Organisation Structure

The organisation of the resources of a company is essential for the success of any ventures that the company undertakes. It is the provision of everything that is needed for the achievement of its objectives.

In order to achieve its objectives it will require: Money Materials Machines Manpower Management

It is the function of management to organise the others. This is done by organising the structure of the company to give management authority over the other resources. It is therefore necessary to clearly show the levels of authority each person has and who they are responsible to. This is determined by the structure of the organisation.

In small companies employees tend to have to carry out a number of different tasks, ie the boss may be the buyer, bricklayer and the bookkeeper. Large organisations are made up of people who specialise in a particular task or area of work.

Advantages of Specialisation Efficiency increased because worker has developed required skill in depth. Work arranged to travel between specialists, or specialist between work. Savings made in training time and costs, since worker trained for one range of operations only. Saving in skill specialisation creates large number of small operations and worker may specialise in area which best suits his own aptitudes and skills.

Enables company to take advantage of mechanisation. Progress and control systems designed to take advantage of specialists. Replacement easier. Person needs only limited skills. New skills may be added to the organisation as developments in technology take place. Work study etc. may be used to obtain maximum efficiency.

Disadvantages Monotony, boredom and loss of interest through constant repetition of few operations in a narrow area of work. Loss of craftsmanship. Specialisation leads to development of machines and automation. Unemployment and redundancy due to machines taking over. Workers only partially skilled so are less adaptable.

More specialisation causes more parts of the organisation to become dependent on others. Thus any breakdown or strike in one specialisation causes problems in others. Communication and co ‑ operation may be difficult between specialists. Monopoly on knowledge creates problems if a person leaves. Lack of flexibility if work load declines. Specialists may require more money.

Exercise One way of a company having the advantage of Specialisation is to engage specialist sub- contractors, discuss the advantages of the use of a specialist sub-contractor to a main contractor.

Types of Organisation Structure Shallow Line Structure Deep Line or Military Structure Line and Specialist Structure

Organisation Charts The structure of the organisation can be represented in chart form. This is normally done in the traditional family tree layout which shows the status of the individual managers and their direct lines of responsibilities /communications.

A chart does not show: Responsibility for each position The authority of the person Informal relationships between personnel Shared responsibilities

The Concentric Organisation Chart Finance Director Contracts Director Contracts Manager MD Site Manager Office Manager

Types of Relationships Line or Direct (Executive) - these are relationships between a senior and subordinates. Lateral - relationships between executives and managers operating at the same level. No one manager is senior to another but all are responsible to a common superior. They all need to co- operate and co-ordinate their efforts and activities. These relationships may not be shown on a formal chart. Functional - a relationship between a functional specialist (Safety Officer, Structural Engineer) and a manager with direct responsibilities. Staff - relationships exist between a manager and his/her personal assistant. The assistant has no authority in his/her own right but can act on the authority of the manager.

Division of Organisation This may be by: – Structure – Elements – Products or Processes – Areas

Exercise Produce a deep military line structure organisation chart, applicable to your company or organisation, showing the positions and the status of personnel and indicate the types of relationships that they may have.