Elements and Importance of Organisational Structure Sample

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Jones George and Hill ( 2011 ) specify administration construction as mentioning to the formal systems of undertaking and describing relationships that coordinate and motivate organizational members so that they work together to accomplish organizational ends. There are six elements of organizational construction harmonizing to Barney and Griffin ( 1992:315 ) which include planing occupations organizing sections and work units making a hierarchy. administering authorization. coordinating and integration activities. and distinguishing between places.

Thompson Strickland and Gamble ( 2008:363-382 ) point out that the benefits of holding a good administration construction among others include enhanced answerability. gross growing and shortened merchandise development. This essay will discourse the importance of a good administration construction and will besides depict the chief organizational structural elements.

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Importance of good administration construction

Organizational construction is made of the different elements that create a flow of communicating and thoughts throughout a company. The employee hierarchy helps to make a concatenation of bid and duty. The communicating construction of an organisation helps thoughts and information to flux from one section to the following. Each of these signifiers of organisational construction serve maps that allow the company to travel frontward and go on to turn.


A company hierarchy serves as a vehicle for answerability within the organisation ( Thompson et al. 2008 ) . When something goes incorrect within a company. the direction construction allows the executive squad to find who was accountable for the issue. and so the company can put out to work out the job. By the same item. a hierarchy construction besides allows the company to see where productive thoughts are coming from and work to promote that flow of positive information.

Revenue Growth

The construction of an organisation dictates how the company will turn. When a dynamic construction is in topographic point. an organisation can turn rapidly and suit all of the alterations that may be associated with fast gross growing ( Thompson et al. 2008 ) . When the organisational construction in topographic point is non equipped to manage rapid gross growing. it can be overwhelmed and jobs will originate. When a company with a good organisational construction additions gross the company measures get paid on clip. bills are issued to clients without job and the company is able to do paysheet for its employees. A weak construction could intend measures are paid tardily. bills are lost and paysheet is delayed.

Product Development

A strong communicating construction can assist to ease the development of new merchandises that can maintain a company competitory. When communicating through the assorted sections is structured decently. applied scientists are given the information they need in a timely mode to assist convey new merchandises to market ( Thompson et al. 2008 ) . When the construction is weak. development gets slowed down and new merchandises take excessively long to acquire released. A weak merchandise development construction can go forth a company invariably trailing the competition and falling behind in market portion.

Main Elementss of Organisation Structure

Whatever the instance. every type of organisational construction contains certain common cardinal elements or features. As Barney and Griffin ( 1992:315 ) put it. there are six elements of organizational construction: designing occupations. organizing sections and work units. making a hierarchy. administering authorization. coordinating and integration activities. and distinguishing between places.

Designing occupations

Barney and Griffin ( 1992 ) point out that planing the occupations people perform so that both workers and directors understand what they are expected to make for the administration is the first component of administration construction. Barney and Griffin ( 1992:315 ) province that occupation design specifies the boundaries of a occupation by depicting what tasks the occupation does and does non affect. the duties and outlooks of the occupation holder and the authorization of the occupation holder to do determinations. The procedure of planing occupations involves occupation specialisation and planing occupations for groups. Job specialisation is achieved in four options: occupation rotary motion. occupation expansion. occupation enrichment and the usage of occupation features. On the other manus. administrations find that planing occupations for groups can take some of the negative effects of occupation specialisation such as that some workers rapidly go world-weary with simple. specialised occupations ( Barney and Griffin. 1992 )

Creating a Hierarchy

A company’s hierarchy or tallness in its organisation is mostly contingent upon size. Organizational construction is depicted with boxes that represent assorted employee rubrics. Employees that are on the same degree. such as selling and trade name directors. represent the breadth of an organisation. The hierarchy refers to the form of describing relationships between persons in places throughout an administration ( Barney and Griffin. 1992:326 ) . Executives are normally at the top of the organisation while. in order of rank. managers. directors and coordinators are one to three degrees down. severally. An employee will by and large describe to the individual who is straight above him. Making a hierarchy requires the administration to specify a concatenation of bid and find a desirable span of direction. These two features of hierarchy in bend play a major function in finding the overall form of the organisation’s construction.

Span of Control

Harmonizing to Ivancevich. Konopaske and Matteson ( 2008:458 ) . span of control in organisational construction refers to the figure of people who report to a peculiar executive or director i. e. the figure of subsidiaries describing to a superior. For illustration. a frailty president of finance may hold a finance manager and a fiscal analyst coverage to her. Consequently. her span of control would be two. However. even in little organisations. works directors or supervisors may be in charge of tonss of employees. Most companies limit span of control to a degree that directors can efficaciously be in charge of and this is affected by grade of required contact. grade of specialisation and ability to pass on ( Ivancevich et al. 2008:458-459 ) .

Forming sections and work units

Administrations need to develop structural agreements wherein occupations households are created to set them into logical groups or units i. e. departmentalization. For illustration. an insurance company may group all employees working on car insurance together. everyone working of life insurance together etc. this grouping is of import because it facilitates coordination. helps incorporate the activities of different people in a incorporate mode and provides administrative convenience. In general. upper degrees of an administration ( i. e. the corporate degree ) . grouping agreements may be called divisions. merchandise groups. or units. At in-between and lower degrees. they are more frequently called sections. Administrations normally employ one or more signifiers of departmentalization: by map. merchandise. client and location.

Coordinating and incorporating activities

In any administration. persons and squads or groups must frequently work together in order to transport out the organisation’s maps. attending must besides be devoted to pull offing horizontal relationships across the administration construction. Coordinating and incorporating activities make certain that these horizontal relationships are integrated and synchronized with one another. The grade of coordination an administration needs is determined by the extent to which the people and groups in it must trust on one another to acquire their work done. Three degrees of mutuality that exist in most administrations include pooled mutuality. consecutive mutuality and mutual mutuality. Common methods of accomplishing coordination include: utilizing the hierarchy. set uping regulations and processs. delegating liaison functions. organizing undertaking forces and incorporating sections.

Differentiating between places

Barney and Griffin ( 1992 ) province that administrations frequently differentiate places by sorting them as either line or staff. A line place is straight involved in the organisation’s operations and straight contributes to the creative activity of goods and services. A staff place serves the organisation’s ends indirectly by supplying subsidiary or support services to line maps. In order to avoid making excessively many staff places. administrations sometimes monitor their ratio of administrative strength.


This essay explained why it is of import to hold a good administration construction and described the chief organizational structural elements. The essay defined administration construction and listed the six elements of organizational construction which include planing occupations. organizing sections and work units. making a hierarchy. administering authorization. coordinating and integration activities. and distinguishing between places. Further. the essay discussed the benefits of holding a good administration construction which among others included enhanced answerability. gross growing and shortened merchandise development.


  1. Barney. J. B. and Griffin. R. W. ( 1992 ) . The Management of Administrations: Strategy. Structure. Behaviour. 1st Edition. Boston: Houghton Mifflin Company.
  2. Ivancevich. J. M. . Konopaske. R. and Matteson. M. T. ( 2008 ) . Organizational Behaviour and Management. 8th Edition. New York: McGraw-Hill Irwin.
  3. Jones. G. R. . George. J. M. and Hill. C. W. L. ( 2011 ) . Contemporary Management. 7th Edition. Boston: McGraw-Hill Irwin
  4. Thompson. A. A. . Strickland III. A. J. and Gamble. J. E. ( 2008 ) . 16th edition. Crafting and Executing Strategy: The Quest for Competitive Advantage. New York. McGraw-Hill Irwin.

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