Option 3: Evaluate the statement that ‘organisational structure reflects and reinforces an unrealistic view of human rationality (Knights & Willmott, 2007)’. Introduction: Different authors have different definition toward organizational structure. Mintzberg (1979) defines the organization structure is defined as ‘The sum total of the ways in which it divides its labour into distinct task and then achieves coordination between them’ (Mintzberg, 1979, p. cited in Knights and Willmott, 2007, p. 197). In simple words, organizational structure is talking about the structure of an organization, how a company categorise their workers or management to achieve their goals.
Basically, organizational structure is talking about the management system that include organic and mechanistic management system. In an organization, there will be a lot of matters happened because of the organization structure.Hence, people keep discover different management structure to assist in organizational structure like Taylor and Ford that influence the organization structure by using scientific method to classified the work of an organization and control the achievement of the organization (Fayol, 1949; Taylor, 1911cited in Singh, 2009). Lewin (1958) cited in Burnes (1996) provided that the planned model that designed for the organizational change is the best model.However, is there any the best structure for organization? When we treat one structure as the best structure for organization, we must consider the factors that will make the structure no longer applicable.
Environment is the important influences that we cannot ignore about. The unstable of environment led the organization structure keep on changing. One of the changes in the structure of organizational was from mechanistic management system to organic management system.Mechanistic and organic of organizational structure are two formally form of management system that applied in organizational structure (Burns and Stalker, 1961).
As what Kulmala and Uusi-Rauva (2005) claims that competition was changing from firm level to network level, which means from centralisation to decentralisation. Changing Of Environment More than 2,000 years ago the Greek philosopher Heraclitus(536-470 BC) claims that everything was continuous keep on changing and there was nothing permanent (Smith, 2011).Organizational structure is also the same, there are no the best structure for an organization since the environment is keep on changing. ‘‘There is no one best way to organize’’ and ‘‘any ways of organizing are not equally effective’’ (Galbraith, 1973 cited in Singh, 2009, p. 954). Environment and organization are interdependent, they depend on each other between an organization (pugh et al. 1963 cited in Child, n.
d. ). Burns and Stalker (1961) cited in Singh (2009) proposed that appropriate organizational structure depends on environmental factors.
Coulson-Thomas (1991) cited in Strachan (1996) argues that business organizational is increasingly face unprecedented change in social, economic, political and business environment. Burn and Stalker (1961) cited in McMillan (n. d. ) claims that an organization must match and follow with the rate of change in its environment if the organization want to reach a maximum performance or achieve their goals. The performance of an organization depend on how they construct their structure to align with the environment (Mintzberg, 1979 cited in Nandakumar , Ghobadian and O’Regan, 2010).
An example that shows the change of technology that led to the changes of organizational structure, the manner of hardware and software development resulted in architectures evolving over time, at the same time organization structures developed special forms to suit and fit their specific environmental and strategic requirements (Mukherji, 2002). An effective structure or strategy can promotes competitive advantage to strengthen an organization performance (Oosthuizen, 1997 cited in Nandakumar , Ghobadian and O’Regan, 2010 ) .Besides, there are a wide range of structures given to an organization to choose whether which structure is appropriate to them and can align to the environmental factors that they face, they can choose the most few effective structure mixed that fix to their different environmental problem faced since there are no one universal structure that applied by all organization (Singh, 2009). However, when environment is change again no matter due to technological or political factor, organization need to aware that whether their structure now is consists with the changing of the environment.If their structure is not the best in current environment, then they need to revise their structure again to get the most productive outcome. Otherwise, the change of environment may either lead to some benefit or harms to the organization.
Thevenet (1988) cited in Soparnot (2011) believe that the change of organizational structure is always beneficial. However, Soparnot (2005) cited in Soparnot (2011) argued that the changes of structure can destabilize organization and it is risky and costly.In an organization, if they are manage according to hierarchy structure, there are different level of manager and different opinion towards the change of the organization exist, different people have their own idea, each will suggest different idea and this will wasting time and resources to test for it. Walston and Chou (2011) said that the greater the differences between hierarchical perceptions, the inefficiency of the organization change and effort.Therefore, there are no any best constant structure of organization, because the environment is keep on changing, what an organization can do is only keep on changing that align with the environmental changes. Mechanistic System Mechanistic management system is consist of hierarchic structure of control, authority, specialization , differentiation and centralized decision making (Burns and Stalker, 1961). Hierarchical structure is commonly carry out in an organizational chart form.
Organizational chart show us the management structure or hierarchical structure, how the organization manage according to different department, or specialization. During the mid 20th century there was a trend for organizations to create huge corporate structures, often composed of many varied and different businesses, for instance, the Hanson Trust, Unilever, Trafalgar House, and GNK in the UK and General Electric in the USA (Mabey, Salaman and Storey, 2001 cited in McMillan, (n. . ). Hales and Rabey (2011) held that a good management is consists of specific job for specific person, clear role definitions for each job, clear job specification and so on.
It is talking about mechanic system of organizational structure. In the hierarchical structure, decisions are made by top level and task are delegated to different department manager of middle level, and these managers will make sure the workers under them is kept in line with them (Hales and Rabey, 2011).Since that are not a teamwork which they do not share common interest but they need to do more than the person who make decision and thus make them do not have any motivation to do their best or produce the best idea. This may occur because everyone have different perceptions. As mentioned earlier, the greater difference between hierarchical perception, the inefficiency of the effort (Walston and Chou, 2011).
When everyone have their own perception, but decision is not made by them, conflict will occur.Conflict usually occur in relation to decision and sometimes it may lead to threat (Beckhard and Dyer, 1983 cited in Frank et al. , 2011). Decision making of hierarchical structure is also a waste of time since there are different level in the organization, decision making need to go through from low to middle and the top, it take time and waste of resources, when there are something happen between the level of authority, it need even more time than usual. Wang and Ahmed (2003) cited in Kulmala and Uusi-Rauva (2005) highlight organizational structure influence its decision making and the internal processes.Employees in an organization should not wait for manager comments or negotiations for organization sake (Kuitunen et al, 1999 cited in Kulmala and Uusi-Rauva, 2005). In order to reduce the conflict of decision making of the hierarchical structure and waste of time, the changes of this hierarchical structure is needed.
Burns and Stalker (1961) highlight that in organic system, position in an organization is differentiated by the expertise, whoever have greater expertise can lead the team and he or she will have the best authority.For mechanistic system, people who control the organization is according to standardization of skill, it is control by the person who have undergone extensive training and socialization (Friedson, 1970 cited in Abernethy and Stoelwinder, n. d.
). Burns and Stalker (1961) claims that the position of the leader is settled by consensus via voting in an organic system. When the position of the leader is agreed by voting, then it may consider fair because there are no any conflict of interest exist. However, for mechanistic system, position of the manager is the decision of the top level management.
When the position of the leader is decided by the top level management people, there are inequality exists. Guy (1999) highlight that the increase of earnings inequality from the late 1970s until now is due to changes of organizational structure. When the decision is not reach the consensus of all but just solely based on the top level management, it seems like it is unfair.
The top level may choose the one that is beneficial to him or her and promotes him or her to get higher position and this is not agreed by all. Organic SystemHence, Covin and Slevin(1990) cited in Altinay and Altinay (2004) claims that organization often decentralize decision making authority, minimize the hierarchical structure and adopt free flow communication channels to make sure organization achieved higher performance. When talk about decentralization, actually it is talking about organic management system, Burns and Stalker(1961) said that organic management system is appropriate to the changing of environment, he describe organic management system as a network structure of control ,authority and communication, there are not alking about responsibilities of a person, but the responsible of the people in the network. Therefore, It is just like a team that achieve the same goals. However, the claimant that organization need to decentralize decision making was argued by Shields and Shields (1998) cited in Subramaniam and Mia (2001), said that not all managers accept the decentralization of organization structure because it will make outcomes of job unfavorable related such as low job satisfaction. For example, as what we have study now, we are choosing courses of education according to our interest.It is also the same as career, we will choose our job according to what we studied or what we like, if decentralize means that they are all working together without departmentalize, then we might need to do the job that we do not like and make us do not have the feeling of satisfaction when rushing for the work.
Conclusion In conclusion, organizational structure is not fixed, it is not constant as all organization is using the same structure and monitor their work of organization.There will be no consensus on one particular structure of organization and thus make the organizational structure do not fixed. Actually, each structure will show their good and bad, when the structure is align with the change of environment or the structure is reach the consensus of all and thus achieve higher performance of organization, then this structure is consider as good.
However, when the environment is change again , and people no longer agree on this structure, then this structure is no longer applicable , if this structure is insist in using, then it may bring harm to organization.Hence, there is no the best or the smartest structure for an organization (Mintzberg, 1979 cited in Wang and Ahmed, 2002). When the environment of the organization change, the structure of the organization also change according to the environment, this dynamism of the organization structure makes the organization do not have a fixed or constant strucuture (Martinsons & Martinsons, 1994 cited in Wang and Ahmed, 2002). No matter organic or mechanistic management system, as long as it is an effective structure that align with the environment, it will lead he organization to achieve superior performance. Organization structure do not fixed because mechanistic management system is applicable in some situation or organic management system is suitable in some situation or mixed of these two management system is necessary for some situation.
In details, an organization can mixed the centralization and decentralization by apply both in their structure. Decentralization can motivate employees to enable them showing out their creative and innovative but not stop by top level manager.At the same time, some others part can be centralize to make sure employees follow the rules and regulation because some decision if freely make by employees on their own may create troublesome such as financing and investing decision. Hence, structure cannot fixed on whether it is centralization or decentralization (Buchanan and huczynski, 2010). Therefore, we cannot say that which structure is the best structure for organization because each of these structures play their own roles in different environmental changes.
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