Depending on the situation organizational charts can be a disadvantage as well. 7) Circular Org Structure. Committees may delay decisions, consume more time and hence more expensive. Over the past couple years, Incipient has aimed to decentralize areas that were creating a bottle neck and empower lower-level management to make decisions that would typically have to go through upper management. When there is confusion within the employee base, that often translates to confusion within the customer base. Other than this, occasionally these circular letters even sent to some of the loyal customers or torchbearers of an office. In this post, we’ll analyze and exemplify 5 of them, so you can understand their advantages and disadvantages, and choose which one to employ in your organization. For instance, those customers who have some considerable shares in a company maybe invites to attend their general body meetings and will also send an invitation for any functions held on their premises. Here, in this article, we are going to look in detail about the various dimensions of office circulars and the advantages and disadvantages of this aspect. 3. These decisions have three types of organizational structure: functional, divisional, matrix and hybrid structures. Skillsets are important, but fitting into to the ecosystem and being a part of the family is critical. 1. It simply states who works for who. We can’t be in control of it all. You will ignore it if you are not in the marketing department. The disadvantage of using the flat organizational structure is that it can create role confusion within highly structured teams. The use of an office circular always has a business aspect to it as it is mainly utilized to convey information amidst an organization, like an intra-office convention. Right from asking the opinions to informing about any dress code/ ethical considerations, these letters play a vital role. We have seen a large change in the momentum and creativity that are the drivers of execution by allowing the micro decisions to be made quickly by those who have proven themselves and gained the trust of upper management. Divisional Structure Functional Structure: This is the simplest & the most prevalent form of organizational structure. Individual creativity and originality may be stifled by the rather rigid determination of duties and responsibilities. These means of communication segregate into various types and range extensively from memorandums to official circulars to office suggestion boxes. Disadvantages of having an organisation structure are as follows: 1. List of the Advantages of a Collaborative Structure 1. Has the possibility of leaving some persons behind: The Best Chrome Extensions for Recruiters Are, Coronavirus and Working From Home Policy Best Practices, How to Work From Home Remotely as a Recruiter, How to Prevent Coronavirus by Disinfecting Your Home, How to Write an Elite Executive Resume? Not showing informal channels – This is one of the biggest disadvantages of organizational charts. Interdepartmental communication is an important aspect of both business and official communication. Top 13 Reasons, 150 Best Inspirational or Motivational Good Morning Messages, It is both time-effective and cost-effective, A form of a legal document with the designation of authority, Has the possibility of leaving some persons behind. Divisional organizational structure. Mechanistic structures, also called bureaucratic structures, are known for having narrow spans of control, as well as high centralization, specialization, and formalization. Functional Organization : All of the companies define its organizational structure to determine the reporting relationships that will exist in the company. This can create some conflict. This method sees as an effective method of communication as it disseminates an issue to a huge number of people. Unlike advantages of business letters, circular letters also have multiple advantages and it acts as an inevitable tool of communication within the premises. There is no more reason to send things “up to the top” for approval and sit their idle while waiting for approval. Then let’s take a a serious look at your mindset. One advantage of the matrix organizational structure is that people across different functional areas have a better understanding of their coworkers in other areas. If the company is customer-oriented, say, for instance, those companies dealing with beauty and any other household products may utilize these circulars to inform about the new varieties that the company is going to introduce in the market. What Makes a Great Workplace? 1. In these cases, oral communication becomes the only possibility. Thus, this aspect leads to a lack of communication and delayed response from the employees’ side leaving doubts amidst the higher management. Though every aspect has its shares of merits and demerits, each of these is an important business tool and contributes either directly or indirectly to the growth of an organization. This structure presents increased problems of top management control. They are: (i) Function, These circulars can extend to any amount of pages if the amount of information that to convey is voluminous. How to Improve Your Credit Score, Who Are the Highest Paid Athletes in the World, What are the Highest Paying Jobs in New Zealand, Strategic Management Advantages and Disadvantages, Top Human Resources (HR) Leaders in the World. How Big Data Recruiting will help you Hire Better, ATS Benefits: How it Improves Time, Quality and Cost Per Hire, The Black Lives Matter Movement and the Workplace, Yoga at Workplace: Simple Yoga Stretches To Do at Your Desk, Mobile Monitoring Apps: A Risk or Opportunity for Businesses, Top 63 Motivational and Inspirational Quotes by Walt Disney, 81 Inspirational and Motivational Quotes by Nelson Mandela, 65 Motivational and Inspirational Quotes by Martin Scorsese, Most Powerful Empowering and Inspiring Quotes by Beyonce, What is a Credit Score? In that case, an official circular expressing the heartfelt gratitude from the management will enact the part by describing the words of the management to its employees. Potential loss of control over outsourced activities and lack of loyalty among infrequently used contractors. Often employees do not know for sure to whom and how to report. Though it sends to the whole office, those who connect with the specific department only will ask to provide their replies and the others can very well ignore it. How to Be More Open and Flexible in the Workplace? It is important to ensure each team member sees their role in a project as more than just a “doer.” Driving a sense of importance and making them know that their input is an element that is driving the direction of the organization is critical for decentralization to be effective. Salary-related expenses are reduced, enabling the company to save money as well as provide better pay for its workers.2. You can type any information in a computer with a watermark and get as many numbers of copies as you may desire. Disadvantages of organizational structure include lopsided management lines, increased bureaucracy, slowed communications, and increased inflexibility. In these circumstances, a centralized approach could be detrimental in a smaller business because that person was the focal point of everything. Therefore, these types of letters lack personal emotions and appreciation that can only be conveyed through personal calls and one to one meetings. These people think that office resources like paper, printer ink, etc., wasted when it comes to delivering the same information through circulars. ii. 10 Simple Tips, Top 30 Recruitment Mistakes: How to Overcome Them, What is an Interview: Definition, Objectives, Types & Guidelines, 20 Effective or Successful Job Search Strategies & Techniques, Remote Recruitment: Everything You Need to Know. Every organization, be it a huge conglomerate or a small company has various departments to it and hence any form of internal communication becomes mandatory. This is true since these fliers are a fast way to hand out and express information. Having this present in your organization is more impactful than any tool we have ever seen. How to Answer, Why Education is Important? If there are too many divisions, coordination becomes complex and difficult. It Is Cost Efficient As mentioned, in this organizational structure, there are fewer (or no) manager layers between the executive and the staff. In these cases, more gentle handling and coaxing need from the management’s side. And whil… Let's take a look at the advantages and disadvantages of each so you know what you're up against when you join a new structure. These types of letters primarily focus on business issues and hold a certain degree of importance amongst employers in an office. A disadvantage is that employees are responsible to their project team as well as to their functional areas. 1. Let’s go through the seven common types of org structures and reasons why you might consider each of them. As most of these terms are too difficult to decode, comprehend and understand, the true specific purpose of sending these circulars gets faltered. 5 Easy Ways to Bring Gratitude to the Office, An Open Letter to Nonprofit News Leaders: Marathon, Not Sprint. Imagine you get a circular about a program or a crash course dealing with marketing strategy. Confused customers become unhappy customers and that can change their brand loyalty. Extensive experience in Complete Recruitment Life Cycle - Sourcing, Negotiation and Delivery. 6 Practices Conscious Leaders Use to Bring Out the Best in Everyone, Using Emotional Intelligence to Lead During a Pandemic. Employees can be empowered through the additional of responsibilities and roles in which they are in charge of execution. It Promotes Faster Decision Making Another advantage about a flat organiza… A form of a legal document with the designation of authority: 5. The major problem is the confusion and annoyance caused by the twofold chain of command. These fliers can also use if the company undergoes the process of recruiting new people and wants the old employees to understand and also to invite some of their friends and relatives to apply. As these fliers circulate throughout the office for a specific purpose, they will file for any future purposes, thereby providing a permanent stature and allowing us to verify its contents at any time in the future. One of the biggest misconceptions is that organizational structures require a significant amount of planning time. Through the disbursement of that individual’s responsibilities, you will mitigate the risk by creating a self-sustaining environment that can operate without that person calling the shots and have the ability to pull up one of the high performing team leads to fill the role until the manger returns or is replaced. However, once those are in place, you must shift your focus to the team members and managers of that process and provide them the power to scale. The term “organizational structure” originates from organizational theory and refers to the hierarchical framework that defines the internal division of labor within the company (but the term is also used in the context of other organizations like authorities and NGOs). Not all the employees of a particular company are literate. It helps an organization decide how the authority passes on, how message communication happens. While it might appear drastically different from the other organizational structures highlighted in this section, the circular structure still relies on hierarchy, with higher-level employees occupying the inner rings of the circle and lower-level employees occupying the … Disadvantages: The important disadvantages of the departmentation by product are the following: i. Functional Structure 2. How to Use Artificial Intelligence in Talent Acquisition Process? If memorandums are a record for future use and also include the aspect of taking disciplinary actions and reprimands, the circular letters are also for the same use as the disciplinary and ethical aspects but also serve as a brief formal note common for all the persons in an office. It is both time-effective and cost-effective: 4. With an increase in technology and the ability to passively monitor initiatives without having to be the focal point, a lot of companies are making the shift to a more circular or frequently referred to as a decentralized management structure. Once we began to see the initial results within that department, we applied the approach in other areas and now have a clear synergy across all departments and individuals. Excessive outsourcing of critical activities can be dangerous to the firm. Divisional Organisational Structure: In this type of structure, the organisation can have different basis on which departments are formed. Circulars. Oral communication can pitch more: One of the main disadvantages of this form of written communication is the preference of oral communication over these circulars. Organizational structure is a comprehensive picture of how different positions and activities are laid down in order to achieve the organizational goals. Thus, we have seen in detail the advantages and the demerits of using circular letters in an organization. organizational structure depends on the situation, consisting of the particular technology, the environment, and many other dynamic forces. Any form of written communication consider as a form of legal authority and these fliers are also no exemption. In a matrix organizational structure, when employees are doing multiple jobs, organizations can become more dependent on them and they get the liberty to perform badly, take days off and even ask for increased pay. Suppose, if you want to inform about an impending seminar, then about four to five lines will suffice. With trust, empowerment, and respect comes a sense of community and family. Here are some of the key advantages and disadvantages to consider when looking at the addition of collaborative structures to the modern workplace. But, it is impossible to type another circular to convey the forgotten information alone, which is ultimately a waste of both money and time. ADVERTISEMENTS: Organizational Structure: Functional Structure and Divisional Structure ! Also learn about its advantages and disadvantages! Centralized, decentralized, linear, horizontal, traditional, matrix… there are several organizational structure examples, and each one is better suited to a particular business type and process model.. Disadvantages: 1. v. Coordination of functional activities related to a product line is easy under this structure. It an indispensable tool that both cost-effective and reduces the effort of management considerably. Potential disadvantages of network structures include: Complicated control and coordination of the network due to the complex business or mission of the organization. It will lead to poor … Say for example you have to invite an entire department for a meeting, or update the dress policy for the whole office – a circular will be the best mode of communication for these purposes.. Additionally, circulars also find use as advertising tools. Suppose, if the manager has to question its employees their views about an organizational aspect, they can very well utilize this method and ask their suggestions to be submitted in the ballot box. It may cause a lack of collaboration. There are several types of corporate structures (organizational structures), and organizations choose the one most suitable for them. Hence, this is a cost-effective method that identifies the target audience. As with anything you haven’t tried before, there may be disadvantages of using circular org charts. When there is a hierarchical organizational structure in place, teams tend to stay within their defined structures. Suppose, if a group of persons or a specific team absent from the company for some purpose and if an important circular distributes throughout the company, then these persons may not know about it completely and hence, has the possibility of ignorant about the instructions provides in the circular. For example, the chart might be hard to navigate when you aren’t used to it, or employees might be resistant to a new structure. The only way for a collaborative structure to be successful is to have each person involved in the structure participate in it. 4. When each core stage requires the approval of a manager, then a lot of momentum can get lost and at times quality can go down because the approval queue is too large and no manager wants to be the source of delays. We desperately need more women in charge. 12 years of Experience within the International BPO/ Operations and Recruitment Areas. Apart from sending instructions and future happenings, these circulars also use as a source of goodwill which extends towards its employees and customers. ... One of the biggest misconceptions is that organizational structures require a significant amount of planning time. In the functional structure, such as shown in the following Facebook organizational chart, functions are separated into different groups, resulting in some defects.Here are the major disadvantages you must consider: Create Your Own Org Charts! The information may vary anywhere from an invitation to a meeting to the important issues like impending meetings, new rules that are going to crop up in the immediate future. ‘Buck passing’ may result. The Disadvantages of a Geographical Structure The main downside of a geographical organizational structure is the potential duplication of resources. It can also decrease high costs of management for inter- department relates and organizational hierarchy. As we expand to Houston in 2018, this approach will be vital to our success, allowing the members there to be adaptive to their environment and make the decisions they feel will have the biggest impact. The advantage of a business letter is to complete the deal within the two parties without knowing others. Advantages and Disadvantages of Using Circular Letters: 1. Whether you are a one-man shop or a 250-employee organization, delegation and empowerment is what will take you to new levels. Group action may lead to compromise and indecision. For traditional organization structures, departmentalization means that “how to group work positions into formal teams or departments that are linked together in a coordinated way” (Victoria management school, 2010, p. 272). Loves Writing in my Free Time on varied Topics. Hence, adequate care must be taken to see whether all the employees are present to provide the circular. Mean Girls at Work – How to Best Deal with Them? Though these disadvantages do not possess the same degree of intensity as the advantages do, nevertheless these are worthy of our consideration. A circular is essentially a letter containing some important information that is distributed to a large number of people. Here are some benefits. How to Improve Concentration and Memory Easily? Organizational functions within an organization are Sales and Marketing, production, human resources, finance, Research & development, and Purchasing etc. But a decentralized approach distributes some of those roles and decision-making abilities to lower level management — encouraging several people to be involved in the decision-making processes. The lack of new challenges can make them unenthusiastic for the job at hand. But office circulars generally those letters that circulate to a huge number of employees in an office simultaneously, conveying a special message or an instruction that needs to follow in the future. One of the main disadvantages of this form of written communication is the preference of oral communication over these circulars. Of course, not all companies should decentralize and it’s a decision that must be taken with ease to ensure the distribution of responsibilities is systematic and not just completely let go of the ropes. Why You Need A Circular Team Structure And Not Hierarchy. The most important disadvantage of this organizational structure type there is no “home” for the project resources once the project is finished. As a moderately-sized company, a lot of work flow comes up to C-Level management quickly and often. The organizational structure can be classified under following two types: ADVERTISEMENTS: 1. We live in a time of failing leadership. Functional Organizational Structure In a functional organization structure, the project manager and all the resources work in the same company division, such as the sales and marketing department. Hence, if using circulars it becomes important to use simple English that can be understood by all the people. An organizational plan serves to structure a company according to its individual goals (e.g. If a company performs extremely well, then the management can’t wish every one personally about the achievement and their contribution. iii. Let us now look into the detail, the disadvantages of these circular letters. It is user-friendly and a cost-effective method of circulating information by ensuring that the particular message reaches many persons at the same time. After a while, the employees may start feeling monotony or boredom. We have seen a large increase in our team over the past year and empowering our employees to source candidates and conduct initial interviews has increased retention and ensured we got the right person in the right seat the first time around. Matrix Organization: Disadvantages Like any organizational form, the matrix has its disadvantages. Organizations choose their organizational structure based on many factors like: size, its geographic location, the manner of delivering different products and services that they will offer. Racial Discrimination at Workplace – How to Avoid? Opinions are shared openly and objectively allowing the company to identify needs and execute quickly. Through a circular, decentralized approach you allow those managers to delegate a leader to make more of the micro approvals and relieve the burden of daily business operations allowing your managers to focus on the bigger picture and identify areas in which we can expand or nurture important clients growing existing businesses. Network breakdown can affect the entire system. Many types of organizational charts exist because many types of organizational structures exist. Not all communication channels are formal and well defined and org charts fail … Hence, the basic tenet of providing the circular itself gets scored off. The structure can meet lots of hierarchical limitations and can also cause slowdown of decision making and implementation process. As a company, we decided to test decentralization in our micro processes where we felt it was hurting the iterative cycle, restricting our teams from being agile, and having the ability to make product decisions quickly. These disadvantages are relatively minor and can be overcome with education and practice. These expressions must show through official circulars only. Thus, this enables the staff to be abreast of those happenings in an office and will aid them to provide rapid feedback about any situation. Importance So, this method saves you time and the cost involved by personally meeting each person and conveying the decision. If the person who types these circulars originally forgets some important aspect that needs to be included in the fliers, then also the objective of sending circulars throughout becomes an epic failure, whereas in oral communication, even if the conveyer forgets something or any other vital note that is to be said, he/she can do so later. 15/11/2020 7 Components Of Organizational Structure Relationships and Chain of Command •Solid horizontal lines represent communication between people with similar spheres of responsibility and power 2. Always, the official circulars have a certain format or aspect to it and it cannot get deviated. When it comes to management you hope everyone is along for the long ride, but circumstances happen in which people move, leave, or seek opportunities and in some cases unplanned emergencies arise in which an individual must take an extend leave. Let us now look into the detail, the disadvantages of these circular letters. These circulars have a vital role in expressing and pitching some ideas. Allow your employees to leverage the knowledge and experience they have gained and implement their own ideas that can result in constant improvement of processes, products, and relationships. If an aspect has certain advantages to it, then there will also be disadvantages. Also, these circulars have the right to discuss the allocation of responsibilities to a specific number of persons by informing about their duration of activities and the extent of their responsibilities. On the other hand, if some of the company’s policies and objectives need to reiterate strictly, then this method can apply very well there also to perform the same. For example, the total work activities of an enterprise may be divided into various functions like purchases, production, marketing , finance, quality control. With a circular flow everything is in constant motion allowing decisions to be made quickly and momentum to be sustained. These structures generally in the form of Attention, Interest, Desire, and Action and are pitch directly towards the employees’ state to follow the guidelines, rather than addressing their minds. These disadvantages may not always persist in an organization. You want resilience? These circulars after the intervention of fax and emails have their fame deteriorated considerably. Therefore, it becomes impossible to impersonate or duplicate the contents of a circular according to one’s needs and the biggest advantage is that these contents along with the specific date of happening can always be verified at any time and on any day. On the other hand, if you want to express any rule or dress code, then sufficient grounds for the implementation should also express along with the desire to change. Many of the lower strata workers are those who cannot read and write and hence, if a circular reaches them they can neither assimilate the information provided nor can act according to those instructions provided there. Elements and Characteristics, What Can You Bring to The Company? The organization may miss out on economies of scale if each geography is duplicating jobs, supplies, resources, know-how and functions. The organizational structure examples are usually a subject of study so that there can be a perfect structure for a particular company. So lets take a look at some disadvantages. Many of the higher echelons think that oral communication can do in a matter of seconds through a group Skype/Whatsapp call or a normal telephonic conversation. A centralized structure typically relies on one individual or upper level management only to make decisions and directly provide for the company. M2: Analyse the advantages and disadvantages of the interrelationships between organizational functions and its impact that can have upon organizational structure. What Can Nudge Theory Teach Us About Organizational Change? 2 Perhaps the oldest and most common method of grouping related functions is by specialized function, such as … As these circulars always bear the official signature and stamp of a higher managerial authority to enhance the validity of the information, the veracity of the claims ought to be accepted. They're also quite rigid in what specific departments are designed and permitted to do for the company.This organizational structure is much more formal than organic structure, using specific standards and practices to govern every decision the business makes. Circular Organizational Chart 11 Horizontal Organizational Chart 12. List of the Disadvantages of a Hierarchical Organizational Structure 1. This method perceives as an old method as it has more susceptibility towards the aspect of red-tapism and it lacks flexibility. There are chances of some important information leaks about an organization. Since there are not departments for the resources based on their specialties, if there won’t be a new project, resources are released at the end of the project. Has a wider dimension and wider reach: Disadvantages of Office Circular Letters: 4. Disadvantages of matrix structure Manager vs Manager. Advantages and Disadvantages of Functional Organizational Structure In this type of organization, the emphasis is on managing some functions wherever the function may be performed in the enterprise. This means that there are less wages, fringe benefits, and so on, to pay for management. Therefore, these tools should not be taken at their face value and should be utilized to the maximum to reap its benefits as ultimately its usage only depends on the company’s comfortability. Disadvantages of Functional Organizational Structure The work can be quite one dimensional. These circulars even when distribute to appreciate someone cannot express the true feelings due to the pattern of it and even if it does so, it will appear as though it is an attempt to flatter the specific employee. Stressing any important aspect via these circulars may or may not have the desired effect among the employees as these fliers will look like an object of subjugation rather than a messenger bearing information. In the beginning, yes, more planning and system creation is important to drive consistency and build your foundational processes. Due to the complex pattern these types of letters follow, it becomes imminent to use complex jargon and terminologies which may not go well with all the kinds of employees in an office. With trust, empowerment, and Purchasing etc, matrix and hybrid structures which extends towards its and... 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