisation, decentralisation and formalisation make up organizational structure. Each element impacts how employees interact with each other to accomplish company goals and objectives.
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Work specialisation ensures that each employee has a set of specific duties they're expected to perform based on their work experience, education and skills. It prevents employees from being expected to perform tasks for which they have no previous experience or training.
The departmentalisation element breaks down how jobs are grouped together to create departments. Departments are created based on the types of jobs employees perform, the products or brands they're assigned to, geographical locations or customer needs.
Chain of Command
In a company, each employee is expected to report to one manager, rather than to several. Mangers are responsible for assigning tasks, informing employees of expectations and deadlines and offering motivation. Managers are also available to answer job-related questions from employees and handle conflicts within their departments. Employees are responsible for completing duties assigned to them by their manager accurately and in a timely fashion.
Span of Control
Span of control suggests how many employees each manager can handle within an organisation. This element of organizational structure also outlines the number of mangers an organisation needs, which is typically determined based on the number of employees and departments a company has.
Centralisation and Decentralization
In a centralised organisation, all decisions are made by c-level managers such as the chief executive officer, chief operating officer and chief marketing officer. Centralisation leaves department managers with little to no input. This system is typical in larger, corporate organisations.
A decentralised system affords all managers the opportunity to give input, while bigger decisions are still made by c-level managers.
Formalisation is the element that outlines employee roles within a workplace, as defined by the rules and guidelines developed by management. Formalisation determines whether employees have to sign in and out upon arriving and exiting the office, frequency and length of breaks, computer usage and dress code.
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