Communication and Decision-Making
Keith A. Alston
October 22, 2012
A good manager must understand the importance of organizational structure and design to effectively manage a business. What works well for one business, may not be appropriate for another. It important to choose the appropriate structure that fits the business. Organizational Structure is the formal arrangement of jobs within an organization. Organizational structure divides work into separate departments, and functions. In the process, roles and responsibilities are identified, and tasks assigned. Resources are allocated to support the tasks assigned, and tasks are executed, tracked and reported through the appropriate management chain of authority. When managers change or create an organizational structure, it is called organizational design. Organizational design involves making decisions about six key elements which are: work specialization, departmentalization, and chain of command, span of control, decentralization, centralization, and formalization.
In order to address issues with organizational structure, one must first recognize that the current structure is not working. In this case, the product line in this company is outdated, which suggests that the company is lacking in new ideas, technology and innovation. This may be highly attributed to the organizational structure in that it does not provide for input from the talented resources in the company. A contemporary approach is recommended for this business, such as a modular network organizational structure. In this structure the business would use its employees to do a portion of the work, and use external partners to provide services and product components. This is recommended approach because it allows the business to focus on its strengths and contract out the other aspects of the company that are not as strong. It also keeps the company in line with current processes,...