Organization is a group of people who together work to achieve a common goal. Organizational structure defines how tasks are divided, grouped and coordinated in organizations. Every organization has a structure they clarify the goals so every member understanding their responsibilities as a group.
Organizational structure is important for any growing company to provide guidance for human resources issues. Business owner’s must have thinking about a strong formal structure early in the growth stage of their business.
Organizational chart contains of functions, responsibilities, authorities, relationships and communications of individuals of employees and management within each department.
The formalized organizational chart had been introduced by DANIEL MACCULUM. He tried to create the organization chart formed a clear line that showed the authority of managers and supervisors.
The purpose of the organizational structure is to achieve goals. Being organized is the process by which the work is divided among department and employees. This department combined together to form a unified system. It shows the organizational design of a company.
Organizational structure is related to seven key elements.
01. Work specialization
03. Chain of command
04. Span of control
Work specialization is the overall tasks of the organization is broken down and divided into smaller components parts. The main hope of this process is that the entire task is not done by an individual and it’s broken down into step because of this work will be done efficiently and effectively.
Departmentalization refers to the process of grouping jobs together in order to coordinate common activities and tasks. There are 5 forms of departmentalization. They are functional, product, geographical, matrix and customer.
Chain of command is a most basic key element of an organizational structure. It is an unbroken line of authority that spread from the top to bottom in a organization.
Span of control refer to the number of subordinates a superior can effectively manage.
In an organization power is concentrated at a single point then the organizational structure is centralized. If decision making power is spread out, the structure is decentralized this is called delegation.
Formalization is the extent to which employee act is guided by rules and procedures. The high formalization organization have strict rules and regulations. The low formalization organizations have very few written rules and procedures