Is There One Best Way to Structure an Organisation Essay Example for Free

Is There One Best Way to Structure an governing body EssayOrganisation is an entity in which people work together to accomplish a set of goals. Organisations scram certain pattern of activities, that is, structures. There is no trounce way to structure an geological formation, since the structure is always altered to best serve the functions of the organisation. The optimal organisational structure is contingent upon both internal (such as strategy, size, and engine room) and external situations (such as external environment) this is referred to as fortuity Theory. Based on the academic articles as wholesome as the observational evidence provided, four hap factors are covered to justify my position, including strategy, engine room and innovation, environmental uncertainty, and size. Firstly, strategy is an important contingency of organisational structure. One of the most important features of an organisation is the goal. Organisations utilise different strategies to accomplish their goals, and a variety of organisation structures are adopted to best serve the strategies since an appropriate structure is critical to the effectual strategy implementation. In the early 1960s, Chandler developed the contingency model which research on the strategy-structure race indoors companies (Qiu Donaldson 2010), he suggested that the optimal organisational structure is contingent on various factors, including the strategies (Pertusa-Ortega, Molina-Azorn Claver-Cortes 2010). In the 1970s, the structural contingency model was extended to multinational corporations (MNCs) (Qiu Donaldson 2010).Based on the research since then, Qiu and Donaldson (2010) constructed the box-shaped Contingency Model which incorporates the earlier models to propose the structure-strategy fits for nine MNC structures. The nine structures fit for different levels of contingent strategies which mean that the design of the structure of an organisation is highly contingent on the organisations strategies. Since the organisations strategies are never stagnant and are always adapt to accomplish its goal, there can never be a best structure for an organisation.Pertusa-Ortega, Molina-Azorn and Claver-Cortes (2010) approached the relationship between strategy and structure from a different angle resource-based lieu (RBV). They argued that organisational structures should be considered as a resource for the development of strategies and a source of competitive advantage. Although this approach differs from Chandlers, it reinforces the conceptive connection between strategy and structure that organisational structure influences the competitive strategies. As competitive strategy is perpetually adapted to the latest goals of the organisation, the structure needs to be varied accordingly, frankincense there is not a best structure.Technologies and innovations are important to the organisational process of converting inputs into outputs, thus it is also an impor tant contingency of the organisational structure. Firms adapt their structures to the technology or innovation activity they utilise. Leiponen and Helfat (2011) conducted studies to examine the relationship between the innovation activity and the organisational structure of a company, namely, RD. They examined the two conflicting perspectives on the best structure (centralisation or decentralisation) under which RD was able to achieve greater innovation output.According to knowledge-based view, decentralisation is more effective for updating existing technology as well as acquiring new sources of knowledge. On the other hand, organisational economics argues that centralisation reduces the cost of communication and coordination, thus improves the innovation output. Leiponen and Helfat (2011) incorporated both literatures and concluded that decentralisation served imitative innovation better, whereas centralisation led to greater new-to-market innovation output. Leiponen and Helfats research effectively proves that the organisational structures are contingent on technology and innovation since organisations technology and innovation activities differ by their degree of standardization, there is no best way to structure an organisation. some other contingent factor of organisational structures is the environment. Contingency theory holds that individual organisations need to adapt to their internal and external environments in order to survive and thrive (Qiu and Donaldson 2010, p. 81). Managerial discretion is highly dependent on the organisations environment and its level of uncertainty (Ferner et al. 2011). The uncertainty of environment requires high level of flexibility within an organisation. Ferner et al. (2011) examined the relationship between span of control and the organisations external and internal environment. Based on the empirical data collected, they made several observations. One of the observation stated that variables such as nationality (ex ternal environment) and product standardisation (internal environment) affect the degree of central control in multinational companies.US ownership features with relative centralised control of HR in subsidiaries and standardisation of product tend to cause less subsidiary discretion. These studies mull over the close relationship between external and internal environment and the organisational structure. Furthermore, a research conducted by Nandakumar, Ghobadian and ORegan (2010) indicated the relationships between the environmental dynamism and the business strategy as well as the organisational structure. They observed that highly dynamic environment favoured the cost-leadership strategy with organic structure whereas lower dynamism favoured the differentiation strategy with mechanical structure. Thus the structure of an organisation is always adapted to the environment, and there is no best structure.Moreover, the size is another(prenominal) contingency variable influencing th e design of organisational structure. Organisations with smaller size tend to be more organic and bendable whereas those with large size have more bureaucracy involved (Bradshaw 2009) larger organisations usually have mechanistic structure with more specialisation, centralisation and departmentalisation. Bradshaw (2009) examined several contingency factors of non-profit organisational structure, including age, size, strategy, environmental stability and so on.Based on the empirical data collected, the size along with organisational age is identified as factors to determine the organisation lifecycle (from entry to mature). Generally, the greater age means greater formalisation and the larger size means a more elaborate organisation structure. Thus, it can be concluded that the organisational structure is also contingent on the organisational size. As size varies according to the companies type and strategy, there is no best way to structure an organisation.In conclusion, there is no best way to structure an organisation. The optimal organisational structure is contingent upon various factors including strategy, innovation, environment and size. repayable to the variance among organisations in terms of these contingency factors, the structures of different organisations vary. Furthermore, the dynamic nature of the internal and external environment of organisations means that the structure of any organisation is always adapted to best serve its goals.BibliographyBradshaw, P. 2009, A Contingency Approach to Nonprofit Governance, Nonprofit Management Leadership, vol. 20, no. 1, pp. 61-81, viewed 18 March 2012, EBSCO host / argument Source Premier.Ferner, A., Tregaskis, O., Edwards, P., Edwards, T., Marginson, P., Adam, D., Meyer, M. 2011, HRM structures and subsidiary discretion in foreign multinationals in the UK, International Journal of Human preference Management, vol. 22, no. 3, pp. 483-509.Leiponen, A., Helfat, C.E. 2011, Location, decentralization, a nd knowledge sources for innovation, Organization Science, vol. 22, no. 3, pp. 641-658.Nandakumar, M.K., Ghobadian, A., ORegan, N. 2010, Business-level strategy and performance The moderating personal effects of environment and structure, Management Decision, vol. 48, no. 6, pp. 907- 939, viewed 18 March 2012, ProQuest Central / Business Source Premier.Pertusa-Ortega, E.M., Molina-Azorin, J.F. Claver-Cortes, E. 2010, combative strategy, structure and firm performance. A comparison of the resource-based view and the contingency approach, Management Decision, vol. 48, no. 8, pp. 1282-1303.Qiu, J. Donaldson, L. 2010, The Cubic Contingency Model Towards a more comprehensive international strategy-structure model, Journal of General Management, vol. 36, no. 1, pp. 81-100.