Line and Staff Organization Structure
What?
A pattern in which staff specialists advice line managers to perform their duties.
Why?
When the work of an executive(line manager) increases, its performance requires services of specialists in an area.
What staff can do?
Right to recommend ,advice ( IT Advisor, Economic Advisor, National Security Advisor)
Figure:
Merits
· Planned specialization
Principle of specialization
Line manager responsible for operations which will achieve organizations objectives
Staff people provide expert advice on their field
· Quality Decisions
Because managers takes decision after discussing with expert staff
· Prospect for personnel growth
Opportunity for staff to concentrate in his area.
· Training ground for personnel
Staff person do the job in which he is specialized.
Line manager observes how staff he is doing the job.
Demerits
Lack of well defined authority
Line and staff conflicts
Suitability
Suitable for large organizations where specialization of activities is required.
Its success depends on harmony between Line and Staff people, clarity in Line of Authority, interpersonal contact of executives.
Functional Organization structure
It is created by grouping activities on basis of functions required for achieving the objective.
All functions are classified into basic, secondary etc.
Example: Production, Marketing, Finance, Personnel.
Marketing department can be sub divided in to Market Research, Advertising, and Sales
etc.
Characteristics
Whole activities of Organization are divided in to various functions based on type of work – Specialization by function.
Each functional area is put under one executive or specialist.
To take a decision related to particular function, consult the functional specialists.
Specialists have independence.
Advantages
Ensure division of labor and specialization
Quick decision making (consult functional head)
Limitation of one man control under line organization is removed
High degree of control and coordination of functions because all work of one kind is under one manager.
Promotes professional achievement as a person is restricted to his own area of specialization
Bring order and clarity in organization by prescribing what is expected from each subordinate.
Disadvantages
Responsibility for ultimate product
Here each department focuses on contribution on their area not on complete product.
Slow decision making- consult each department head
Line and staff and interdepartmental conflict
Divisional Organization Structure
Organization is divided into different autonomous units. Each unit is self contained and it has separate resources/ functional units to operate independent of others. Ie. Each unit has its own manufacturing; marketing etc. each unit is headed by a manager.
Basis of Departmentation
Product divisionalization
Product structure groups employees together based upon specific products produced by the company. An example of this would be a company that produces three distinct products, "product a", "product b", and "product c". This company would have a separate division for each product.
Example: Reliance Industries Limited has no of product divisions. : textiles,chemical ,oil and gas,polymers.
Territorial divisionalization
Here each organization may have regional offices operating in different areas. They may be established as separate units. Each regional office has its own set of functional departments.
Project Organization Structure
Here divisions or units are based on projects. There will be separate units for each project. When a project is completed, that unit/division may disappear.
Difference between Divisional and Project structure
In divisional various units are created on permanent basis, but in project structure units are created on temporary basis, ie: depend on life time of the project.
There will be a project manager for each project. He prescribes “what is to be done, when it is to be done, how much resources are required”.
The functional personnel are taken from various departments and functional managers decide who will perform the task and how it will be done.
Project manager has the responsibility for completing the project.
He doesn’t have the vertical authority on personnel from various functional departments.
Matrix Organization structure
Combination of functional and product structure
A matrix organization frequently uses teams of employees to accomplish work, in order to take advantage of the strengths, as well as make up for the weaknesses.
An example would be a company that produces two products, "product a" and "product b". Using the matrix structure, this company would organize functions within the company as follows: "product a" sales department, "product a" customer service department, "product a" accounting, "product b" sales department, "product b" customer service department, "product b" accounting department
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