Most organization has a number of features in common:
- Goals and objectives
- Formal organization structure
- Informal organization structure
With an ever-changing marketplace, an organizational has to look continually at its goals and structures. This will ensure that it is being responsive to the demands of the market in which it operates.
Goals and Objectives
For an organization to function effectively, it must have a set goal or goals. It then translates these goals into operational objectives. It is the responsibility of management to support staff in achieving these objectives.
The primary goal of private sector organizations is to make a profit in order to survive in the market place.
The public sector is being encouraged by government to shift its focus toward a business orientation and become self-funding, if not profit-making. This is called corporatisation.
Formal organization structure
The structure of an organization is determined by the type of ownership, its business activities and its size.
In a small business, the contact between the owner and staff is simple and direct, with each person performing a variety of tasks. The division of tasks is not as distinct as that in a large business.
In large business, the organization structure is centered on chains of command, authority and responsibility, and the formal communication network in which decision are made and instructions given. Decisions and instructions flow downward from management. Reports flow upward to management. This allows the business to effectively achieve its specific goals and objectives.
Essential elements to consider when developing an effective organization structure in a large business are:
- Setting clear goals and objectives
- Planning from the objectives to decide on the type of work and functions necessary to achieve those objectives
- Division of the functions into departments and individual jobs
- Staffing decisions and the degree of specification required to perform the various functions
- Providing a physical environment that allows the employees to perform the functions effectively.