TYPES OF ORGANISATIONS

Based on Authority & Responsibility

1. LINE ORGANISATION
Also called as Military or Scalar Organization Managers have direct responsibility for the results

Engineer

Draughtsman - I (Design & Drawing)

Merits

Draughtsman - II (Plans)

Draughtsman - III (Specifications)

Demerits

1. Sets clearly direct lines of authority & responsibility 2. Simple to understand 3. Each dept. can be treated as a unit for control purpose 4. It is flexible 5. Facilitates quick decisions & prompt actions

1. Manager is overburdened with all tasks relating to a particular department 2. There is no scope for specialization 3. More scope for favoritism 4. Lead to low morale in the Organisation

2. LINE & STAFF ORGANIZATION

Here we have both line & staff managers Staff managers support the functions of line managers Staff managers are specially appointed to give advise, suggest or assist line managers Line managers take support of staff managers to get full view of the issue under consideration It is not necessary that line manager should follow the suggestions offered by Staff manager. Line manager has authority to consider or ignore such suggestions

Engineer
Admin. Officer Accountant

Draughtsman - I (Design & Drawing)

Draughtsman - II (Plans)

Draughtsman - III (Specifications)

Line & Staff Organization in a Services Organization

Engineer
Advisor

Manager (Personnel)

Manager (Production)

Manager (Marketing)

Manager (Finance)

Line & Staff Organization in a manufacturing unit

Merits

Demerits

1. Enhances the quality of 1. May create conflict among line decisions & staff managers 2. Greater scope of advancement 2. Staff suggestions are rarely implemented 3. Relieves line manager 3. Expensive to have both line & staff managers
There is criticism against staff by line manages about the degree of their involvement & cooperation Staff managers complain about the behavior of line managers Staff managers are criticized on the grounds that they do not with practical solutions & fail to realize the consequences of the problem Line managers are the criticized approaching staff managers for counseling only when they are about to sink It is often complained that line managers do not take staff manager in to confidence

3. FUNCTIONAL ORGANISATIONS
F W Taylor suggested Functional Organization in his theory of scientific management Planning tasks & Implementation tasks to ensure division of labour Planning Tasks: Route clerk (identifies the route for the materials to pass on) Instruction clerk (what to do & what not) Time & Cost clerk (identifies time & cost of jobs) Shop disciplinarian (maintains the discipline on the shop floor)

Contd

Implementation Tasks: Gang boss (assembles the machinery needed for the workers) Speed boss (standardizes & sets the speed of the machines) Repair boss (repairs the machinery incase of breakdown) Quality inspector (responsible for matters relating to quality)

Works Manager

Planning Function TCC

Control Function RB

RC

GB

IC

SD

SB

INSP.

WORKERS
Taylors Functional Organization

1. 2. 3.

4.
5.

6.

Merits Planned specialization Separate activities related to planning & control Facilitate large scale production through standardization Disciplinary controls are well defined Appropriate when there is a single product or service Offers clear path for functional specialists

1.

2. 3. 4. 5.

Demerits Ineffective controls as workers have more than one boss Very costly Calls for more coordination Less appropriate when an organization diversifies No clear line of authority

4. COMMITTEE ORGANIZATION
A committee is formed when two or more persons are appointed to work as a team to arrive at a decision to the matters referred to it It is intended to utilize the knowledge, skills & experiences of all concerned persons. Particularly, in large organizations, problems are too big to be handled by one single expert

Executive Council Finance Committee

Vice Chancellor

Academic Senate Board of Studies

Rector

Registrar

Selection Committee

Purchases Committee

Convocation Committee

Committee Organization in a University

1.

2. 3.

4. 5.

Merits Demerits Pools up the organization 1. Responsibility for decisions resources in terms of knowledge, cannot be fixed on a skills & experience particular person Represents all interested groups & 2. It requires high degree of thus facilitates group discussion coordination It yields good results if the 3. It involves high cost in committees are headed by task terms of time & money makers like chairman & timebound in terms of decision-making Minimizes the fear of too much authority vested in one person Motivates all the concerned or affected groups to participate

5. MATRIX ORGANIZATION
Also called as Project Organization It is combination of all relationships in the organization i.e. vertical, horizontal & diagonal It provides high degree of operational freedom, flexibility & adaptability for both the line & the staff managers in performing their respective roles Workgroups along with its resources can be shifted from one project to the other, depending upon the requirements. When the project is completed, they return to their functional departments

President

Vice President (Production) Project A Manager W

Vice President (Marketing)

Vice President (Finance) W

Project A Manager

1. 2. 3. 4. 5.

Merits It offers operational freedom & flexibility It seeks to optimize the utilization of resources It focuses on end results It maintains professional identity It holds an employee responsible for management of resources

1. 2. 3.

4.

Demerits It calls for greater degree of coordination It involves unity of command principle It may be difficult to define authority & responsibility Employees may find it frustrating to work with two bosses

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