FACTORS THAT INFLUNCE CHOICE OF ORGANISATIONAL DESIGN

Organization design is the process of creating and changing an organisation structure (Robbins &
DeConzo, Fundamentals of Management: Essential Concepts and Applications, 2008). There are
two types of organization structures namely mechanistic and organic structure. Mechanistic
organizations are those characterized by high specialization, rigid departmentalization, clear chain
of command, and narrow span of control, centralized and high formalization. Organic structures
are those characterized by cross functional teams, less hierarchical teams, free flow of information,
wide span of control, decentralized but also low formalization (Robbins & Coulter, 2012). For
managers to make decisions on what type of organization to choose there are factors that need to
consider namely, strategy, size, technology and environment? This paper explains factors that
affect the choice of organization design and how they influence decision for choice of organization
design.

Strategy is defined as the set of decisions and actions used to achieve organizational goals (Daft,
2010). According to Robins and DeCenso (2008) strategy and structure are closely linked. This
means that a major change in strategy leads to major changes is organisation structure.
Organizational design has major implications on an organization’s ability to deal with
contingencies, achieve competitive advantage, and effectively manage diversity and to innovate
new goods and products. As strategy moves from a single product to diversification, structure must
move from organic to mechanistic (Robbins & Coulter, 2012).

Size is another factor that affect structural designing choice of an organisation. The design can
either be mechanistic or organic depending on size (Robbins & DeConzo, 2008). It has been
observed that larger organisations differ in structure from small ones in terms of task specialisation,
centralisation of power, task performance appraisal and budgeting procedure of the whole
organisation. However, once an organisation grows to a certain size, the influence of size turns to
be less on structure. For example, the church of Roman Catholic a large organisation which has
more than ten thousands of priests, its structure is fairly mechanistic, it has rigid and tight control.
Adding three hundred priests will not impact the structure much. On other hand adding two
hundred Employees to an organisation that have six hundred workers, it will likely be mechanistic
to manage such large number of employees.
Changes in technology are the most frequent cause of change in organisation structures since they
generally result in greater efficiency and lower costs. Technology aids in work procedures such as
communication, recording transactions and the manufacturing process. Different organisations
require different levels of operational technology to function. Technology mostly affects
manufacturing companies since they use machines. Production is divided into 3 categories namely:
small batch, mass production and continuous-process (Robbins & DeConzo, 2008). Small batch is
used to manufacture custom made goods to meet customer’s specifications. Mass production is
where a large number of uniform goods in an assembly line system are produced. Lafarge cement
limited is a good example of a company that use mass production. Continuous-process is where
highly automated systems are used and there is a small labour force. Small batch and continuous
process production have more flexible structures and it is relatively easy for such organisations to
adapt to change hence they work well with the organic design. The mass production is a more rigid
work system and therefore uses the mechanistic design.

The environment is the world in which the organisation operates, and includes conditions that
influence the organisation such as economic, cultural, legal, technology and natural environmental
conditions (Robbins and Coulter). The environment is described as either stable or dynamic. In a
stable environment, the customers’ desires are well understood and remain consistent for a
relatively long period of time. Examples of organisations that face relatively stable environments
include manufacturers of staple items. In a dynamic environment however, the customers’ desires
are continuously changing. The dynamic environment leaves managers with no option but to
continuously be innovative and come up with adaptive measures to survive and grow in this
turbulent environment. An example of the industry functioning in a dynamic environment is
electronics. In general, organisations that operate in stable environments find mechanistic structure
to be advantageous because it provides a level of efficiency that enhances the long term
performances of organisations. Organisations that operate in volatile and frequently changing
environments favour an organic structure which provides the greatest benefits.

There is no best organisation structure between mechanistic and organic. The best organisation
structure depends upon contingency factors namely; strategy, size, technology and environment.
Successful and efficient managers choose and develop organisation structures that best facilitate
the attainment of their goals.
References
Daft, R. L. (2010). Management. Mason: Cengage Learning.

Robbins, S. P., & Coulter, M. (2012). Management. New Jersey: Pearson Education Inc.

Robbins, S. P., & DeConzo, D. A. (2008). Fundamentals of Management: Essential Concepts and
Applications. New Jersey: Pearsons Education Inc.