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Organizational Structure: Definition and Influence on Organizational Behavior

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  • 0:05 Organizational Structure
  • 1:15 The Role of Structure…
  • 1:54 Six Elements of…
  • 4:35 Why Organizational…
  • 5:30 Lesson Summary
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Lesson Transcript
Instructor
John McLaughlin
Expert Contributor
Jerry Allison

Jerry holds a Doctor of Business Administration and a Master’s in Mathematics. He has taught business, math, and accounting for over 25 years.

In this lesson you will learn the definition of organizational structure and how the structure of an organization can influence the attitudes and behaviors of organizational members.

Organizational Structure

An organization is a group of people who together work to achieve a common goal. In order to work together efficiently, the group must find the best way to organize the work that needs to be done in order to meet the goals of the organization. Organizational structure defines how tasks are divided, grouped, and coordinated in organizations. Every organization has a structure that clarifies the roles that organizational members perform, so that everyone understands their responsibilities to the group.

For example, the Beaver Scouts is a youth organization that meets for outdoor activities, such as hiking and camping. When the Beaver Scouts of Colony #33 go camping, the lodge leader constructs a list of tasks that must be performed during the trip. Tasks are divided up among the members of the colony and written down on a chore chart, so every scout knows what job they are responsible for each day. Without this formal structure, the scouts would waste a lot of time trying to decide who should do what, and many tasks would likely go undone.

The Role of Structure in an Organization

Similar to the Beaver Scout chore chart, companies use a diagram called an organizational chart that displays the structure of the organization, and also shows the relationships between organizational members and the ranks of all the positions in the organization.

The formal structure of an organization provides two important roles for organizational members. The structure of an organization clarifies roles for organizational members, so that each member knows what they are supposed to do and who they report to. The structure also dictates the amount of control an organizational member has regarding his job in the organization.

Six Elements of Organizational Structure

The structure of an organization consists of a combination of six different elements. Each of these elements has an impact on how the tasks are carried out in an organization.

Work specialization - the first element that affects the structure of an organization is how tasks are subdivided into separate jobs. Is a job completed by an individual, or is it broken down into separate steps and completed by several individuals? The more a job is broken down into small tasks, the more specialization is required by each individual worker. High specialization results in high efficiency, but can lead to boredom by workers who are required to perform the same repetitive task over and over.

The next element of organizational structure is departmentalization, which establishes how jobs are grouped together. Jobs can be grouped in many ways, including by job function, product line, or territory. Every organization has a chain of command, which provides a line of authority that reaches from the top of the organization to the bottom and spells out who reports to whom in the organization.

The structure of every organization must also dictate how many managers are required to direct their employees. This is known as the span of control and determines how many individuals a manager can efficiently and effectively manage. Companies with wider spans of control require fewer managers and are more efficient than companies with narrow spans of control, but if the span of control becomes too large, employees may not receive adequate leadership and support from their managers.

Another element of organizational structure is centralization and decentralization, which determines 'where does decision-making authority lie?' If top management makes all the organizational decisions with no input from lower-level personnel, the organization is considered to be centralized. The more that lower-level managers are involved in the decision-making process, the greater the degree of decentralization that exists in the organization.

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Additional Activities

Organizational Structure: Definition and Influence on Organizational Behavior

Discussion Question

Jack and Jill, the owners of Wedont Know Inc., are starting a business and hire ten people to help them. When the employees were hired, the owners told them that when they show up for work, they should just find something to do, i.e., there is no structure. If each employee is picking what he or she wants to do and there is no guidance on how to do it, what do you think would happen to the work of the business? What would be the future of the business? How do you think the employees would feel? How would you feel?

Research Project

Pick five well-known companies and find the website of each. Somewhere on that website is the organizational chart that shows the chain of command (at least for the upper layers of management). What similarities are there in how these organizational charts are designed? What are the major differences? Why do you think there are these major differences? Write a report detailing your answers.

Survey Project

Create a list of at least ten people that you know well who have a job and ask them the following questions:

1. How well is your job defined? Do you understand everything you need to do and how to do it?

2. Do you think the chain of command in your organization is defined well? Why?

3. Is your job grouped with other peoples' jobs into a department in a way that makes sense? Why?

4. Do you have any decision-making ability in your organization? If not, who does?

5. How do you feel about how all these things are set up in your organization?

Take the answers to these questions and look for common responses and for very different responses. The most important information may be what the person says beyond the answer to the question. The responses will show you how people respond and behave because of the organizational structure.

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