What decisions go into the structuring of an organizationSol

What decisions go into the structuring of an organization?

Solution

The organization structure takes place to bring the efficiency in the information flow process, ability to cope with challenges and cater the opportunities that are created in the business environment. In this regard the following decisions are applied in structuring an organization.

1.   The decision related to the fast and efficient flow of information and decision across the structure so that everyone in the organization remains at the same level. It creates synergy, quick readiness among the functions and capabilities to respond within the organization.

2.   The decisions related to the elimination of waste in the organization. An organization can face different types of waste in the form of operational redundancies, bottleneck, underutilization of human resources and inefficiency. A close look and careful structuring of the organization helps to eliminate the waste and make organization lean.

3.   The decision related to existing work and opportunities arriving in the future. An organization works on different projects and maintains different function or departments also. While doing so, it can draw resources for different projects, from different department. Hence, an organization structure will clarity of command between line and project structure is very important. It leads the management to opt for a project or matrix organizational structure.

4.   The decision related to respond the volatile business environment. An organization structuring should be evolving in nature, so that it can adapt to the changing business environment. A globalization drive and frequent changing of the government policies, make it imperative to make evolving organizational structure.