Hyper-Competition and Its Relationship to Organizational Structures

The structure of an organization is the sum of total ways in which it divides its labour into distinct tasks and then achieves coordination among them. (Mintzberg, 1979). An organization can be structured in many ways depending on their objectives. An organizational structure consists of activities such as task allocation, coordination and supervision which are directed towards the achievement of organizational aims. (www.wikipedia.org)

When an organization grows beyond the smallest operation, management divides work vertically, as those at the top delegate more of their work to those below them. The vertical hierarchy establishes what decisions people at each level can make. Centralization is when those at the top make most decisions, with managers at divisional level ensuring those at operating level follow the policy while Decentralization is when a relatively large number of decisions are taken lower down the organization. (Boddy,2008). Transfer of decision making power and assignment ofaccountability and responsibility for results. It is accompanied by delegation of commensurate authority to individuals or units at all levels of an organization even those far removed from headquarters or other centres of power. (www.businessdictionary.com)

An organization is structured in a certain way based on some factors. Size is a factor because the bigger the organization, the more complex its structure. If the company is small, the design is generally simple. A small company does not have to undergo a formal structure. Larger organizations depend more on authority delegation and formal work responsibility, because a bigger company is harder to manage. Another factor is the lifecycle of the organization. An organization undergoes the...

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...decision making because all the decisions are made by a few people at the top of the organization.

Therefore organizations have to find the perfect balance between these two structures and in this age of hyper-competition more of them are adopting a more decentralized structure in order to respond faster to the ever changing market and threats from competitors both new and existing.

Works Cited

* Grace Ferguson, 2010. www.suite101.com “Factors determining organizational structure; Identifying the key components of an organization design”.

* www.wiikipedia.org

*Ian Palmer et al, 2001. Journal of Organizational change management, volume14 number 2 - Changing forms of organizing: dualities in using remote collaboration technologies in film production.

* www.businessdictionary.com

*David Boddy, 2008. Management; An Introduction. Chapter 10, pg322 - 324