Saturday, 24 May 2014

Organizational Structure

Organizational structures need to be tailored to the particular need of the business. The type of business conducted and the preferred management style will be major factors in determining how the organization is structured.

Basic type of structure

            As a starting point, however, most types of organization structure are based on either line authority or staff authority.

Line Authority

            This type of organization structure is represented by a standard chair of command, which starts with the top management and extends downward to ordinary workers who carry out the basic activities.

            There are clearly defined relationships for reporting and working. An employee knows to whom and for what duties he or she is responsible. Line authority provides managers with the right to direct others and requires employees to conform to decisions, policies and goals. Managers in the system have a directive, operative role.

            Sample of level management as below shows the standard chain of command when an organization’s structure is based on line authority.

Staff Authority

            Managers and other staff members in an organization structured on staff authority provide both service and advice to the line. They often have some particular professional or technical expertise. The primary objective is to provide technical assistance to line managers to help them achieve the organization’s objectives. Theirs is consultative rather than a directive role. (They are not necessarily known as “manager”).

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