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Formal organizations[
An organization that is established as a means for achieving
defined objectives has been referred to as a formal organization. Its design
specifies how goals are subdivided and reflected in subdivisions of the
organization. Divisions, departments, sections, positions, jobs, and tasks
make up this work structure. Thus, the formal organization is expected to
behave impersonally in regard to relationships with clients or with its
members. According to Weber's definition, entry and subsequent
advancement is by merit or seniority. Each employee receives a salary and
enjoys a degree of tenure that safeguards him from the arbitrary influence
of superiors or of powerful clients. The higher his position in the hierarchy,
the greater his presumed expertise in adjudicating problems that may arise
in the course of the work carried out at lower levels of the organization. It is
this bureaucratic structure that forms the basis for the appointment of
heads or chiefs of administrative subdivisions in the organization and
endows them with the authority attached to their position. [3]
Informal organizations[
In contrast to the appointed head or chief of an administrative unit, a leader
emerges within the context of the informal organization that underlies the
formal structure. The informal organization expresses the
personal objectives and goals of the individual membership. Their
objectives and goals may or may not coincide with those of the formal
organization. The informal organization represents an extension of the
social structures that generally characterize human life the spontaneous
emergence of groups and organizations as ends in themselves. [3]
In prehistoric times, man was preoccupied with his personal security,
maintenance, protection, and survival. Now man spends a major portion of
his waking hours working for organizations. His need to identify with a
community that provides security, protection, maintenance, and a feeling of
belonging continues unchanged from prehistoric times. This need is met by
the informal organization and its emergent, or unofficial, leaders. [2]
Leaders emerge from within the structure of the informal organization. Their
personal qualities, the demands of the situation, or a combination of these
and other factors attract followers who accept their leadership within one or
several overlay structures. Instead of the authority of position held by an
appointed head or chief, the emergent leader wields influence or power.
Influence is the ability of a person to gain cooperation from others by
means of persuasion or control over rewards. Power is a stronger form of
influence because it reflects a person's ability to enforce action through the
control of a means of punishment.[2]
Organization
Organization as a System
Organizational structure
An organizational structure defines how activities such as task allocation,
coordination and supervision are directed toward the achievement of
Functional organization
is a type of organizational structure that uses the principle of
specialization based on function or role.units, leaving them the
responsibility of implementing, evaluating, or controlling the given
procedures or goals.
These different departments are sometimes referred to as silos. This means the
system is vertical and disconnected. The communication flows through the
department heads to the top management.
Here all authority (i.e. budget allocation, resource allocation, decision making,
etc.) stays with the functional manager. Usually, the position of the project
manager does not exist in this type of organization structure. Even if this position
exists, the role of the project manager will be very limited and he will need
permission from the functional manager to fulfill his requirements. The project
manager may have the title of a coordinator or an expediter.
The functional organization structure is suitable for an organization which has
ongoing operations and produces standard products or goods, such as
manufacturing industries.
Employees are grouped by their knowledge and skills, which helps achieve
the highest degree of performance.
Employees are very skilled, efficiency is gained because they are
experienced in the same work and they perform very well.
Their roles and responsibilities are fixed, which facilitates easy
accountability for the work.
The hierarchy is very clear, and employees dont have to report to multiple
supervisors. Each employee reports to his functional manager, which
reduces the number of communication channels.
There is no duplication of work because each department and each
employee has a fixed job responsibility.
Employees feel secure, and therefore they perform well without fear.
Since there is a sense of job security, employees tend to be loyal to the
organization.
Employees have a clear career growth path.
Within the department, cooperation and communication are excellent.
Employees may feel bored due to the monotonous, repetitive type of work
and may lose enthusiasm for the job.
If the performance appraisal system is not managed properly, conflicts may
arise. For example, an employee may feel demoralized when a lower
performing employee is promoted.
A highly skilled employee costs more.
The departments have a self-centered mentality. The functional manager
pays more attention to his department; he usually doesnt care about other
departments.
Communication is poor among the departments, which causes poor interdepartment coordination. This decreases flexibility and innovation. Moreover,
there is a lack of teamwork among different departments.
Employees may have little concern and/or knowledge about events outside
their department. This causes obstacles in communication and cooperation.
The functional structure is rigid, making adaptation to changes difficult and
slow.
Due to bureaucratic hierarchy, delays happen in decision making.
Generally, the functional manager makes decisions autocratically without
consulting the team members, this may not always work in favor of the
organization.
When the organization becomes larger, functional areas can become
difficult to manage due to their size. Each department may start behaving like
a small company with its own facilities, culture and management style.
All managers must bear that there are two organisations they must deal withone formal and the other informal.
Advantages:
1. Tends to simplify and clarify authority, responsibility and accountability
relationships
2. Promotes fast decision making
3. Simple to understand.
Disadvantages:
1. Neglects specialists in planning
2. Overloads key persons.
.
Disadvantages:
1. Committees may delay decisions, consume more time and hence more
expensive.
2. Group action may lead to compromise and indecision:
1. Committee decisions are better than individual decisions
Summary
The functional organization structure helps organizations run their business and
earn a profit. This type of structure suits organizations intended to produce some
product or service on a continuous basis. Here, employees feel secure, perform
well and tend to be highly skilled. The project manager often doesnt have any
role in the functional organization, and even if he exists, his role will be very
limited.
This concludes the post on functional organization structure ends. If you have
something to add, you can do so through the comments section.
Span of Management
Definition: The Span of Management refers to the number of subordinates who can be
managed efficiently by a superior. Simply, the manager having the group of subordinates who
report him directly is called as the span of management.The Span of Management has two
implications:
1.
2.
Since the span is narrow, which means less number of subordinates under
one superior, requires more managers to be employed in the organization. Thus,
it would be very expensive in terms of the salaries to be paid to each senior.
Lack of coordination and control because the operating staff is far away
from the top management.
The major advantage of using this structure is that the cross communication
gets facilitated, i.e., operative staff communicating with the top management.
Also, the chance of promotion increases with the availability of several job
positions.
In the case of a flatter organizational structure, where the span is wide leads to
a more complex supervisory relationship between the manager and the
subordinate. It will be very difficult for a superior to manage a large number of
subordinates at a time and also may not listen to all efficiently.
However, the benefit of using the wider span of management is that the number
of managers gets reduced in the hierarchy, and thus, the expense in terms of
remuneration is saved. Also, the subordinates feel relaxed and develop their
independent spirits in a free work environment, where the strict supervision is
absent.