Chapter 2 - Organizational Structure - Part I

1.1 Different Typres if Structure

There are various patterns of structural changes which are stated below

Entrepreneurial

Entrepreneur owns and manages the business on his own or with the help of an employee. This structure is adapted by business in their early stage.

1. Benefits of this structure
· Fast and easy to decision making
· More responsive to market
· Good control
· Close bond workforce

2. Threats of this structure
· Lack of career structure
· Dependant on the capabilities of the manager
· Cannot cope with diversification


1.4 The Informal Oraganisation and its relationship with the formal organization:
Formal organization structures are those structures which are designed by the management in order to attain its goals. Whereas Informal organization structure consist of the relationships that exists within an organization. These relationships arise due to common interest or friendships.

All the organizations have mix of both the formal and informal structures
Benefits of Informal organizations
· Better motivations
· Better communications
Weakness of Informal organizations
· Inefficient organization
· Opposition to change can be intensified
· The “grape vine effect”


1.5 The Impact of the informal organization on the business:
Manager need to be more aware of the informal structure and ensure that they adapt the formal structure to compliment the informal one. The managers also should concentrate on maintaining a looser formal structure so that the informal structure can thrive. It is highly important for the managers to take in account the informal structures in decision making.