Organization Structure Types & Charts

ORGANIZATION CHART,
ORGANIZATION STRUCTURE
TYPES
R.ArunKumar,AP/Mech,RIT

WORK SPECIALIZATION:
 Dividing work activities into separate job tasks.
 Individual employees specialize in doing part of activity
rather than the entire activity in order to increase work output.

ORGANIZATION CHART:
 Organization chart is the visual representation of an
organization’s structure.
 It shows the organizational relationships and activities
within an organization.

PURPOSE OF ORGANIZATION CHART:
 Divides work to be done into specific jobs and departments.
 Assigns task and responsibilities associated with individual
jobs.
 Coordinates jobs into units.
 Establishes relationship among individuals, groups and
departments.
 Establishes formal line of authority.
 Allocates and deploys organizational resources.

TYPES OF ORGANIZATION CHART:
1. Top – down chart / Vertical chart:
 Structure will be in form of pyramid.

2. Left to right / Horizontal chart:
 Lines of command flows horizontally.

3. Circular / Concentric chart:
 Top executive of organization is located at centre of the chart.
 Subordinates are located outside.

ADVANTAGES OF ORGANIZATION CHART:
 Defines relationship.
 Dual reporting relationship and overlapping positions come to
light.
 Helps to identify the limit of authority.
 Improves communication.
 Provides clue to lines of promotions.
 Outsiders can easily identify and understand the structure of
organization.
 Guides every new employee in understanding how their
positions fit to the organization.

DISADVANTAGES OF ORGANIZATION CHART:
 Avoids informal relationships.
 If not clearly defined, may lead to misleading inferences.
 Fails to show how much authority an individual can exercise
and how far he is responsible.

ORGANIZATION STRUCUTRE:
 Organization structure is a flow chart which defines, the formal
arrangement of jobs within and organization.
 An organization structure is designed both from mechanistic
and humanistic point of view.

TYPES OF ORGANIZATION STRUCUTRE:
1. Based on the flow of power
 Bureaucratic structure
 Adaptive structure

1.1 Bureaucratic structure:
 Structures are formed based on the formal authority.
 Includes hierarchy of authority, promotion based competency.
 College / university environment.

Characteristics of Bureaucratic structure:
 Uses division of labour principle.
 Ensures coordination among employees.
 Organization is governed by clearly defined rules.
 Defines the hierarchy of the organization.
 States the rights of every employee.

Drawbacks of Bureaucratic structure:
 Lack of flexibility
 Lack of humanity.
 May lead to conflict.

1.2 Adaptive structure:
 Maintains high degree of openness to input from internal and
external environment.
 Framed based on knowledge based authority and cooperation.
 More flexible.

Characteristics of Adaptive structure:
 Roles are not highly defined.tin
 Tasks are continuously redefined.
 Decentralization of control.
 Quick decision making.
 Little reliance on formal authority.

2. Based on formation of group:
2.1 Functional structure:
 Groups the people / employee based on similarity in work
nature.

Advantages of Functional structure:
 High degree of control and communication o functions.
 Makes employee to feel comfort.
 Helps to improve productivity.
Disadvantages of Functional structure:
 Isolation leads to narrowed perspectives.
 Inter – departmental contradiction.
 Lack of proper communication with other departments.

2.2 Divisional structure:
 Divisions are based on the output of the organization.
 Each division has its own functional departments.

Advantages of Divisional structure:
 Size of organization can be increased without problem.
 Improves ability of organization to respond to customer.
 Enhances the efficiency of organization.
Disadvantages of Divisional structure:
 Competition may lead to conflicts.
 Formulation is expensive.
 Control system is complicated.

2.3 Matrix structure:
 It is the combination of both functional and divisional
structure.
 Resources will be directed to other project when one is completed.

Advantages of Matrix structure:
 Facilitates better planning.
 More flexible.
 Ensures better use of resources, enhances skills of an employee.
Disadvantages of Matrix structure:
 Multiple projects at a time will lead to complex control.
 Relationship is complicated.
 Decisions are usually delayed.

2.4 Team structure:
 Comprises members of various departments who work together.
 E.g. Shift employees.

Advantages of Team structure:
 Reduces interdepartmental conflicts.
 Administrative cost is low.
 Employee learns the function of various departments.
Disadvantages of Team structure:
 Conflict in loyalties.
 Increased time spent in meetings.

2.5 Network structure:
 Relies on other organization.
 Permits outsourcing.

Advantages of Team structure:
 Provides flexibility.
 Improves quality.
 Reduces cost.
Disadvantages of Team structure:
 Unpredictability in supply.

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