Comparison Between Organizational Structures And Cultures Commerce Essay


INTRODUCTION: An organizational structure consists of activities, such as task allocation, coordination and supervision, which are directed towards the achievement of organizational aims.

Each and every organization in order to work in an effective way need to create an organizational structure for its company, because it tells every individual its position in the company and it also specifies the chain of command, span of control and the hierarchy in an organization.

There are many types of organizational structures of a business depending on the type and also on the number of people it has.

Now we will look at some of the types of organizational structures that are available in a business organization:

1. Line structure: This type of structure is suitable for smaller organizations, such as a small firm or a shop with only three to four employees working under a single manager. Such a structure has very narrow span of control and chain of command. It is often considered to be informal and decentralized in nature.

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2. Functional structure: This kind of an organizational structure classifies people according to the functions they perform in an organization. For example the engineering department would only be staffed with software and hardware engineers. As a whole functional organizational chart is best suited for producers of similar or standardized products at a huge scale and low cost.

3. Divisional structure: This kind of structure is based on different divisions in an organization. It can be split up into two divisions:

a. PRODUCT STRUCTURE: It is based on the concept of organizing workers on the bases of different products. For example if a company produces two different products then they will have a separate structure for each product.

b. MARKET STRUCTURE: In market structure workers are grouped on the bases of different market segments. For example a company operates in two different market segments (teens and old age) then such an organization will have separate structures for both the segments.

4. Geographic structure: This type of structure is suitable for very large organization, with many branches either divided on the bases of departments of countries. For instance they have different structures for every county they operate in and their day to day operational strategies and decisions are taken on regional bases but the long term goals are collectively made.

5. Matrix structure: This type of structure cuts through the hierarchal structure. In matrix structure people from different departments are put into a team for a single project. In this structure no one is the boss and everyone has full delegation of authority.


In conclusion I would say that one should closely examine all the aspects of each structure before choosing any one for it�s organization because the wrong set up could hamper proper functioning and affect the efficiency of an organization.


INTRODUCTION: The collective rules by which an organization operates define it�s culture. These rules are formed by shared behaviors, values and beliefs. Culture forms the basis for how individuals operate in the premises of an organization.

The above given figure highlights the key factors which combine to make an organization�s culture. In simple words it can be defined as the feel which you get when you walk into an organization.

An organization can be categorized into two groups regarding the culture it has:

a. Forward looking: Organizations that are always looking forward towards a better change of culture with accordance to the external and internal environment are said to be forward looking organizations.

b. Backward looking: Organizations with pre-set rules and cultures are said to be backward looking organizations. Such organizations do not change their values or beliefs with accordance to any change in the internal and external environment. These types of organizations cannot survive in a competition unless in monopoly. Example of such an organization can be military and defense. They have their own rules and policies which they do not change no matter what happens.

Forward looking organizations are mostly found in the private sector of the economy and have some pre set cultures to choose from for their organizations. Till yet the culture of an organization can be split up into four major heading:

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i. Power culture: An organization having a power culture has all its decision making power centralized with one key individual. In such an organization employees are given strict orders, the environment is very formal, there is a proper dress code for every level of employee etc. it has some disadvantages as well, because there is no delegation of authority, so the employees feel de-motivated and thus the production suffers.

ii. Role culture: The key factor in such a cultured organization is specialization of tasks. Each employee is split up into groups and is assigned a particular role in that group, which is assigned to him in his job description. This increases motivation because the employee has a role and say in the production, while the disadvantage is that the employee has to do the same work every day thus the repetition of work can make the employee bored and affect his efficiency and the overall productivity of that individual. However this type of culture is commonly used by almost all the organizations in the world.

iii. Task culture: This refers to a team based approach to complete a particular task. The employee feels valued as he is selected within the team and is given the responsibility to complete a task, taking his own decisions at work.

iv. Person culture: The focus of such a cultured organization is the interest and will of its workers. It tries to satisfy them by all means in order to keep them motivated and thus productive. Such a culture is often found in non-profit organizations and charity or organizations working for social benefits.

P2 Relationship between organizational structure and culture:

So far we discussed both the organizational structure and culture separately, now we will look at the relationship of both with each other.

Both the organizational structure and culture and are set up according to each other and both their motives is to have clearly stated job descriptions and motivated staff in order to increase efficiency and thus production. So we have learned that both the organizational structure and culture are interlinked, if an organization chooses one type of structure then it cannot choose another type of culture instead it has to opt for the related culture hence the combination will have a failing affect on the overall business.

For instance, an organization that has chosen a Matrix organizational structure cannot choose Power culture, because in Matrix structure the power of decision making is fully delegated to the group and there is no leader, where as in Power culture all the decision making power rests with one key individual.

If an organization chooses to go for a matrix organizational structure then it has to adopt a task culture. If the organization fails to understand the relationship between it�s structure and culture, it will end up in a mess of confusion amongst the workers and managers.

In conclusion, I would say that when deciding the structure and culture of a business the management has to take into consideration all the aspects before declaring the decisions, because both the culture and structure are the bases of an organization and if the bases are not strong and are made up of wrong decisions then such an organization is bound to fail.

P3 Factors influencing behavior at work:

As a manager of Human Resource (HR) we need to know what factors influence the behavior of individuals or employees at work, cause only then we will be able to sort them out and come up with a solution.

Broadly we can categorize the factors into three major groups:

a. Physical: Physical factors that would influence a person at work can include physical disabilities that an employee has. For instance a person without an upper limb cannot be appointed as a line worker in a production process, because he will not be able to satisfy the job description.

b. Demographic: The demographic factors include education, nationality, race, age, sex etc. So a Chinese cannot be appointed as a tourist guide in the UK, or a student of grade six cannot be appointed as a manager of accounts as he will not be of the minimum age and will not be capable enough to solve the issues related to a companies� accounts department.

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c. Psychological factors: They deal and changes with the individual�s mind. A person may be psychologically weak and cannot pursue complicated tasks or may be his/her perception about work is different than that of the manager, in such a situation problems can arise which will affect the efficiency of the person and hence the overall business.

Besides these factors the other important aspect which does affect an individual�s behavior at work is his/her Personality.

Personality can generally be defined as a set of qualities that make a person distinct from another. According to the modern researchers personality types can be categorized into five types.

The Big Five Personality Traits (OCEAN) by Robert McCrae and Paul Costa (2003):

Openness:�You love adventures and trying new things; you're insightful and imaginative.

Conscientiousness:�You're organized and disciplined, dedicated and loyal, especially at work.

Extroversion: You're assertive, talkative, and don't mind being the centre of attention.

Agreeableness:�You're friendly, pleasant and easy to be around; your relationships are mostly strong.

Neuroticism:�You feel anxiety, and you worry often. Your anxiety can make you emotionally unstable, and you're more likely to struggle with depression and sadness.

After identifying the category in which an employee fits, the manager has to analyze and answer the following questions:

a. The compatibility of an individual�s personality with the task.

b. The compatibility of an individual�s personality With the system and management culture of the organization

c. The compatibility of an individual�s personality with that of others in the team.

After answering and analyzing all these questions and queries then only can the manager of human resource select and recruit employees.

P4 Organizational theories:

For about almost a century management has been looked upon as a branch of science. Many scientists have pass on their theories after decades of experience and research which are still in use by the modern management sciences. In this section we will look at some of the major theories introduced by the leading management scientists in the history. Before that we fist need to identify what management is and what are the roles of management in an organization.

MANAGEMENT: It is the act of getting people together to accomplish desired goals and objectives efficiently and effectively.


It is not an easy task to list down the roles of a manager. A manager is not any less than the lead scientist working for NASA. Before management was look upon as a branch of science people were unaware of the role of a manager but then SIR HENRY MINTZBERG a scientist in the field of management came up with a list of ten points that summarized the overall role of management. As the definition of management states that accomplishing goals efficiently and effectively is called management, keeping this in mind all the theories were made to make workers do their jobs efficiently and thus generate more profits for the organization. According to the scientists of management the key to an efficient and effective work force is MOTIVATION and thus they all focused on different ways to motivate their work force. A well motivated work force is expected to have a comparatively low absenteeism rate, low turnover rate, are not late for work, no grievances amongst each other, their response rate is quicker and most of all they are prepared to take responsibility.

Now we will look at the different approaches of some of the management sciences gurus.

Frederick Winslow Taylor (1856-1915):

Sir F.W Taylor came up with the idea of ECONOMIC MAN. This was the first time that someone came up with a scientific approach towards management. The summery of ECONIMIC MAN approach was that people work best if they are paid more money.


* Select a group of workers who are performing the same task.

* Observe them, how they do the work and record their time.

* Identify the quickest method.

* Train rest of the workers to adopt the same method.

* Supervise them.

* Pay the workers according to their output, any one giving more output should be paid more.

DRAWBACKS of Taylor�s approach:

There was only one drawback to this approach that workers will try to do their job quickly in order to get more pay but this will affect the quality of the product produced.

GEORGE ELTON MAYO (1880-1949):

He came up with the concept of HAWTHORE EFFECT. According to him money was not the real factor of motivation the all of the work force. He thought that motivation only comes when people are consulted in their work, and where they are made to be a part of a project. According to him work force should be divided into groups and then should be given all the authority to take their own decisions in this way the groups will come up in competition with each other which will motivate them to work more effectively and efficiently than each other.

ABRAHAM MASLOW (1908-1970):

Abraham Maslow came up with the famous HIERARCHY OF HUMAN NEEDS. According to him every human being can be categorized into his pyramid of human needs and once a person�s needs for that category are met he has to be moved or promoted to the next category.

There was a drawback to Maslow�s approach, which later scientists identified and it was that, a human being cannot reach his maximum potential or the self actualization level instead he always wants to move on to the next step. So if some has already reached the self actualization stage he/she will get demotivated as there is no higher position available for him.

HENRY FAYOL (1841-1925):

Henry Fayol was a French engineer and director of mines. He played an important role in identifying the key roles of a manager in an organization. He listen five key points which a manager of an organization should be able to effectively carry out in order to be a good manager, according to him the key points are:

PLANNING: they should be able to plan for every situation.

ORGANIZING: they should organize everything scientifically.

COMMANDING: they should be able to be in command at all times.

CO-ORDINATING: should effectively co-ordinate work to the employees.

CONTORLLING: should control any kind of problem that arises at work.

These were his five proposed roles of management. These five roles are still considered to be effective and are practiced by all the successful managers around the globe.

In conclusion I would say that Management science is still a mystery and is still not fully discovered, there is still room for improvement and many scientist from across the world are studying management deeply so that they can reach the very crux of it and come up with ways and principals that would really change the whole perception of management.


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