How Should Organizations Be Structured to Compete Effectively?

There are two parts in this task comprise of Part 1 – How should organizations be structured to compete effectively. Justify your recommendations. Part 2- What type of Decision-Making capabilities a Manager or Leader need to have in competitive environment.

Executive Summary

Part 1 - Organizational structure refers to the division of labor as well as the patterns of coordination, communication, workflow, and formal power that direct organizational activities. Two fundamental processes in organizational structure are division of labour and coordination. Division of labor refers to the subdivision of work into separate jobs assigned to different people. Coordination is so closely connected to division of labour that the optimal level of specialization is limited by the feasibility of coordinating the work.

Organizational structure has four elements that apply to every organization. The elements are span of control, centralization, formalization and departmentalization. Span of control, centralization, and formalization together because they cluster around two broader organizational forms. Two broader are Mechanistic and Organic structures. Mechanistic structure is characterized by a narrow span of control and high degree of formalization and centralization. Organic structure has the opposite characteristics. They operate with a wide span of control, decentralized decision making, and little formalization. Tasks are fluid, adjusting to new situations and organizational needs.

Centralization means that formal decision-making authority is held by a small group of people, typically those at the top of the organizational hierarchy. Formalization is the degree to which organizations standardize behavior through rules, procedures, formal training, and related mechanisms. Formalization is the degree to which organizations standardize behavior through rules, procedures, formal training, and related mechanisms.

Departmentalization involves dividing an organization into different functioning units/departments, which perform tasks according to the departments' specializations in the organization. Five elements for departmentalization are Simple structure, Functional structure, Divisional structure, Team-Based Structure and Matrix Structure. There is no single organizational structure that fits every company. You have to evaluate your company's mission and strategy, and then build your organizational structure from there. There is no one right way to organize the members of your staff; some structures seem to work better than others, depending on your goals.

Part 2 - The term leadership is a word taken from the common vocabulary and incorporated into the technical vocabulary of a scientific discipline without being precisely redefined. Both leadership and decision making are terms that are seriously considered to be of vital in the operations of any organization, society, and country. These terms have been a major topic of research in both psychology, social sciences, and other disciplines for almost a century and has spawned thousands of empirical and conceptual studies. They have gained the attention of researchers worldwide and are expensive terms with different meanings, definitions, and applications in which case one size does not necessarily fit all.

Five pillars importance of decision making in a manager or leader are saves time, foster respect, serves as motivation, prevents conflict and increases productivity. Saves time knows which decisions can make just trusting their instinct, and which ones need some research first. Foster respect is a well-informed manager, employees will feel good knowing they can trust their manager/leader to steer them in the right direction. Serves as motivation is   when workers see that their manager has great decision making skills, it gives them something to emulate as they grow in their professional positions. Prevents conflict is when a manager/leader is not assertive and leaves too many decisions up to the staff, that can create conflict in the workplace. Increases Productivity is when a manager/leader can weigh the pros and cons of a task and provide a quick decision; it allows the employees to start working on it faster, thus increasing productivity.

Six pillars types of decision making are ttactical and strategic decisions, programmed and non-programmed decisions, basic and routine decisions, organizational and personal decisions, off-the-cuff and planned decisions, policy, administrative and executive decisions. Tactical decisions are those which a manager makes over and over again adhering to certain established rules, policies and procedures. The programmed decisions are basically of a routine type for which systematic procedures have been devised so that the problem may not be treated as a unique case each time it crops up. The non-programmed decisions are complex and deserve a specific treatment. Basic decisions are those which require a good deal of deliberation and are of crucial importance. Routine decisions are of repetitive nature and hence, require relatively little consideration.