Free «The Structure of an Organization» Essay Sample


The structure of an organization is considered as an anatomy of organization that provides a foundation within which the organization functions and the behavior of the members of the organization is affected by the structure of the organization. The structure of an organization has two basic functions that affect the behavior of the organization, that include the structures that regulate the influence of the individual variations of the organizations and the structures that act as setting in which decision is made, power is exercised and the activities of the organizations are carried out. (Hall,1977). The structure of the organization has an impact on the performance of the organization.

Problem statement

The global business environment of the 21 century is the most turbulent and is characterized by globalization, knowledge and information revolution, and structural changes in organizations. The economy is knowledge based and knowledge is the only meaningful resource. A new paradigm for the organizational form replaced the rigid and cumbersome traditional form and the organizations need to understand the nature of the organizational structure. The design principles of the structure of the organization play a key role in improving the performance of the organization.

Present study

With the rapidly changing businesses on a global basis, there is also a rapidly changing external environment and the present study comprises of identifying the goals and strategies of ITsoft  a software company that makes and exports the software products.  The study also examines the changes in the external environment of an organization and the affect of each change on the organization. The study also identifies the reason to place emphasis on one competitive strategies of the porter’s competitive strategies.

The company

IT soft is a global computer manufacturing company and with the changes in the business environment the company is forced to reevaluate and redesign its organizational structure and culture in order to gain a competitive advantage. The major restructuring of the organization is to control its operations to stay competitive in the global markets.  The unique structure of the company has allowed it to grow and respond quickly to the rapid changes in the external business environment and the focus of the organization is to place decision making on the people.  However, corporate office feels difficulties in keeping track of the pending and purchasing when the decision making is with the employees at different levels. (Offermann & Spiros, 2001, pp 376-92).  


Formalization comprises of the written form of rules, procedures, instructions and communication and a legitimate procedure of the organization that occurs regularly applies invariably. (Walsh and Dewar,1987).The structure of the organization is relatively flat and informal and the company is efficient in perceiving the environmental changes.  The number is 8.


The functional specialization is the number of specialties from a specific list that are performed by a specialist and the list includes advertising, market research, employee training and development, quality control, maintenance, and transportation. Specialization is the norm of the company and it can be given top level for this measure.


The company has features of innovation embedded within the organization, and the supervision of the employees by the management of the company is less and the management encourages more of employee participation in the decision making process. The hierarchy is thus flat in nature. The measurement is 10.


The company is knowledge based and the design of the product is based on the advanced technologies and innovations and the number for the measure can be given 1.

External environment

The external environment for the company rapidly changes as the company is knowledge based and the rapid technological changes require a quick response. The measure can be 10.


The company believes on values, qualities, customs, standards and principles the will help the employees to be successful. (Koberg & Chusmir,1987, p.397 The measure can be 1


The technical competence required for the employees of the organization is fulfilled through a high level training offered to the employees of the organization. The professionalism can be measured as 1.


Effective designing of the product that attracts people and the company has clarity of its goals. Products from the company are genuinely new and the measure is 1


The size of the organization is determined by its number of employees, its operations, and its market share. The technology that is necessary to produce the product, the amount of task specialization, and the job satisfaction, are the major determinants of the size.(Gans and quiggin,2000). The company is innovative and in terms of market capitalization the company is large and the measure can be 7.

Organizational mindset

The new competitive landscapes invite the managers of the organizations to adapt a new organizational mindset and the new mindset examines the traditional functions of management to modify them according to the changing external business environments. (Clegg and Clarke, 1999, p.192). The measure for this is 5

Goals and strategies

Business strategy plays an important role in the changing business environments of today and the strategy outlines the series of actions that give an assurance towards the achievement of business goals. This makes the firm to remain competitive and responsive to the market needs.

Financial goals

Decisions of the management specifically investment, finance and operations affect the value of the share holder by influencing growth duration, operating profit margin for the cash flow from the operations. These are the value drivers that connect the valuation components through the share holder value network.( Rappaport,1986). The financial measures should be useful for the assessment of the past managerial performance as well as the current corporate value.

Internal business processes

Any function of an organization that enables the organization for a successful delivery of the products and services is business process and most of the organizations perform the similar business processes. The human resource business processes may be critical for the success of an industry. The strategic focus of the company should be towards developing business processes that would satisfy both the shareholders and customers.

Learning and growth

The strategic focus on growth and learning perspective is the ability of the organization to sustain the change and the goal of the measurement is to monitor how well the organization is building the infrastructure that facilitates learning and growth.(Neeraja Kumari,2011)


The customer is at the receiving end of how the employees behave and the actions, as well as the attitudes of the employees towards customers determine the quality of services and products of an organization.

Market orientation of the company

Market orientation of the company stresses on the importance of connecting the organization with the delivery of the value to the customers. The whole process of the market orientation is of participatory nature with the involvement of customers in the process and the higher rate of involvement of the employees in the decision making process enables the organization to meet the needs of the customer. (Narver & Slater, 1990; Homburg & Pflesser, 2000)

The environment


The recession has affected the company and despite this economic gloom the company sustained the situation by generating profits and this success is attributed to a new range of products of the company.

Government regulations

All businesses must comply with the statutes and regulations that are associated with all levels of government, and the enforcement agency has no obligation to notify about this to the businesses. The regulations do affect the financial condition of the company and even though there no adverse impact of the regulations on the company as such there is no guarantee that there will not be adverse affect to the company by the future regulations.(Shaffer,1995).


When the new technologies are introduced, there is a threat of legal action from the competitors

Social change

The objective of the company is to be recognized for the responsible management and ethical performance. The policies towards the ethical performance are well explained.

Global market place

Trade is increasingly globally significant and the consumers have the good access to best products. Rapidly increasing life cycles increase competition among the countries that can produce newest in technology. (Pukthuanthong and Roll,2009).The company is innovating and knowledge based and can sustain competition in the global market place.

Mission statements and official goal statements provide an organization with genuine legitimacy in the external environment

The mission statement of an organization subsumes all others beneath it and the mission statement has a number of possible purposes. It is used to communicate the values and objectives of the organization to the various groups of stakeholders and thus assists in promoting the hierarchical congruence. It may also have an effect in influencing the behavior and attitudes of employees and it can also be seen as a starting point for the entire planning process of the organization. Mission statement is important for the managers to instill a sense of mission in the employees, and the success of the mission requires the behavior of the employees to match the values of the company. (Campbell and Yeung ,1991).



Conflict is a fact of organizational life, in any organization; conflict may be the very essence of an organization is about and if there is no conflict the organization has no reason for being. With the increasing awareness on the issues such as cultural diversity and gender equity, conflicts arise and training in organizations is a part of conflict management.(Hathaway,1995). Unresolved conflict has a negative impact and conflict management in organizational setting is important as the employee learns to get along with the fellow employee, manager and public. Managing conflicts in organization is also important as a supervisor can see the rise of conflict, learns how to respond productively to the conflict, gets more cooperation from the employees, helps the employees to resolve the disputes and reduces the spread of conflicts to the other parts of the organization.(Wilmot and Hocker,1998).

Problem statement                        

Conflict in organizations is viewed and managed as an isolated event; however, conflict is ongoing, amorphous and tangible and it is manifested in many ways in an organization. Resolution of the dispute is a process that provides solutions in the conflict situations.

Present study

The present study is an in depth discussion on the nature conflicts in organizations and how the conflict is managed in organizations in such a way that the significance of conflict is decreased.

Influence of structure andbehavior on the conflict

Conflict is inevitable and it can happen any time and the source of conflict may be due to different view points over the ideas, values, position and background. The conflict in organizations can be interpreted as who is to exert influence and the conflict is caused by the structural in congruencies in the distribution of potential influence in groups and organizations. Potential influence is described in terms of the structural relations defined by the structural role theory. (Aronoff,2004). Structural concepts that cause conflicts include specialization, common resources, goal differences, interdependence, authority relationships, ambiguity in jurisdiction, and differences in status. Much of the conflict in organizations is caused by the perception of the people, and through this perception people understand and interpret the occurrences of their organization.

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Interaction of the environment with the conflict

The competitive business environment is changing dramatically with increasing globalization and when the business collaborations transcend the organizational boundaries, more challenges appear. In the partnerships between different organizations, conflicts are inevitable and this may lead to suspicions in collaborations resulting in negative outcomes.( Friedman, Chi, & Liu, 2006). However some business collaborations survive these challenges of the inter organizational conflict. In cross national business collaborations, language differences have a significant impact on the communication process and understanding the precise meaning of the cross cultural communication is important as these meanings contain cross cultural connotations which are beyond the meaning of the words. In many governmental, semi governmental, and commercial organizations, there is a need for cooperation between organizations that have strong contrasting cultural and social backgrounds. There raising concern about the divergent management and leadership styles, organizational cultures, and corporate entities as sources of conflict.

Systems of controlandcoordination that affect the conflict        

The control and coordination of the subsidiaries is a permanent task for the multinational companies and the international management control is a means to achieve common organizational goals, international management control and this directly relates to the general global local dilemma of the internationally active companies. Multinational companies must find an optimal mix between the centralized and decentralized decision making while they employ several control and coordination mechanisms. Within an organization management of the human resources is important and the coordination shifts from more formal to informal and subtle mechanisms. Within this indirect control and coordination system the employment of the expatriates plays a crucial role and these expatriates provide an alternative control mechanism and centralization creating a control and coordinating system based on socialization and informal mechanism. The subsidiary has a role in business network of relationships with important customers, suppliers and other business partners. There is a latent conflict between these two roles.

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Managing conflict

Various factors influence the conflicts that may foster or impede conflicts and the conflict handling should result in efficient solutions even though such solutions are not feasible. Hindrance to the efficient solutions may be due to the lack of knowledge, the perceived unfairness of procedures, self serving biases and bounded rationality. Behavioral and psychological factors are the important factors in social interactions, and inappropriate behavior is a big problem of the work place. The conflict arises due to this behavioral factors would require a structured, scientifically reported workable solution. (Rahim and Rabim,2000). Contracting the employees should have only few explicit conditions, however this can lead to questions as to how these contracts can be legally, economically and psychologically managed.


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