7.

4 ORGANISATIONAL STRUCTURE
An organizational structures defined as ‗Network of job positions,
responsibilities and authority at different levels‘.
Organizational structure refers to the way that an organization arranges
people and jobs so that its work can be performed and its goals can be met.
When a work group is very small and face-to-face communication is frequent,
formal structure may be unnecessary, but in a larger organization decisions have
to be made about the delegation of various tasks. Thus, procedures are
established that assign responsibilities for various functions. It is these
decisions
that determine the organizational structure.
An organisation structure specifies the various job tasks and shows how
the same are formally divided, grouped, and coordinated. It provides an
appropriate framework for authority relationship. It indicates the hierarchy of
authority and the reporting relationships. It is a means to help the management to
achieve the organisational objectives.
An organizational structureconsists of activties such as task allocation,
coordination and supervision, which are directed towards the achievement of
organizational aims.It can also be considered as the viewing glass or perspective
through which individuals see their organization and its environment. Organising
structure is the outcome of organizing process. Whenever an organization grows
in size and complexity, an adequate structure is needed. Structure cearly defines
the job positions, authority, and responsibilities of different employees.
An organization can be structured in many different ways, depending on
their objectives. The structure of an organization will determine the modes in
which t operates and performs.
Organizational structure allows the expressed allocation of responsibilities
for different functions and processes to different entities such as the branch,
department, workgroupand individual.Organizational structure affects
organizational action in two big ways. First, it provides the foundation on which
standard operating procedures and routines rest. Second, it determines which
individuals get to participate in which decision-making processes, and thus to
what extent their views shape the organization‘s actions.
Peter Drucker clearly says, ‗An organizational structure is an
indispensable means; and the wrong structure will seriously impair business
performance and even destroy it.‘
As the objectives of the organisation are derived from the overall strategy
of the organisation, it is logical that an organisation structure is closely linked
to
its strategy. As such, if the management makes a significant change in the
organisation‘s strategy, the organisation‘s structure needs to be modified to
accommodate and support the change. There is considerable evidence to indicate that
choice of an organisation‘s strategy (stability strategy/growth
strategy) is determined by three basic factors (contingency factors): (i) the
organisation‘s size, (ii) technology used by the organisation (for converting the
financial, human and physical resources into products and services), and (iii)
environmental uncertainty (external environment). Information technology and
globalsation have had a tremendous impact on organisation structures. Many of
today‘s managers realise that the traditional organisation structures based on
bureaucratic principles no longer provide solutions to the challenges posed by
the new paradigm environment. The needs of flexibility, adaptability to change,
creativty, innovation, knowledge and the ability to overcome environmental
uncertainties are among the biggest challenges facing many of the organisations.
The result has been that the vertical (tall) structures are being replaced by
horizontal (flat) structures, the organisations wth mechanistic structures are
being transformed into ones with organic structure . These shifts reflect a clear
departure from the practice of centralised decision-making to decentralised
decision-making, from command to consensus based self-control. The new forms
of organisation structure that have emerged are: taskforce, network, virtual,
boundary less structures. The salient features of these and other organisation
structures are briefly described here to present an overview of different types of
organisation structure and their suitability under different situations.
Benefits of a good organizationalstructure
1.It allows correlation and coordinaton among human, physical resources
and enables the business to achieve its goals.
2.It ensures a smooth flow of communication and better control over the
operations.
3.It provides the framework within which an organization functions while
coordinatng the responsibilities of individuals and departments.
The span of management, to a large extent gives shape to organizationa
structure. It refers to the number of subordinates that can be effectively managed
by a superior. This determines the levels of management in the structure. The
span of control depends upon:
Capacity and intelligence evel of managers.
The trust of managers in their employees.
The employees‘ intelligence level.
Nature of job (routine or specialized).
7.4.2 Types of organizational structure
Line Organisation: Line organsation is the simplest form of organisation
structure. Line organizationis the oldest and simplest method of administrative
organization. Accordng to this type of organization, the authority flows from top
to bottom in a concern. The line of command is carried out from top to bottom.
This is the reason for calling this organization as scalar organization which
means scalar chain of command is a part and parcel of this type of administrative
organization. In this type of organization, the line of command flows on an even
basis without any gaps in communication and co-ordination taking place. The
line structure s based on the scalar principle, which states that authority and
responsibiity should flow in a direct line vertically from the hghest level of the
organisation to the lowest level. The primary emphasis in the line organisation is
upon the superior-subordinate relationship. Every person in the organisation is in
the direct chain of command.
Features of Line Organization
1.It is the smplest form of organization.
2.Lne of authority flows from top to bottom.
3.Specialized and supportive services do not take place in these
organizations.
4.Unified control by the line officers can be maintaned since they can
independently take decisions in their areas and spheres.
5.This kind of organization always helps in bringing efficiency in
communication and bringing stability to a concern.
Line and Staff Organisation
Line and staff organization is a modification of line organization and it is
more complex than line organization. According to this administrative
organization, specialized and supportive activities are attached to the line of
command by apponting staff supervisorsand staff specialists who are attached
to the line authority. The power of command always remains with the line
executives and staff supervisors guide, advice and counsel the line executives.
Personal Secretary to the Managing Director is a staff official.
Most business organisations, except the very small, have this type of
structure. As the organisations have grown complex, the problems of line
executives have become sufficiently complicated. The line executives being
generalists need the advice of personnel with specialised knowledge and
functions to tackle these problems. For this purpose, the staff postions are
created in the organisation. In line and staff organisation, the line authority
remains the same as it does in the line organisation i.e. theauthority flows from
top to bottom; and the ine executives perform the major functions; the staff
functionaries support and advise the line executives. For example, for sound
management of human resources, the line managers are provided specialised
assistance through personnel/Human Resource managers. As staff functionaries
are employed to perform supportive roe, they do not have any power of
command in the organisation Features of Line and Staff Organization
1.There are two types of staff :
a.Staff Assistants-P.A. to Managing Director, Secretary to Marketing
Manager.
b.Staff Supervsor-Operation Control Manager, Quality Controller, PRO
2.Lne and Staff Organization is a compromise of line organization. It s
more complex than line concern.
3.Division of work and specialization takes place in line and staff
organization.
4.The whole organization is divided into different functional areas to which
staff specalists are attached.
5.Efficiency can be achieved through the features of specialization.
6.There are two lines of authority which flow at one time in a concern :
a.Lne Authority
b.Staff Authority
7.Power of command remains with the line executive and staff serves only
as counsellors.
This is the most widely used form of organisation structure because of its
simple logic and commonsense appea. Here the tasks are grouped together on
the basis of common functions. So, all production activities or al financial
activities are grouped into a single function which undertakes all the tasks
required of that function.
The functional structure suits best to the small to medium organisations
producing one or a few products, where the goals of the organisation emphasise
functional specialisation, efficiency and quality. When the activities or jobs are
grouped keeping in mind the functons to be performed then it is called functional
structure. These functions are organized in to separate departments. For
example, in a manufacturing concern division of work into key functions will
include production, purchase, marketing, and personnel.
Functional organizationhas been divided to put the specialists in the top
position throughout the enterprise. This is an organization in which we can define
as a system in which functional department are created to deal with the problems
of business at various levels. Functiona authority remains confined to functiona
gudance to different departments. This helps in maintaining quality and
uniformity of performance of different functions throughout the enterprise.
The concept of Functional organization was suggested by F.W. Taylor
who recommended the appointment of specialists at important positions. For
example, the functional head and Marketing Director directs the subordinates
throughout the organization in his particular area. This means that subordinates
receives orders from several specialists, managers working above them.
Features of Functional Organization
1.The entire organizational activities are divided into specific functions such
as operations, fnance, marketing and personal relations.
2.Complex form of administrative organization compared to the other two.
3.Three authorities exist-Line, staff and function.
4.Each functional area isput under the charge of functional specialists and
he has got the authority to give all decisions regarding the function
whenever the function is performed throughout the enterprise.
5.Principle of unity of command does not apply to such organization as itis
present in line organization.
DivisionalStructure
This form of organisation structure is adopted by large companies
producing a wide range of products. Here, the activities are grouped on the basis
of the individual products manufactured by the company. Thus, one finds
autonomous ―little companies within the company‖ adoptng this type of
organisation structure. As such, within each of these little independent units, we
find all important functions viz. production, marketing, finance and human
resources. An organization which is very large in size and is producing more than
one product, they need to evolve a design to cope with the complexity. The
activities related to one product are grouped under one division. The
organizational structure consists of separate divisions, each such division has its
own manager. Within each division, functions like production, marketing, finance
etc. are performed.
In other words, each division tends to adopt a functional structure.
However, functions may vary across divisions in accordance to their product line.
Formal and Informal organization
When the managers are carrying on the organizing process then as a
result, an organizational structure is created to achieve systematic working and
efficient utilization of resources. This type of structure is known as formal
organizationalstructure.This structure clearly spells out the job, authority, and
responsibility assigned to each individual, the superior subordinate relationship
and their designations.Features of formal structure are:
1. This structure is created deliberately created by the process of organizing.
2.The purpose of the structure is to achieve organizational goals.
3. It gives more emphasis to work than to interpersonal relationships among
employees.
4. Each individual is assigned a specific job and a fixed authority. Various job
positions and their interrelationships are cearly defined. This clarifies who s to
report to whom.
5. It results into the creation of a scalar chain. Efforts if different departments
are
coordinated, interlinked and integrated.
Merits of formal structure are:
1. It helps in effective accomplishment of goals by clearly defining the job role
of each employee.
2. It is easy to fix responsibility as mutual relationshps are clearly defined.
3. There is no overlapping or duplication of work as work is systematically
divided among various departments and individuas.
4. Unity of command is maintained through an established scalar chain.
5. It provides stability to the organization since the behaviour of members can
be fairly predicted.
Demerits of formal structure are:
1.Because of scalar chain, communication is generally slow, leading to delay
in action.
2.It does not give importance to the social and psychological needs of the
employees. This may lead to demotivation.
3.It places more emphasis on structure and work, and so it ignores human
relations, creativity and talent.
In the formal structure, individuals are assigned certain job positions.
While working on these job positions, the individuals interact with each other and
develop some social and friendly relations in the organization. Ths network of
social and friendly groups forms another structure in the organization which is
called the informal structure.Informal structure gets created automatically and
spontaneously for getting psychological satisfaction. However, the existence of
such organization depends upon the existence of formal structure. So, if there is
no formal structure, there will be no job positions, there will be no people
working
on these job positions, and there will be no informal structure.
Features of informal structure are:
1. It gets created automatically without any deliberate efforts by the
management.
2. The existence depends upon formal organization. It originates from
within formal organization as a result of personal interactions among employees.
3. It does not follow any fixed path of authority or communication. So
there is no specific direction of flow of information.
4. There are no officially laid down norms of behaviour. There is no
definite structure. The source of information cannot be known.
Merits of Informal structure:
1. Informal communication does not follow scalar chain and so there can
be faster spread of communication.
2. It helps to fulfil the social needs of members and gives them a sense of
belongingness and motivation.
3. It helpsthe top level manager to know the real feedback of employees.
This information can be made use of to fufil organizational objectives.
Demerits of Informal structure
1. It may sometimes work against the interests of formal organization and
spread rumors.
2. Sometimes the informal structure may oppose the policies and
changes of management, and then it becomes very difficult to implement them in
organization.
3. It may force the members to follow group norms. This may be harmful
to the interest of the organization.
Hybrid Structure
The hybrid form combines features of both functiona and divisiona
forms. When an organisation starts to get very large, it establishes some self
contained units. Functions that are considered important to each product are
decentralised to the units; however, some functions like finance and accounting
are centralised at headquarters for practical reasons Hybrid Organisation Structure
The functional part of the organisation is reflected in the departments
centralised at the corporate level. However, each of the product divisions has
specialists in functional areas for necessary assstance.
Merits of hybrid structure are:
1. The overall organisation enjoys the benefits of both functional and
product(decentralised) structures.
2. It provides the opportunity to improve coordination both within and
among divisions.
3. It helps in proper alignment of corporate and divisional goals.
4. It enables the organisation to pursue an adaptive strategy within the
product divisions whle at the same time achieving efficiency in the functional
departments.
Demerits of hybrid structure are:
1. It often leads to excessive duplication of activities between functions
and divisions.
2.Another disadvantage is its tendency to create conflict between
headquarters and divisional functions.
Matrix Organisation Structure
Matrix organisation structure is essentially a violation of unity of command
and therefore, all the classical concepts related to the principle of unity of
command are violated. Matrix structure is the realisation of twodimensional
structure, which emanates directly from two dimensions of authority. Two
complementary structures- pure project structure and functional structure
are merged to create the matrix structure.
Thus, matrix structure not only employs a multiple command but also related
support mechanism and associated organisational culture and behaviour. Thus,
it shows many organisational overlaps, not only in terms of command system
but also in terms of complete organisational processes and behaviour.
Design of Matrix Structure
In the matrix organisation structure, a project manager is appointed to coor
dinate the activities of the project. Personnel are drawn from their respective
functional departments. Upon completion of the project, these people may
return to their original departments for further assignment.
Thus, each functional staff has two bosses- his administrative head and his
project manager. During his assignment to a project, he works under the
coordinative command of the project manager and he may be called upon by
his permanent superior to perform certain services needed in the project.
Thus, a subordinate in matrix structure may receive instructions from two
bosses.
Communication
Effective communication is a crucial skill for leaders in the construction
industry. The
construction process involves a large number of people, each with their own roles
and
responsibilities, and good communication is essential for coordinating their
efforts and
ensuring that the project is completed successfully.
Strong communication skills allow leaders in the construction industry to
communicate
clearly and effectively with their team, clients, and other stakeholders. This
includes the
ability to listen actively, to provide clear instructions and feedback, and to
communicate
complex ideas and technical information in a way that is easily understood by
others.
Good communication also involves the ability to adapt to different situations and
audiences.
For example, a construction leader may need to explain technical details to a team
of
engineers, or to present a project proposal to a client. In each case, they must be
able to
tailor their communication style and approach to meet the needs and expectations of
their
audience.
Effective communication is also essential for building and maintaining strong
relationships
with team members, clients, and other stakeholders. By communicating openly and
honestly,
leaders can build trust and foster collaboration, which can help to improve the
overall
performance of the project team and the success of the project.
In addition to these practical benefits, strong communication skills are also
important for the
personal and professional development of leaders in the construction industry. By
learning
how to communicate effectively, leaders can improve their confidence, influence,
and
leadership ability, and position themselves for success in their careers.
10.3 Communication
10.3.1 Introduction and Definition
Communication is one of the most frequently discussed dynamics n the
entire field of organizational behavior, but it is seldom clearly understood. In
practice, effective communication is a basic prerequisite for the attainment of
organizational objectives, but it has remained one of the biggest problems facing
the management.In general, communication may be defined as the process by
which nformation is exchanged between individuals.
Hovland defined communication as ―a process by whch an individual
communicator transmits to modify the behavior of other individuals‖
According to Warner Weaver communication is ―the procedure by which
one mind can affect another‖.Theo Haimann defined communication as ―the
process of passing information and understanding form one personto another. It
is the process of imparting ideas and making oneself understood by others‖.