John Bosman: September 2009 Archives

Structure & Design

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How an organization is structured depends on a few different things, like the size and goals of the organization.  If an organization is smaller and has fewer employees, it would make sense to be less formalized, horizontal and decentralized.  For a larger organization, it would likely be better to be more vertical so that there is a certain level of authority within the organization, preventing chaos.  It's along the same lines that they would want to me more formalized as well, having lower departments reporting to a higher single entity, delegating tasks.  It keeps everyone on the same page and working towards the same goals.  Other wise you could have one department striving solely towards making as much money as possible, and another working towards being environmentally friendly.  Means of attaining these goals may be conflicting.  Basically, structuring an organization is dependent on the size and organizational goals.     

An Effective Organization?

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Determining whether an organization is effective may, on the surface, seem to be a relatively simple problem.  Most people would probably look at whether income > expenses, but there are a few more things to consider.  What if the organization is a non-profit?  You first have to determine the criteria for effectiveness in each organization's situation.  For a non-profit, you could first look at the goals of the organization.  Are they meeting those goals?  Is the organization meeting them in the most efficient way possible?  Efficiency is important for every organization.  If one goal is to increase profit, being inefficient won't help reach that goal.  One example would be determining if an organization's staff is under/over utilized.  If an MLB team is trying to increase it's fan base, and there is a large, untapped population in a foreign country, China for example, it would make sense to send people over to try and bring in more fans.  The organization would have to decide, do we transfer current employees from another area, or do we bring in new employees.
Running with that same example, would current employees be happy being sent over?  Would it make more sense for employee morale/attitudes to bring in new employees who would be applying for a position in China?  Organizations have to look at the positives vs. the negatives, and determine which is more important, and which would be more efficient in the long run.  Which most would base on whether hiring more employees would be justified in the books by an increase in profit.  
These are just a few of the many areas to look at when determining organizational effectiveness.  It's such a complicated and difficult question to answer, especially when it's impossible to create a global formula to decide.  Each individual company has it's own individual goals and objectives.