• TYPES OF ORGANIZATION
MEANING OF THE ORGANIZATION STRUCTURE
1. AN
ORGANIZATIONAL STRUCTURE IS MAINLY CONCERNED WITH ALLOCATION OF
RESPONSIBILITIES AND DELEGATION OF AUTHORITY.
2. MEANS HIERARCHICAL
ARRANGEMENT OF VARIOUS POSITIONS IN THE ORGANIZATION
3. HELPS IN
ALLOCATING AUTHORITY AND RESPONSIBILITY IN THE BUSINESS
4. THE LAYING
DOWN OF PATTERN OF COMMUNICATION AND COORDINATION ARE ALSO FACILITATED BY A
GOOD ORGANIZATION.
•
TYPES OF THE ORGANIZATION
1. LINE
ORGANIZATION
2. FUNCTIONAL
ORGANIZATION
3. LINE AND
STAFF ORGANIZATION
4. COMMITTEE
FORM OF ORGANIZATION
• LINE ORGANIZATION
1. LINE
ORGANIZATION IS THE BASIC FRAMEWORK FOR THE WHOLE ORGANIZATION
2. IT REPRESENTS
A DIRECT VERTICAL RELATIONSHIP THROUGH WHICH AUTHORITY FLOWS
3. SIMPLEST AND
OLDEST
4. ALSO KNOWN
AS CHAIN OF COMMAND OR SCALAR PRINCIPLE
5. THE AUTHORITY
FLOWS FROM TOP TO THE LOWER
6. VERTICAL
STRUCTURE AND AUTHORITY IS DELEGATED BY SUPERIOR TO SUBORDINATE AND WHO IN TURN
DELEGATES TO HIS SUBORDINATES AND SO ON
7. AUTHORITY
FLOWS VERTICALLY FROM TOP LEVEL PERSONS TO ALL THE PERSONS RESPONSIBLE FOR THE
EXECUTION OF WORK
•
LINE ORGANIZATION
•
FOLLOWED IN MILITARY ESTABLISHMENTS
•
LINE ORGANIZATION IS OF TWO TYPES :
1. PURE LINE
ORGANIZATION
2. DEPARTMENTAL
LINE ORGANIZATION
•
PURE LINE ORGANIZATION
•
IN PURE LINE ORGANIZATION ALL PERSONS AT A
GIVEN LEVEL PERFORM THE SAME TYPE OF WORK. THE DIVISION ARE SOLE FOR THE
PURPOSE OF CONTROL
•
PURE LINE ORGANIZATION
 |
| PURE LINE ORGANIZATION |
•
DEPARTMENTAL LINE ORGANIZATION
1. DIVIDES THE
ORGANIZATION INTO DIFFERENT DEPARTMENTS WHICH FOR CONTROL PURPOSE. UNITY OF
CONTROL AND LINE OF AUTHORITY FLOWS FROM TOP TO BOTTOM
2. WHOLE
ORGANIZATION IS PUT UNDER THE OVER ALL CHIEF EXECUTIVE
3. DIFFERENT
DEPARTMENT ARE UNDER THE CONTROL OF DEPARTMENTAL MANAGERS
4. EVERY
DEPARTMENTAL HAS ITS OWN LINE OF ORGANIZATION
5. DEPUTY
MANAGERS,SUPERVISORS,WORKERS IN EVERY DEPARTMENT
 |
| DEPARTMENTAL LINE ORGANIZATION |
•
MERITS OF LINE ORGANIZATION
1. SIMPLICITY :
SIMPLE TO ESTABLISH AND EASILY UNDERSTOOD BY EVERY PERSON
2. FIXING OF AUTHORITY
AND RESPONSIBILITY : HELPS IN FIXING AUTHORITY AND RESPONSIBILITY OF EACH AND
EVERY PERSON IN THE ORGANIZATION. AUTHORITY SHOULD BE COMMENSURATE WITH THE
WORK ASSIGNED.THE ALLOCATION OF THE WORK WILL HELP IN FIXING THE RESPONSIBILITY
3. COORDINATION
:- THE HIERARCHY HELPS IN ACHIEVING EFFECTIVE COORDINATION
4. EFFECTIVE
COMMUNICATION :- FROM TOP TO BOTTOM AND DIRECT LINK BETWEEN THE SUPERIOR AND
THE SUBORDINATE
5.
MERITS OF LINE ORGANIZATION
6. ECONOMICAL :
EASY TO OPERATE AND LESS EXPENSIVE
7. QUICK
DECISIONS : ONLY ONE PERSON IS IN CHARGE OF THE DEPARTMENT OR DIVISON AND HE
HAS TO TAKE VARIOUS DECISIONS HIMSELF
8. UNITY OF
COMMAND : IN LINE ORGANIZATION EVERY PERSON IS UNDER THE COMMAND OF ONE BOSS
ONLY. THIS TYPE OF ORGANIZATION ACCORDANCE WITH THE PRINCIPLE OF SCALAR CHAIN.
9. EFFECTIVE
CONTROL AND SUPERVISION :-THE NUMBER OF SUBORDINATES IS LIMITED UNDER LINE
ORGANIZATION. SUPERIOR CAN EXERCISE EFFECTIVE CONTROL AND SUPERVISE THE PERSONS
UNDER HIM
10. MERITS OF
LINE ORGANIZATION
11. EXECUTIVE
DEVELOPMENT : AS THE DEPARTMENTAL HEAD IS INVOLVED IN TAKING AND EXECUTING
VARIOUS DECISIONS AND HIS TASK IS CHALLENGING AND HE IS EXPECTED TO DISCHARGE
HIS RESPONSIBILITY IN AN EFFICIENT WAY.
12. FLEXIBILITY
:- DECISIONS CAN BE TAKEN ACCORDING TO SITUATIONS
•
DEMERITS OF LINE ORGANIZATION
•
EXCESS WORK:WORK LOAD OF EXECUTIVE IS TOO MUCH
AND NOT POSSIBLE TO DEVOTE SUFFICIENT TIME FOR EVERY WORK
•
LACK OF SPECIALIZATION : THE LINE OFFICERS CAN
NOT BE EXPERTS IN EVERY LINE OF BUSINESS
•
LACK OF COORDINATION AMONG VARIOUS DEPARTMENTS.
ALL DEPARTMENTAL HEADS TRY TO RUN THE DEPARTMENT IN THEIR OWN WAY AND ACCORDING
TO THEIR SUITABILITY
•
IMPROPER COMMUNICATION : THE LINE OFFICERS MAY
BECOME AUTOCRATIC
•
LACK OF INITIATIVE : FINAL DECISION MAKING IS
DONE BY THE TOP MANAGEMENT AND THE LOWER LEVEL DO NOT SHOW ANY INITIATIVE
•
DEMERITS OF LINE ORGANIZATION
1. FAVORITISM :
SCOPE OF FAVORITISM IN LINE ORGANIZATION. THE OFFICERS WORK ACCORDING TO THEIR
WHIMS AND PREFERENCES
2. INSTABILITY
:-BUSINESS IS DEPENDENT UPON KEY PERSONNEL AND SUDDEN DISAPPEARANCE OF SUCH
PERSONS FROM THE SCENE MAY CREATE INSTABILITY IN THE BUSINESS.
•
•
FUNCTIONAL OR STAFF ORGANIZATION
1.
TASK OF MANAGEMENT AND DIRECTION OF SUBORDINATES SHOULD BE DIVIDED ACCORDING
TO THE TYPE OF WORK INVOLVED
2.
ALL ACTIVITIES ARE GROUPED TOGETHER ACCORDING TO CERTAIN FUNCTION LIKE
PRODUCTION,MARKETING,FINANCE,PERSONNEL ETC
3.
ALL THE PERSONS IN THE ORGANIZATION DEALING WITH A PARTICULAR FUNCTION ARE PUT IN CHARGE OF THE
PERSON CONTROLLING THAT PARTICULAR FUNCTION
4.
THE PERSON IN CHARGE OF A FUNCTION IS A SPECIALIST IN IT AND BRINGS OUT THE
BEST IN HIMSELF
5.
IN CASE OF PERSON PERFORMS A NUMBER OF FUNCTIONS THEN HE WILL BE ACCOUNTABLE
AT THE LOWER LEVEL OF THE ORGANIZATION STRUCTURE.
6.
F.W TAYLOR,FATHER OF SCIENTIFIC MANAGEMENT : DEVELOPED THE CONCEPT OF FUNCTIONAL
ORGANIZATION
7.
RECOMMENDED FUNCTIONAL ORGANIZATION EVEN AT THE SHOP LEVEL WHERE WORKERS
HAVE TO PRODUCE GOODS
8.
ONE FOREMAN COULD NOT MANAGE ALL THE ASPECTS OF WORK ASSIGNED TO HIM
9.
F.W TAYLOR SUGGESTED THE SUBSTITUTION OF LINE AUTHORITY BY FUNCTIONAL FOREMAN SHIP
AT THE LOWER LEVEL OF THE ORGANIZATION STRUCTURE
•
FUNCTIONAL OR STAFF ORGANIZATION
•
TAYLOR SUGGESTED THE DIVISION OF SUPERVISORY
FUNCTION INTO TWO GROUPS :
•
OFFICE SPECIALISTS
1.
ROUTE CLERK : PLANNING THE ROUTE FROM WHICH THE WORK WILL PASS
2.
INSTRUCTION CARD CLERK :EXACT METHOD TO DO THE WORK
3.
TIME AND COST CLERK : RECORDING OF TIME AND FIXING OF STANDARD TIME
4.
DISCIPLINARIAN : IMPLEMENTATION OF
VARIOUS RULES AND REGULATIONS
•
SHOP SPECIALISTS:
1.
GANG BOSS : ARRANGING OF MACHINES AND TOOLS AT THE WORK
2.
SPEED BOOS : DETERMINES THE SPEED AT WHICH THE WORK IS TO BE COMPLETED
3.
REPAIR BOSS :
4.
INSPECTOR :WORK DONE ACCORDING TO PRESCRIBED STANDARD
•
FUNCTIONAL ORGANIZATION
•
IN A FUNCTIONAL ORGANIZATION STRUCTURE AN ORGANIZATION ‘S REPORTING
REATIONSHIP ARE BASED ON SPECIALTY OR FUNCTIONAL AREA
•
SEPARATE DEPARTMENT FOR MARKETING,ACCOUNTING,ENGINEERING,HRM ETC
•
GENERALLY ALL THE FUNCTIONAL HEAD WILL REPORT DIRECTLY TO COMPANY PRESIDENT
OR CEO
•
FEATURES OF FUNCTIONAL ORGANIZATION
1.
THE ENTIRE ORGANIZATIONAL ACTIVITIES ARE DIVIDED INTO SPECIFIC FUNCTIONS
SUCH AS OPERATION,FINANCE,MARKETING AND PERSONNEL
2.
THREE AUTHORITIES EXIST : LINE,STAFF AND FUNCTION
3.
EACH FUNCTIONAL AREA IS PUT UNDER THE CHARGE OF FUNCTIONAL SPECIALIST AND
HAS GOT THE AUTHORITY TO GIVE ALL DECISIONS REGARDING THE FUNCTION WHENEVER THE
FUNCTION IS PERFORMED THROUGHOUT THE ORGANIZATION
4.
PRINCIPLE OF UNITY OF COMMAND DOES NOT APPLY TO SUCH ORGANIZATION AS IT
PRESENTED IN LINE ORGANIZATION
•
MERITS
•
SPECIALIZATION: BETTER DIVISION OF LABOUR
•
EFFECTIVE CONTROL :ELIMINATES ONE MAN CONTROL. JOINT CONTROL AND
SUPERVISION IN THE ORGANIZATION. IT BOOST THE MORALE
•
INCREASE IN EFFICIENCY :DUE TO DIVISION OF LABOUR,PLANNING AND EXECUTION IS
SEPARATED AND IT WILL ENHANCE THE OVER ALL EFFICIENCY
•
SCOPE FOR GROWTH :THE EMPLOYMENT OF SPECIALISTS AT VARIOUS LEVEL OF WORK
ENABLES THE ORGANIZATION TO GROW AS PER THE NEEDS OF THE SITUATION
•
FLEXIBILITY :FUNCTIONAL ORGANIZATION ALLOWS CHANGES WITHOUT DISTURBING THE
WHOLE WORK
•
BETTER SUPERVISION AND ECONOMY IN OPERATION
•
DEMERITS
1.
THE PRINCIPLE OF UNITY OF COMMAND IS VIOLATED IN FUNCTIONAL ORGANIZATION. A
SUBORDINATE IS ANSWERABLE TO MANY BOSSES
2.
THE APPOINTMENT OF SO MANY SPECIALISTS CREATES PROBLEM OF COORDINATION
3.
AS THERE IS NO UNITY OF COMMAND, BECOMES DIFFICULT TO FIX RESPONSIBILITY
4.
THE DIVISION OF AUTHORITY CREATES PROBLEM OF DISCIPLINE
5.
MULTIPLICITY OF EXPERTS INCREASES OVERHEAD EXPENSES
6.
ALSO INCREASE GROUPS RIVALRIES
•
LINE AND STAFF ORGANIZATION
•
THE LINE SYSTEM FOCUSES EXCESSIVELY ON AUTHORITY AND THE FUNCTIONAL
ORGANIZATION DIFFERENT DEPARTMENTS ARE CREATED. LINE AND STAFF ORGANIZATION
ELIMINATES THE DRAWBACK OF BOTH
•
BOTH LINE AND STAFF PERSONNEL HAVE IMPORTANT ROLE TO PLAY
•
THERE ARE TWO TYPES OF RELATIONSHIP
•
LINE PERSONNEL : ARE VESTED WITH EXECUTIVE AUTHORITY AND RESPONSIBLE FOR
MAKING IMPORTANT DECISIONS AND ARE ALSO ACCOUNTABLE FOR THEIR IMPLICATIONS.
AUTHORITY FLOWS FROM VERTICALLY FROM TOP TO BOTTOM
•
LINE AND STAFF ORGANIZATION
•
THERE ARE TWO TYPES OF RELATIONSHIP
1.
LINE PERSONNEL : ARE VESTED WITH EXECUTIVE AUTHORITY AND RESPONSIBLE FOR
MAKING IMPORTANT DECISIONS AND ARE ALSO ACCOUNTABLE FOR THEIR IMPLICATIONS.
AUTHORITY FLOWS FROM VERTICALLY FROM TOP TO BOTTOM
2.
STAFF PERSONNEL : ARE EXPERTS IN THEIR FIELD. ATTACHED TO LINE MANAGERS TO
ADVISE THEM IN THE FIELD OF THEIR SPECIALIZATION. THE ROLE IS OF ADVISERS. LINE
MANAGERS MAY FOLLOW OR NOT FOLLOW. THE STAFF ORGANIZATION FACILITATES THE
ACCOMPLISHMENT OF ORGANIZATIONAL OBJECTIVES
•
TYPES OF STAFF
1.
PERSONAL STAFF : PERSONAL STAFF IS ATTACHED TO INDIVIDUAL LINE OFFICERS. THE
PERSONAL ASSISTANT OR THE PRIVATE SECRETARY. THE ROUTINE WORK IS HANDLED BY
THEM. FIX THE ROUTINE MEETING, OPEN THE POST, MAINTAINS THE DAIRIES.
2.
SPECIALIST STAFF :-TECHNICALLY
QUALIFIED PERSONS WHO PROVIDE SERVICES TO THE WHOLE ORGANIZATION. THEY
SERVE LINE AND OTHER STAFF IN PLANNING. ORGANIZING AND COORDINATING. THEIR
SPECIALIZED KNOWLEDGE IS AN ASSET. LIKE APPOINTMENT OF ADVISERS
3.
GENERAL STAFF :CONSISTS OF PERSONS ATTACHED TO THE KEY EXECUTIVES. THEY HAVE
THE SAME BACKGROUND AS THAT OF LINE MANAGERS. ATTACHED TO IMPORTANT
FUNCTIONARIES LIKE DEPUTY MANAGERS, ASSISTANT MANAGERS
4.
AGENCY OF CONTROL : DISCHARGE FUNCTIONS SUCH AS
ORGANIZATION,COST,AUDIT,BUDGET,PERSONNEL AND ACCOUNTING ETC.
5.
AGENCY OF COORDINATION : HELPS IN COORDINATION OF WORK AMONG DIFFERENT
DEPARTMENTS . THESE FUNCTION AS PLANNING,ORDER AND DISTRIBUTION, PRODUCTION
PLANNING AND COMMUNICATION
6.
AGENCY OF SERVICE : PERFORM THE FUNCTION OF RESEARCH AND DEVELOPMENT,TAXES
ETC
7.
AGENCY OF ADVICE : LEGAL ADVICE,PUBLIC RELATIONS,LABOUR RELATIONS, PERSONNEL
DEVELOPMENT
•
ADVANTAGES
1.
SPECIALIZATION : PERSONS WITH SPECIALIZED KNOWLEDGE ARE APPOINTED TO HELP
LINE OFFICERS. PLANNING PART IS GENERALLY TAKEN BY STAFF AND EXECUTION PART BY
LINE
2.
BETTER DISCIPLINE : THE UNITY OF COMMAND IS MAINTAINED IN THIS TYPE OF
ORGANIZATION. THE STAFF PERSONNEL DO NOT INTERFERE WITH THE EXECUTIVE WORK OF
LINE OFFICERS.
3.
BALANCED AND PROMPT DECISIONS :THE FUNCTIONAL MANAGERS HAVE THE ADVANTAGE OF
EXPERT ADVICE WHEN TAKING IMPORTANT DECISIONS.
4.
GROWTH AND EXPANSION :THE LINE AND STAFF ORGANIZATION IS QUIET SUITABLE FOR
GROWTH AND EXPANSION. THE BURDEN OF LINE STAFF IS EASED BY THE APPOINTMENT OF
SPECIALIST
5.
DEVELOPMENT OF EMPLOYEES : THE SEPARATION OF FUNCTIONS OF PLANNING AND DOING
ALSO HELP IN CREATING MORE AND MORE JOB OPPORTUNITIES
6.
LESSER BURDEN ON LINE OFFICERS
7.
QUICK ACTIONS
•
DISADVANTAGES
1.
POSSIBILITY OF CONFLICT BETWEEN LINE AND STAFF
2.
LACK OF RESPONSIBILITY FOR STAFF
3.
THE LINE OFFICERS BECOMES HABITUATED
FOR ADVICE FOR STAFF OFFICIALS
4.
LACK OF COORDINATION
5.
THE STAFF OFFICERS DO NOT WIELD ANY POWER IN THE ORGANIZATION. WITHOUT POWER
THEY WILL NOT GET PRESTIGE IN THE ORGANIZATION
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