Advantages and Disadvantages of Four Types of Organisation Structure

In: Business and Management

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Advantages and disadvantages of four types of organisation structure

In this essay, I shall analyze relevant examples of existing companies, present their organization design, organization chart, work specialization, chain of command, span of control, for the purpose of presenting the advantages and disadvantages of four types of organization structure. As Mintzberg defined it, "The structure of an organization [is] the sum total of ways in which it divides its labour into distinct tasks and then achieves co-ordination among them" (Boddy, 2008:319) and "makes possible the application of the process of management and creates a framework of order and command through which the activities of the organization can be planned, organized, directed and controlled" (Mullins 2007:564). As the business environment evolves, traditional approaches to organizing work are being reevaluated. Managers are searching out structural designs that are more appropriate to their environment, that are more relevant to the contingencies that reflect their organization. "Organisations are collections of people brought together for a purpose. To achieve this purpose successfully, people need to be organised within the best possible structure. Decisions on structure are primary strategic decision. Structure can make or break an organisation." (Lundi and Cowling 1996:141). Firstly we are going to examine the organization structure of Pharma Nord, a Romanian import, export and distribution company of pharmaceutical and Para-pharmaceutical products. This company is a good example of a functional structure, where tasks are grouped into departments based on similar skills and expertise. As it can be seen in the organisation chart in figure 1, activities and staff are grouped according to their function - such as chief pharmacist, economic director, executive director, etc - forming a flat…...

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