Class Presentation by students on the topic Structural design

1. Structural design
In management

2. Introduction
• An organization is a system made of many sub-
systems
• Structural design is the way or method through
use of hierarchy that a group, business,
organizations, people or objects collaborate to
achieve success on one common goal.
• Complexity is an ever-present obstacle in any
business. Managing complex systems is therefore
a core competency to successfully run any
business.

3. Factors cont’d
3. Culture – most difficult. Organizations have
many sub-cultures distributed through out the
organization.
4. Effectiveness – the measure of effectiveness
within an organization. For instance, many
organizations use balanced score card to
measure both company and individual
performance.

4. Factors to consider when designing a
mgt structure
1. Environment – in which the company
operates. Both internal and external.
External, all businesses are affected, e.g.,
taxation. Internal, specific to business’ day-
to-day operations, e.g., capital adequacy.
2. Technologies – used within the company.
Relates to a range of infrastructure used to
perform the day-to-day operations.

5. The Contingency Approach to
Organization Design
• Creating an effective organization-environment
fit.
• “organizations tend to be more effective when
they are structured to fit the demands of the
situation”
• This model calls for using various organization
design configurations to achieve an effective
organization.

6. • Two classic contingency design studies:
1.Differentiation and Integration: The Lawrence
and Lorsch Study
2.Mechanistic versus Organic Organizations

7. Differentiation and Integration:
The Lawrence and Lorsch Study
• Paul Lawrence and Jay Lorsch explained how two
structural forces simultaneously fragment the
organization and bind it together
• Differentiation splits the organization apart
• Integration binds the organization together
• Concluded: As environmental complexity increased,
successful organizations exhibited higher degrees of
both differentiation and integration.
• The more differentiated an organization, the more
difficult it is to achieve integration

8. Mechanistic versus Organic
Ogranizations
• Tom Burns and G M Stalker drew a very
instructive distinction between mechanistic
and organic organizations.
• Mechanistic organizations – rigid, command-
and-control bureaucracies
• Organic organizations – fluid and flexible
networks of multi-talented people

9. Types of Structural Designs
• Pre-Bureaucratic Structure
These structures are simple and are usually referred
to as horizontal organizations. They work well for
small businesses and entrepreneurs. They are
referred to as horizontal as employees report to a
single owner or manager and there are no
branches or specialized tasks among the
employees. Everyone takes part in all the business
activities.

10. Types cont’d
• Bureaucratic Structure
This structure is better suited for large scale
complex organizations. There are clear defined
roles, a hierarchical structure and respect for
merit. This structure usually adopts a tall structure
and is more vertical. Here production is all about
efficiency, effectiveness and speed. Subordination
is also strict.

11. Types cont’d
• Functional Structures
Within an organization there are divisions which are
specialized in performing a set of tasks for example a
computer engineering department would be staffed
with only software engineers, making the group more
efficient. This structure type is best suited for
standardized good and services at large volume and
low cost for example a car assembly plant. However
functional structures may cause a lack of
communication within an organization making it slow
and inflexible.

12. Types cont’d
• Matrix Structure
In this structure employees are grouped by function
and product. This structure is group oriented and
uses groups of employees to achieve objectives.
For example if an organization produces product
“A” and “B” the company would take up a
structure of product “A” sales department ,
product “A” accounting department, product “B”
sales department, product “B” accounting
department and so fourth.

13. Importance/adv of Structural design
1. Organizational chart
2. Distribution of Authority
3. Departmentalization
4. Flexibility
5. Effectiveness and efficiency

14. Conclusion.
• In conclusion the structural design of an
organization is basically determined by the;
• Environment.
• Size of the organization.
• Organization culture.
• Technology.
• Organizational goals.