This document discusses elements of an effective organization. It argues that a decentralized organizational structure is most effective in today's global environment. Key elements of effective organizations include structure, global operations, communication strategies, management, decision-making, problem-solving, and leadership. Decentralized structures allow for open communication across departments and empower employees. Clear, participatory communication is important both internally and externally. Principles of effective management should follow an open-system approach in decentralized organizations.

1. Running head: Elements of an Effective Organization 1
Elements of an Effective Organization
Joel M. Schrap
ORG 502 – Effective Organizations: Theory and Practice
Colorado State University – Global Campus
Dr. Johnny Morris
April 28, 2015

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Elements of an Effective Organization
In today’s business culture effective organizations are desperately needed from their
structure, culture, communication style and social responsibilities. Within the structure the ethics
and core values need to be in place to make them effective and ethical. In this analysis of
effective organizations we will look at the key elements to develop an effective and profitable
organization. These elements include, but not limited to, structure; working in a global
environment; communication strategies; effective management; decision-making processes;
problem-solving processes; and leadership approach. All these combined assist in making the
organization effective.
Components of an Effective Organization Structure
Two types of organizational structures are predominant in organizations, centralized and
decentralized. Centralized structures are a top-down organization where the chief executives
make the decisions and it filters down to the bottom of the organization. “In a hierarchal,
vertically structured organization, authority for making critical organization-wide decisions is
located or “centralized” in the top apex of the organization among the executive officers”
(Stanford 2004 pg. 17-18). In this type of structure the organization operates and works from the
top-down and “silos” are developed. The “silos” is when one part of the organization receives
majority of the funds and communication from the top. However, in this analysis and the
research that has been done, in an ever changing culture and environment where organizations
are more global and information is readily available to all within an organization a more
decentralized organization is more beneficial for organizations moving forward.
Decentralized structures are structures that decisions and information is disseminated
throughout the organization and is not always top down. In contrast to centralized structures the

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decision-making is not done autonomous. “The decentralized decision-maker is expected to
share with others in the making of decisions and their result” (Stanford 2004, pg. 18). With the
decentralized structure decision-making is not just at the higher levels of the organization, in fact
decisions are being made throughout the organization vertically and horizontally. Every
department is informed of the decisions that are being made and knows what other departments
are doing to help solidify the whole organization as a team. For instance, R&D will know exactly
what the Sales and Marketing team is doing and needing and the vice versa. These two teams can
communicate with each other without having to go to the top and go back down to find out. The
lines of communication are open and problem solving is happening.
In decentralized organizations the key is communication between departments,
management, stakeholders and customers. In these structures there are four key areas that are
needed to be strong are effective communication; effective coordination; speed/responsiveness to
the customer (internal/external); and the empowerment of the employees throughout the
organization. (Goswami and Goswami 2010, pg. 162-163).
Effective communication in an organization is key to having all employees and
management headed in the same direction and knowing fully what the task is and the
implementation of the task. We will look at different styles of communication later in this
analysis.
Effective coordination in a decentralized organization is the breaking down of the walls
in the organization between departments and decision-making. All have input and are heard and
the log jam of working in a “silo” not knowing what other departments are doing is gone and the
team environment is being built. Collaboration and input from different departments will help the
organization thrive and grow and become more competitive.

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The speed/responsiveness to the customer is impacted with the walls of separation being
dissolved. For instance, customer service will know what is going on with R&D and if there is
any thing the customer may need to know to fix issues. Instead of transferring customers
throughout the organization the customer service agent knows what is going and the exact
timeline when an issue will be fixed.
Empowering the employees with allowing them to be innovative and being free to think
outside the box in a decentralized structure allows the employees to be engaged. It allows them
to work towards a common goal and that their input regardless if it deals with their specific job
description or not, their input and ideas will be heard and decided on if they have value to the
organization.
In decentralized organizations that we suggest in using the executives still make major
decisions; however, they will gather input from lower level employees in some of the decisions.
However, when decisions of significant impact to the organization and/or responses that are
needed to be made in a timely fashion the executives will make the decisions based on their
experience, information at hand, prior interactions with lower level employees to make a proper
response to the crisis at hand.
The organization also needs to be able to support being a corporate citizen, “Corporate
citizens can be characterized by a clear purpose beyond profit, driven by shared values, and
supported with systems and processes.” (Weymes, 2004, pg. 96).
Globalization
Globalization is a real issue with organizations and the structure that they decide that is
best used to create the biggest impact on the global stage. Executives in organizations not only
have to deal with the internal structure of the organization they have to make sure that the

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structure is successful in different cultures outside of the home country of their organizations.
Workers in China have different culture insights and ideals than those of American workers. The
structure of the organization needs to be able to address these concerns and works to solidify two
very different cultures together and make them work together. In a decentralized organization
counterparts in different parts of the world will be able to communicate and learn to understand
each other and work for the common good of the organization.
Communication Strategies needed in Effective Organizations
Clear and precise communication is needed for an organization to be effective. This
communication is not just communication between superior and subordinates; however it is
communication between co-workers; management; and consumers. When all communication is
working, as it is design to be implemented these communication skills will be useful in and out
of the organization.
Poor communication can derail an organization from being effective. With the
decentralized structure as proposed the organization relies heavily on true and effective
communication. Ashu Singh contended that, “Communication links the various managerial
levels and affects efficiency and productivity.” (Singh 2013, pg. 22). Singh further stated that,
“The five elements – strategy, processes, people, structure and rewards – have to be closely
intertwined with internal communication to gain competitive advantage.” (Singh 2013, pg. 22).
To gain the competitive edge communication needs to be not just a hierarchal form as
used in the centralized structure, however, a flat and social organizational type of communication
that is built on trusts and respect.
When developing the communication strategy in an effective organization Dresp-Langley
stated that there are ten clauses in which at Communication Contract should be based on. These

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clauses are; sincerity, relevance; continuity; clarity; prudence; tolerance; openness; prompt
resolution; balanced speech time; and optimal timing (Dresp-Langley 2009, pg. 420). These ten
clauses have a direct impact with the way organization communication internally and externally.
Internal communication should be based off these ten clauses. These ten clauses will help
that the information being sent out from superior-subordinate; co-workers and other relationship
communications will be heard from a point of trust; respect; clear information and removes the
ambiguity of information that is misleading. Questions will be asked and answered.
Understanding will be there and the clearer the form of communication the more effective the
organization will become. “When employees know that the manager is giving valid information,
is not withholding information, and is available to listen, there is no need for employees to go
elsewhere to get information.” (Conrad 2014, pg. 105-106).
Communication also needs to be a participatory and not a programmatic. Programmatic
is focused on the telling what needs to be done and no response or questions and true
communication is held. “In contrast to programmatic efforts, participatory approaches invite
input, using involving and empowering methods to gain the insights of various stakeholders to
shape the change programmed and not merely to ‘receive it’.” (Russ 2008, pg. 204).
Principles of Effective Management
In organizations there are several theories that are available for the types of effective
management. Majority of the organizations are built on the hierarchal theory of the decisions
being made from the top down, which is predominate in centralized structures. With a
decentralized structure an open-system of management style is needed.
An open-system the walls for hierarchal management styles will come down and the
input of employees and lower level management will be heard and implemented. The theory on

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open-systems allows the innovation of the employees to be used and expressed as not one person
has all the ideas. Management will listen to the ideas of the employees and understand what is
being said to help either improve the culture; structure; product; strategies; communication of the
organization. With management being open to the ideas of the employees, they will have a
workforce that is engaged and on task for the goals of the organization and not just for what the
task assigned to them. Through effective communication of listening, engaging and
understanding all levels of the organization will move forward and become more effective.
Ultimately, upper management has the final say in certain aspects of ideas, however, they have
been open to hearing varying inputs from those around them.
Decision-Making and Problem-Solving Processes
Managers have several ways of making decisions and solving problems. Some managers
will use intuitive decision-making processes. They rely heavily on making the decisions on their
own with the knowledge and experience that they have gathered throughout their career. These
decisions are useful in the sense that they can be made arbitrarily and are best suited for tasks
that are not detrimental to the strategy of the organization. Decisions that would be best made by
the intuitive way are more programmed based decisions. Decisions on how to deal with
employee disruptions or disagreements; whereas a more non-programmed issue more input will
be needed.
Non-programmed decisions will need to be made with more of a rational and input filled
process. The input will come from different levels within the organization and at least two
options will be weighed if not several other. Once a decision is made based on the facts that
have been gathered, the information processed and understood then a decision is made. Once the

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decision is made a re-evaluation of the decision will be made after some time has passed to
evaluate if the right decision was made or a correction needs to be made.
When problems arise in the organization several steps need to be made to understand
what the problem is and what decision process will be best utilized with the problem at hand.
First, identify the problem and see if the problem when resolved will affect the organizational as
a whole or individuals or will not affect the organizational as a whole. If it does not affect the
organizational as a whole then proceed with the intuitive approach and make the best decision to
resolve the problem. If the problem will affect the organization as a whole, gather the facts. Find
out what caused the problem and ask questions. Get the needed input from all that will be
affected and develop a plan to execute the decision that is being made. Make sure that the
employees impacted by the problem or the change will have enough information
Effective Leadership
Servant-leadership is, “thought that when leaders place a priority on providing tangible
and emotional support to followers and assisting followers in reaching their full potential.”
(Linden, Wayne, Liao, and Meuser 2014, pg. 1435). When a leader is actively performing the
servant-leadership role their subordinates are more prone to do the needed work to help not only
the organization to succeed, but also the success of the leader.
Linden, Wayne, Liao and Meuser, stated that there are seven dimensions: emotional
healing; creating value for the community; conceptual skills; empowering; helping subordinates
grow and succeed; putting subordinates first; and behaving ethically. (Linden, Wayne, Liao, and
Meuser 2014, pg. 1434-1435). On top of these seven dimensions other attributes are also noticed
in servant-leaders: honesty, integrity, authenticity, humility, empathy and sincerity. If the leader

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is trying to be a servant-leader and is not truly any of these characteristics then there is
manipulation into getting the subordinates to do what they want and turnover will happen.
Authentic servant-leadership is key in today’s organizations as older models of leadership
prove to be ineffective with dealing with today’s workforce. Servant-leadership requires ethical
behavior by the leader and their subordinates and is grown in a culture that is open and honest.
Due to the failures of organizations like Enron where unethical and illegal activity was
encouraged due to top-down, centralized and hierarchal structures where there was no
accountability and transparency a new type of leadership is needed. With servant-leadership the
openness and transparency of the leader and the willingness to put the group above them to see
them truly succeed is a change in philosophy and outlook. With servant-leadership the culture
changes and unethical habits are changed. The servant-leader can make decisions on their own
and should not be considered weak; in fact they should be viewed as strong and knowledgeable.
These types of leaders view the social organization as a place for the collective to grow
and become better at their positions. That the organization will become better and more effective
and profitable. The servant-leader is not about their ego and pockets, they are about the
betterment of their organization; their subordinates; and the betterment of their community.
Conclusion
In today’s global economy, effective organizations need to not only have a structure that
is decentralized, they also need to have an open-system management style. These organizations
focus on the whole organization and the breaking down of walls that will limit communication.
In decision making when it is appropriate they will listen and understand other inputs to make
sure they make the best decision for the organization and that by listening to subordinates will

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ultimately bring the team together and having subordinates not only feel that they have a say but
that they also have been understood. The servant-leader rounds out the effective organization
with communication and truly believing that in serving their subordinates the ultimate goal of
success for the organization can and will be reached.

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References
Stanford, Jane Herring (Summer2004). Curing the Ethical Malaise in Corporate America:
Organizational Structure as the Antidote. SAM Advanced Management Journal, Vol.69
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Goswami, Chandana and Goswami, Sinmoy (2010). Role of Organisation Structure in
Facilitating Marketing. Global Business & Management Research, Vol.2 Issue 2/3, pg.
162-183.
Weymes, Ed (Winter2004). Management Theory: Balancing Individual Freedom with
Organisational Needs. Journal of Corporate Citizenship, Winter 2004 Issue 16, pg. 85-
98.
Singh, Ashu (March2013). Achieving Sustainability Through Internal Communication and Soft
Skills. IUP Journal of Soft Skills, Vol. 7 Issue 1, pg. 21-26.
Dresp-Langley, Birgitta (July2009). The Communication Contract and Its Ten Ground Clauses.
Journal of Business Ethics, Vol.87 Issue 3, pg. 415-436.
Conrad, David (Jun2014). Workplace Communication Problems: Inquiries by Employees and
Applicable Solutions. Journal of Business Studies Quarterly, Vol.5 Issue 4, pg. 105-116.
Russ, Travis L. (Sept2008). Communicating Change: A Review and Critical Analysis of
Programmatic and Participatory Implementation Approaches. Journal of Change
Management, Vol.8 Issue 3/4, pg. 199-211.
Linden, Robert C., Wayne, Sandy J., Chenwie, Liao, & Meuser, Jeremy D. (Oct2014). Servant
Leadership and Serving Culture: Influences on Individual and Unit Performance.
Academy of Management Journal, Vol.57 Issue 5, pg. 1434-1452.

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