Organizational Structure Types

Traditional Organizational Structure

Traditional organizational structure is a strategy for the organization of a company or person in what is known as a hierarchy or a top-down structure. With this approach, the processes of allocation and management of activities on a vertical structure defines a rigid chain of focus command.

Organizational Structure  1
Organizational Structure 1

Hierarchy organizational structure is mainly developed to organize huge number of organizations including non-profit organizations and small business. On the other hand traditional type of organizational structure can often be effective when competent people are in positions of authority, and often there are also potential pitfalls with this model, which include the lack of checks and balances. The creativity of the organization may be limited in this type of business structure, because the ideas of ​​a relatively small number of people who are actually involved in the overall operation.

There are two basic types of this organizational structure. First is a Line approach, this strategy is supported by a very well-defined and rigid chain of command that ultimately bear the responsibility and decision-making problems at the highest level of the structure. In little organizations, this strategy needs to be developed, since the company is consisted of one owner and more than one worker. This model can be problematic with the growth of organization.

A certain difference compared to the traditional organizational structure is known as the line and staff method. There is a well-defined chain of command, but the owner or CEO decides to delegate some of the responsibility for a small group of people, usually managers or supervisors. While the ability to cancel the decisions taken by the staff, the owner is usually solve issues that are of greater importance than, while human resource managers are needed to deal with other problems.

Over time, alternatives to the traditional organizational structure together. While the owners still get full control of a company, they tried to change the design so that employees indicated more input. The delegation of responsibilities to employees of great repute, announcing committees and other processes that can help in developing quick and easy communication between all levels organization all can enhance the productivity of the company and organization. At present, traditional organizational structure can deal at broader level with latest trends that can bring more chances of productivity of an organization.

In decision of choosing the organizational structure for the company, no doubt management will decide to choose the one that can bring parts of organization together with best coordination to make it effective and well efficient unit.

This is no doubt a very important and serious choice by the management. This is because the whole infrastructure will be based on the decided organizational structure. Some groups lead to a well-defined and mechanistic.

Before knowing more about traditional organizational structure it is very important to know about the types of traditional organizational structure.


This type of structure related to organization mainly groups people on basis of typical activities for maximum business – marketing, finance, human resources and production – then further subdivide them. This results in a vertical hierarchy.

Organizational Structure  2
Organizational Structure 2

The advantages: efficiency and clear authority, responsibility and communication. Workers easily coordinate and communicate within their departments. Unfortunately causes a priority interdepartmental communication and coordination to suffer. Hierarchical levels mean ideas for change must be a bureaucratic chain of command. Functional structures are controlled and mechanized, but also less flexible and adaptable to changes in their environment.


This structure actually groups company’s workers, depending on geography, product line, or customer. Each division operates as an independent company, complete with all the necessary functions, even if the management controls a couple of times more functional areas such as finance.

Organizational Structure  3
Organizational Structure 3

Duplication of functions is one of the disadvantages of this structure, as it means less efficiency and economy. In addition, the rivalry between divisions and poor communication and coordination between the units can be derived. However, the divisional structure allows each product line excel, to better respond to customer niche and capable geographical and cultural differences.


The matrix structure operatively connected to substructures, including the benefits of both. Everyone has heard before a department, such as the production, reporting to a boss. Each person responds to a project team or business unit.

Organizational Structure  4
Organizational Structure 4

To qualify teams for the functional competence of the members, while the functional hierarchy exerts a degree of control and responsibility to society. The downside, of course, is that each of us has two bosses with possible conflicts of interest and loyalty.


According to the team structure, the group of people has same goals. Every team has the goal of achieving accountability for performance results. The participants of the group are in power. The company does not lose levels of government, for the horizontal and vertical directions.

Organizational Structure  5
Organizational Structure 5

No chains of command decisions to be made quickly, and the company is adaptable and move freely on the market. Meanwhile, make the employees motivated with top performance. The risk of that structure is the need to monitor employees. Workers must be trained to meet the challenges.


Instead of hiring employees for all business functions, a company only uses networks for better communication. The network companies are able to hire some workers, and enjoy the scope, performance and functionality of a large company. For example, you can connect external manufacturers to produce their products.

Organizational Structure  6
Organizational Structure 6
Organizational Structure  7
Organizational Structure 7

The network structure reduces the costs and gains flexibility because it uses outside help as needed. Starting a business, but this is losing control of the network that all business processes delegated to others.

A critical success factor for organizations today is ability to adapt their structures, systems, and existing process to win and develop new markets. A key factor in the strategy is the use of right organization of design. This article highlights the strategic importance of organizational planning for entrepreneurs and suggestions on how organizations can find the useful and most suitable designs for the success of their business.

After the choice of organizational structure the next step is to choose organizational design.

Organizational Design

Organizational structure refers to the type of image that a company uses for the flow of information on the organization of power and authority, roles and responsibilities. After the organization has elected its structure, they can go to the selection of designs. Organizational design is the process of review by the Management Company, the duties, functions and objectives of the company. Decisions about how people come together, to go to the best and most effective way to achieve their goals are very important.

The six most common approaches to organizational design is simple, functional, divisional – Team Matrix and network designs. A company is to choose its organizational structure, depending on their needs. The project is based on the organizational structure that is aligned with the economy at a given time. Mainly due to the organizations they are living, they will never be able to, as a matter of course, the best structure organization at the first attempt. Rather manager is the best structure through strategic assessment and reassessment of the tasks and groups of employees. Combinations must be developed in order to achieve the objectives and tasks of reorganizing these groups completely.

To define a better understanding of the concept of organizational design we will discuss the three best designs, also known as the traditional forms of organization, including the design of simple structures, functions and industries.

Simple Design Structure

The first type of traditional design is simple. Simple structure is a fundamental structure of organizational design with low departmentalization, little specialization of labor, wide spans of control, the central authority (usually the owner has most of the power), and little or formalization of the rules that operate on government . Organizations use a simple structure, usually are flat, because there are many levels of the hierarchy.

Organizational Structure  8
Organizational Structure 8

The simple structure is very common, with a few employees and an owner who manages and controls the majority of business functions. Since there are a limited number of employees of the landscaping company, it is necessary that each employee different functions in different areas of the organization, creating little, if any, departmentalization. Policies, procedures and rules are limited in the simple structure of the variety of taxes and limited specialization of labor. Of course, if the landscaping company expands, it will probably be too large to navigate design and simple to a more complex structure.

Functional Design

You can select the next type of organizational design that is the traditional functional structure. Functional design focuses on the specialized practice, similar or related occupational specialties (also known as departmentalization known).

Organizational Structure  9
Organizational Structure 9

Departmentalization groups of workers with similar tasks in work units on the basis of a product or service, carry out the activities of employees, skills and know-how, resources or types of customers. Title of work explicitly, can the chain of command, hierarchical relationships, and a communication channel well defined in these specialized units are working to maximize its functionality.

A functional organization is a strong hierarchy. With the idea of ​​departmentalization, the organization in the individual departments, where each department has a specific function and all departments work independently to carry out organizational goals are shared. If you find a functional structure, you can see how the departments, such as sales and marketing, finance and accounting, customer service, human resources, planning and construction and maintenance, are grouped specialization. The design of the functional organization is more suitable when a company working on a single product or service, such as landscape. As a result, these devices can operate independently as sales and marketing, finance and accounting, customer service, human resources, design and construction, maintenance, and, every hour, on a specific task, manufacture and sale of packaging of that product or service.

Long-Term Planning

A partial structure design offers large businesses the ability to separate the majority of the division semi – autonomous or departments. These groups are self-managed and focused on a narrow aspect of the business with the objectives to be achieved. Examples of such divisions may be divided for providers who are covering the same geographic location or designers on the same product line.

Unlike departments, divisions have more autonomy from the rest of the organization, as they often have their own manager who manages the operations of the department. This autonomy allows managers, in particular on their individual unit to focus its resources and its results. Many believe that their leader is the thing to get success, because it ensures that a person who has the authority, power and resources are available at all times.

Globalization and the economic crisis is dating constant over the last three years that have forced companies to rethink their strategies and change their way of working. From what I understand, there was a lot of “up” with the companies put their focus on competing products or markets, rather than looking at the big picture. This can be a large number of initiatives bring gradual rather than trying the whole concept of organizational change.

For organizational changes in strategy, structure, roles and functions should be revised with new goals. This is not always the case, so that responsibility can not be ignored, the staff may not be enough working against each other.

There is a little more than a flattening of the traditional hierarchy, perhaps expanding into a matrix structure in parts of the organization. Often, however, remains the hierarchy in the “new” structure, which can be cut in all its power and leave people confused. Worse, organizations, to show people how rarely work in a new facility that can also affect performance.

Wrong choice of design and organizational structure results in a tangle of contradictions in the grove between the roles, the lack of coordination between functions, the lack of sharing of ideas and decisions of managers slow to bring unnecessary complexity, stress and conflict. Often those at the head of an organization are not aware of these problems.


Let’s review. Organizational design is the process of review by the Management Company, the duties, functions and objectives of the company. Decisions about how people meet are the best and most effective way to go to achieve their goals there are different forms of organizational design.

For the success of any organization it is necessary for it to to work out on specific structure and then make its organizational design on the basis of organizational structure. Organizational structure and organizational designs are both for the progress and success of the company and organization. It is up to the organization that its management chooses which structure and which design for the success of business.

Industry consolidation to large multinational companies through alliances and other types of cooperation between the authority’s efforts to create harmony, and the need of right organizational structure in the twenty-first century has become increasingly important. Sub-organizations of all sizes are thinking of manager’s influence on their organizational structure. One can not deny the importance of organizational structure for the ultimate success of a companies and organizations.


Brews, Peter J., and Christopher famous book “Exploring the Structural Effects of Internetworking.” Strategic Management Journal 25, published in 2004

Hansen, Morten T., and Nitin Nohria’s “How to Build Collaborative Advantage.” MIT Sloan Management Review

Ticoll, David’s “Get Self-Organized.” Harvard Business Review 82

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Organizational Structure

Organizational Structure and Behavior

The fundamental intention of the study is to focus on the behavior of individuals and groups and how it affects the organizations. This study helps one to survey the links and relationship between the culture and constitution of organizations and how both the factors manipulate the behavior of workforce within the organizations. The impact of culture and structure can be measure with the ways and regularities being applied in organizations. These values basically conclude the functional prototype of behavior of organizations personnel. The structure and culture which are being applied within the organization structure are important aspects which stimulate the workforce at all echelon of the organization.

Understand the relationship between organizational structure and culture

The organizations are basically developed up on the base of communication and culture of any organization is a communicatively accomplished part of the organization which saturates it. According to Anne Maydan Nicotera (2003, p.1) the “organizing is a communication process” and an organization is an entity which is basically embedded in cultures. The relationship between culture and organizational structure is a vast and comprehensive dilemma to discuss because the organizational members create and recreate the organization cultures and organizational structure entities are embedded in this cultural environment. In other words it can be said that members of an organization is a culture part of the organization and this organization is a cultural part of society.

Culture is basically the combination of disciplines, norms, values, customs, beliefs, attitudes, practices, and several other aspects. These factors are not culture itself but culture underlies them in it (Marcia J, 2003, p.2). Culture is a conferred set of communal emblematic systems those direct individuals’ behaviors and incline them to play a role as an assemblage (Chen and Starosta, 1998).

Compare and contrast different organizational structures and culture

Organizational structures

The “organizational structure identifies the responsibilities for each position and relationship among these positions”. A firm basically establishes a structure which determines the job and responsibilities of each individual within the organization under the supervision of someone above all of them who monitors and guides them to perform their job efficiently. In some organizations where the jobs and responsibilities are not supervised by some other position the workforces are not contributed to the production of organization due to not getting proper guidance about their responsibilities towards their organization. In other cases, where the positions are supervised by more than one person the chances of conflicts are much higher (Jeff Madura, 2007, pg. 277 to 278).

Types of organization and associated structures

Different organizations use different organizational structures. The organizational structure is particularly based on the nature and specification of business. Basically the following types of tools are used to build up the organizational structure.


Rob Dransfield (2004, p.74) stated that the organizations based on the functional structure basically apply the grouping of workers in order to bring the different individuals and groups of workers altogether so they can help and support each other’s in specific projects and jobs. In this structure the individuals and groups mutually share their expertise and ideas with each other so they can produce something innovative and progressive.


The product based organizational structure is completely the customer oriented structure. This structure is being organized in product line and each line reports to the CEO or an organization. And these product lines lend themselves in centralized and decentralized decision making process (Sandra M. Reed and Anne M. Bogardus, 2012, pg.77).

Geographically based

Geographically based organizational structure is basically the country based structure in which an organization widens its scope of business at international levels. The organization establishes its business in different countries or merged with other multinational organization globally. It often gets complicated if an organization has a large number or competitors. In other cases, the geographical based structure works successful where all the organizations are organized along product lines (Sharan Jagpal and Shireen Jagpal, 2008, pg. 552).   

Multi-functional and multi-divisional structures

Rob Dransfield (2004, pg. 76) demonstrated that some organizations basically use the formal organizational structure while in large firms the multidivisional and multifunctional organizational structures are being applied. To combine the different areas and expertise of organizations such types of structures are used.  

Span of control

Management is responsible for the organizational structure span of control. In span of control some individuals are being supervised by any individual manager. In large firms one manager supervise several employees while in small scale organizations, the numbers of employees are less. These spans are also called as narrow span of control and wide span of control (Jeff Madura, 2007, pg. 278).

Hierarchal levels

The organizational division is also an important factor of organizational structure. The organizations which apply the wide span of control use the flat organizational structure because it doesn’t have several layers to determine the workforce and its responsibilities while the other organizations which use narrow span of control have to adopt the tall organizational structures and cultures consisted of many layers (Mason Carpenter, Talya Bauer and Berrin Erdogan, v. 1.0).

Organizational charts

Sakthivel Murugan (2007) defines, “The organizational charts are the useful mean of providing the information about the organizational relationship”. Theses charts are also used as the tools of management controls. They graphically represent the managerial positions and interpretation between them. The charts are the blue print of organizational structure of an organization. There are several kinds of organizational charts, the vertical charts, horizontal chats, circular charts,

Matrix organization

Jeff Madura (2007, pg. 293) stated that organizations are often tackled with some specific conditions which demand some inputs from employees. In matrix organization structure, several parts of the organization interact on specific projects. These projects normally based on the short span of time so these individuals can perform their normal routine work under the supervision of same boss. The matrix organization is combination of product based and traditional functional structure (Carpenter et al, 2012).

Centralization and de-centralization

The centralization is an organizational structure which refers to the organization which is held under the authority of high leveled managers. The middle managers and supervisors monitor and control the day to day task of the organization and then reporting to the top managers. In this type of organizational structure, the middle managers are not liable and allowed to take decisions (Jeff Madura, 2007, pg. 288).

While in decentralization structure, the organizational structure functions are ruled under the supervision of several managerial and supervisions divisions. The self-government organization is the basic illustration of decentralization structure in which the managers and supervisors are responsible to make decisions where necessary (Dave Needham, 1999, pg. 232).

Internal and external network structures

The internal network structure consists of the information which is organized, processed, analyzed and reported to all levels of managerial position within an enterprise. Whilst the external organizational structure encompasses at international level as well as with the parent departments of an organization (F. L. Harrison and Dennis Lock, 2004, pg. 70).     

Flexible working

The flexible working organizational structure allows workforce and managerial positions to work in flexible and relaxant working environment within the organization. It helps to adopt and deal with the modern economical and financial business pressures. Every firm basically needs the functional, financial and numerical flexibility working structure (Rob Dransfield, 2004, p.85).

Organizational Structure
Organizational Structure

Organizational cultures

Culture is the way of life for individuals or particular group of society. It is consisted of norms, beliefs, customs and values for those specific social groups. People learn values from the environment where they live or work and this culture determines the way of life for these people. The behaviors and responses are being adopted by the environment. In an organization the culture is a personality of an organization. The way of working, rules, norms and values upon which the organization based and workforce is pressurized to act upon is the culture of an organization (Rob Dransfield, 2004, p.87). 

Classification of organizational culture

The organizational culture is further divided into different classes according to the culture and social styles. Following are the four main classifications of organizational culture.

Power culture

Power cultures can be illustrated as the spider web, which has a main central power point from which it influences and controls the workforce in outward direction from its center of power.

Role culture

Role culture is most identical culture class, which easily can be determined by the specific role or job rather than the performance of specific individuals or groups.

Task culture

In task culture, the management is basically responsible for all the problems and the solutions of an organization. The main concern is the job or project, not the individual because it is team working culture.

Personal culture

It is purely based on the individual’s performance and job. The talent, education, expertise and skills of an individual for his organization matter here.

Explain how the relationship between an organization’s structure and culture can impact on the performance of the business

Cultural norms and symbols

The cultural norms, beliefs and values are the ways and standards the organizational management or HRM settled up for all the levels of workforce. These values and norms basically motivate the workforce to perform best for their organization in order to make it well developed and progressed. The cultural norms are structured in decision making process according to internal, external behaviors and situations the organization has to deal with.

Development of organizational culture diagnosing behavioral problems

Psychology is the study of human behaviors and organizations take deep interest in studying the psychology because it helps them in seeking about the behaviors of their workforce and managerial positions. The main two concern often make organization complex in knowing ne is why people behave as they do and how can organization tend their workforce to behave as they want them to. The psychology basically helps organizations in behavioral problems and provides deep insight into different strategies such as absenteeism, group interaction, intelligence, stress management, resistance to change and levels of motivations.

Concepts, Principles, Perspectives and Methodology

Cognitive, behaviorist and psychoanalytical are three main approaches of psychology. These approaches assume different methods of researches according to the area of study for an organization. The qualitative, quantitative and action researches, survey and experimental design, psychological assessment, diaries, of an organization are some essential strategies of these concepts and approaches.


Perception is most identical organizational behavior because it is based on the judgments or decision making according to the given or immediate situations of an organization. The decisions are taken on these perceptions and misperception often leads towards the wrong and inappropriate decision making. Three main elements of a perception process are the perceived, the perceiver and the circumstances or situations. The understanding of individual’s perception of an organization is an essential part for the management. It helps in understanding that the perceptions of individuals are differ from each other so overcoming procedure must be vary from a person to person or specific groups.


Organizational structure conflicts cause several internal and external issues for organizations and also for individuals of that organization. Wrong assumptions, perceptions, negative attitudes, opinions, rumors, and several other reasons cause conflicts in an organization. The conflicts are not always negative; they might of productive or destructive nature. They often rise on introducing new working protocols and environments, repositioning of goals, and developing new organizational structure and strategies.

Discuss the factors which influence individual behavior at work

Individual behavior at work

Personality of a worker of an organization is the main factor of determining the individual behavior at work. A worker have two types of personality aspects, one is stable characteristic, while other is distinctive characteristic. The stable characteristic of an individuals’ personality always remains same all time while the distinctive characteristics make him identical among crowds. The traits and types of the worker’s personality depend on the current situations and circumstances in an organization. An individual’s behavior at work is purely based on his traits and types of personality.

Intelligence Significance and nature of individual differences

The intelligence is an entity which is still not defined in any universal term because of its unique diversity. Few groups suppose it as an intellectual power while others takes it as the sense of understanding the environment. However, intelligence plays a vital role in understanding and responding towards the society, people and work. While the personality of an individual worker predicts the success of that person and how he will be working with other workers in an organization. It is a combination of behaviors and mental characteristics of a person which depict the person’s altitude and aptitude. It also has an important impact on how people behave at work.


Attitudes are the likes and dislikes of an individual, we all have some specific attitudes towards our environment and society. Attitudes are basically developed according to the personal experiences and environmental or social effects. When a person get anything positive and good in an organizational environment, it seems he must have a positive attitude towards is work or organization while the person who always make issues and stay annoyed have a negative attitude towards his work and place.

Aptitude or ability

The aptitude or ability is the individual capability of a person to learn something positive from his surroundings. In an organization the employers take much interest in the aptitude or ability of worker rather than his attitude.

Understand different approaches to management and leadership

Different approaches to management and leadership

Michael Armstrong and Tina Stephens (2005, pg. 4) stated that the main purpose of the management and the leadership in an organization is to provide direction, arrange changes and attain results through the accurate, proper and responsible use of resources. The management process is divided into the different methods which are used in achieving the organizational structure objectives. The main processes of the management and leadership approaches are planning, motivating, organizing and controlling.

Mangers are always leaders, while leaders are not always managers” (Michael Armstrong and Tina Stephens, 2005, pg. 5). But there is a clear distinction between the management and leadership processes. Management basically concerned about the achievement of organizational objectives by using all the available resources, while leadership focus on one an ultimate resource which is the “people”. It is essential for the managers to be a good leader as well.

Compare the effectiveness of different leadership styles in different organizations

Talha Iqbal (2011) stated in his book “The impact of leadership styles on organizational effectiveness” that leadership is an important part of any organization, but often leaders get confused on initial stages about how to do leadership. However, leadership is itself a quite comprehensive approach which has divertive aspects according to all field of life. The leadership styles basically portray the impact and application of leadership process and its effects on an organizational structure. The main three styles of leadership are autocratic, participative, and free rein. In autocratic style of leadership, all the decisions are taken only by leaders while in participative style the leader makes decisions with team involvement. The free rein leadership style is completely different because in this style leader leave all the decision making processes on the team.

Explain how organizational structure theory underpins the practice of management

Development of management thought

Rob Dransfield (2004, pg. 174) stated that the main concern of the managers is to secure maximum profitability and prosperity of the organization and providing the job satisfaction to the employees. The empowerment of employees by giving them responsibility to manage them is being developed to lower down the organizational and managerial responsibility. This hierarchal top down management trend was used in twentieth century for scientific managers.

The scientific management and the classical administration are the hierarchal structure of an organization. Managerial positions are responsible in this organizational structure for specific group of employees while the bureaucracy is a hierarchical authority and goal oriented system of an organization.

Evaluate the different approaches to management used by different organizations

Human relations, systems and contingency approach

The human relation approach is however necessary to get positive and expected outcomes form workforces of an organization rather than just pressurizing them to produce. It is necessary to respect the human forces of an organization by giving them incentive to motivate them for their organizational progress. The system approach refers to the organizational structure systems which are specifically introduced for the wellness and betterment of workforce so they can return the positive production.

Andrew J. DuBrin (2011, pg. 27) demonstrated that the contingency approach basically attained when not any other approach or structure is being applied. In an organization, sometimes such situation occurs when HRM have to decide something on immediate basis according to the current circumstances, so the contingency approach thus applies.

Understand ways of using motivational theories in organizations

Motivation is basically related with the most important question, why people do what they do. Motivation is a key to understand the various types of organizational behaviors. What factors and strategies motivate the employees are some basic considerations an organization supposes first. The organizations with clear motivational protocols always generate the positive outcomes (Steve M. Jex, 2002, pg. 209).

Discuss the impact that different leadership styles may have on motivation in organizations in periods of change

John Darling and Anita Leffel (2010) stated that different leadership styles influences the organizational structure functions in various ways. The team leader affects the other team members through this decisions and practices to motivate and facilitate the competence in organization. The leadership styles adopted by the team members are based on the behaviors, thoughts, communication, and interaction of team members. Organizations get benefited from the well-established leadership styled system among team members and the leader. It inspires the collective and entrepreneurial spirit to the organizational team.

Compare the application of different motivational theories within the workplace

Motivation is a process to stimulate a person to perform his action or role in achieving the goal. Motivation has several kinds, thus the motivational theories are also diverse in numbers. The motivation is becoming more important in present era of competition at work place. The organizational management implies several motivation theories to stimulate themselves as well as to its employees. The scientific management was fir introduced by Fredrick W Taylor and known as the most important motivational theory for organizational structure development. He also introduced the Piece Rate motivational theory through which the employee gets salary according to the production average. This theory better stimulate the workforce to struggle more to increase the organizational productivity so they can get more salary (Friederike Hertel, 2003, pg. 3).

Evaluate the usefulness of a motivation theory for managers

(Dave Needham, 1999, pg. 263) As it is mentioned before that the managers are only concerned about the productivity and profitability of the organization by applying all the resources available, while leaders are responsible for the people of his team members not about the resources. The leadership is an important motivational theory for the managers to make them able to stimulate themselves for their organization. For progressed organization, the manager must be a good leader also. The scientific management is ne mot highlighted motivational theory which better stimulate the managers to boost up themselves and their personnel to struggle more for the profitability of an organization.

Understand mechanisms for developing effective teamwork in organizations

The system of developing the effective teamwork in an organization develops the respect, trust, and support to the leadership environment and thus improves the individually as well as collectively performance and attitudes for the organizational structure achievements by motivating the team members to perform at high levels.


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