Organizational Structure and Culture

Organizational Structure and Culture



Organizational Structure and Culture

As organizations grow and differentiate, what problems can arise with a functional structure?

Functional structures are meant for organizations dealing with the production of single goods or services that are similar. It is impractical to use this structure if the organization is dealing with many different types of goods and services and when it has several locations. There will be less coordination between staff and this will affect the efficiency and performance. Organization expansion will require managers to make more decisions. If the organization will continue to use the functional structures, then the decisions will continue piling up and this will affect work performance. In addition, using the functional structure means that the organization will respond slowly to any changes that occur. There will be less time for workers and managers to do other things that may result in innovation and this will affect the development of the organization. Other problems include poor communication and duplication of functions (Robbins & Coulter, 2007)

What are the principal differences between a functional structure and a multidivisional structure? Why does a company change from a functional to a multidivisional structure?

Functional and multidivisional structures differ in the sense that the latter is able to handle more divisions and departments with more efficiency. There is more coordination in the multidivisional structures. Moreover, the creation of the different divisions makes it possible for the organization to respond to changes even when the environment is unstable. When companies grow and when they contain multiple divisions, the functional structure becomes less effective and more costly. Multidivisional structure enables an organization to increase profitability as its division acts individually. An organization finds it easier to diversify its interests. It is easier to oversee all the staff operations using this structure.

What are the advantages and disadvantages associated with network structures?

It is suitable for organizations that deal with many products and those that have outsourced services to various providers. It is suitable for modern day businesses, which handle many activities at the same time. Reduces production costs and makes it easy to replace non-performing partners. Avoids much bureaucracy and reduces costs associated with it. However, requires the concerned groups to interact frequently and it is difficult to control because managers do not have the time to coordinate all the partners.

What is the origin of organizational culture? Why do different organizations have different cultures?

Organizations develop their culture from the characteristics of their workers, the ethics the management has put in place, the sense of ownership that the employees have in the organization, and the organizational structure. For instance, some organizations have flat structures while others observe hierarchies. This will highly influence the culture of the organization. Therefore, organizations will have different cultures because they differ in all these aspects (Jones, 2010). The character of the employees includes their degree of aggressiveness and competitiveness, their willingness to work in teams, their willingness to innovate and take risks and the level at which they pay attention to details. The stability of the organization and the managers’ decision on what to focus on will determine the organization’s culture (Robbins & Coulter, 2007).

In what ways can organizational culture increase organizational effectiveness? Why is it important to obtain the right fit between organizational structure and culture?

Organizations can use culture to encourage trust and cooperation among the members. It can encourage a culture of open dialog and communication, understanding, and teamwork. This will encourage the members to work together, resolve their conflicts and misunderstanding in due time, and improve performance. As noted one of the factors that determine a company’s culture is its structure. At the same time, the culture can affect the structure by influencing the distribution of resources and in evaluation and redesign of strategic plans. This will make it easier to introduce changes and improve organizational performance. Organizations can create strong commitment among the workers. A strong culture will enable the organization in the recruitment and socialization of new workers. Promoting the workers initiative will encourage higher performance.


Jones, R. G. (2010). Organizational theory, design, and change. Upper Saddle River, NJ: Prentice Hall

Robbins, P. S., & Coulter, M. (2007). Management, 9ed. Upper Saddle River, NJ: Prentice Hall

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