ORGANIZATION

STRUCTURE & DESIGN

Group 1

Iqra Mazahir 20212-29353

Kanza Mehmood Anwar 20222-31455
Saud Ashraf 20211-29510
Outline ● Introduction to organizational structure

● Features of an ideal organizational structure

● Comparative analysis of the organizations

● Conclusion
 Organization structure is defined as (1) the set of formal tasks assigned
to individuals and departments; (2) formal reporting relationships,
including lines of authority, decision responsibility, number of hierarchical
levels, and span of managers’ control; and (3) the design of systems to
ensure effective coordination of employees across

Managers should address seven key elements when they design their
organization’s structure:

Organizational Work specialization

To what degree are activities subdivided into separate jobs?

Structure Departmentalization
On what basis will jobs be grouped Together?
Chain of command
To whom do individuals and groups report?
Span of control
How many individuals can a manager efficiently and effectively direct?
Centralization and decentralization
Where does decision-making authority lie?
Formalization
To what degree will there be rules and regulations to direct employees and
managers?
Boundary spanning
Do individuals from different areas need to regularly interact?

Management_-_Richard_L._Daft 12th Edition

Organizational behavior. By Judge, Timothy A._ Robbins,

Stephen P. 17th Global edition.-2017.
 Centralized Organization
Where the decisional authority is located near the top of the
organization.The higher-ranking managers have higher
control over the lower ones. The ideation, strategy and
execution trickles down this hierarchy. This structure is
similar to how the armies have been traditionally organized.

Types of an Decentralized Organization

organizational Where the decisional authority is pushed downward to lower
organization levels.This gives them more autonomy to take

structure decisions. Although, it helps in agility and increases

innovation, there are some drawbacks as well. Decentralized
organizations may increase the redundancy. There may also
be miscommunication, conflicting objectives and
inefficiencies.

https://managementweekly.org/centralized-vs-decen
tralized-organization/

Management_-_Richard_L._Daft 12th Edition

Diagram

The above diagram shows the central organizational chart. The chart
compares it to the decentralized organization. As you can see, the
centralized organization has a central command of authority. On the
other hand, the decentralized organization has a distributed
command of authority.
 Advantages of Centralized Organization
1. Centralized organizations are more efficient in terms of
resource utilization
2. Higher coherence in terms of meeting organizational
objectives. Employees are better aligned to the mission and
vision.
3. Efficient structure of direction and authority. The decision
Advantages and making is centralized and it helps in staying focused due to a
centralized chain of command.

Disadvantages of 4. Execution time is lower.

5. Reduced inefficiency in work, data and personnel.

Centralized The Disadvantages of a Centralized Organizational

Structure

Organization 6. It reduces innovation in individuals.

7. Reduces the speed of response to external changes.
8. Higher tendency to please seniors rather than meet
organizational objectives..
9. Inputs from lower level employees may never reach the top
management.
10. May reduce the learning of low and mid-level managers. A
major component of learning is through decision making and
feedback. The autonomy for making decisions is lower in a
centralized organization.
https://managementweekly.org/centralized-vs-decentralized-organiz
ation/
 Advantages of Decentralized Organization
1. Increases creativity and innovation in individuals. Lesser
control is shown to make people more creative.
2. Leads to higher motivation, job satisfaction and wellbeing in
employees. Also, helps in training future leaders who are
confident about their decisions.
3. This structure is very useful in tapping on to the expertise of
Advantages and individuals.
4. The perception of threat is faster. Decision making to combat

Disadvantages of the threats is also faster.

5. It frees the top managers from making smaller decisions.

Decentralized
These small decisions may wear out the top management in a
centralized organization. Therefore, they are free to focus all
their energy on important decisions.

Organization The Disadvantages of a Decentralized Organizational

Structure
6. Increased chances of miscommunication.
7. Possibility of conflicting objectives between different teams
in the same organization.
8. Competition within teams inside the organization, leading to
lower trust and information sharing between teams.
9. Duplicated projects, increasing redundancy.
10. Information silos, especially for tacit knowledge.
https://managementweekly.org/centralized-vs-decentralized-organi
zation/
 Poor organizational design and structure results in a
bewildering morass of contradictions:

● confusion within roles

● a lack of coordination among functions
● failure to share ideas

Importance of
● slow decision-making
● bring managers unnecessary

organizational complexity, stress, and conflict.

Often those at the top of an organization are

structure oblivious to these problems or, worse, pass them off
as or challenges to overcome or opportunities to
develop..

Corkindale, G. (2011) “The importance of organizational design and structure,”

Harvard business review, 11 February. Available at:
https://hbr.org/2011/02/the-importance-of-organization (Accessed: June 4,
2022).

Chokheli, E., 2015. ROLE OF THE ORGANIZATIONAL DESIGN IN THE

COMPANY’S SUCCESS. European Scientific Journal April 2015 /SPECIAL/
edition ISSN: 1857 – 7881 (Print) e - ISSN 1857- 7431,pp.1857- 7431.
Aspects of An Ideal Organizational
Structure
 RESEARCH ARTICLE
Deciding Your Organization Structure For 2021

When it comes to designing an organization structure, there are four drivers to consider:

➔ Product-market strategies: How the company intends to lead each product-market field in
which it will compete
➔ Corporate strategy: How the company intends to gain an advantage from competing in the
product-market areas
➔ People: The skills and attitudes of the individuals within the organization
➔ Constraints: The cultural, environmental, legal and internal factors that can curb the choice
of design

Brodie, P. (2021) Deciding your organization structure for 2021, Forbes. Available at:
https://www.forbes.com/sites/forbescoachescouncil/2021/01/04/deciding-your-organization-structure-for-2021/?sh=4adfce6c50a6
(Accessed: June 5, 2022).
 Toyota Motor Corporation (TYO:
7203) has often been referred to as
TOYOTA the gold standard of the automotive
industry.

Despite the global recession and the

tough economic times that American
auto companies such as General
Motors and Chrysler faced in 2009,
Toyota enjoyed profits of $16.7 billion
and sales growth of 6% that year
 The organization structure or
hierarchy of Toyota Motor
TOYOTA Corporation is based upon the
numerous business operations
carried out by the company all
across the world.

Being one of the leading

automobile manufacturers in the
world, the company employs a
hierarchical structure which
supports its business goals and
strategic aims.
TOYOTA: 1

Organizational structural
changes
TOYOTA
1

Last Structure: 2010

TOYOTA
1

Current Structure:2022
 The company has a divisional organization structure which is strongly
centralized global hierarchical in nature.

The company has 8 geographic

divisions.
Toyota maintains a global Each of the divisions has a
hierarchy with its division head who takes the last
headquarters in Japan. decision for that particular
branch.

This is one feature of the organization structure of Toyota which supports development of
product lines and brands. This division also makes way for smoother operations, divided
decision making per branch and ability to resolve issues fast.

TOYOTA Reference: Toyota Company Hierarchy | Toyota's Organizational Structure (hierarchystructure.com)

Organizational Structure of Three
Companies
 Getz Pharma is an international research-driven,
branded generic pharmaceutical company
specializing in the formulation development,
manufacturing, testing and marketing of a wide
range of quality, affordable medicines.

GETZ PHARMA Additionally, the manufacturing facility is the

first and only, in Pakistan, certified and
approved by a member country of the
Pharmaceutical Inspection Co-operation Scheme
(PIC/S), which comprises more than 50
participating authorities, including US FDA and
European Medicines Agency, among others.

Getz Pharma currently operates in more than 25

countries in South Asia, Central Asia, South East
Asia, the Middle East and Africa. IMS rates Getz
Pharma as the fastest growing pharmaceutical
company within most countries where it
operates.
GETZ PHARMA Reference: Getz Pharma
Genix Pharma (Private) Limited was founded in the year 2004
by (Late) Choudhry Muhammad Sharif Sahib who had the vision
to help and provide top quality and affordable medicine for all
those in need. Since inception, Genix has grown from being a
relatively humble contender to being one of the fastest growing
companies in the Pakistani Pharmaceutical Arena.

Having the best human capital, coupled with a state of the art
manufacturing facility spanning over 150,000 sq. feet and the
prime focus on quality, we aim to become the benchmark in the
pharmaceutical industry. Our product line ranges from specialty
products to OTC medicines, as we believe in providing a wide
range of products to cater to the needs of all types of
requirements.

With its increasing export folio over the years, Genix has been
making an ever increasing contribution to the export exchequer
of Pakistan. Currently we are exporting medicines to more than
26 countries including Afghanistan, Sri Lanka, South East, Asia,
South Asia, Central Asia, Gulf, Countries East Africa, West
Africa and Francophone Africa.
GENIX Reference: Genix
Matco Foods Limited is a leading Food Processing
& Export Company in South-Asia, established in
1964. As the largest basmati rice exporter from
Pakistan, we have over 50 years of experience in
the rice industry, and more than 150 corporate
customers, with our flagship brand “Falak”
available in more than 65 countries worldwide.

The philosophy of Matco Foods is to produce

premium quality food products and ingredients
that conform to international standards.To be
innovative, customer oriented and create strong
partnerships with suppliers.To continuously
invest in our staff – the biggest assets of the
company.To create long term value for all our
stakeholders – customers, shareholders, staff,
suppliers and the wider community.
MATCO FOODS LTD. Reference: Matco Foods LTD
Comparative Analysis of Different
Organizational Structure
 RESEARCH ARTICLE
Do You Have a Well-Designed Organization?

➔ Organizational decisions are inevitably complex, and tweaking one area may produce
unanticipated consequences in a very different area. To get the best design, you need to take the
broad view, working step-by-step through the myriad tradeoffs. It’s not an easy process, but it is a
manageable one.

➔ We have encapsulated our findings into tests of organization design, which can be used either to
evaluate an existing structure or to create a new one. The first four tests are what we call “fit” tests.
They provide an initial screen for design alternatives, revealing whether the structures support the
company’s strategy, talent pool, and situation. The next are “good design” tests.
Goold, M. and Campbell, A. (2002) “Do you have a well-designed organization?,” Harvard business review, 80(3), pp. 117–24, 134. Available at:
https://hbr.org/2002/03/do-you-have-a-well-designed-organization (Accessed: June 4, 2022).

Carucci, R., 2019. 4 Organizational Design Issues That Most Leaders Misdiagnose. [online] Harvard Business Review. Available at:
<https://hbr.org/2019/12/4-organizational-design-issues-that-most-leaders-misdiagnose> [Accessed 5 June 2022].
The market advantage test
➔ Getz Pharma: As it is leading the pharma market, its organizational structure is vast & covering
all the aspects of national & global business.

➔ Genix Pharma: Has a clear idea of the market (i.e health care) in which it is competing. It
focused on both Integrative (Pharma, Nutra, Beauty care) and Intensive growth (adding new
products in new markets [in both local and export]).

➔ Matco Foods ltd: objective of Matco Foods is to be a leading rice exporter. They have state of the
art installed plants and diligent and dedicated teams which assist Matco to be a business leader.
Being the pioneer in the rice industry they have also diversified by going into rice glucose and
corn starch division.
The people test
➔ Getz Pharma: Its organizational structure is decentralized therefore giving the opportunity to
every department to grow at their own pace & encourages innovation, creativity & cross
department bonding.

➔ Genix Pharma: Genix has long decentralized organizational structure to carry out its vast
operations. Departmental heads and managers are encouraged enough to take decisions and
catered the needs of their respective departments.

➔ Matco Foods Ltd: Matco is very critical at hiring its staff. According to the organizational
structure design, for each department the right skillful people are hired. Every manager of their
own department is competent and is the key part of hiring process.
The feasibility test
➔ Getz Pharma: It has multiple departments and as it is operating globally so it has its local field
force & team in all regions of the world.

➔ Genix Pharma: Pharmaceutical companies are extensively dominated by regulations of

Government, In local market, from hiring of competent personnel (As per new SROs) to even
approving layout of the company. In Export, local technical representatives / distributors are to
be hired in respective countries.

As for company’s internal culture is concerned, It is entirely up to departmental heads.

➔ Matco Foods Ltd: If we see the feasibility of the organizational structure of Matco foods, what we
have observed is that as far as the corporate culture feasibility is concerned, here at Matco, every
department has its own culture and it solely depends on their head of departments.
The specialist cultures test
➔ Getz Pharma: The culture of commercial departments varies from operational departments from
punctuality, innovation & following SOPs which depicts that department wise culture is different
in order to have better efficiency.

➔ Genix Pharma: Departments such as Internal audit, International Business and Business
Development here at Genix Pharma have their own specialized Culture to promote creativeness,
innovation and to prevent decisions made under restricted specially in case of Internal Audits.

➔ Matco Foods Ltd: As far a the specialist culture is concerned, there is a department in Matco
which requires this type of culture. That department is of new product development. The food
technologists and engineers work there separately without the influence of outsider other than
their team-members. They have their separate lab where they do experiments to create and work
on new products.
The difficult links test
➔ Getz Pharma: It allows the managers & their employees to coordinate with each and solve
problems on their own which helps top management to focus on their departmental goals rather
than fixing the links.

➔ Genix Pharma: Managers conduct mock meetings weekly to ensure coordination and
collaboration between different departments, to achieve unified goals. Issues that prevent them
from achieving the goals are mostly resolved in weekly mock meetings by discussing possible
solutions to overcome problems. However some are resolved in monthly (formal) meetings
which includes the departmental heads and DMD. Example (External GMP inspections and ISO
audits).

➔ Matco Foods Ltd: The organizational structure of Matco foods allow different departments and
their heads to work together and collaborate. This is because several departments work under
same directors, who leads them and ask them to collaborate on different tasks together.
The redundant hierarchy test
➔ Getz Pharma: As a pharmaceutical company, multiple departments & different business units
development is a need in order to penetrate more deeply in field. It helps in increasing the
efficiency in field. Additionally, multiple departments help in tailoring the JD for each of its
employee to be specific at their job.

➔ Genix Pharma: Each department is further segmented in order to smoothly and efficiently carry
out the operations of specific regions/areas. However this doesn’t hinder the normal work
dynamics as departments are well coordinated and in the end they all report to their respective
departmental head.

➔ Matco Foods Ltd: As a rice processing company, there are several departments at Matco, and each
department is further segmented and have respective personnel for each role. Though major
decision making for big projects depends on directors and head bosses but all the other
departments are well equipped too to perform efficiently.
The accountability test
➔ Getz Pharma: Each and every employee at their level is accountable which shows that it is a
decentralized organization.

➔ Genix Pharma: Individual employee is accountable to carry out their own set of weekly/monthly
tasks which collective is measured against their Key performance indicator.

➔ Matco Foods Ltd: Matco is a centralized organization, therefore, accountability of actions is also
high. Here at Matco, every department and all the team members are responsible for their
actions. Management support the team in taking risks for the aim to grow but also never let
anything bypass which may harm the interest of the organization.
The flexibility test
➔ Getz Pharma: It has a very flexible structure as the basic strength of Getz Pharma’s strategy is
based on organizational structure which tends to change every year according to the dynamics of
market.

➔ Genix Pharma: Since it has integrative and intensive growth, Genix Pharma ensures flexibility in
its organizational structure.

➔ Matco Foods Ltd: Although the organogram of Matco foods is flexible now, but in future it can
become outdated. The reason can be organization structure being centralized. Therefore, with the
passage of time, some changes would be needed to be made in the organogram.
Gaps in Organizational Structure
 Broadly, there are no visible gaps in

GETZ PHARMA the organizational structure of Getz

Pharma yet it can be improved if at
certain levels centralization;
accountability & authority can be
implemented as completely
decentralized structure sometimes
lead to unaligned pace of different
departments which creates difficulty
in completion of tasks on time.
There is a huge competition coming up in almost
every industry in Pakistan.
The competitor offers more lucrative jobs to the
employees. This leads to high turnover rate, thus the
retention of employees have become a tough challenge
for the organization so far.

Multiple departures leave gaps in the organizational

structure which take months to fill.

This transitory phase detrimentally effects the

workload distribution and completion of respective
task may take more time than initially planned.
Up until now, the organizational structure of
Matco Foods has only helped
1
the company to
grow and expand. The only factors that may
concern in the future may be the issue of
organization being centralized.

This means that employees are less

empowered for decision making and it can
prolong the process for decision making and
can also cause demotivation to employees to
some extent.
Conclusion
Organization structure cannot have a gold standard for all organizations.
Each industry must have their own dynamics according to which the
organization should be structure. It must specific attributes like flexibility,
competitive advantage and feasibility etc.
It should be a mix and match or a hybrid model which can be transformed as
per the need.
Questions?
 References
Corkindale, G. (2011) “The importance of organizational design and structure,” Harvard business review, 11 February. Available at:
https://hbr.org/2011/02/the-importance-of-organization (Accessed: June 4, 2022).

Goold, M. and Campbell, A. (2002) “Do you have a well-designed organization?,” Harvard business review, 80(3), pp. 117–24, 134.
Available at: https://hbr.org/2002/03/do-you-have-a-well-designed-organization (Accessed: June 4, 2022).

Brodie, P. (2021) Deciding your organization structure for 2021, Forbes. Available at:
https://www.forbes.com/sites/forbescoachescouncil/2021/01/04/deciding-your-organization-structure-for-2021/?sh=4adfce6c50a6
(Accessed: June 5, 2022).

Carucci, R., 2019. 4 Organizational Design Issues That Most Leaders Misdiagnose. [online] Harvard Business Review. Available at:
<https://hbr.org/2019/12/4-organizational-design-issues-that-most-leaders-misdiagnose> [Accessed 5 June 2022].

Chokheli, E., 2015. ROLE OF THE ORGANIZATIONAL DESIGN IN THE COMPANY’S SUCCESS. European Scientific Journal April
2015 /SPECIAL/ edition ISSN: 1857 – 7881 (Print) e - ISSN 1857- 7431,pp.1857- 7431.

Management_-_Richard_L._Daft 12th Edition

Organizational behavior. By Judge, Timothy A._ Robbins, Stephen P. 17th Global edition.-2017.

https://managementweekly.org/centralized-vs-decentralized-organization/

For Videos
1. https://www.youtube.com/watch?v=Y4vEos6xuks 2. https://youtu.be/5hENFA3CJUY