The document discusses organizational structure and its key characteristics. It defines organizational structure as how job tasks are divided and coordinated, and notes that structure represents the framework for organizational behavior. The key aspects of structure discussed are differentiation of roles, departmentalization, chain of command, centralization, specialization, and factors that influence structure like strategy, size, technology, and environment. Three main structural designs are described: simple, bureaucratic, and matrix.

1. Organisational STRUCTURE
The ORGANISATIONAL STRUCTURE REPRESENTS THE SKELETAL FRAMEWORK
FORORGANISATIONALBEHAVIOUR.ItISASYSTEMOFCONSTANTINTERACTION
WITH THE ENVIRONMENT, GOAL, PEOPLE AND TECHNOLOGY.
STEPHEN P.ROBBINS HAS DEFINED ORGANISATIONAL STRUCTURE AS
‘HOW JOB TASKS ARE FORMALLY DIVIDED, GROUPED AND COORDINATED’. It
TELLS HOW SPECIALISED AND NON-SPECIALISED TASKS ARE PERFORMED.
Classification OF ORGANISATIONAL STRUCTURE
Organisational STRUCTURE IS THE DIFFERENTIATION OF FUNCTION TO
FACILITATETHEACHIEVEMENTOF GOALS. TheMAINCHARACTERISTICS OF THE
ORGANISATIONAL STRUCTURE ARE:-
1. Differentiation:- JOBS ARE DIFFERENTIATEDFORACHIEVING THE GOALS
MORE EFFICIENTLY, THE JOBS ARE SUBDIVIDED INTO HORIZONTAL AND
VERTICAL FORMS.
Horizontal DIFFERENTIATIONS:- THE DIVISION OF LABOUR IS THE BEST
EXAMPLEOF HORIZONTAL DIFFERENTIATION. TheJOBCAN BE DIVIDED ONTHE
BASIS OF PURPOSES, PROCESS, PERSON AND PLACE.
PRODUCT LINECHANGE ON DEPARTMENTALISATION
IS HORIZONTAL DIFFERENTIATION. Technological CHANGES ARE
DIFFERENTIATION FOR THE IMPROVEMENT OF THE PROCESS.
Vertical DIFFERENTIATION:-VERTICAL DIFFERENTIATION DEALS WITH
HIERARCHY, POWER INFLUENCE, AUTHORITY RESPONSIBILITY AND SPAN OF
CONTROL, LEVEL AND FUNCTION ARE VERTICAL DIFFERENTIATION. Vertical
DISTANCE IS CREATED BETWEEN THE INDIVIDUAL AND GROUPS. Scalar OR
CHAIN OF COMMAND IS USED FOR DIFFERENTIATION. Generally, FIVE LEVELS
OF AUTHORITY ARE OBSERVED THAT IS MIDDLE, LOWER, SUPERVISORS, AND
EMPLOYEES.
Standardisation:- THE ORGANISATIONAL STRUCTURE IS FORMALISED OR
STANDARDISED FOR SIMPLICITY AND EFFICIENTLY. The PROCESS INPUT AND
THE OUTPUT ARE UNIFORM. Jobs ARE EXPLICITLY DEFINED AND DESCRIBED.
Employees HAVETHELEASTAMOUNTOFFREEDOMUNDERTHESTANDARDISED

2. STRUCTURE. A LESS STANDARDISEDSTRUCTUREGIVESMOREFREEDOMTO THE
EMPLOYEES. They EXERCISE DISCRETION IN THEIR WORK.
Specialisation:- EACH AND EVERY PART OF THE WHOLE WORK IS DONE BY
SPECIALISED PEOPLE. The TOTAL WORK IS BEATEN UP INTO SMALLER FACTS
AND THE RESPONSIBILITY OF PERFORMANCE OF EACH PART IS ASSIGNED TO
EXPERTS. This MAKES PEOPLE MORE SPECIALISED AND ACTIVE.
SPECIALISATION MAKES ALL THE WORK MORE USEFUL.
Whether IT INVOLVES SKILLED OR UNSKILLED FUNCTIONS. It HAS INCREASED
PERFORMANCE AND EMPLOYEES’ SATISFACTION.
2. Departmentalisation:-ITISGROUPINGOFSPECIALISATIONINTOSPECIFIC
FUNCTIONS. DifferentFUNCTIONS AREGROUPED ONA SIMILARBASIS. It
IS USED IN ALL TYPES OF ORGANISATIONS ACCORDING TO THEIR
OBJECTIVES AND FUNCTIONS. The DEPARTMENTALISATIONIS DONE ON
SEVERAL BASES SUCH AS PRODUCT, PROCESS, PLACE, CUSTOMER,
SERVICE AND ADMINISTRATION.
 Product DEPARTMENTALISATION:- DEPARTMENTS AREDIVIDED ONTHE
BASIS OF THE PRODUCT. An ORGANISATION ENGAGED IN CLOTH
MANUFACTURING HAS READY-MADE DEPARTMENT, CLOTH
DEPARTMENT HAS ITS OWN HEAD WHO LOOKS AFTER THE TOTAL
FUNCTIONS OF HIS DEPARTMENT. The ACCOUNTABILITY ARE
SPECIFICALLY ASSIGNED FOR EACH DEPARTMENT.
 Process DEPARTMENTALISATION:- THE PROCESS OF ORGANISATION IS
THE BASIS OF DEPARTMENTALISATION,FOREG. Proofreading, PRINTING,
MACHINE REPAIRING AND SETTING OF PLACES ARE THE IMPORTANT
DEPARTMENTS OF A NEWSPAPER PRINTING ORGANISATION. Each
PROCESS REQUIRES DIFFERENT SKILLS. The PEOPLE WORKING ON A
PROCESS BECOME SPECIALISED WITHIN REASONABLE PERIOD.
 Place DEPARTMENTALISATION:- THE DEPARTMENT IS DEVELOPED
ACCORDING TO TERRITORY, GEOGRAPHICAL AREAS PLACE OF
FUNCTIONS. Regional DEPARTMENTS, HAVE THEIR SPECIALITIES IN
PERFORMANCE AND FUNCTIONS. Head OFFICE AND BRANCH OFFICES
ARE THE BASIC OF EXAMPLES OF PLACE DEPARTMENTALISATION.
 Customer SERVICE DEPARTMENTALISATION:- DEPARTMENTS ARE
FORMEDACCORDINGTOTHENEEDSOF THECUSTOMER’SSERVICE.Effort

3. ARE MADE TO SATISFYTHECUSTOMER’S NEEDS IN EVERY DEPARTMENT.
If IT IS NOT SATISFIED, THE CUSTOMERS ARE REQUESTED TO CONSULT
SOME SPECIALISED PERSONNEL IN HIGHER DEPARTMENTS.
 AdministrationDEPARTMENTALISATION:-ANORGANISATIONDEVELOPS
ITS OWN ADMINISTRATION DEPARTMENT. The PERSONNEL
DEPARTMENT, SECRETARIAL DEPARTMENT, TRAINING AND PLACEMENT
ARE THE VARIOUS EXAMPLES OF SUCH DEPARTMENTS. Head OFFICE,
ZONAL OFFICE, DIVISIONAL, BRANCH OFFICESAREGLARING EXAMPLEOF
DEPARTMENTALISATION.
3. Chain OF COMMAND:-THE ORGANISATIONAL STRUCTUREDECIDES THE
MODEOF THE CHAINOF COMMAND LINEORGANISATIONHAS A SCALAR
CHAIN OF COMMAND AND THE FUNCTIONAL ORGANISATION HAS A
SUPERVISORYCOMMAND. The CHAINOF COMMAND IS THE UNBROKEN
LINE OF AUTHORITY THAT EXTENDS FROM TOP OF THE ORGANISATION
TO THE LOWESTLEVEL. ItDECIDES THE AMOUNT OF AUTHORITYFLOWS
FROM A HIGHERTO A LOWER LEVEL INDIFFERENTFORMS IN SEPARATE
ORGANISATION.
IN THE LINE ORGANISATION, THE COMMAND IS BY
ONLY ONE PERSONTO PERSONTO WHOMTHE LOWERMANAGER IS LIABLETO
REPORT. It IS KNOWN AS THE UNITY OF COMMAND.
In A FUNCTIONAL ORGANISATION, THEEMPLOYEES AREACCOUNTABLE TO THE
FUNCTIONAL HEADS. The CHAIN OF COMMAND DECIDES THE SPAN OF
CONTROL WHICH IS THE NUMBER OF SUBORDINATES A MANAGER CAN
EFFECTIVELYAND EFFICIENTLYDIRECT. The SPAN OF CONTROL IS DECIDED BY
THE FORMULA, SPAN OF CONTROL
=N[2N/2+(N-1)] WHERE ‘N’ IS THE NUMBER OF EMPLOYEES.
4. Centralisation:- THE ORGANISATIONAL STRUCTURE IS ALSO BASED ON
CENTRALISATIONANDDECENTRALISATION.CentralisationISTHEDEGREE
TO WHICH DECISIONMAKING IS CONCENTRATED AT A SINGLEPOINT. It
IS THE RIGHTOR AUTHORITYWHICH IS CONFINED TO A FEW PEOPLE IN
THE ORGANISATION. On THE CONTRARY, WHEN A LOWER MANAGER IS
GIVEN THE DECISIONMAKING POWER, IT IS DECENTRALISATION. Under
DECENTRALISATION, DECISIONIS MORE EFFECTIVEAND QUICK. Modern

4. ORGANISATION MAINLY ADOPT DECENTRALISATION FOR FLEXIBILITY
AND RESPONSIVENESS.
Factors INFLUENCING ORGANISATIONAL STRUCTURE
The IMPORTANT FACTORS INFLUENCING THE STRUCTURE ARE CORPORATE
STRATEGY, SIZE, TECHNOLOGY AND ENVIRONMENT.
Corporate STRATEGY
The CORPORATE STRATEGY HAS AN IMPORTANTIMPACTON THE STRUCTURE.
TheDICTATORIALSTRATEGYOFANORGANISATIONREQUIRESABUREAUCRATIC
STRUCTURE. The MECHANISTICSTRUCTUREIS LOOSENED UNDERDEMOCRATIC
STRATEGY. A STRUCTURE IS DEVELOPED TO ACHIEVETHEOBJECTIVETHROUGH
THE APPLICATION OF CORPORATE STRATEGY. The HIERARCHICAL STRUCTURE
DEPENDS ON THE OVERALL STRATEGY AT THE CORPORATE AND
DEPARTMENTAL LEVELS.
The STRATEGIC FRAMEWORK ARE IMITATION INNOVATION AND COST
MINIMISATION.
IMITATION REFERS TO FOLLOWING ITS OWN PREVIOUS
STRATEGY. The PREVIOUS STRATEGY HELPS TO FIND OUT THE SUITABLE
STRATEGY FOR MINIMISING COSTS AND MAXIMISING REVENUE.
The INNOVATION STRATEGY REFERS TO THE CHANGES IN THE EXISTING
STRATEGY FOR THE BETTER.
The TECHNOLOGICAL DEVELOPMENTS ARE INCLUDED IN THE STRATEGY.
Innovation STRATEGY DEALS WITH LOW SPECIALISATION, LOW
CENTRALISATION AND LOW STANDARDISATION.
INNOVATIONSTRATEGYENCOURAGESTHEORGANICSTRUCTURE
AND COST MINIMISATION STRATEGY HELPS TO MAINTAIN THE MECHANISTIC
STRUCTURE, WHEREIN CONTROL SPECIALISATION, FORMALISATION AND
CENTRALISATION ARE AT A HIGH LEVEL.
Size
The SIZE OF AN ORGANISATION HAS IMPORTANT BEARING ON THE
ORGANISATIONAL STRUCTURE. A LONGER ORGANISATIONCANNOT PERFORM
EFFECTIVELYWITH A SIMPLEORBUREAUCRATIC STRUCTURE. ItHAS TO ADOPT

5. THE MATRIX STRUCTURE. An ORGANIC STRUCTURE IS SUITABLE FOR A BIG
ORGANISATION. Specialization, DEPARTMENTALISATION, FORMALISATION,
DECENTRALISATION ARE REQUIRED FOR BIG AND LARGE ORGANISATION.
Technology
Technological DEVELOPMENTS INFLUENCES THE STRUCTURE SOPHISTICATED
TECHNIQUES REQUIRE A MECHANISTIC APPROACH, WHEREIN HIGH
SPECIALISATION, RIGID DEPARTMENTALISATION, CLEAR CHAIN OF COMMAND
ARE NEEDED. Technology REFERS TO HOW ITIS APPLIED INALL THE AREAS OF
MANAGEMENT THAT IS FINANCE, MARKETING, PERSONAL, PRODUCTION ETC.
Environment
The ENVIRONMENT IS THE REACTIVE RESULTS OF VARIOUS INTERNAL AND
EXTERNAL FACTORS INFLUENCING THE BEHAVIOUR OF MANAGERS,
EMPLOYEES, CUSTOMERS’ DISTRIBUTORS, GOVERNMENT AGENCIES AND
OUTSIDERS DECIDES THE SPECIFIC FORM OF ENVIRONMENT. The CAPACITY,
COMPLEXITY AND VOLATILITY OF THE ENVIRONMENT INFLUENCES THE
ORGANISATIONAL STRUCTURE.
Capacity:-
The CAPACITY OF AN ORGANISATION TO SUSTAIN THE ENVIRONMENT
ENCOURAGING GROWTH IS THE DECIDING FACTORS OF AN ORGANIC
STRUCTURE. An ENVIRONMENTINHIBITING DEVELOPMENTCOMPELS ONE TO
ADOPT A MECHANISTIC FORM.
Complexity:-
Complex FUNCTIONS REQUIRE A MECHANISTIC AND MATRIX STRUCTURE. A
HETEROGENEOUS ENVIRONMENT REQUIRES AN ORGANIC STRUCTURE. A
HOMOGENOUS AND CONCENTRATED ENVIRONMENT ENCOURAGES THE
ORGANISATIONTO ADOPTA ENVIRONMENT HAS MORE HETEROGENEITY AND
DISPERSION.
Volatility:- IT IS RELATED WITH PREDICTABILITY AND STABILITY. A MANAGER
HAVING A VOLATILE SYSTEM ADOPTS A MECHANISTIC STRUCTURE. If IT IS
HIGHLY VOLATILE, THE ORGANISED STRUCTURE WILL BE FORMALISED,
SPECIALISED AND SO ON. In LOW VOLATILITY, THE ORGANIC STRUCTURE IS

6. SUFFICIENT. The DEGREE OF VOLATILITY DECIDES OF COMBINATION OF THE
MECHANISTIC AND ORGANIC STRUCTURE.
Organisational DESIGN
The STRUCTURAL DESIGN OF AN ORGANISATION HAS BEEN GIVEN PRIME
IMPORTANCE IN THE ORGANISATIONAL BEHAVIOUR.
BASICALLY THREE DESIGNS ARE ACCEPTED IN
BEHAVIOURAL SCIENCE THAT IS SIMPLE STRUCTURE, BUREAUCRATIC
STRUCTURE AND MATRIX STRUCTURE.
Simple STRUCTURE
A SIMPLE STRUCTURE HAS A LOW DEGREE OF COMPONENTS OF STRUCTURE.
There IS LOW LEVEL OF CONTROL, SINGLE-PERSON CONTROL, LESS
STANDARDISATION OR FORMALISATION AND LOW DEGREE OF
DEPARTMENTALISATION. The SPAN OF CONTROL HAS ONLY TWO OR THREE
VERTICAL LEVELS AND LOOSEEMPLOYEECOMMAND. TheMANAGERIS ONEOR
VERYFEW BUT CONTROLLEDBY ONLYONE. There AREVERY SMALLNUMBER OF
EMPLOYEES. The EVERY FUNCTION IS SIMPLE AND WELL KNOWN.
Accountability IS CLEAR. The STRUCTURE IS IN EXPENSIVE TO MAINTAIN. The
SIMPLE STRUCTURE IS VISIBLE IN SMALL ORGANISATION.
Bureaucratic STRUCTURE
A BUREAUCRATIC STRUCTURE IS BASED ON RULES AND REGULATION WHICH
ARE CONSIDERED THE PRIMEMOVERS OF ORGANISATIONAL BEHAVIOUR. It IS
STANDARDISED.
BUREAUCRACY IS HIGHLY ROUTINE, OPERATING THROUGH,
SPECIALISATION. A BUREAUCRATIC STRUCTURE HAS A NARROW SPAN OF
CONTROL, SCALAR CHAIN OF COMMAND, FUNCTIONAL
DEPARTMENTALISATION, CENT RAINED AUTHORITYAND HIGHLYFORMALISED
FUNCTION. TheACTIVITIES AREDIVIDED INTOHIGHLYSPECIALISED STRUCTURE
TO MAKE THE FUNCTIONS EFFICIENT AND EFFECTIVE. In THE ABSENCE OF
SPECIALISATION, THE PERFORMANCE WILL NOT BE QUALITATIVE AND
EFFICIENT. Managers HAVE NO SCOPE FOR PERSONAL DISCRETION AS THEY

7. HAVE TO FOLLOW THE RULES AND REGULATIONS WHILE TAKING ANY
DECISIONS.
CENTRALISATION IS ONE OF THE MAIN TENETS OF A
BUREAUCRATICSTRUCTURE. Duplication IS AVOIDED ALTHOUGH INA LENGTHY
SPAN OF CONTROL, THE ORDER UNNECESSARILY FLOWS TO VARIOUS
CHANNELS.
Matrix STRUCTURE
A MATRIX STRUCTURE COMBINES THE DIFFERENT FACTORS OF
ORGANISATIONALBEHAVIOURINANEFFICIENTMANNERS.EmployeesHAVETO
CARRY VARIOUS RESPONSIBILITIES ACCORDING TO THE NATURE OF WORK,
HIERARCHY AND POSITION. Matrix IS A COMBINATION OF
DEPARTMENTALISATION, FUNCTIONALIZATION AND PRODUCT. Functions ARE
USED TO CREATE SEVERAL STRUCTURE. Similarly MAIN PRODUCTS BY
PRODUCTS, SUB PRODUCTS AND ALLIED PRODUCTS ARE FACTORS OF
DIVISIONALISATION.
THE MATRIX STRUCTURE IS A CO-ORDINATION OF DIVERSE
FUNCTIONS. Instead OF A SCALAR CHAINOF COMMAND THERE ARE MULTIPLE
SUPERVISORS AS PER THE NEED OF THE FUNCTIONS. It IS MOST USEFUL IN
LARGE ORGANISATIONS. ItPROVIDES ECONOMYOF SCALEBY MINIMISING THE
COST OF OPERATION AND MAXIMISING THE REVENUE.
Completed BY:-
Danveer KUMAR VEER