TYPES OF ORGANIZATIONS

They include

1. Line organization
2. Functional organization
3. Line and staff organization
4. Matrix
5. Freeform
6. Committee organization
7. Informal organization
8.

Line organization

It’s a traditional type of organization. It refers to a direct chain of command from

top to bottom. In this org. authority descents from top to bottom .

There’s downward delegation of authority and responsibilities runs from top to

bottom. All decisions and orders are given by top management to workers who
inturn break them to specific instructions for the purpose of execution by other
subordinates.

Line org. means that each superior has direct authority over his subordinates.
Every one in the org. reports to only one supervisor (one man one boss) Managers
have complete authority in their own areas of operation. Authority flows
downwards and responsibility flows upwards.

MERITS

1. It’s the simplest form of org.as it can be easily defined and explained

2. Its more flexible as required change can easily be made quickly and easily due
to the executive have full authority.

3. Its economical and effective as it makes rapid decisions and effective

coordination possible. This is because all activities are controlled by one
department

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4. Communication is easy

5. Responsibility is fixed and unified at every level and so each individual knows
to whom he is responsible.

6. Provides greater control and discipline in the organization

7. System is capable of adjusting itself to changing condition

8. It develops an all round officer since thinking and doing functions are combined.

9. No division of loyalties and no danger of conflicting orders.

10. Its less expensive since there are no staff specialist.

DEMERITS

1. It overloads the executive so that long range planning and policy formulation are
often neglected. Administrative works overloads executive that makes reflective
thinking absent.

2. Sucess and survival of the enterprise depends on a few individual. Theres little
scope of expansion of the business beyond their capabilities, loss of key executive
may put the future of the concern in jeopardy.

3. There’s no scope for specialization as one individual cannot be an expert in all

functions. It makes executives jack of all trades and masters to none.

4. Theres danger of authoritarian rule and favoritism since each department is

under one master

5. Management decisions taken are arbitrary since its done by one man\

6. Distribution of work may be according to the whims of th manager and not

according to scientific plan.

7. Its likely to encourage nepotism

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8. Due to lack of expert advice issues of division of work may become incidental---
crude

9. Executives in line management requires to have diverse knowledge and its

difficult to employ such a person.

10. Subordinates hesitates to offer suggestions because they are afraid of the boss.

SCOPE OF LINE ORGANIZATION

Its applicable in:

1.Small scale business where staff is less and operative is not large.

2. Industries with continous manufacturing process

3. Where work is routine in nature

4. Where entire work process is automatic and requires little intelligence on the
part of the worker.

5. Where relationships between labour and management is cordial.

ii) FUNCTIONAL ORGANIZATION.

It was developed by F.Taylor while he was working as a foreman. He experienced

difficulties getting men with sufficient ability to meet the various requirements of
the job he was in charge of.

Through experience and experiment he discovered that a well rounded man should
possess brains, education, special or technical skills, strength, tact, honest
judgement , common sense and good health. None possessed these qualities and
therefore he developed his functional organization system.

In this org. work is divided to ensure workers have few functions. The org. is
divided into functional departments. Each departments reports to a man
specifically qualified for a particular function (sells, finance).

The specialist attends to one function in the department but each workman works
under 4 superiors who include
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1. Gang boss----procures tools and arranges them

2. Speed boss—supervises the speed of machinery to ensure its in order

3. Repair boss—looks after maintenance of machinery

4. Inspector—checks quality

This shows theres a specialist for each function. A worker is under command of a
several superiors at a time. The departmental head has authority over personnel in
other departments in respect of his function

MERITS

1.Theres complete specialization of work

2.Its easy to staff since an executive is required to be an expert in one function

3.Its simplifies control and burden of excecutive is reduced .specialization makes

supervision effective.

4. Success and growth of org. is not limited to few managers

5. Separation of manual operation and mental leads to high degree of efficiency.

6. Theres high productivity.

DEMERITS

1 Confusion in determining where ones supervisor responsibility ends and another

starts

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2.Lack of unity of command ie. Due to diffusion of authority effective control
becomes difficult.3

3. It encourages buck passing ie cannot fix any one for irresponsibility

4. Workers are uncertain to whom they should turn to advice when they have
problem

5. Workers find it difficult to satisfy several bosses

6. Narrow specialization hampers development of an all round executive

7. Supervisors have narrow outlook i.e. they think in terms of their functional area
not organization.

8.Theres issue of delayed decision

9. its uneconomical –expensive since several specialists have to be maintained

The functional org. development by Taylor is not in use today but function basis is
used in in big concern for division of work at top management.

III) LINE AND STAFF ORGANIZATION

It concentrates control and seeks to combine division of labour with unity of

command. The line side maintains unity of command and discipline. The staff side
provides knowledge and advice on solution to managerial problems.

Line managers ensures execution of work while staff officers provides advice and
assists line managers to work efficiently.

The line officers command subordinates in their departments but not the staff
officers.

TYPES OF STAFF

Staff support to line executives may be in the following ways

Personal staff—consists of personal staff or adviser attached to th line executive

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Specialized staff---this staff has expert knowledge e. engineer, accounting etc

General staff---they are experts in different fields and normally aid top
management.

MERITS

1.They advice line executives

2.Unity of command is maintained

3. Opportunity for promotion is great due to separation of functions

4. Due to specialized advice managers can make bettr decisions

5. Each line officer is fully accountable for his department thus no undivided
responsibility

DEMERITS

1. There’s a possibility of conflict or friction between line mangers and support

staff .This is because the support staff may undermine the line authority and the
later ignore the staff

2. Lack of clarity of allocation of jobs between line and staff. It could create
confusion and disorder

3.Its expensive

4. Staff are not responsible to their job so they may not be careful with their job

6. Advise by staff is not be binding and so cannot enforce their their

recommendations.

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PROJECT ORGANIZATION

It is a recent structure which was conceived after world war ii. It was set to
overcome the weaknesses of functional organization. Its composed of core
functional departments with specific programmes or units. The main units of the
org. are specific projections. Its disbanded after the project has been completed.

A project may exist for a long time before its completion, and later may become
permanent and eventually become a branch of th organization. As days go by
depending on its growth may become a full pledged product division the
organization and later on end up separating from the main organization.

MATRIX ORGANIZATION

It has two chains of command and is refered to as multiple command system.One

chain of command has vertical authority and the other horizontal authority.The
horizontal authority comprises of a team led by an expert in his assigned area.

MERITS

1. Combination of functional and purpose department emphasises the same goal.

2. It focuses on specific projects thus better planning and control.

3. Most appropriate to respond to external changes

4. Highly flexible in adherence to rules and regulations

5.Theres motivation for workers since each department has to use its effort to
complete a single project

6.It has good framework for training and developing able managers.

DEMERITS:

1. Workers are answerable to many bosses making the relationship complicated

2. Due to double command power struggle may arise between project and line
managers

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3. Decision can be delayed because it requires joint decision and there may be no
willingness from one side

4. Its difficult to control the functioning of matrix org. since the workers are
temporary.

COMMITTEE ORGANIZATION

It’s a group of people constituted to deal with a specific issue in an organization. It

functions as a group whose work is to exchange ideas amongst themselves. A
committee has more than two persons and its activities are limited as its appointed
to deal with specific problem.

They deal with the problem assigned to the intensely and make their decisions
through a vote. Some committees are executive in that they make decisions and
implement them. Non executive committees only forward their recommendations
to others for implementation.

TYPES OF COMMITEES

Standing committee—its permanent and always present in the organization its

assigned duties routinely

Ad hoc ---its temporary and is assigned to deal with a specific problem

Executive---is responsible for making and executing decisions

Advisory---it looks at details of a specific problem and makes recommendations

Line—controls and coordinates specific functions in an organization

Staff----acts as an adviser and cannot implement its accessories

Formal---is constituted as per rules of an organization and is authorized to

function by the same authority

Informal---is formed without rules but around a certain problems.

When are committees constituted?

1.When activities of several department needs to be adjusted abruptly.

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2. When different information is required for taking a sound decision

4. When judgement is important that it requires a number of qualified people to

pass it.

For a committee to be successful

1.Tasks should be carefully and clearly defined

2. Have fewer members

3.Composition of committee be determined by the function

4. Members should understand purpose of the committee

5. Freedom of expressing views

FREE-FORM ORGANIZATION

Its formed in response to an external environment that is highly dynamic and

unstable

Its objectives are long range and development oriented. Decision making is non
programmed

There are no definition levels of authority as tasks are assigned on individual

expertise and competence. There are no fixed communication channels.
Communication is in the form of advice and information. It focuses on activities
and results.

INFORMAL ORGANIZATION

Organizational types discussed so far are formal. No business operates completely

by book. In real business setting the relationship that exists among employees does
not follow formal lives .Employees know each other and may need information on
what is happening in another department or advice on delicate matter.

The association of persons in such a case comes under informal organization.

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The association may be among employees on the same level of hierarchy or
different levels. Informal organization exists within confines of formal
organization. It consists of a group of people who relate to each other for purpose
of mutual benefit and achievement They are formed spontaneously and are
primarily a source of information and knowledge..It also furthers social ties.

This information compliments formal communication. It serves as a source of

protection against threatening oppressive forces. People are able to find solution to
mutual and personal problems. This informal group can support org. goals but it is
also capable of opposing formal guidelines.

Studies shows that:

1.Informal groups dynamics are important

2. Informal group norms can be developed which can undermine formal working
relation

3.Norms can be developed which can lead to acceptable days work than
management may think

4.Informal group is important to workers in that one can refuse promotion if it

means leaving the group.

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